Here's a reality check on how business is realigning globally: The largest injection press maker in the world may no longer be European or Japanese or North American, but Chinese.
Haitian International Holdings Ltd. probably has the largest world revenues making injection molding machines.
The Ningbo-based company was No. 5 in global sales in 2005, but growth in China and other emerging markets, coupled with the crisis in developed economies, has likely pushed it to the top.
Haitian's injection press sales are now at least $800 million a year and rising. The traditional global heavyweights in the injection world have gone the other way, with sales dropping sharply from weakness in Europe, North America and Japan.
There's a fair amount of guesswork in this estimate — besides currency conversions, some of the companies don't say much publicly or very timely about their financials. But based on what is available and the impact of the global downturn, I think it's a reasonable guess. Here's why.
Engel Austria GmbH had sales of about $980 million in its fiscal 2008, but company executives told reporters last year it was likely to fall to $555 million for the year ended in March 2010.
Canada's Husky Injection Molding Systems Ltd. said its total sales in 2009 were $994 million, but that included other businesses like hot runners and robots. As well, the firm in 2009 stopped making large-tonnage presses.
Germany's KraussMaffei AG saw its machinery sales drop 20 percent to just under $1.1 billion in the year ended Sept. 30, 2009, but that includes reaction injection and extrusion machinery. The company does not break out injection molding machinery figures, but it's unlikely they top Haitian right now.
If you look at the Japanese, Toshiba Machine Co. Ltd. reported molding machinery sales of about $650 million in the fiscal year ended in March 2009, a drop of about 25 percent from 2008.
And Sumitomo Demag, a hybrid Japanese-German competitor, had global sales of about $800 million when it was created in early 2008, before the global crisis.
In case you're wondering, the source of Haitian's numbers are its twice-a-year filings of injection molding machinery-specific sales with the Hong Kong stock market. Its figures may be among the most accessible.
But everything is in flux these days. The economies in Europe, America and Japan will gain back some of what was lost, the other injection machinery makers still have good technology and Haitian's top spot may prove fleeting.
Still, it says a lot to me about how much things are changing due to the economic crisis and the historical resurgence of Asia.
When Haitian was the world's No. 5 press maker in 2005, according to its IPO filing, its annual sales were about $320 million. This year it's on pace to triple that.
Sales volume is not everything, of course. Having the best-selling record doesn't mean you have the best music.
Haitian has staked its claim so far on selling inexpensive machines. It's long been the top in the world by volume, selling in the neighborhood of 15,000 or more machines a year. It has clearly benefited from its dominant position in China, the fastest-growing plastics equipment market in the world.
But there's more to it than just geography. Company officials argue they smartly made early moves into energy-saving machines in China, which have proved to be big sellers. (Executives at other Chinese competitors also have said Haitian came in early on that trend.) And Haitian has set up a subsidiary in Germany to develop higher-technology machines, its weakest point.
What will be worth watching is whether Haitian can capitalize on its strong position in China and in other emerging markets, and use that to innovate and close the gap while the other global giants are weaker.
I asked Haitian executive Helmar Franz, who had a long career in Germany's plastics machinery industry before joining the Chinese firm in 2005, what he thought. He said it is possible, given what's happening, that Haitian is now the biggest press maker in sales. But he also doesn't think it matters very much.
If Haitian is now the biggest, Franz said, it's “only because the others did poorly.”
“This is not our target. We want to be the No. 1 in sales when others are good.''
Franz said he thinks the other global firms will bring more innovations, though he believes their pace of innovation has slowed.
Whether that's true, I don't know. But, it's an important question. Who can innovate the best?
The other firms will recover, and they still have technology and marketing advantages. But when they do come back, will all the global changes have left the injection molding machine industry with a new leader at the top of the sales chart?
Steve Toloken is Plastics News' Asia bureau chief, based in Guangzhou, China.