GEORGETOWN, ONTARIO (Updated Jan. 28, 8:30 p.m. ET) — Fast-growing markets In Asia have prompted Mold-Masters Ltd.to recently complete a $20 million expansion of its Kunshan, China, hot runner plant.
The firm added 68,000 square feet and a range of machinery including CNC lathes and mills at the site established in 2005. The plant now exceeds 160,000 square feet and the expansion was officially opened with a ribbon cutting in late 2011.
“We want to align our manufacturing footprint similar to our sales footprint,” Mold-Masters President and CEO Bill Barker said in a Jan. 27 telephone interview. “Asia is our fastest growing market.”
“China is a demanding market,” Barker explained. Suppliers need to respond quickly, adapt rapidly, provide innovation and partner with customers. Often a supplier must provide products unique to the Asian market.
The Kunshan plant supplies China and other Asian markets, which now comprise 40 percent of Mold-Masters' sales. When Mold-Masters' current owner, 3I Group plc of London, acquired the hot runner major in 2007, Asia represented 25 percent of Mold-Masters' business.
Barker pointed to mobile phones, automotive and packaging among the main drivers for China's growing thirst for plastics processing equipment.
China had 60 percent of world capacity to make mobile phones in 2010, Barker estimated. Vehicle sales in China grew to 18.5 million units last year and continue to rise dramatically. Packaging tracks GDP growth which in China is in the high single digits per year, Barker added. Medical markets also are swelling rapidly as China's consumers increasingly want new disposable, sterile technologies. Caps and closures molding is one area gaining from the evolution of China's medical market.
Barker estimated hot runners are installed on about 20 percent of China's injection molding capacity and that fraction is projected to double in the next few years as more molders abandon conventional cold runner systems.
Mold-Masters, based in Georgetown, Ontario, employs 450 at the Kunshan plant and another 250 throughout Asia. Barker said his firm's management has been key to its success in Asia. Ling An-Heid, president of Mold-Masters Asia, is a 22-year veteran of the company and led Mold-Master's entry into production in China.
Barker has been heading up Mold-Masters for about a year. He previously was group executive director at packaging giant Rexam plc of London. At Mold-Masters he replaced Jonathon Fischer who stepped down in September 2010.
“If you don't have a China strategy, you don't have a global strategy,” Barker concluded.