Custom injection molder Ironwood Plastics Inc. has embarked on an ambitious expansion program.
The Ironwood, Mich., company will spend $19 million in Two Rivers, Wis., to buy a building next door to its factory there and to add injection presses.
“Our business is growing,” said Ironwood President Rick Faustich in a phone interview. “We're up 33 percent year-to-date over last year. We need additional production capacity.”
Faustich did not disclose sales figures but he estimated it had been running at about $30 million per year. He said the firm's automotive business is a big driver for recent growth as OEMs try to cut down on vehicle fuel usage by converting components to plastic.
Ironwood chose to expand in Two Rivers because its Ironwood headquarters operations are at capacity. Two Rivers also has an available manufacturing building next door that can readily be converted to molding. Crowding in the Ironwood operation is spurring the company to turn a storage building onsite into a small molding area to handle the overflow of work at the head office. The Ironwood facility houses its main tool room and does all the engineering for the company. It employs about 150.
In Two Rivers, Ironwood will buy a 27,000-square-foot building next door, convert it to injection molding and add injection presses there. This first phase will cost $6 million. Another $13 million will be invested over the next several years, by which time employment in Two Rivers could triple to 120.
Faustich said Ironwood's growth reflects the company's increased emphasis on customer needs.
“We are targeting applications in international companies needing injection molded components,” he explained.
Ironwood's new strategic push is partly due to it being part of CTB Inc., a Milford, Ind., company that sells internationally. CTB primarily makes agricultural products and most of its molded components are made in house but Ironwood molds a few complex parts for CTB. CTB has been owned by investment giant Berkshire Hathaway Inc. since 2002. The CTB and Berkshire Hathaway connections help Ironwood's access to capital and give customers more confidence to do business with the custom molder. CTB acquired Ironwood in 2010 from the Stephens family, which had founded it in 1979.
When the current phase of expansion is done, and a total of 12 new injection presses are delivered, Ironwood will have 50 injection molding machines at its two sites with clamp forces from 56 to 720 tons. Most of its presses are in the middle of that range.
Besides automotive, Ironwood's main markets are electronics, military, industrial and medical.
The state of Wisconsin and city of Two Rivers are contributing about $500,000 to the expansion project.
Ironwood has estimated sales of $31.5 million, according to the most recent Plastics News survey of North American injection molders.