The current optimism in the plastics industry is palpable and nothing makes that more apparent than the 2015 state of the industry report from Manufacturers Association of Plastics Processors (MAPP).
More than 70 percent of the 170 plastics processing executives surveyed said their sales today are better than they were a year ago — and 85 percent said they expect their sales a year from now to be even better.
Plastics has officially bounced back from the recession, and steadily moving forward to surpass pre-recession sales levels, said Troy Nix, executive director of MAPP.
“If there are companies out there right now that are still really, really sluggish and they're trying to blame it on the economy, it might be an industry sector I don't understand. I know not everyone is doing great but overall, our industry is kicking it,” Nix said.
A calming trend on raw material price swings, and recent declines in prices overall, have contributed to the optimism.
“When you lessen the volatility in the marketplace, it takes some of the variability and vulnerability out of how you run your business,” Nix said.
Improving overall economic health in the United States in the last three years, particularly in certain sectors, has also helped plastics' recovery, Nix said.
“Automotive is leading the way,” he said, citing a December J.D. Power and LMC Automotive Report projecting sales numbers around 17 million units for light vehicle sales for 2015. “When 65 percent of our members are touching automotive in some way, obviously a strong automotive industry is going to push a strong plastics industry.”
Consumer goods is the second end market about which respondents are most optimistic for 2015, followed closely by the medical market. An increase in consumer confidence and could boost the 51 percent of the processors surveyed that are feeling optimism on consumer goods, Nix said, but concerns about the medical device tax could be holding back any more than the existing 37 percent who said they felt good about the future of medical plastics processing.
“It's not as robust as I thought it would be,” Nix said. “The medical device tax has definitely created a rationale for changing their strategic plans for new facilities in the U.S.”
But when it comes to U.S. plastics facilities overall, Nix can hardly contain his optimism for the reshoring trend.