Blow molder Roth Industries Inc. is spending $5.9 million to double capacity of its Watertown, N.Y., factory as it tries to grow beyond its traditional focus on the housing market.
Roth, which is a unit of German plastics processor Roth Industries GmbH & Co. KG, said it will add a second large blow molding machine in Watertown, to give it more manufacturing flexibility and push into new markets like automotive.
“We have existing product line growth that in a year's time will exceed our capacity,” said Joseph Brown, president and CEO of the U.S. unit.
The company said it aims to increase North American sales from $22.5 million to $30 million over five years.
Roth blow molds large tanks for fuel oil or septic systems and makes products for heating and environmental systems.
Its second U.S. factory, in Syracuse, N.Y., has what Brown said is the largest blow molding machine in the United States, capable of churning out blow molded 15-foot long septic tanks for homes.
But with the number of new single family residential housing starts in the U.S. still well below what it was before the housing market crash of a decade ago, Brown said the company has been trying to grow elsewhere.
For example, four years ago its tanks were certified to handle a wider variety of combustible fluids, allowing the company to enter the market for automotive lubrication tanks.
“We now have a growing business selling these tanks into the automotive lubrication market,” he said. As well, the company has an expanding business blow molding traffic cones for a customer.
Roth's German parent set up its first U.S. production when it built the Watertown factory in 2006, and then in 2007 it bought Fralo Plastech Manufacturing LLC, giving it the current Syracuse plant.
But Brown said the company “struggled greatly” in the U.S. from 2007 to 2012 as the U.S. housing market tanked from an all-time high of 1.8 million new single family housing starts in 2006 to fewer than 400,000 in 2009.
And the market is still not entirely back, he said — there were 764,000 new single family housing starts in the country from May 2015 to May 2016.
Brown said most housing experts feel that a healthy market would be back up over 1 million single family housing starts a year, closer to the historical average of the last 50 years.
Still, Roth's U.S. business has had “decent” growth since 2012, he said.
The expansion will see the company add 12 jobs to the 42 employees it has in the two New York factories. It currently has two blow molding machines in Syracuse, along with one in Watertown.
Globally, the family-owned Roth has 1,100 employees and about $250 million in annual sales.
It also makes polycarbonate cases for solar panels, extrudes various grades of crosslinked polyethylene pipe, has capabilities in rotational molding and has a unit in Europe that makes composite wind turbine blades.