Walker, Mich.-based Plasan Carbon Composites Inc. is winding down its automotive carbon fiber manufacturing operations as an affiliate focuses on the defense industry.
The company's Plasan Carbon Composites Inc. division in Walker is in the process of finalizing the sale of its remaining inventory and assets and is "ceasing operations," according to the Michigan Economic Development Corp.
The company has shipped its parts inventory to customers and sold off specialized machinery and inventory, according to an MEDC memo today to the Michigan Strategic Fund board, detailing an agreement for Plasan to repay portions of state incentives awarded to the company in 2014.
Casey Calvo, marketing specialist for Plasan, said the company’s automotive operations began to wind down around a year ago as the company shifted to primarily focus on its defense manufacturing capabilities, which does business as Plasan North America Inc.
"With the increased demand from our defense side of the business, it made sense to invest in resources there," Calvo said.
Employee layoffs took place last year, though Calvo did not provide a specific number. She added that the company worked to place laid off employees with other local firms.
MEDC officials did not provide additional information about the company's operations during a media briefing June 27.
The Michigan Strategic Fund board considered a repayment plan from Plasan, which had originally been awarded a performance-based $6 million Business Development Program incentive in 2014, $3 million of which would be repaid to the state. The company received $4.8 million of the incentive after hitting certain milestones.
However, when Plasan eliminated 69 jobs in 2016, the restructuring triggered a repayment clause in the company's agreement with the state. As a result, the company owed nearly $668,000 plus interest in repayments. At the time, Plasan paid $60,000 in exchange for the state considering delaying the deadline for the repayment until June 30, 2017. The state agreed, but the company failed to meet the extended deadline, according to the MEDC memo.
A 2018 agreement between the MSF and Plasan required the company to pay back $681,000 in five annual installments starting in January 2021. To date, Plasan has made only one payment and has a $544,000 unpaid balance, according to the state.
At today's MSF meeting, the board agreed to accept a 62.5% haircut on the remaining balance and approved the company to submit a one-time payment of $204,000 to satisfy its repayment obligation.
Plasan Carbon Composites is a Tier 1 supplier of carbon fiber hoods, rocker panels and other components for performance vehicles, including past models of the Chevrolet Corvette ZR1, Dodge Viper SRT and Shelby Mustang GT500KR.
Established in 2006, Plasan North America relocated its headquarters from Bennington, Vt., to West Michigan in 2015. By 2017, Plasan had roughly 550 employees working at its Walker campus and generated $85 million in annual revenues, according to coverage at that time.
Plasan North America is a U.S.-based incorporated affiliate of Plasan Sasa Ltd., based in Israel. The company formed in 2006 when Plasan Sasa acquired a line of business from Vermont Composites Inc. that manufactured automotive components used on sportscars. Plasan North America has operated as a standalone entity since 2010.
The last graf can read: In 2013, Japan-based Toray Industries Inc. acquired a 20% stake in Plasan Carbon Composites, though it separated from the company prior to the COVID-19 pandemic.
EDITOR’S NOTE: This story has been clarified to distinguish the separate operations of Plasan Carbon Composites Inc. and Plasan North America Inc., and to note that Toray Industries has since separated from Plasan Carbon Composites.