Haitian, Engel follow nearshoring trends to keep production near customers

Shanghai — Injection molding machine makers are investing to localize production, research and development to serve global customers nearby instead of relying on exports.

China-based Haitian Plastics Machinery Group Co. Ltd. is growing and hiring in research and development, Dominik Wiesner, European head of marketing and communication at Haitian, told Plastics News in an interview at Chinaplas in Shanghai.

With about 11,000 employees at Haitian, nearly 1,600 of them are in R&D, Wiesner said. Some come from Haitian's own educational division, Haitian University, and others from collaborations with other technical universities.

In addition to its headquarters in Xiaogang, China, each of its five international headquarters has small R&D teams, he said.

With growing markets in Mexico and Southeast Asia, Haitian has been "domestically stable," with a 17 percent growth in exports, driven primarily by global demand for new technology, Wiesner said. Europe is also one of the company's largest export customers, he added.

"We try to innovate as quickly as possible," he said. It's now "mandatory to have sustainable and energy-saving solutions" for customers in Europe and beyond. "It's a global issue."

All of Haitian's fifth-generation line of machines come with smart features using AI as a standard, Wiesner said, including intelligent switchover point and automatic climbing force control, which were an upgrade on the company's fourth-generation products.

The new machines also have upgraded energy systems showing and measuring energy consumption of each movement of the entire process, he added. The machines have "double-digit energy savings" compared with the previous generation, a news release said.

"Global footprint has always been a part of our business strategy," Wiesner said. "In every local market, we want to have sales service, application centers and production."

Haitian opened its first manufacturing site in the Americas in June 2023 with a $55 million facility in western Mexico. The company is also building sites in Serbia, Europe, India and Japan, part of its recent acquisition of Niigata Machinery Co. Ltd., Wiesner said.

Haitian is not alone as an injection press supplier investing in a global manufacturing strategy. Engel Group Inc.'s Changzhou, China-based subsidiary, Wintec Industries Inc., for example, is expanding to meet demand for energy reduction and digitalization through Wintec in China, Japan, South Korea and other parts of the world.

Schwertberg, Austria-based Engel (W3301) saw its sales down by 6 percent to $1.7 billion last year, despite an overall market dip of 40 percent, Gero Willmeroth, Engel's Asia and Oceania president, said during Chinaplas' Media Day presentations in Shanghai.

There are "still some looming uncertainties" in the market, Willmeroth said, adding that he hopes time spent meeting with customers at Chinaplas and NPE would give Engel "a good feeling of what we can expect from the year to come."

While demand from Europe and the Americas showed growth last year, Asia's demand was "slightly behind," he said, due to a "very price-competitive market."

Engel sent Wintec's president of sales and service, Markus Fuchs, to take on the position of regional president of Southeast Asia for Engel "to put more management attention on [the Asian] market," Willmeroth said.

Wintec added R&D and design employees for its Changzhou facility, which it expanded last year to double its former capacity. It also hired in sales and service for the region.

According to Fuchs, 90 percent of the machines Wintec sells in Asia are used in Asia, while most exports from Engel's Moscow factory are "specialties."

When the European economy dipped in 2020 during the COVID-19 pandemic, Wintec "decided to invest in local R&D," Fuchs said during the Media Day presentation. Wintec's R&D and engineering base in China grew from 40 to 100 people that year, and is "still growing, because we [used] the last three years in China for developing to prepare ourselves for the future."

Wintec then "developed a completely new machine portfolio," he said, to combine "the philosophy of Austrian or European machine making with the mindset of our Asian colleagues, especially our Chinese products."

"Customers really appreciate European-quality machinery," Fuchs said. "However, we also understand that for many standard applications, the price of European-produced machines or machines produced under European philosophies are a little bit too high. They are not fulfilling the capex requirements of the large automotive tier ones."

Localization of production is "getting more and more imminent," especially with U.S. tariffs on Chinese-produced machines, he said.

"There is a threat that [tariffs] will be increased to 40 or 60 percent with the next presidency," Fuchs added. "So for us, it is very important to diversify and mitigate our risks and … to produce locally.

"Shipping is getting more troublesome," Fuchs said. "This year, we had and still have problems in the route to Europe. … With the war going on, we had an issue with the Panama Canal. We spent a lot of money and a lot of time … to go to the East Coast of the U.S. from China.

"At Wintec, [localized production] is important … because if we want to be … on top, we need to be able to produce most of the products you want to sell to your customers there and service locally," he said. "In Europe, we are very well established; that's our home curve. But now it's time to also strive in [the U.S.]"