Detroit — As the automotive industry reopens production in North America, some members of its supply chain are facing challenges from the COVID-19 pandemic and an income gap from widespread shutdowns of nonessential production.
Ben Holder, president and CEO of Lindstrom, Minn.-based Plastic Products Co., told Plastics News the injection molder has faced "a huge challenge" amid reduced demand in the industry.
The company was able to stay open for some essential production throughout shutdowns, Holder said, but it has done "a lot of reducing operations then increasing operations again," due to its two largest customers shutting down plants because of COVID-19 cases in their facilities and decreased output as they implement production line changes for social distancing.
"We are managing as well as we can," he said.
"Sales for May were only 70 percent of budgeted levels," Holder added. "A few employees have expressed concerns [over COVID-19] in certain locations but concern is not widespread."
Injection molder MVA Stratford lost about 10 percent of its workforce during shutdowns for "various reasons," including those employees moving, finding other opportunities or a lack of childcare, General Manager Jason Cousins said in an email.
"We have hired to react to this and are still in process of getting back to full staff," Cousins said. "We expect to be back to normal head count with new hiring within a few weeks. We also see large increases from our customers that will challenge capacity in the coming months for both machine and labor."
Planning ahead with customers "helped a lot" with restarting efforts, he said, "but we were not given a lot of notice on how quickly the numbers would recover and surpass old volumes again. Our customers did openly communicate though and were giving all the information they had to give us."
"We are hoping that [case] levels stay at pre-COVID shutdown or a slight increase that is manageable," Cousins added. "It is uncertain though what the future will bring with auto sales. Forecasts do look very strong though."