IMA June-July 2015 Country Focus

Injection Moulding Asia Country Focus

China’s “slow” economy not a damper on growth from Gero Willmeroth, President, Engel China.

“In recent years, we have enjoyed huge growth in China but we cannot see it growing that much now.

We view the declining market dynamics as a new “normal” positive sign that markets are maturing,” he said, speaking at the Adsale-organised Media Day event before the start of Chinaplas.

The slowing down of the economy in China is not necessarily a bad thing, according to exhibitors at the May-held Chinaplas show in Guangzhou.

Chinaplas surges ahead with number of visitors/exhibitors espite the bad weather that caused flight and train disruptions during Chinaplas, the organiser Adsale Exhibition says that Asia’s largest and the world’s second largest plastics and rubber trade fair attracted a total of 128,264 visitors. The show this year also welcomed 35,090 overseas visitors, representing 27.4% of the total, from 137 countries with India, Hong Kong, South Korea, Taiwan, Indonesia, Vietnam, Thailand, Iran, Malaysia and Japan as the top ten countries.

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Gero Willmeroth of Engel China says China’s slower growth is a new “normal” positive sign

Companies still benefiting from moderate growth hether the growth is slower, Willmeroth added that machine maker Engel is benefiting from the quality requirements, since it is in the premium segment of the market that is growing, with companies investing in higher quality and focusing on efficiency and productivity, to compete in the market on a higher level now.

Another machinery maker KraussMaffei Group has also had “an excellent year in China” and will grow above the country’s GDP, according to CEO Christian Blatt. Having set up a second production hall at its facility in Haiyan last year to meet the demand, the German machine maker says growth has come from the automotive, construction, beverage packaging and medical sectors. “Our made-inChina machines that are adapted to local requirements and cost-saving features are appreciated by our Asian and Chinese customers,” he said, speaking at the Media Day event.

Meanwhile, German engineering plastics maker Domo Chemicals is counting on further growth to come from China, and has invested in a nylon compounding plant, as part of its global expansion of its engineering plastics unit, said Ludovic Tonnerre, Managing Director. The new plant will be located at the company’s Jiaxing facility in Zhejiang province. As part of the total investment, Domo will have a step-bystep expansion at the plant starting up with 10,000 tonnes in 2015; 15,000 tonnes in 2016 and a total Ludovic Tonnerre of Domo capacity of 20,000 tonnes Chemicals outlined the firm’s plans by 2020, said Tonnerre. to invest in a compounding plant

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This year’s Chinaplas had more visitors

Compared with the show held in Guangzhou in 2013, this year it registered a 12.4% growth in visitors, while overseas visitors rose by 14%. This year, the show also had 3,275 exhibitors, surpassing the number of exhibitors at the world’s largest plastics show, K in Germany.

What do all these numbers really say, against the backdrop of a slowing economy in China? Even with the country’s GDP expected to “slow” to 7% this year, after having a good run of 9-10% in previous years, the exhibition floors at Chinaplas showed brisk activity.

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Injection Moulding Asia Country Focus “The plant is now being built with four extrusion lines and will be up and running by the end of the year,” said Tonnerre. The new plant will serve Asian customers with Domo’s variety of products including Domamid nylon 6 and 6.6 as well as high temperature nylon compounds and Econamid and Econamid Oro engineering polymers based on post industrial recycled (PIR) waste feedstock. In China, the company is focusing on the automotive industry since China has become the largest vehicle maker.

Cincinnati-based machine maker Milacron, which recently announced an IPO, is also investing US$10 million to double output at its hot runner factory in Kunshan, according to CEO Tom Goeke.

“2015 is an important year for us. We are expanding our subsidiary Mold-Masters’s facility. The change is driven by customers and the need for new technology,” said Goeke, Tom Goeke of Milacron spoke adding that the expansion at the ten-year old facility will be about the Mold-Masters expansion completed by next year.

Last year, Taiwanese machine manufacturer Fu Chun Shin Machinery Manufacture (FCS) broke ground on a new plant it is building together with medical devices maker Shengguang Group in Henan. According to FCS’s Area Manager John Hsieh, the plant will target to produce 500 machines/year, mainly for the medical devices sector. FCS already has two plants in Ningbo and Dongguan, which manufacture around 2,000 machines/year, but it is unable to expand at those sites due to lack of space, said Hsieh.

Meanwhile, one of the world’s largest manufacturer of injection moulding machines Haitian International opened the first stage of a new plant in Chunxiao, Ningbo, solely for producing its all-electric Zhafir Venus machines.

Spanning 120,000 sq m, the facility has a capacity of 5,000 machines/year. Total area for the plant is planned for 300,000 sq m, with a maximum production capacity amounting to 10,000 machines/year.

plant and will start up in 18 months. “In the current market situation, it is how fast we are able to adapt to market needs that is vital. The utilisation of our factories is also important and since we adopt a flexible production, all our factories are 100% utilised,” claimed Franz. He also added that around 80% of the machine output was for the domestic market, with machinery being used by foreign companies setting up in China as well.

Another Chinese machine maker Tederic expects to focus its attention more on the Southeast Asian markets, in view of the “China slow down”, said a company spokesperson. “We have already been selling for three years in Southeast Asia and also export our machines to the US.” Guangdong-based injection moulding machine maker Yizumi Precision Machinery, to support its strong sales growth of 30-40% last year, expects to build two more factories. One is in Wusha, Shunde, with a land area of 81,117 sq m, and the other is in Suzhou, with the first phase comprising a land area of 33,213 sq m. It also intends to further develop the HPM heavyduty die casting machines, HPM presses and auxiliary automated equipment. Yizumi purchased the intellectual property of US-based HPM Yizumi’s improved A5 Corporation in 2011, when it machine went bankrupt. Set up in 2002 with a facility in Shunde National Hi-Tech Industrial Zone, Yizumi also plans to set up another overseas factory either in India, Brazil or Poland, said a company spokesperson.

Machine makers expand machinery offerings aitian, in an effort to shift its small machine focus to all-electrics and having sold over 5,000 Venus all-electric machines worldwide since the launch, is now working on a new 1,000 tonne Venus machine that will be available at the end of the year.

Franz from Haitian also announced that the company will launch a two-platen Jupiter II Plus in the second half of 2015, also a strategy aimed at shifting its large machinery focus to two platens. The upgraded machine will feature an enhanced speed and injection pressure, and is targeted at the export markets of the US, Europe and Japan. Last year, Haitian sold 211 Jupiter machines, up from 150 in the previous year, and 1,062 Venus all-electric machines, up from 994.

Another company that has entered the all-electric machine market is Tederic that was showing its DE series, available in clamping forces from 50-450 tonnes. Last year, the company invested in a 150,000 sq m facility in Hangzhou, where its new product line is made.

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Robust growth from Chinese machine makers verall, the Haitian Group delivered around 26,839 machines in 2014, with a turnover of RMB7.56 billion, a 5% increase compared to the previous year. Export sales grew by 13% and reached a new record of RMB2.3 million.

The key drivers of growth were attributable to gaining market share in high-level machinery markets such as US, South Korea and Thailand, where double-digit growths were recorded, said Helmar Franz, Chief Strategic Officer.

In fact, the company has had a CAGR sales growth of 10% over the past nine years, which Franz said was “remarkable.”

In Germany, it is doubling its process capacity at its

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Injection Moulding Asia Country Focus Future of the IMM market ith the call for higher efficiency growing, Haitian’s Franz expects future injection moulding machines to incorporate more digitalisation, reduce the weight of moving parts (moveable platens, clamps and toggles) and to have more energy-efficient drives. He also said that more “cross applications” are expected, such as those that blend injection moulding with other processing techniques like say thermoforming.

Looking further into the crystal ball, Franz expects that hardware manufacturers might adopt a different business model, where customers pay not to own a manufacturing machine but to use it. He gave an example of mobile phone network providers that give away free phones to buyers willing to sign a long-term contract.

Another company that has undertaken R&D on the market is Yizumi. It says its findings show that smalltonnage all-electric machines and large-tonnage two-platen machines are the future directions of the industry, “but upgrading will take time because the technology and priceperformance ratio of all-electric machines and two-platen machines still have a long way to go.”

Though the trend for general purpose machines is still strong, Engel’s Willmeroth says that market volume in China is decreasing due to a shrinking market share or machines lasting longer, hence there is no need for constant replacement. “The daily bread and butter business may need to be repositioned to some extent,” said Willmeroth.

Also jumping on the bandwagon of the all-electric machinery line is Ningbo Liguang Machinery with the Flower press, featuring technology from injection machine maker Ripress in Italy.

Germany-headquartered Arburg used the Chinaplas show to have the Asian launch of its Freeformer additive manufacturing of one-off parts and small batches. Helmut Heinson, Managing Director Sales, Arburg, said the machine offers two significant advantages: lower raw Liguang’s new all-electric material costs and the production of “real” parts with same physical machine properties as parts from an injection moulding machine. “The launch of the machine is indicative that Arburg will become a systems supplier for the digital factory of tomorrow,” he said, adding that it will be targeted at the automotive sector.

KraussMaffei’s two-platen MX series has been manufactured in Haiyan since 2012, and this year the company extended it to two clamping sizes of 2,700 and 3,200 tonnes. It also introduced the new model in its CX series, CXV for multi-component moulding.

Subsidiary company Netstal Arburg’s Freeformer made showed its latest PET-Line 5000 its Asian debut for moulds up to 144 cavities.

Also showcased at Chinaplas was Yizumi’s A5 hydraulic series, an improved version of its A5 servohydraulic series, with a larger and stronger clamping unit to allow for bigger tooling.

FCS displayed its latest horizontal rotary table twocomponent injection machine.

Meanwhile Wintec, a fairly new kid on the machinery sector in China that was set up by Engel last year, has started making two-platen machines in Changzhou. The 22,000 sq m facility, with a capacity of 300 machines/year, is making the t-win series in six clamping forces between 450-1,750 tonnes.

Furthermore, Peter Aulinger, President of Wintec, speaking at the Media Day, said the machinery showed productivity increases of 23%, due to reduced cycle times, and 63% less energy consumption, according to independent testing by the National Quality Supervision and Inspection Centre of Plastic Machinery. The twoplaten machines also require 22% less floor space.

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Automation playing a big role eanwhile, closer to home in China, machine makers expect automation to take off in a big way, due to increasing labour costs. It is for this reason Engel Shanghai has started up an automation centre with five engineers.

“We see the degree of automation increasing because of higher demands on efficiency and precision and also higher labour costs in the country,” said Willmeroth.

He said further enquiries are seen in the six-axis robot sector, with assembly and insert functions also growing.

“Some parts require automation, such as bumper parts for vehicles and pipes with insert parts. Automation is needed here to reduce the cycle time,” added Willmeroth.

KraussMaffei’s Blatt says, “There are a multitude of customers investing in automation in China, especially global key accounts producing in a similar way that they are producing anywhere else in the world. We see a trend of automation with customers that previously invested only in stand alone machines, now adding on a higher degree of automation.”

Chinaplas also took the opportunity to dedicate an area with a special robot parade for machine makers to showcase the automation.

Overall, the conclusion from Chinaplas is that China is still a global growth engine, with companies in the process of developing further their resources, building up additional sales and competence.

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