Home>>Related Stories

Email this story     Print this story

Emerging markets, shale and supplier partners fuel Sekisui SPI

Steve Toloken | PLASTICS NEWS

Orlando, Fla. -- Shale gas in the U.S., the emerging middle class in Asia and the rise of mass customization in manufacturing are fueling opportunities for compounder Sekisui Polymer Innovations LLC.

The Bloomsburg, Pa.-based company, a unit of Japan's Sekisui Chemical Co., has re-engineered its manufacturing in the last six years -- and is investing $24 million this year in its U.S. factories -- to handle the quick response manufacturing needed in both Asian markets like aviation and new entrants in industrial manufacturing like Tesla and Google.

The company used NPE2018 to detail those investments and note the role that its industry suppliers have played in developing new equipment to help it dramatically shorten its lead times and be much more flexible.

Chief Operating Officer and President Ronn Cort said that since 2012, the company's average order size has dropped from 1,700 pounds with a lead time of four weeks to 600 pounds and a lead time of 12 days.

"With 3 billion people moving into the middle class over the next 10-15 years, they are skipping -- they need to skip -- the traditional metal to fiberglass to plastics journey and they're going to jump right into plastics," Cort said.

"In the next 10 years, half of all the aircraft being built will be delivered in Asia," he said.

And they'll want those plastics much faster. The company's end markets in Asia include supplying plastic materials to aviation and mass transit.

"The Middle East and Asia, their product cycle in an aircraft may be two or three years, where in North America it's seven or nine years," Cort said. "These really small batch and these really short lead times become critical for them."

As an example, he said, the company supplies materials for large Chinese airlines China Southern and China Eastern.

"They're in rapid competition with each other to develop the brand leadership in these emerging markets," he said. "They're constantly renovating and constantly upgrading. They're in a brand contest to win the hearts and minds of the Chinese middle class."

The rapid response time is the same with customers like Tesla and Google.

"Without getting too specific, we supply some plastics to both Tesla and Google," Cort said. "Their expectation of how quickly we can iterate is completely different than traditional industries.

"The Elon Musks of the world and the Googles of the world, as they move into industrial hardware, they are not looking for legacy suppliers," he said.

Three things are making it possible for Sekisui SPI to respond, Cort said: shale gas in the United States making resin and energy costs globally competitive, a renewed focus on developing its workforce and its suppliers developing new equipment.

The company issued a news release at the show noting how its suppliers have redesigned their equipment to meet Sekisui's rapid product development cycles.

For example, it's spending $8.4 million on a new 80-foot blending tower, with suppliers like Schenck Process and Greiner Extrusion that will let Sekisui automate its small custom color batch manufacturing.

As well, it's spending $4.4 million with Milacron for new PVC extrusion lines at its factories.

"Our strategy is to partner with our suppliers to help them reinvent their existing equipment to help us make ever smaller production batches and shorter lead times," Cort said.

 

Read Next


NOW IN PRINT

Sample

This week's Plastics
News print issue

To download the full contents of this week's PN global issue, click HERE

GET MAIN NEWS

Latest news

on the trends and events impacting the Chinese plastics industry

SUBSCRIBE

CONNECT WITH US

erj tb ut rpn tb

Copyright © 2016 Crain Communications Inc. Use of editorial content without permission is strictly prohibited.