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What Goes Around Comes Around

Posted by: Mu Ju 2019-10-09 Comments Off on What Goes Around Comes Around

I don ’t want to sound Pollyanna-ish about the hard hits that North American molders and moldmakers have taken from overseas competition lately, but the good news about this globalization thing is that the globe is round, not flat. If you keep going in any direction, you’ll come back to where you started. You can see that happening in the plastics business, at least a little, so far.

In late April, I attended Moldmaking Expo 08 in Novi, Mich., hosted by our sister magazine Moldmaking Technology. The pain of globalization was clearly being felt there. Mike Zacharias, president of Extreme Tool & Engineering, Inc. of Wakefield, Mich., told how his firm suddenly lost 25% of his business—then largely telecom-based—because a majority of his customers were having most of their tools built in China. But these customers “were not happy with the results,” he said. So he built a plant there to service his U.S. customers—or former customers—and apply the homegrown skills and service that had made his firm successful. Meanwhile, he refocused his domestic plants more toward medical, automotive, and consumer markets, and now, he said, “Our backlog is as strong as it’s ever been.”

Something else was evident at this show, and at other plastics meetings I have attended in the last few months: Globalization swings both ways. Close to a dozen moldmakers told me that they have seen some moldmaking—and molding—business coming to the U.S. from European OEMs. Thanks to the Euro/dollar exchange rate, these OEMs now see us as a lower-cost manufacturing region—but one with quality and experience they feel comfortable with. Several said European firms are sending RFQs across the Atlantic every week. Others noted that domestic molding shops are getting parts—and tooling—orders that normally would have been filled in Europe. From the sound of it, this is still more of a trickle than a flood of new business, but it sounds like a logical trend.

Several people I talked to agreed with the proposition that this might be a propitious time for U.S. molders and moldmakers to make active efforts to market their skills in Europe. As Todd Finley, v.p. of Commercial Tool & Die Inc. in Comstock Park, Mich., put it at Moldmaking Expo, “We used to be regionally focused, but now we must look farther afield. We have to be able to support customers’ global programs—something we never would have considered before.”

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