Has injection molding technology peaked?

Many injection molding machine manufacturers have suffered over the past few years, some teetering on bankruptcy. A recession, coupled with a flight of manufacturing business to Asia has played no small part in this. Yet there are also suggestions that the industry, compared to other manufacturing and high-tech sectors, may be offering less and less innovation in successive product cycles.

According to our latest injection molders’ survey (this issue), 47% of responding companies bought injection molding machines last year. For the upcoming year, 43% say they are purchasing new machines. These aren’t bad numbers, implying about one out of every two Canadian molders is investing in new equipment. However, of those companies that bought machines last year, nearly 60% said they were buying to add capacity, not to replace old machines. About the same percentage of molders say they are buying to add capacity for the upcoming year.

In the U.S., injection press shipments have fallen in 2001 and 2002 to about 3500 machines, from a peak of 6,000 machines in the roaring late 1990s, according to data from the SPI. These numbers also suggest that the majority of injection machine purchases are being driven by economic expansion, not the need to replace older equipment.

The difference, in economic terms, between buying to expand and buying to replace is huge. Imagine the impact on the automotive industry if people only bought new cars, SUVs and trucks when their families, houses or incomes got significantly larger. In a similar vein, the computer industry would stagnate if households or businesses only invested in new PCs and peripherals when demand grew, not to replace inefficient or obsolete technology.

Despite the recession, annual North American vehicle sales have held steady at around 17 million units over the last few years. Sales of home and office PCs have seen a decline of few percentage points over the past few years, but nothing like the drop of 50% for sales of injection molding machines.

This pattern implies that perhaps as much as half the time, the reason people and businesses buy new cars and computers is to capture the advantages of new technology. In the case of cars, better handling, engine performance, safety, comfort, GPS navigation systems, etc. In the case of computers, ever faster processing speeds and greater amounts of RAM and hard drive storage.

There are limitations to the comparison between cars and computers and injection molding machines. The purchase of an injection molding machine is strictly a capital investment and is influenced by factors such as depreciation rate and a company’s strategic market niche. A company molding storage baskets probably does not need state-of-the art technology.

Neither am I suggesting that machinery makers have been uniformly deadbeat when it comes to innovation. Multi-shot molding, automation, rotating platen technology and machine control are a few areas in which important advances have been made in the last six years.

Perhaps, in some cases, the industry could benefit from improved marketing. Having spent time on the plant floor, I’m aware of the reluctance to part with the old way of doing things. Plant managers are instinctively skeptical about claims on return-on-investment and cycle time improvements. Maybe machinery OEMs need to assume some of this risk and offer limited guarantees on these claims.

There’s also over-capacity and a glut of confusing assertions. Ask 50 people “what’s the best mid-tonnage machine for your buck” and you’re likely to get 50 different answers. It would be great if OEMs would agree to submit their machines to independent, head-to-head analysis, but competitive and proprietary concerns make this highly unlikely.

So that leaves us waiting for an overdue “wow” innovation, the injection-molding equivalent of the fuel-injected engine or the point-and-click PC operating system. Maybe we’ll see it at this year’s K show. The IM industry needs a shot of excitement.

Michael LeGault, editor e-mail: mlegault@canplastics.com