Canadian Plastics

IMM manufacturers shape up, ship out

Major M&E companies are responding to recent industry trends by turning their North American subsidiaries into lean, mean fighting machines.

July 1, 2007   Canadian Plastics



Major M&E companies are responding to recent industry trends by turning their North American subsidiaries into lean, mean fighting machines.

Guelph, Ont.-based Engel Canada Inc. announced that it would focus on the production of small- and medium-sized machines. In addition, the parent company, Schwertberg-based Engel Austria GmbH, will invest US$4 million over the next three years to modernize the North American production network.

Engel Canada will manufacture the all-electric E-Motion machines and Speed presses for the packaging industry. Meanwhile, Engel’s facility in York, Penn. will focus on the production of large-capacity machines, and the company plans to open a technology and training centre at the location.

The York facility will also serve as Engel’s official North American headquarters.

According to the company, the improved integration of its two North American facilities will allow the Guelph plant to “optimize processes, improve flexibility and reduce costs.”

“With a reduced market for standard machines, especially for the production facility in Canada, some changes in manufacturing processes are required to maintain profitability,” explained Engel North America president Steven Braig. “Engel North America will utilize the expertise of the parent company Austria or Engel’s factory in Asia, to enable us to provide a quality product at a competitive price.”

Injection machine manufacturer Demag Plastics Group offered similar reasons for its decision to phase production out of its North American facility. The company is ending machine production at its Strongsville, Ohio plant and will rely on its manufacturing plants in China and Germany.

In the future, the Strongsville operation will focus on sales, service and technical support for the machines that it has supplied into the North American market.

Demag’s manufacturing structure now comprises of plants at Schwaig and Wiehe, in Germany; and in Ningbo and Chennai, in China.

Dr. Klaus Erkes, Demag’s CEO, noted that electric machines now make up half the market, much to the detriment of the hydraulic units manufactured at the Strongsville facility.

Engel said the focusing may result in layoffs, but did not elaborate on the impact its modernization would have on the Guelph workforce. Meanwhile, Demag estimates that approximately 100 employees could be laid off as a result, at either the end of August or end of September 2007.


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