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European injection molding leaders excel
Source:    Author:By Andy Lau    Date:14.Jul.2017

More than half way through 2017, good news were “injected” into the plastics machinery industry, as major European injection molding suppliers reported positive results last year, and the momentum is expected to carry through the year.

Germany delighted with 4% growth

The German plastics and rubber machinery manufacturers reflected a better-than-expected 4% growth in 2016, continuing the positive trend of the past few years.

At 4%, growth is actually higher than the 2% originally anticipated,” said Ulrich Reifenh?user, Chairman of the VDMA Plastics and Rubber Machinery Association, giving the industry grounds for continued optimism for the future.

It is expecting sales for the current year to increase by another 4% in real terms.

The extremely pleasing development in export markets was particularly striking in the second half of 2016,” said Reifenh?user.

In 2016 as a whole, German machines’ export increased 5.1% to €4.9 billion. Sales to North America amounted to €774 million, an increase of 7.6%. The US therefore not only maintained its leading position among export markets, but also increased its lead over second-placed China.

At €629 million, German exports to China continued the trend of recent years, being down 3.6% in 2016. But after declining for three years running, exports to China are also set to pick up again with growth forecast for 2017 as a whole.

After a further slight fall in the first quarter of 2017 (-1.7%), supplies to China are expected to increase again in the following months. The expansionary economic policy measures of the Chinese government in particular are providing a boost in this regard, said VDMA.

Mexico ranked third among the most important countries buying German plastics and rubber machinery. In 2016, exports to Mexico were up by an impressive 51.9% to €255 million. The momentum continued, with 58.3% increase in 2017 first quarter.

2016 saw German deliveries of plastics and rubber machinery to Russia shrink for the third year in succession. They amounted to €86 million, down 36.3% on the previous year.

However, the appreciable recovery in the Russian packaging sector as a direct consequence of Russian food sanctions suggests that exports of plastics and rubber machinery will pick up in 2017, according to VDMA.

In Britain, on the other hand, the effects of Brexit are slowly being felt,” said Thorsten Kühmann, Managing Director of the VDMA Plastics and Rubber Machinery Association in his trend analysis. Exports to the UK fell in 2017 first quarter by 31%, resulting in that market dropping from 4th to 8th place among the major plastics and rubber machinery buying countries.

German powerhouses made strides
Gerhard B?hm (left), Managing Director Sales, and Tong Zhao, Head of Arburg China, posed for picture at CHINAPLAS 2017.
For the third consecutive year, Arburg broke its turnover record with €630 million in 2016.

Gerhard B?hm, Managing Director Sales, analyzed the trends in injection molding. He said all-electric machines and drives continue to gain in importance. As a result, shares of all-electric machines in Arburg's business has risen to 27%.

Our new electric entry-level GOLDEN ELECTRIC machine series has also contributed to this. We launched this a year ago and it has been very well received by customers,” he said.

Turkey solutions were growing in the market as well, which contributed around 17% of Arburg’s turnover. “The significance of automation and turnkey solutions is also reflected at the CHINAPLAS 2017: all of the ALLROUNDER exhibits are automated: this applies to the machines on our own stand and on those of our partners,” B?hm said.

KraussMaffei Group CEO Dr. Frank Stieler, speaking at CHINAPLAS 2017 Media Day.The KraussMaffei Group, consisting of KraussMaffei, KraussMaffei Berstorff and Netstal brands, posted sales of €1.27 billion in 2016, an increase of 5% over the previous year. Incoming orders in the period grew 5.5% to €1.33 billion.

Group CEO Dr. Frank Stieler is confident of a bright future, and pointed to several global trends that will support the company’s development: urbanization, sustainability, health, productivity & resource efficiency and premiumization.

After ChemChina’s acquisition, Dr. Stieler said KraussMaffei is in the process of taking over the management responsibility of ChemChina’s rubber machinery plants. He expects the product portfolio can be successfully blended together by 2018.

Cui Xiaojun, CEO of KraussMaffei Group China, announced an ambitious target: to achieve a double digit growth in China. He believes the increasing requirements of the Chinese plastics industry will turn into valuable opportunities.

To prepare for the future, we are adding 20% staff for technical support, sales & services and operations. As for the Haiyan manufacturing site in China, we will certainly increase our investment. Announcement will be made when the appropriate time comes,he said.

Sumitomo (SHI) Demag CEO Gerd Liebig.
In 2016, Sumitomo (SHI) Demag recorded the most successful business year in its corporate history. With a total of €234 million, the German injection molding machines manufacturer has topped its 2015 record sales of €231 million.

It was also the fourth consecutive years Demag recorded a sales increase. “Our customer base has become even more consolidated,” CEO Gerd Liebig stated. “In 2016, incoming orders were 20% higher than our turnover, which means that 2017 will see a massive capacity expansion.” He expects a 15% sales increase this year to €270 million.

In addition, Sumitomo (SHI) Demag noted that the number of repeated buyers of all-electric machines over the last four years has doubled – in accordance with the company’s sales to plastic packaging manufacturers.

Over the past two years, our share in the global market for screw caps and thin-wall parts has risen by about 20%,” Liebig said.

Austria happy about “pretty and strong” market in China

Most of the Austrian companies in the plastics industry are heavily engaged in export, with some of them shipping up to 98% of their annual turnover. Therefore, it is influenced substantially by the external economic environment, said Dietmar Schwank, Commercial Affairs Consul for Austrian Consulate General Guangzhou.
Dietmar Schwank, Commercial Affairs Consul for Austrian Consulate General Guangzhou.
The Chinese market is pretty stable and strong for us. It is picking up again and there is more and more demand for high quality machinery, which favors the Austrian companies,” he said. “The trends we see in the industry are pretty positive.”

When it comes to end consumers, such as automotive, electronics industry, household goods, medical, these industries are quite strong and have an interests to increase its quality and efficiency in China. This also happens in the field of plastic materials, for the construction sector for example.”

With regard to China, Schwank observed that the topic of resource and energy efficiency and automation is gaining in importance.

Austria is one of the leading countries in terms of automation and digitalization. The industrial and research landscapes in this area are very similar to Germany where the Industry 4.0 concept comes from, according to Schwank.

This is an area China focused on as they realize there is a need to promote automation and robotization in China. We can see that very clearly, and our companies are making good business out of this development because we can work with Chinese customers, not only by supplying automation technology to China but also helping them to develop the know-how.”

In 2016, the total export values of Austria to China was €3.3 billion (+0.3%) and sino-China trading value amounted to €11.3 billion. Both export and imports are expected to reach a new record this year, according to him.

Austrian big names remained strong

The Engel Group closed the fiscal year 2016/17 at the end of March with record sales of €1.36 billion, up 8.6% compared with the previous year.
Gero Willmeroth, Sales and Service President at Engel Machinery Shanghai, appeared at CHINAPLAS 2017.
The markets in Asia have played a big role in the success of the Engel Group,” said Chief Sales Officer Dr. Christoph Steger. “Asia grew faster than average in the last fiscal year, primarily due to China. On top of this, we are benefiting from the strong momentum in Southeast Asia.”

Since the global financial crisis in 2009/10, the company has averaged a growth rate of 21%. Europe constitutes the majority (55%) of Engel’s business, followed by the Americas (24%) and Asia (20%).

To address the increasing demand, Engel is investing in different parts of the world. The southern part expansion of its Schwertberg, Austria headquarters has completed, providing an additional 10,000sqm floor space for offices, workshops and child care. The expansion of the northern part begins in May, and once completed, will double its production capacity.

Engel’s Shanghai base is also undergoing an expansion that is expected to complete by the end of July. There will be more spaces for offices (+450sqm), machining area (+1,600sqm) as well as apprentice workshop.

We will then also have industry know-how available to us for Asia at our site in Shanghai, thereby enabling us to grow our market position in the five business units further,” said Gero Willmeroth, Sales and Service President at Engel Machinery Shanghai. This is an important step in our efforts to strengthen our technological expertise here in Asia.”
Wittmann Kunststoffger?te GmbH in Vienna.
The Wittmann Group posted a 5% increase in sales to €377 million in 2016, which is “more than satisfactory” after a record 19% growth in the previous year, according to its Managing Director and CEO Michael Wittmann.

An expansion in the order of almost 20% is, of course, an exception and not possible every year. We are proud that we could add yet another 5% in 2016 to that impressive rate,” he said.

With an exceptionally high order intake in the second half of 2016 and at the beginning of 2017, the company’s order books are already full well into the autumn of this year.

Wittmann said, “2017 has got off to an excellent start for us, and we will be very likely to exceed €400 million in sales this year. We are looking forward to an exciting year with a great variety of challenges and tasks.”

Significant investments were made last year in corporate machinery and infrastructure. For this year, an extension of the production facility by some 2,200sqm is planned.

The expansion of the production area for robots still under way in Wittmann’s facility in Vienna. This will increase the total capacity at the company's four robot production plants to 4,800 units per year.

Furthermore, investments in additional ultra-modern machining centers have been made over the last 12 months, which will lead to a capacity increase in the coming months.

Once this construction work has been completed, an extension of the new Wolkersdorf production plant in Austria will be started, which was only opened in October 2015, and where bulk material technology products for material drying, loading and dosing are made. With the planned addition of 2,600sqm, the total production floor space for this segment will be increased to 9,300sqm.

Italy: poised for further growth in next three years

The industry has returned to its pre-crisis level, but the best, is yet to come, declared Alessandro Grassi, President of Amaplast, the Italian plastics and rubber processing machinery, equipment and molds manufacturers association formerly known as Assocomaplast.
Alessandro Grassi, President of Amaplast.
In 2016, exports reached an historic level, approaching €3 billion mark. There was even greater progress in imports, exceeding 12% to reach €850 million.

With regard to production, in the absence of official data, Amaplast estimated that revenues for the sector in 2016 topped €4.2 billion, breaking the record set in 2007 before the global financial crisis hit in 2008.

Europe is still the main market for Italian suppliers,” analyzed Grassi. “Germany remained our biggest export destination, followed by the US and Mexico.”

China is also an important market for us. Although export volumes dropped in the last 12 months, the demand is coming back now, and we expect a good performance this year for Italian manufacturers.”

The Chinese market has been rather stagnant in the last two to three years, Grassi observed, “but a big market like China will not stop for a long time, so the investment comes again now.”

All in all, a better future is expected, at least for the next three years.

We traded ideas with leading associations in Europe. The consensus is that, barring any unforeseeable circumstances arises from the political side, the global plastics industry is poised to grow further, at least in the next 36 months,” Grassi stated.

Climate change is a global issue that has to be addressed urgently. Reducing CO2 emission is a common goal in the automotive industry that contributed to the rebounds of Italian plastics industry, according to Grassi.

More plastics are used in vehicles than ever,” he said. “An extrusion line supplier told me that even the premium brands are trying to replace genuine leather with synthetic ones made with high quality polymer. This is a challenge but also an example of how important plastics is for the automotive industry.”

In terms of technology, Industry 4.0 is expected to propel the industry to another level.

This is the most important trend in the next two or three years,” emphasized Grassi. “The concept that we are pushing so hard for in Europe is now at a very good level. We can say now that everything is ready.”

All kind of benefits associated with Industry 4.0 that started in Europe can be transferred into China, he said.

China is such a huge market, and like all markets in the world, there will always be players in the entry level that are not ready nor are they interested in Industry 4.0. But we see that the medium segment is trying to improve and will be ready for it; and then some in the high end segment is already asking for it.”



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