Reality check for Chinese IMM market
“Typically, 40,000 injection moulding machines are sold a year in China. This is made up of 20,000 low, 19,000 medium and 1,000 high-end machines,” he said, adding that in the future the gap between the high and middleend will narrow with fewer low-end machines being sold. Greif also says the industry is in for more changes with the government’s plans to implement certification requirements, akin to the European CE standards. And to encourage processors to buy locally made machines, from the beginning of this year, imported machines have been subjected to a non-refundable 17% value-added tax (VAT), while those bought in China receive the VAT refund. Greif says this will work in Demag Ningbo’s favour as it is able to supply locally produced high-end machinery at a fraction of the cost. “It will become more expensive to import machines in the future and only machines for special applications will be imported,” he said.
The recent recession was an eye opener for the injection moulding machine (IMM) market in China. Numerous Ningbo-based machine makers that could not cope with the demanding requirements shut down, leaving a more consolidated and mature supplier base. PRA spoke to major machinery manufacturers, like Husky Injection Molding Systems, Haitian International, Nissei Plastic Industrial, Netstal China and Demag Plastics Group, that were exhibiting at the recent Chinaplas show for updates on their businesses.
High-end equipment trend Meanwhile, Swiss injection moulding machine maker Netstal is steadfastly maintaining its stand on not producing machines in the country. “There will always be a need for high-end machinery because the locals are unable to fill this gap,” said Andreas Nydegger, General Manager, Netstal China. It was showcasing an all-electric Elion for medical parts. Using a 64-cavity mould made by Schöttli of Switzerland, it was producing needle protection caps for disposable syringes, under cleanroom conditions, in a 6.5 second cycle. Having sold machines successfully to the PET preform and optical disc sectors, Andreas said the company is now aiming to capture a share of the medical products market in China, one which is growing steadily. Canadian machine maker Husky Injection Molding w a s p ro m o t i n g b e v e r a g e packaging solutions aimed at light weighting. These were first shown at the NPE l a s t y e a r. “ B o t t l e w e i g h t reduction is becoming a s t a n d a rd e v e r y w h e re . B y re d e s i g n i n g t h e b o t t l e i n the gate area, we are able to Gerardo Chiaia of Husky says reduce the weight by 2.5% the company’s focus in China is for all bott le size s, ” said to provide complete solutions Gerardo Chiaia, President, to the PET market, including bottle and closure designs, Husky Asia Pacific, Europe, to lower costs and reduce the Middle East and Africa. Its weight of packaging 96-cavity HyPET 400 system with High Performance Package (HPP) was running 15% faster at 7 seconds, producing a 13.3 g EcoBase preform, while the 72-cavity HyCAP 300 was producing PCO 1881 CSD closures weighing 2.3 g in a 3.5 second cycle, which is said to be 20% faster than the industry standard.
Transformation of the IMM market The Chinese injection moulding machine market is huge by global standards but it shrank during the recession. Ningbo, home of the country’s largest machine maker Haitian International and many others, including subsuppliers, had in its heyday 150 machine makers. This has declined to around 45 today, according to Stephan Greif, CEO of Demag Plastics Machinery, the Ningbobased subsidiary of Sumitomo Demag. “Five to ten years ago, China was considered a lowcost producing location but not any more,” he said, adding, “Many of the low end machine makers could not raise the technical levels of their machines to meet the market requirements.” The market shrank when the smaller machine makers closed down. “Those who survived have a higher level of automation to maintain a constant production process and the ability to produce a higher quality,” he said. Stephan Greif of Demag Plastics Machinery says the company is expanding its customer base with a higher tonnage range of machines and by moving into new markets like the automotive and medical sectors
5 I n j e c t i o n M o u l d i n g A s ia • M A Y 2 0 1 0
It also had the Talos on show, which Franz says is a “real” hybrid machine equipped with a hydraulic injection and electrical clamp with features like parallel movements and precise positioning of the mould. “With this machine, we intend to close the gap between European hybrid machines,” he commented. Other exhibits included the 230 tonne all-electric Venus, a highspeed model for packaging. “We’ve already sold 250 of these machines and will double it this year,” said Franz.
Nissei President Hozumi Yoda says that to remain competitive in the market, the company will concentrate on developing new technology. It recently showed a NEX series model at another show in Japan that it says is the first in the world capable of consistently moulding heat resistant PLA material, without any additives
Nissei, meanwhile, exhibited two Japanese-made machines, a Nex 110 tonne machine for thinwall moulding of products like light guide plates and a 40 tonne vertical model for insert moulding of micro-connectors and LED chips. “In China, since most manufacturers do not produce small machines (of under 50 tonnes), we are paying more attention to this market,” said Hozumi Yoda, President of the Japanese company. While Nissei sold 300 machines last year in China, this year it is aiming to sell 500. “Business in China was good compared to other countries around the globe but we expect to increase our market share in other countries this year,” said Yoda, adding that in Japan, the company expects to sell 2,100 machines this year. He also said that business is picking up in all applications including the automotive, mobile phone, electronic and computer parts sectors.
Helmar Franz of Haitian expects the first six months of this year to be good for the company
Franz also spoke about the company’s performance in the first quarter of 2010 terming it as encouraging. “We had orders worth RMB800 million, a new record for that period,” he said. Expansions on the cards To further increase its market share in the high-end machinery segment, Demag Ningbo inaugurated a new plant in Ningbo just before the Chinaplas show. “We have doubled the space to 11,060 sq m and now have the capacity to produce 1,500 machines/year,” said Greif. “We have expanded our machine clamping force to 650 tonnes and will expand it to 800 tonnes by the end of this year (from the 350 tonnes it used to produce).” But even with the expansion the company is unable to meet the demand, said Greif, adding that this year it will produce around 600 machines. When asked about exports, he replied, “It is our dream to increase it to 30%. The first step will be to tackle the Southeast Asian markets.” Currently, 95% of Demag Ningbo’s output is for the domestic market with only 5% destined for the Asian markets. Having set up a plant in Taicang, Jiangsu, last year to produce its all-electric models (from 50-180 tonnes) for the Chinese market, Nissei is already considering expanding its production. “We will increase the number of machines produced to 900 a year by 2013, from the current 300 machines a year,” said Yoda, adding that the precision machinery will cater to the growing medical and electronic parts markets in China. ◆
Local machines stand up to the test Not to be outdone, Demag Ningbo showcased a Chinesemade 280 tonne Systec hydraulic machine fitted with what it says is the country’s first stack mould, fabricated by SQ Co. It also had a 100 tonne German-made El-Exis hybrid machine that was equipped with a laminar flow cleanroom unit from Suzhou Nanmar Filter Materials. While it had showcased a prototype of an all-electric model at a Chinaplas show a few years ago, the company is not in a hurry to proceed with this plan. “Our parent company (Sumitomo) already caters to the all-electric market,” explained Greif. With a view to promoting energy efficiency, Haitian showed its Pallas, which is based on its bestselling hybrid Mars machine. “This is the next generation of Mars, shown for the first time at any show,” said Helmar Franz CSO of Haitian. “It uses the same precision and energy reduction of 80% through the use of an AC servomotor. It also has a gear pump that has been developed with an on/off switch and it can be switched off during cooling, allowing for energy savings,” he explained. 6
I n j e c t i o n M o u l d i n g A s ia • M A Y 2 0 1 0