By Lynne Sherwin
The Trump administration has made the return of factory jobs to the U.S. a priority. But building, equipping and staffing a factory can take years. If customers want to reshore quickly, do plastics processors have enough open capacity to take on new programs?
Respondents to a poll on Plastics Machinery & Manufacturing's (PMM) website overwhelmingly say yes, with 67 percent confirming they have capacity not currently being used that could accommodate new business. Eighteen percent said no, and 15 responded that they didn’t know.
Some shared additional comments, including:
“Being mostly automotive and with the increase in interest rates, new vehicle pricing, drop in domestic auto sales we have over 50 percent free capacity.”
“Ready but not connected to the right buyer.”
“We are in a position to increase by 10 to 15 percent.”
“We could start new products in our facility. Always looking for new ideas for products that we could manufacture.”
“We have varying capacity from 300T to 1500T machines, as we have geared up along the way for much higher volumes than we are seeing. We are heavily in automotive, which means great processes and controls, and ready to diversify.”
More than five years after COVID-19 began wreaking havoc, its economic repercussions are still working their way through the market, some respondents said, with one citing “large warehouses mothballed since COVID pandemic.”
Another said, “We built a new building just prior to COVID. We [were] a bit worried about how to pay for it but we did extremely well with firearms during COVID. We added a lot more capacity (from 9 to 24 machines) but changes in the laws idled 8 machines and we already had excess capacity. We have since added new customers but have not filled near capacity. The tariff unknowns have idled several tooling projects.”
Perc Pineda, chief economist for the Plastics Industry Association, also saw the ripple effect of the pandemic in the results of PMM’s poll.
“The surge in capacity utilization in plastic products manufacturing to 85.0 percent in January 2021, driven by COVID-related demand, was expected to be unsustainable. Since then, utilization rate has declined to 70.0 percent as of January this year, with a slight improvement to 71.0 percent in June,” he told PMM via email.
“There remains room for further increases — particularly if plastics conversion needs rise for import substitution — producing them locally due to reduction in imports because of high tariffs,” Pineda said.
Taking on new business would require a new equipment purchase for 25 percent of respondents, while 58 percent said they already had the necessary equipment on hand, and the remaining 17 percent said they didn’t know: “Depends, if we have the right machine. If we don’t then we would purchase,” one said.
“New equipment would be dependent upon the product — assembly (light/heavy), branding (laser, stamp, labels, etc.), automation requirements, etc.,” another noted.
The shortage of workers also remains a stumbling block, with one respondent saying their plant had “open capacity as it stands today. Issue becomes labor and who will work in a plant nowadays.”
Another echoed that sentiment: “Equipment we can buy, qualified employees is the problem.”
Among all respondents, 50 percent utilized injection molding, 18 percent extrusion, 5 percent thermoforming and 14 percent recycling.
Lynne Sherwin | Managing Editor
Managing editor Lynne Sherwin handles day-to-day operations and coordinates production of Plastics Machinery & Manufacturing’s print magazine, website and social media presence, as well as Plastics Recycling and The Journal of Blow Molding. She also writes features, including the annual machinery buying survey. She has more than 30 years of experience in daily and magazine journalism.
