ISTANBUL, Turkey-Teklas Kaucuk A.S. and Standard Profil Otomotiv A.S., Turkish automotive suppliers affiliated through ownership, have expanded and improved their manufacturing capabilities.
Their decisions come, however, after auto and truck production in Turkey plunged more than 40 percent last year. Runaway inflation and a rapidly devaluating Turkish lire have hit local purchasing power.
The two companies were left operating at only about a third of rated capacity. But both are actively trying to obtain more export business to offset the local decline and solidify business for the long term, which would ensure higher capacity utilization over time.
Teklas, a manufacturer of hose, molded and extruded goods since 1971, has concentrated all mixing operations at a second site opened last year at a newly established industrial park in Gebze. Teklas moved out of its original factory in Istanbul in 1990 because it had no room for expansion, according to General Manager Bekir Sonmez. The site was retained for other uses.
Teklas-``Tek'' from the word for ``technical,'' ``las'' from ``lastik'' (rubber)-invested $12 million to build and equip the new mixing facility, which features a Francis Shaw K5 internal mixer and fully automated carbon black and white filler handling system from Chronos Richardson.
The 21,600-sq.-ft. Gebze plant also incorporates Teklas' existing Meccaniche Moderne mixer and a smaller MM mixer that is being refurbished for batch-mixing purposes. Considering all three lines, the new facility has the capacity to make 20 metric tons of product.
Teklas has processing capacity for 7,000 tons of extruded and molded rubber parts-via 30 injection molding presses, eight extruders and 14 autoclaves. That translates into about $27 million in annual sales, 33 percent from exports.
After dipping 28 percent last year, sales this year are projected to rebound to more than $50 million and increase an additional 33 percent in 1996. Growth will be fueled by exports, which the firm sees doubling as a percentage of sales to more than 75 percent in the coming years, Sonmez said.
The firm supplies all the Turkish vehicle companies and is a QSP-certified vendor to General Motors Corp.'s global operations. New customers secured recently include Volkswagen A.G. in Germany and Toyota S.A. in Turkey.
Teklas is re-engineering the five-year old, 50,400-sq.-ft. Gebze hose, extrusion and molding plant to take advantage of the floor space freed by the transfer of the mixing room to the new plant.
In its place will be brake hose production, manufactured under license from Freudenberg France. This production soon will be expanded in the coming year with Teklas-engineered manufacturing.
Toward this end, Teklas has designed and built its own textile knitting equipment for the hose.
The expanded production, plus an organization based on Total Quality Management, should help solidify the jobs of the 240-person workforce, Sonmez said. The company earned ISO 9002 certification in December 1994.
Teklas also is a licensed manufacturer of Cooper Industries Inc. for ``Champion'' brand windshield wipers, primarily to supply Tofas Oto Ticaret A.S., the local Fiat affiliate. For other customers and the aftermarket, Teklas has established its own brand, ``Silgec.''
Meanwhile, Standard Profil upgraded and expanded its mill room last summer at its Duzce plant, a project that's integral to the company gaining ISO 9002 certification, according to Rifat Kamhi, company founder, president and majority owner. Standard Profil makes extruded window and door seals for the Turkish automotive industry and for export.
The company invested about $5 million to set up the new mixing room, the heart of which is a Francis Shaw K-135 (intermeshing rotors) mixer, fed by a computerized Chronos Richardson Fluidized system, yielding up to 15 tons of compound per shift. The investment also included a hydraulic-drive Iddon Bros. calender and a Prodicon batch-off.
The mixing room is housed in Standard's original factory and will run parallel with an existing mixer currently being refurbished.
Standard Profil is an affiliate of Standard Products Co. via the Standard Products industrial unit in France, which has licensed technology to the Turkish company since its inception in 1976. Standard Products agreed to extend the arrangement after it bought out SPI in 1992, Kamhi said.
At first glance, Duzce seems a questionable location for an automotive supply plant. The town is more than 60 miles east of Istanbul and Ismir, where most Turkish vehicle plants are located. It originally took five hours of driving on twisty, two-lane roads to reach the site. A recently completed highway cuts the travel time down to about two hours.
The site was picked in the mid-1970s because the Turkish government was offering incentives to attract industry to a primarily agricultural area. The son of an automotive parts and B.F. Goodrich tire dealer, Kamhi entered into automotive parts wholesaling in the mid-1950s and branched into manufacturing in the 1970s after Fiat, Ford and Renault established local operations.
It was Renault's desire for local supply that led Standard Products Industrial to look into finding a Turkish partner. Standard Profil began production in 1979, originally as a four-way partnership, with an investment of $1 million and seven employees. Today the partnership involves Kamhi and M.M. Danon, chairman and owner of Teklas.
Mixing capacity was initiated in 1984, and a second manufacturing site was established in 1991 at a nearby plant left empty by a bankruptcy. Together the two sites occupy 87,120 square feet with nine extrusion lines, two continuous flocking lines and 10 injection presses. Employment has grown to nearly 350.
Parallel to the mixing room investment, Standard Profil has upgraded its extrusion lines with Troester extruders designed specifically to process EPDM, and more recently with a Gerlach high-temperature curing unit that allows faster processing speeds and cuts down on scrap, Kamhi pointed out. A compact flocking unit is planned as well as a new laboratory.
The relationship with Standard Products has been positive for both partners, Kamhi maintains, although it does have a negative effect on Standard Profil's export possibilities.
With annual sales of about $28 million, Standard Profil has a near monopoly on supply of extruded seals to the Turkish vehicle industry, and it derives a third or more of sales from exports.
General Motors is the firm's single largest customer, Kamhi said, and Standard is now being brought into the design and bidding process for the firm's next generation models. The company supplies GM plants throughout Europe and in Brazil, and final preparations are under way for supplying seals to a GM plant in Mexico.
Why didn't the two companies set up one mixing venture to supply both factories? ``We considered it, but in the end, each company has its own agenda and growth strategy that requires captive mixing capability,'' said Kamhi.
The companies acknowledge their mixing capacities will be under-utilized for several years because of the collapse of domestic vehicle manufacturing. But increased exports should keep the activity level from sinking too far.