SHANGHAI—Injection molding machine heavyweight Engel Austria GmbH is plowing $12.9 million into expanding capacity for its Changzhou, China-based Wintec subsidiary, the company announced in Shanghai on the eve of Chinaplas 2018.
The expansion, slated to start in the fourth quarter and be completed a year later, will double the production area and boost the unit's headcount by 60 percent, said Mark Feltes, the newly appointed president of sales and service at Wintec.
It's the first expansion since the company launched the Wintec brand four years ago as a more standardized machine than its namesake Engel machines.
"Our strategy of selling very high quality, reliable, standard performance machines is paying off," said Feltes, who spoke at a news conference in Shanghai April 23, a day ahead of Chinaplas, which runs April 24-27.
The Wintec expansion mirrors what Engel executives said is solid growth in its other China operation. The parent company's Shanghai factory sold 20 percent more machines in its most recent fiscal year, which ended in March, executives said.
Feltes, who was most recently vice president of packaging at Engel Austria, anticipates additional capacity in coming years at Wintec.
"The good news for Wintec in Changzhou is we have land, so we can continue to expand," he said.
Wintec's offerings, including e-win electrics and two-platen t-win servo hydraulics, are targeted at standardized applications.
"We are very highly standardized, although we have 200 options packages," Feltes said.
Seventy-six percent of the unit's sales are in China. The key market is automotive, with 72 percent of sales, followed by home appliances at 23 percent.
Wintec also will formally enter the Americas market at NPE2018 in Orlando, Fla., in May, and is also targeting the Middle East, Turkey, Africa and Iran.
Peter Auinger, who started Wintec in 2014, is taking charge of Americas sales.
In Asia, Engel manufactures its more premium, customizable Engel brand machines in Shanghai and Pyungtaek-City, South Korea.
Shanghai focuses on larger machines with more than 350 to 4000 metric tons of clamping force, while South Korea's smaller all-electric e-motion and hybrid e-victory machines are targeted at the medical industry.
Engel currently has 950 employees throughout Asia, including 490 at Engel Shanghai. That's a 20 percent increase in headcount in just one year, said Gero Willmeroth, sales and service president at Engel Machinery Shanghai.
"The automotive industry in China continues to be the most important driver of growth and innovation," Willmeroth said.
A focus is automotive lighting, especially with lightweight composites that replace glass. At its Chinaplas booth, Engel is demonstrating the manufacture of multilayer, thick-walled LED lenses.
The company also is showing medical and electronics applications.
Ninety percent of the machines sold in Asia are made in China or South Korea, Willmeroth said.
Training skilled Chinese workers is a priority. Last year, the company invested $1.03 million on equipment for a new Shanghai-based apprenticeship program and hired a dedicated training manager. Currently, Engel Shanghai is training 51 mechatronics engineers, CNC technicians and plastics technicians.
Also in 2017, Engel Shanghai added office space and expanded its large-machine production area.
The expansion taps out the company's available space in Shanghai, Willmeroth said.
The investment announcements cap a year of growing sales for Schwertberg, Austria-based Engel. Global sales for the fiscal year ending March 31 were $1.84 billion, up 11 percent from the year-before period.
That included $367.1 million in Asia-Pacific.
The privately held company does not break out sales by country but the majority of its Asian sales were in China, Feltes said.
At Engel's headquarters in Austria, it's expanding one production hall by 124,000 square feet and building a new consumer technology center. Construction is expected to be completed this autumn.
Schwertberg makes small and mid-sized machines up to 660 tons of clamping force.
In St. Valentin, Austria, Engel is spending $195.7 million to expand production, add a new administration building and enlarge its center for lightweight composite technologies.
St. Valentin makes large machines, ranging from 350 to 6,500 tons of clamping force.
Worldwide, Engel employs 6,600 people, including 3,700 in production in Austria.
Europe, led by the German market, represents 53 percent of total sales, followed by the Americas with 26 percent and fast-growing Asia with 20 percent.
The customer base for Engel machines is more diverse than that for Wintec machines. Overall, 25 percent of the company's machines are used in the automotive industry, 21 percent in electrical and electronics and 20 percent in industrial and environmental. Consumer, construction and health care are other key applications.
Wintec has seven service centers throughout China. Last August, Engel upped service and support in southeast Asia with the launch of a new parts hub in Bangkok. The hub stocks 5,000 parts for next-day delivery.