GERMANTOWN, Wis.—Medical tubing extruder Sunlite Plastics Inc. laid off 58 employees at its Germantown headquarters plant after unexpectedly losing work from its biggest customer.
Founded in 1946, the subsidiary of Diversatek Inc. specializes in PVC extrusion but processes other thermoplastics and offers in-house compounding of proprietary formulations for the medical, pharmaceutical and consumer goods markets.
"This layoff is due to an unforeseen business circumstance—specifically a sudden, drastic and unanticipated reduction in manufacturing orders from Sunlite's primary customer, about which it just learned and will take effect immediately," Sunlite Vice President Julie Skowronski told the Wisconsin Department of Workforce Development.
The layoffs are permanent but don't affect all employees at the Germantown facility, according to Skowronski's Oct. 29 letter. The layoffs went into effect on Oct. 29 and Oct. 30 for 43 employees in production and machine operations, five in compounding and blending, two in engineering, two in quality inspection, and one each in administration, sales, accounting, customer relations, maintenance and shipping.
"Reductions in manufacturing orders are an unfortunate industry obstacle we face as medical device suppliers," Diversatek Chairman and CEO Brant Stanford said in an email to Plastics News.
He called the work loss "unforeseen" and the decision to lay off production employees "very difficult."
"While we expect business and volumes to return to normal, we've taken every precaution possible to ensure that Sunlite continues to operate in the most efficient manner possible," Stanford added. "During this transition, we will deliver the same industry-leading manufacturing expertise and quality assurance that our customers have relied on for decades."
Sunlite has about 80 employees at two facilities serving a mix of medical customers. In addition to Germantown, where the company is based, Sunlite has a plant in Weyers Cave, Va.
In April, Sunlite became the first company in the world to earn an extrusion accreditation for tubing and profiles from MedAccred, which is a supply chain oversight program managed by the medical device industry to prevent product defects. Sunlite manufactures a variety of medical products for cardiology, dialysis, enteral feeding, minimally invasive procedures, urology and more.
With $22 million in annual sales, Sunlite ranks 99th among North American pipe, profile and tubing extruders, according to Plastics News' latest rankings. The business has 21 extrusion lines and a throughput of 2.1 million pounds of resins.
Last year Sunlite said it produced enough medical tubing to circle the globe.