TIJUANA, Mexico—A rubber products company serving the automotive industry is investing more than $1 million in new presses.
Morgan Polymer Seals indicated the new energy-efficient presses will help the company lower electricity costs and allow it to remain competitive in supplying parts to auto makers, the company's bread and butter.
"Even before the coronavirus hit, a lot of suppliers were having to pass along their own cost increases to their customers in the form of price increases, so already price increases have been a rampant problem for our customers," Marketing Director Sam Morgan said.
"Not only has Morgan Polymer not passed on price increases to our customers, but one of the things that we're doing to try to prevent from having to do that is invest in high-efficiency machinery," he said.
The $1.3 million equipment purchase includes eight new machines: six rubber presses and two plastic injection molding machines at the company's facility in Tijuana, a city located along the border with the U.S. in the Mexican state of Baja California.
Not only are the new rubber machines more energy efficient, they also use a "full-stroking ram" to evenly distribute clamping force over the entire surface of the mold used to make the rubber parts.
This even distribution and support protects the integrity of the mold over the long term, helping guard against the potential for any sort of deformity to develop over time, Morgan explained.
Adding the new energy-efficient presses helps Morgan Polymer keep a check on pricing to their cost-sensitive automotive customers.
"If you are using less electricity, and these things use a lot of electricity, you get higher efficiency machines," Morgan said. "In this case we are able to keep our electricity costs at bay.
"When we save money, we're more financially stable. And when we're financially stable, our customers are less stressed out."
Todd Tesky, vice president of sales, said the purchase of the presses from Maplan GmbH of Kottingbrunn, Austria, provides both economic and operational advantages.
"By partnering with Maplan for our presses we are able to reduce our operating costs since they are very energy efficient," Tesky said in an email interview. "This, in turn, allows us to pass these savings onto our customers in terms of lower prices. Also, since this style of press requires less square footage in comparison to, as an example, a horizontal press, we are able to increase our capacity in each of our plants, which means a reduction of our operating cost per square foot."
Morgan said his company sticks with Maplan presses to allow for consistency on the shop floor.
"This style of custom press that we specify also allows us to increase our operating efficiency due to our PM (preventive maintenance) program, which reduces our downtime and increases working capital, since we do not need to stock key parts for a multitude of different equipment," Tesky said. "The press also has a full stroking ram, which allows us to maximize the life of our customers' tools and protects their investment."
Customers typically own the molds that are used on the company's presses, so Morgan Polymer sees the importance of protecting those investments for its clients, the marketing director said.
Adding the new presses is the second recent investment the company has made in operations in recent months, following an $800,000 move to expand vision systems to inspect parts.
Morgan described the investments as part of a continuous improvement approach the firm takes to stay competitive.
The company makes a variety of rubber parts used in automotive applications, including engines, transmissions, fuel systems and electrical systems. Products include gaskets, seals and grommets.
A portion of the latest capital expenditure involves the purchase of two more machines to injection mold plastic parts that are integrated with rubber parts to create a certain finished component.
Rubber parts makers have two options when it comes to these products that contain both rubber and plastic components. They either can contract with a plastics processor to make the parts and ship them to the rubber company for final assembly. Or they can take that manufacturing in-house and handle both aspects of the manufacturing process.
"For us, investing in the plastic molding machines was our way of basically keeping consistent vertical integration," Morgan said. "Making sure the quality is good. Because when your quality is good, you don't have to pass along price increases."
Morgan Polymer makes nearly 100 million parts each year to companies including Ford, General Motors, Volkswagen, Nissan, Hyundai and Fiat Chrysler Automobiles. Other clients include Continental A.G.
Even with the recent equipment spending, the marketing director stressed the company's most important investment is its employees.
"At the end of the day, great machines can only get you so far," he said. "I want to be clear that this is the harmony of technology and humanity that makes this work. No matter how much money we spend on stuff, if you don't have good people, it doesn't matter. And we've got good people."