GREENVILLE — A Pennsylvania plant closure could translate into growth in West Michigan for a global plastic injection molding supplier.
Earlier this month, Madison Heights-based DME Co. and parent company Milacron Holdings Corp. (NYSE: MCRN) detailed plans to consolidate its mold base manufacturing to a “new world class” plant in Greenville, Mich., located northeast of Grand Rapids.
Cincinnati-based Milacron will close its DME Youngwood plant southeast of Pittsburgh and move its operations to Greenville later this summer, according to a statement from the company.
DME President and General Manager Pete Smith said company wants to consolidate to one plant to “direct our investment funds to build a new world class site at Greenville,” which currently makes quick-change mold frames and mold insert systems.
DME, formerly Detroit Mold Engineering, made metal mold bases at the Youngwood plant for use in the plastic injection molding industry. The move is expected to affect 63 people at Youngwood, which “was no longer able to compete cost effectively,” according to Smith. The company will help some interested Youngwood employees relocate to work at other Milacron sites “where possible.”
In the statement, the company said it plans to update the Greenville facility, located at 1117 Fairplains St., although it did not specify its level of investment. Milacron Director of Marketing and Communications Michael Ellis declined to provide any additional information on Smith’s comments.
“This facility will incorporate the latest state of the art manufacturing processes and, together with its location, it will be ideally positioned to service customers throughout North America,” Smith said in a statement, referring to the Greenville plant.
West Michigan has one of the highest concentrations of tool and die makers in the country. According to the U.S. Bureau of Labor Statistics, the industry is nearly 7.5 times more concentrated than normal in the Grand Rapids-Wyoming metropolitan statistical area. The companies in the MSA pay an annual mean wage of $48,410.
According to data from The Right Place Inc., a regional economic development group, 130 tool and die shops operate within a 75-mile radius of Grand Rapids. They employ more than 4,300 people in the region, and hired nearly 800 workers between 2011 and 2016.
Most tool and die companies in the region supply automotive and furniture manufacturers, according to the data.
A spokesperson for The Right Place declined to comment on whether the agency was working with Milacron around the company’s plans for Greenville.
Milacron generated nearly $1.2 billion in sales for the full year in 2016 and had operating earnings of $105.6 million, or 43 cents per diluted share, according to an statement issued last month. The company had $130.2 million in cash on its balance sheet as of Dec. 31.
In providing guidance for 2017, Milacron said it expects flat sales to growth of 2 percent, according to its earnings statement. It also plans to commit around $50 million in capital expenditures during the year.