Molding and casting manufacturer acquires 52 acres in Walker for future expansion
WALKER — Citing increased demand from its automotive customer base, Betz Industries Inc. wants to expand its manufacturing capabilities at its sprawling West Michigan campus.
By investing an expected $3.5 million for a new 41,280-square-foot facility, the Walkerbased molding and casting manufacturer plans to offer machining services to its customers, according to co-owner Gregg Betz.
The expansion, which could create up to 15 new jobs, will allow the company to bring machining in-house after previously farming out that service to third parties, he said.
“We’ve always had our customers ask us to do machining, or for us to find outside machining sources for them,” Betz told MiBiz. “We’ve had a number of our customers that have asked us to do some of the 2-D type machining, especially at the bottoms of the castings.”
To accommodate the new building, an affiliate of Betz Industries acquired three parcels along Walker Avenue NW totaling nearly 52 acres, including a vacant house and the remainder of the Triick Sand Pit. The property abuts the back edge of Betz Industries’ more than 28-acre industrial site that fronts Bristol Avenue NW in Walker.
Pending approvals from the city of Walker, the company hopes to have construction of the new facility completed by the fourth quarter of 2019, Betz said. Grand Rapidsbased John W. Potter Inc. will serve as the general contractor for the expansion.
Betz said the land should accommodate additional expansions for the company. In a presentation of concepts to the Walker Planning Commission, Betz Industries indicated the site could have room for three possible additions.
For now, the plan for the new building “is just going to be for machining castings,” Betz said. “That’s all we’re looking to do at this point in time.”
The expansion by one of Walker’s “most stable and oldest companies” comes as good news for City Manager Darrel Schmalzel, who said Betz Industries’ continued investment brings “more stability” to the community.
“They continue and always have been a wonderful asset to the community,” Schmalzel said.
Although the expansion will add new capabilities to the company’s offerings, it will also help the manufacturer with logistics, Schmalzel added.
“It allows them to have access to Walker Avenue, which is great access for their truck traffic and deliveries,” he said. “It’s also close to I-96. The 42,000 (square-foot expansion) is just the first part of a plan — they can expand as they need to.”
According to Schmalzel, Betz Industries will submit an actual construction plan for the site if the Walker Planning Commission grants final approval for the project on Aug. 1. He added that the company has yet to apply for any tax breaks for the expansion.
BUSINESS PICKING UP
Currently, Betz Industries serves the automotive, wind energy, machine tooling, industrial tooling and stamping and die industries. Between its pattern shop and casting center in Walker, the company employs roughly 185 people.
Betz declined to disclose the company’s annual sales, but noted the majority of Betz Industries’ end customers are in the automotive and tool and die industries.
“We do a good portion of machine tool and energy type castings,” he added.
Betz warns the “ebb and flow” of the automotive industry cycle is forcing suppliers to adjust to slower business. Despite flat year-over-year quote activity so far in 2018, Betz said he expects business to “pick up a little bit” this quarter as more projects come online.
That sentiment aligns with a forecast from Southfield-based Harbour Results Inc. Earlier this year, Laurie Harbour, president and CEO of Harbour Results, told MiBiz that mold makers had $2.3 million in work on hold in the first quarter of 2018, which translates into delays for some projects. However, she said that “it’s going to be a busy back half of the year” as “most of the companies we are talking to are still expecting very high capacity utilization.”
According to a second-quarter report from the Original Equipment Suppliers Association (OESA), automotive supply chain executives indicated they planned to increase capital expenditures this year over 2017, especially for firms with revenues of less than $151 million. Additionally, 76 percent of suppliers said they were “very confident” their companies would implement the capital investments needed to hit demand requirements in 2018 and 2019, although “sales and production volumes, customer program launches, technology direction and political decisions are all concerns for delayed or hindered investment plans.”
That degree of unpredictability has Betz questioning who to believe when it comes to industry forecasts.
“I look at the articles on some of the tool and die people that have been interviewed in the past, and some of the articles are saying that 2019 is going to be a huge year, or 2018 is going to be a huge year, and I wonder when it’s going to happen,” Betz said, noting that with tariffs and other headwinds, the automotive supply chain faces many threats these days.
“In the past we’ve been extremely optimistic about how things are going and yet you see the consumers on the other hand are very pessimistic,” he said. “And now it’s kind of reversed and businesses aren’t very optimistic as in the past, and the consumers are keeping the economy going.”
To that end, in the most recent Supplier Barometer Index from OESA, automotive suppliers’ optimism slipped four points in the second quarter from a three-year high to start the year.
“It’s always a difficult concept,” Betz said of predicting the path for the automotive industry. “There’s just so many forces out there.”
MADE IN MICHIGAN
With the addition of a new facility in the city of Walker, Betz Industries will be able to offer machining services to customers. Betz Industries, a manufacturer of moldings and castings, will invest $3.5 million for the new 41,280-square-foot facility on nearly 52 acres an affiliate acquired along Walker Avenue. The Walker Planning Commission will consider the expansion plans at its Aug. 1 meeting. Betz Industries serves the automotive, wind energy, machine tooling, industrial tooling and stamping and die industries.