PCS invests $3M as it becomes only US mold base producer | Plastics News

Fraser, Mich. — PCS Company has invested $3 million in the last nine months to expand with new machinery, staff and inventory as it takes its place as the only U.S. manufacturer of mold bases.

PCS increased its capacity by 50 percent, inventory by 15 percent and workforce by 10 percent, President Angela Elsey said during an Oct. 9 plant tour in Fraser.

The expansion is the first phase of a five-year improvement plan that also coincides with the restructuring of a major competitor, Batesville, Ind.-based Hillenbrand Inc.'s DME unit, which has a site in Madison Heights, Mich. DME closed its mold base manufacturing plant in Windsor, Ontario, in April followed by a facility in Greenville, Mich., in May.

Meanwhile, PCS is expanding.

Founded in 1960, PCS — as in pins, cores and sleeves — started out as a family-owned operation and grew into a supplier of mold bases, mold base components, molding supplies and hot runner products for the plastics and die-cast industries.

At first, PCS sold mold bases from a source in China. Then, in the 1990s, the company started machining them in-house. Now PCS is the only company doing so in the United States.

"The biggest challenge mold makers face when sourcing bases outside the USA is support and assistance when the product doesn't meet expectations," Elsey said. "They find it challenging when they cannot go directly to the manufacturer for immediate support and resolution. This is why our goal is to continue to partner with our customers to manufacture domestic mold bases, not only competitively but [also] to exceed their expectations on American soil."

While many tooling and mold shops are struggling, the outlook at PCS, which serves the medical, automotive and consumer goods markets, is rosier with some growth opportunities in the changing competitive landscape.

"One of our larger competitors exited the production of USA-made bases, and that has allowed us to reach customers that have been a challenge to get to prior to that," Elsey said. "We're reinforcing our place in the market and reminding everyone we have these quality mold bases at record lead times and great pricing. That has allowed us to offset some of the soft market that we're still experiencing."

The latest PCS investment comes at a time of restructuring for DME. Earlier this year, DME closed facilities in the United States and Canada and laid off workers.

"In North America, we did some restructuring," Hans Hagelstein, president of Mold-Masters and DME, said Oct. 15 at Fakuma 2024 in Germany. "We stepped out of the mold base production, but we now have a supply chain, and we're stepping back in. We found a supply chain where we can really be competitive."

DME Marketing Manager Marc Zaborny said the business unit embarked on a "bold and transformative journey" in the beginning of 2024.

"We halted our manufacturing of mold bases in North America, a strategic pause that allowed us to reassess and restructure our supply chain," Zaborny said in an email.

"DME continues to be a supplier in North America of DME standard mold bases, custom mold bases and components. This strategic move allowed us to forge partnerships with several third-party suppliers around the world — including North America. Since 1942, DME continues to be the industry's global supplier and partner for mold bases and innovative components," Zaborny said.

In Fraser, PCS Company is positioning itself to be more competitive. The latest equipment investment includes another new DMG Mori machining center — the first was installed in October 2023 — and a vertical lift module (VLM) in the warehouse to support the added component inventory needs.

"The machining center allows us to expand our frame sizes. We can machine larger bases now," Elsey said. "It also gives us capabilities for tighter tolerances, which is critical for some customers in the medical market."

The VLM unit, which is the company's third, will improve picking efficiency and increase capacity while not taking up a lot of floor space.

Through the decades, PCS has been on a steady growth trajectory, in part by continuing to add products to meet more needs. Most recently, the company added cavity pressure sensor heads and dry ice blasters.

However, the last two years, especially 2023, were a bumpy ride for all mold shops, particularly those serving the automotive market. When demand weakened for electric vehicles, production plans were shelved, delaying payments to mold makers that had already created the molds for the EV car parts.

In Canada, the unemployment rate reached 9.1 percent in June in Windsor — the highest in that country — with the contraction of the mold making industry being cited as one of the contributing causes.

DME closed its mold base manufacturing plant in Windsor in April. Hillenbrand officials had announced plans in a Feb. 6 earnings call to cut its workforce by about 5 percent in its injection molding and hot runner equipment unit as well as shrink its footprint. Company officials pointed to softening demand and global pricing pressure.

Elsey said PCS then became the only U.S.-based company that both manufactures mold bases — standard and custom — and supplies mold components. The company picked up business from processors and mold makers that want a domestic source for these components, she added.

Mold bases from China arrive by ship and can take 90 days for delivery. At PCS Company, Elsey said, the lead times vary between three days and four weeks, depending on the complexity of the base.

"Domestic mold making can be strong if you're competitive, and that is our goal," Elsey said. "We're planning to automate our shop even further beyond the investment we've currently made to be competitive against these global suppliers."

PCS' mold making customers are very price-sensitive. Elsey said some have seen their sales drop 35-50 percent.

"Our goal is to partner with our customers to offer competitive mold bases on American soil," she added.

PCS Company has 120 employees at its headquarters site, which includes two other facilities within the same Fraser industrial park, as well as sites in Grand Rapids, Mich., and Torrance, Calif.

Orders for components and products received by 4 p.m. usually ship that day to what Elsey describes as a strong mix of customers in the auto, medical and consumer markets.

"We're diversified enough where we didn't get to a point where we had to do any layoffs," Elsey said.

Meanwhile, other tooling shops are struggling.

Saylo Lam, the chair of the Canadian Association of Mold Makers, told CBC News a big part of the problem is that companies that serve the automotive market don't get paid until automakers start production. "So not only do you have to be a great mold maker, you almost have to be a strong banker or have good banking relationships," said Lam, who also is president of Lakeshore, Ontario-based Circle 5, a tool and mold shop founded in 1987.

In addition, pressures continue from abroad, namely China, which produces molds at a lower cost. Then, there are high interest rates and geopolitical conflicts prompting companies to be more efficient, including laying off staff.

Still, Lam told CBC he is optimistic the industry will see a turnaround for companies that modernize and increase efficiencies to stay afloat.

That's the plan at PCS.

The forecast for internal combustion engine vehicle launches for 2026-27 looks good, Elsey said, which will bode well for mold makers and their suppliers in the 2025-26 time frame.

"The forecast is pretty aggressive, so we're trying to prepare for that as well," Elsey said. "One launch puts thousands of automotive tools out into the market, so it's important to track that right. Lead time is going to definitely become a key buying factor again, and we're able to turn mold bases around fairly quickly."

PCS' investment in a third VLM for its warehouse has improved productivity and efficiency by about 20 percent, Elsey added, which in turn is making it possible to take on more orders and still keep its out-by-4-p.m. pledge.

"As we want to grow the mold base business, we have to consider what that does to the warehouse because we're the ones supplying the components. We're not buying them from somebody else," Elsey said.

The company isn't afraid to have a ton of inventory.

"It's a shock to see the amount of mold plates we keep in stock, which benefited us during COVID," Elsey said. "We were able to constantly pull from it and turn mold bases around very quickly."

For the components, the automated VLM systems act like vertical carousels with each storing and retrieving up to 3,500 parts to service PCS customers.

When an order is scanned, a lighted bar lists the sales order number, the part number and its location. The VLM pulls the component from the corresponding tray. Each VLM has 38 trays, giving PCS some 10,000 SKUs to pull quickly, said Scott Jackson, PCS' warehouse supervisor.

The list of mold components stored and tracked grew again recently with the addition of Kistler-brand cavity pressure sensor heads, which identify issues such as short shots, sinks, flash and warp, while the line of maintenance and repair products was expanded with Kärcher-brand dry ice blasters.

One of the Kärcher products is billed as the world's first dry ice blaster with integrated production made from liquid carbon dioxide. The liquid-to-pellet system lets users store CO2 in gas cylinders almost indefinitely and then make dry ice pellets when needed to clean grooves and bearings or remove burnt-on encrustations.

PCS officials are working with Tokyo-based parent company Misumi Group Co. to onboard more of their metric products.

Many mold makers are looking for metric sizes in addition to the imperial products the company currently carries, Elsey said, or they are indifferent and will take what is available.

"We're working with our parent company in a much more synergistic way to start bringing out a lot of that product to support customers," Elsey said.

The metric products should be in stock next year.

Company officials also continue to look at ways to further automate the business to be competitive against global suppliers.

"We want to mitigate the risk of this global uncertainty. We want to mitigate the lead time exposure," Elsey said. "We believe that, with automation, we can now become price-competitive to try and onshore as much as we can from a mold base perspective."

At some point, Elsey also would like to consolidate the Michigan operations under one roof somewhere nearby.

"We don't want to go too far," she added. "We have 120 amazing employees, and we have an obligation to 120 families to do the right thing and create a sustainable future for them."

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