Reshoring, shortages; time is right to fix PPE supply

The two issues of reshoring and ensuring the U.S. has an adequate supply of critical products during a national emergency would seem to go hand-in-hand. Anytime a manufacturing company moves production to the U.S. or invests in new plants here, it would seem to insulate a product from the vagaries of crisis-related shortfalls. 

If only it were that easy. 

Take the ubiquitous face mask that has been so important during the COVID-19 pandemic. In the early 2000s, there was almost no U.S. production after Chinese manufacturers took over the personal protective equipment (PPE) market. 

Then came the swine flu virus in 2009 and PPE shortages that caused U.S. manufacturers to invest in PPE production. But when the swine flu faded, low-cost Chinese manufacturers quickly regained their market dominance. 

Early in 2020 it was the COVID-19 pandemic that caused PPE shortages and spurred U.S. manufacturers to once again ramp up production. But ramping up takes time, and during a medical crisis, taking time means that people die. 

Now that demand for masks and other PPE is slowing, mask manufacturers say Chinese companies are once again gaining market share by flooding the U.S. with low-cost products. 

“The domestic mask industry is collapsing, and, compared to a year ago, only half the manufacturers are now around,” Nicolas Smit, executive director of the American Mask Manufacturer’s Association (AMMA) told my colleague Karen Hanna. “Within months, half the manufacturers around today will likely shut down, as well.” 

Reshoring and nearshoring are happening, but the pace is slow. President Biden said during the State of the Union address in March that everything from the deck of an aircraft carrier to the steel on highway guardrails would be made in America. Sounds good, but there is currently no roadmap or legislative plan or funds to make it happen. 

One plan proposed in the U.S. House of Representatives, which would require the federal government to work with domestic manufacturers to ensure a supply of PPE during national emergencies, is languishing with little support. 

The bipartisan Innovation Act that would make record investments in emerging technologies and American manufacturing is also still sitting in Congress at this writing. 

What does it mean for plastics processors? 

Every part that is made in U.S. boosts the domestic plastics industry. Resin manufacturers, processors and recyclers all have a stake. 

An encouraging sign is processors’ growing interest in automation. Automation is the key for U.S. manufacturers to successfully compete with low-cost Asian companies. 

Some 57 percent of plastics processors participating in PMM’s most recent equipment buying survey said that they planned to buy new robots or other automation equipment in 2022.  That was up from 48 percent just a year earlier. More than half said they planned to spend over $100,000. 

“We are seeing customers purchasing robots and/or automation for the first time, many of whom would never have considered it a few years back,” said Raul Scheller, managing director, North America, for Sepro, in our January article on the buying survey. “They have made this decision in order to stay competitive, and they have seen a good return on their investment.” 

Processors may not realize that the steps they are taking now to make better parts with fewer people is positioning their companies for the future — a future where they can supply a part that is of equal or better quality at equal or less cost than processors anywhere in the world. 

Waiting for Congress is not a winning strategy. It is time for processors to aggressively go after molding and extrusion programs their customers have outside the U.S. Processors need to look at every plastic part and component their customers source and make a case that they can do it better. 

I visited the Stihl manufacturing plant in Virginia Beach, Va., shortly before the COVID-19 pandemic. It is one of the largest captive molding plants in the U.S.  

The Virginia Beach plant sources injection molds and resin for approximately the same price as Stihl’s plant in China. It manufactures some components at lower cost than the Chinese plants. “The only major remaining difference is the labor,” said a Stihl manufacturing executive in Virginia Beach. “If we have a highly automated process and good quality, we can compete.” 

It was a source of great pride that the Virginia plant could make parts at lower costs.  

Can your plant compete? You might stack up better than you think. The best way to find out is to talk to your customers about the specific molding and extrusion programs they currently source from Asia. If you cannot convince them that you can do the job better, let them know you are trying to win the business and want to be considered for future projects. 

Mask-type shortages won’t happen if more plastic products are made in this country. We can make it happen. 

Ron Shinn, editor 

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