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Noted US name in plastics equipment now made in China
By Zhang Zhao (China Daily)
Updated: 2012-04-11

Noted US name in plastics equipment now made in China

When Hydraulic Press Manufacturing Co again brought its injection molding machines to one of North America's largest plastics industry fairs this month, it arrived with equipment made in China.

The 135-year-old HPM, which began in Ohio as a maker of machinery to extract apple cider, was one of the top plastics equipment manufacturers in the United States before it ceased operations in 2009 amid the global recession.

Guangdong Yizumi Precision Machinery Co Ltd then acquired all of its intellectual property in March last year and began production in South China.

The deal included HPM's trademarks, mechanical drawings, engineering designs, customer lists and technical patents for plastic injection molding, die casting and extrusion machines.

A Yizumi executive said his company decided to purchase HPM's intellectual property rather than the entire US company because the brand was the most valuable asset.

"A company is called successful not just because it sells products across the globe, but also because it has a globally recognized brand," according to Richard Yan, CEO of Yizumi.

"This also can avoid disputes in the local market," he said.

"The reason for most of the unsuccessful Chinese acquisitions is that the company in the end failed to adapt to the culture and management model overseas," he explained.

Former HPM technicians and managers have been recruited because they are "familiar with the local market, consumer culture and customers' demands", Yan said.

North America is now recovering from the recession, which is creating increasing demand for equipment manufacturing, said Yan.

"Also, with this year an election year, the US government is taking more measures to stimulate the economic recovery," he said.

"HPM has a well-known brand, and Yizumi has advanced manufacturing techniques. Our new US team has glued the two factors together successfully," he added.

The CEO noted that many Chinese companies are eager to get a "quick return" on an international acquisition, but "a company in the equipment manufacturing industry should not just focus on short-term profits".

"When they seek to expand to the world market, Chinese companies should note how overseas counterparts do business in China" as an example of sustainable operations, he said.

Yizumi plans to set up its own North American technical centers and a network to manage many of its local distributors.

It will then start local R&D operations to design products that "meet the needs of different markets", Yan said. Establishing overseas production facilities will be the last step.

The company now has North American contracts worth a combined $3 million.

zhangzhao@chinadaily.com.cn

(China Daily 04/11/2012 page17)



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