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PK USA adds massive press, gets Nissan work
When a company can add a lucrative contract, install an enormous piece of machinery, hire new employees and increase production without the expense of expanding the facility, it is in a good place.
PK USA, 600 Northridge Drive, finds itself in that enviable position as its new injection-molding press started producing automotive parts immediately following the holiday shutdown.
According to Luis M. De Alba, general manager in charge of engineering and new business at PK, the new contract with Nissan was a speedy and unexpected windfall for the company that resulted from a previous supplier in Michigan losing the contract.
Since Nissan already was doing business with PK and was pleased with its performance, the Shelbyville facility was offered the contract to produce plastic parts for Nissan's cars.
"Normally, negotiating a new contract is a lengthy and complicated procedure," De Alba said, "but this deal took place very quickly, within a couple of months."
The challenge facing PK in accepting the contract was the necessity of ordering a new injection molding press from UBE Machinery in Japan.
At a cost of $2 million, PK determined that it could purchase the machine, have the 3,000-metric ton press shipped to Los Angeles from Japan and delivered to Shelbyville - using 14 semitrailers.
While waiting for the press to arrive, PK had to reconfigure the production layout in its plastics division and reinforce the floor of the factory to support the weight of the machinery - and all of this had to happen very quickly.
UBE Machinery also sent contractors to install the machine and get it up and running, even sending an engineer from Japan to make sure that it was working properly. De Alba described buying the machine as a "turnkey purchase" - the price would ensure that it was installed and in production at PK before the engineers from UBE would leave.
In a side note, De Alba said that the company was intrigued this week to see their president, Eiji Umabayashi, perform a safety ceremony at the site of the new machine, which consisted of placing salt in the corners surrounding the press and throwing sake on the floor.
"These safety ceremonies are very common in Japan," De Alba said, "but I have been here 12 years, and this is the first time that I have seen it done. It was interesting to see the ceremony, and anything that will make the machinery safer is good for the company."
Bill Kent, vice president of human resources and corporate relations for PK, said that safety is a primary focus of the automobile parts manufacturer. He stressed that meetings to discuss safety issues are frequent at the facility, and workers often start their shift with exercises to warm up their muscles and make them more alert.
The new press is the biggest piece of machinery in the plastics division at PK, and it will consume 1 million pounds of plastic pellets per year. The melted pellets are then heated to 400 degrees as they go into the mold, and the machine applies tremendous pressure to squeeze the plastic into the desired shape.
Parts are then cooled by thermolators - or water chillers - before enormous robotic arms remove them from the machine and hand them to workers, who inspect the parts and apply a piece of foam insulation to each one. Robert Brewington, manager of engineering and new business for the plastics division at PK, said that the machine can produce two parts every 70 seconds.
The substantial investment by PK makes sense for the parts manufacturer because the Nissan contract will add $4 million in annual revenue and represents a significant increase in the company's plastic parts production, which currently makes up only 15 percent of the company's total plastics output.
The company posted $130 million in sales for 2006, and at a time when many American car manufacturers are in serious financial trouble, De Alba said that PK is in a "growth plan."
"Our midterm and long-term plans show continued growth," De Alba said.
He also added that PK is "in conversation" with company officials at Honda, which is currently building a new assembly plant in nearby Greensburg, and he hopes that this will lead to a relationship with Honda for the local company to produce parts for them.
Because of anticipated growth, PK has taken its building at 1755 McCall Drive - PK USA Plant No. 2 - off the market, thinking that it will be needed for future expansion.
In March, PK moved its employees from Plant No. 2 to the Northridge Drive plant with the intention of selling the McCall Drive building. All of the workers and machinery at the closed plant were absorbed at the larger plant; however, an upswing in business has caused PK management to reconsider the sale.
Growth at PK obviously bodes well for the tax coffers of Shelbyville, even though the $2 million investment in the community was supported by the city through the approval of a tax abatement. De Alba said that the business expansion added eight new production-team workers and $300,000 in yearly salaries.
PK USA currently has 500 full-time employees and 70 part-time workers at the Shelbyville plant, which is the North American headquarters for the international company. PK also has plants in Gallatin, Tenn., and Canton, Miss.; and all three facilities are primary suppliers of metal body parts, chassis parts and plastic injection parts for automotive companies throughout the world.
The parent company of PK USA is the Japanese company of Press Kogo, which has more than $820 million in assets and employs more than 2,000 people. The global company has five operations in Japan, with 13 locations worldwide.
Copyright 2018 PKUSA Inc.