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Is the plastics industry suffering from trade show overkill? After all, what with NPE in Orlando and Chinaplas in Shanghai, it’s been a busy spring, to say the least. It’s one of the theories that was advanced last week to explain why Plast, Italy’s triennial trade fair for the plastics industry in Milan and the second largest European show, felt slightly less busy than in other years.

Karen Laird

May 14, 2012

5 Min Read
PLAST 2012 in perspective

Of course, with 1514 exhibitors from 58 different countries, PLAST 2012 could in no sense of the word be called quiet—after all, close to 80% of what is on display are machines of one kind or the other, all generating enough heat and bustle in the six halls of the show to make up for any slowdown in attendance. And many exhibitors reported that, although they attracted fewer visitors to the stands, those who did come were serious. “We have been writing a lot of quotations”, said a spokesman at Technova, a supplier of recycling plants. “We saw a lot of real interest, at least.”

According to the PLAST 2012 organizers, the “number of visitors, considering the current negative economic situation, overcame the expectations of the major part of the exhibitors.”

Nonetheless, the atmosphere was somewhat subdued, and many exhibitors, when asked, confirmed that they—and their customers—were engaged in what one materials producer called “watchful waiting.”

“It’s an Italian show, and in Italy, the economy is a shambles,” explained a major Italian masterbatch producer. To which a spokesman at Ferromatik Milacron added: “It’s not a good time for investment. And even a company willing to invest has trouble getting the credit it needs from the banks. Banks are not in a lending mood. And it’s not just Italy. Right now, nobody knows where Europe is headed. The general feeling is that everyone is waiting for better times, and looking abroad—outside Europe—for customers.”

Exhibitors from countries outside the euro area who do business in the Eurozone complain they are losing customers there, and they, too, are looking elsewhere for new markets. Banu Ergan, from the Turkish Plastics Manufacturers Research, Development & Educational Foundation, said that the Turkish industry was not feeling the crisis. “Turkey is booming, and Europe has discovered that. On the side of the Europeans—especially Germany and Italy—people are eager to come to Turkey. On our part, we are starting to look at countries in South America, and in southern Africa. Although Italy and Germany are our major trade partners, and the Turkish industry buys a lot of Italian machinery, we are seeing are slowdown here.”

So what’s going on? Right now, the whole of the Eurozone is in recession, with the south doing considerably worse than the north—except for the disproportionately hard-hit Netherlands, whose government fell last month over budgetary disagreements, and Ireland, that basically is broke. In Northern Europe, particularly in Germany, maintaining budgetary discipline is the number one priority, which means that large packages of unpopular austerity measures are being foisted on the Eurozone countries—measures that many feel are making a bad situation a lot worse, especially in the south. The Italian economy contracted during the final two quarters of last year, and the International Monetary Fund forecasts the economy will shrink 2.2% this year. Unemployment is rampant in Portugal, Spain, and Greece, and high in Italy and France. Politically, too, the area has been shaken up by the recent election results in Greece, France and Germany, where voters have made it pointedly clear that further austerity measures will be firmly rejected.

At PLAST 2012, the big example that exhibitors were all pointing to was the U.S. From auxiliaries’ suppliers to recycling machine manufacturers, all were extremely positive about what they see as the economic comeback of the United States, and especially about the support, in the form of subsidies, that is currently being pumped into manufacturing.

Dr. Peter Neumann, CEO Engel cited the development in sales of injection molding machines as an example. “About 10 years ago, somewhere between six and seven thousand machines were being sold annually in total in the U.S.,” he said. “This dropped to 1400 a few years ago. Many manufacturers left the US market, as manufacturing was increasingly offshored. Now, however, that number is back up to 3000. People are slowly starting to realize they need to bring back production from overseas. They need to invest in manufacturing. “He added that Engel’s market share in the U.S. was now 15%. And: “It is this kind of investment that is needed here in Europe, and right now in Italy, too.”

Striking evidence that this may be precisely not what is happening—at least in Italy—could be seen at Plast, at the stand of Romi Italia, the Italian branch of Brazilian machine manufacturer Industrias Romi, who acquired the assets of Italian press maker Sandretto in 2008.

Starting on the first day of the fair, employees of the company staged daily occupations of the stand, preventing people from entering, to protest the closure of Romi’s production facilities in Italy, and the plan to move these to Brazil. The workers distributed copies of their protest in English and Italian, in which they claimed that shuttering the plants will cause 140 people to lose their jobs. They also declared that, contrary to the agreement at the time of the sale, under which Romi was to pump Euro 8 million into the business within two years from the date of the assets’ acquisition, Romi has instead taken technological knowhow out of the company. Also, employee numbers have dropped from 300 in 2008, to currently only 165.

Industrias Romi has not confirmed the closure of the Italian production facilities.

While workers taking control of a stand at a major trade fair may be somewhat extreme, it nonetheless sends a powerful signal. It is often pointed out that hard times separate the men from the boys; in other words, a good shakeout in the form of austerity measures, closures, and redundancies serve a useful function in weeding out companies too weak to survive. But among the exhibitors at Plast last week, the strong, too, were calling attention to the challenges facing the manufacturing industry. The question is, is anyone listening?

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