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Articles from 2012 In August


Cups and lids market boosted by food packaging

The report states that the growing importance of specialty beverages among foodservice operators will be a key factor, with many quick-service restaurants placing greater emphasis on products like premium coffee, specialty coffee drinks, iced coffee, and smoothies, among others.

Drinking cups are expected to remain dominant, but the fastest gains are anticipated in the packaging cup segment due to cup-using markets such as yogurt, coffee and tea, and fresh fruits and vegetables. Additionally, advances will be driven by expanding applications where cups satisfy consumer demand for portable, convenient, single-serving packaging, or can help reinvigorate sales of mature products.

Food cups are forecast to enjoy above average growth thanks to the increased presence of products like oatmeal in quick-service restaurants and coffee and snack shops, and the rapid rise of self-service frozen yogurt shops.

Lid demand growth will outpace cups' growth, climbing 4.9% per year to $1.2 billion in 2016. The report forecasts an increasing percentage of drinking cups utilizing lids, heightened demand for costlier specialty lids, and healthy increases for single-serving packaging cups. Lids for packaging applications are expected to post faster gains than drinking cup lids, thanks to single-serving cup packaging. 

Foodservice, which accounted for 68% of demand in 2011, is by far the largest market for cups and lids. Growth will trail the cup and lid average as a result of sluggish sales of fountain beverages, growing competition from bottled beverages, and the overall maturity of most applications.

Green Matter: Yparex launches first ever bio-based tie layer

has announced that it is the first supplier in the packaging industry to develop and commercialize a bio-based adhesive tie layer for multilayer packaging films. The new tie-layer resin is derived from 95% annually renewable resources and is fully recyclable, yet reportedly meets the same performance specifications as non-renewable petroleum-based polymer of the same family, thus providing a drop-in solution for packaging designers seeking to "green" their products.

Developing truly green packaging is a tough call for manufacturers everywhere. And with the packaging industry still debating how best to improve the sustainability of its products, there is still remarkably little consensus on the best way to go. Would that be thinner and lighter? More functionality? Renewably sourced material? Biodegradable or recyclable? All of the above?

"There's a lot of disagreement about how best to make the packaging industry more sustainable," notes Wouter van den Berg, general manager at Yparex. "Some argue for glass, since it's inert and recyclable. Others say paper is better, as it's made of materials that grow back. Still others say lightweight plastics are greenest because they save significant transportation costs and energy, while increasing safety (since they're unbreakable), and extending shelf life (reducing waste). Given the incredible size of the packaging industry, and the breadth of products involved—from food and beverages to car parts to industrial maintenance supplies and consumer electronics—I don't believe there will be one easy answer that solves the sustainability question or a single approach that addresses the needs of all the segments that are involved. As an industry, we need to develop many parallel initiatives to help move packaging to the next level of sustainability. And as a producer of adhesive tie resins, Yparex management decided that the best way we could contribute was by formulating the greenest tie resin we could make."

The new polymer is the first of what the company hopes will become a growing family of bio-based "green" tie-layer grades. The new extrusion grade plant-based resin is said to offer the same performance and properties as an equivalent grade of petroleum-derived resin and is suitable for blown or cast multilayer film structures manufactured using PA and EVOH.

Adds Van den Berg, "We are shipping our first lot of green Yparex Renew resin to an innovative film producer this month for evaluation. We hope the packaging industry responds favorably to this sustainable product offering and, if it does, we promise this will be the first of many more 'green' innovations coming from our company."

Yparex was formerly the adhesive tie-layer business of DSM Engineering Plastics. The company was purchased in February 2011 by Resin (Products & Technology) BV, a Dutch privately held specialty-resin compounder, with a strong focus on developing and commercializing environmentally friendly, specialty thermoplastic compounds.

Trexel to open China subsidiary on heels of record year

Trexel Inc. (Wilmington, MA) has established a Chinese subsidiary in Shenzhen, with plans underway to open an additional satellite office in Shanghai, seeking to tap into growing demand for its MuCell microcellular foaming amongst domestic Chinese firms, as well as demand for the technology as a lightweighting option for the country's burgeoning automotive sector. 

Trexel MuCell microcellular foaming technology"What we have seen lately is there is more interest by Chinese-owned companies," Trexel President and CEO Steve Braig told PlasticsToday. "For these companies, it's very difficult to deal with a foreign company."

In 2004, the company established an office in Hong Kong to service the region, and that business will remain in place, serving as support hub for Australia and Southeast Asia. Roger Cheng, previously technical manager of Trexel Hong Kong will become general manager of Trexel (Shenzhen) Technology Co. Ltd., with his former position in Hong Kong to be backfilled.

A majority of the automotive OEMs in China are located in the Shanghai area, Braig noted, adding that Trexel has already hired an automotive account manager for that office, signing on an individual who had previously worked with two resin manufacturers in China within their automotive product segment.

Braig himself is headed to China in early September, with Trexel currently recruiting two additional process engineers. The company is not currently planning on doing any manufacturing in China, seeking application engineering, service, and support staff at this point in time. Braig said the Shenzhen branch has eight employees, with six hired and two more to come, while Shanghai will start with three to four, primarily focused on automotive.

China has made headlines recently for what amounts to a slowdown of sorts locally, but Braig said Trexel is not concerned about the market's prospects going forward. "We believe in the long-term future of the Chinese market based simply on demographics," Braig said, pointing out explosive growth in automotive, which pushed the country to be the top market globally. "We believe in Chinese domestic market...we are interested in the Chinese domestic market."

Record revenue
Trexel announces this investment in China on the heels of a record fiscal year, ending in June with revenues up 48% from the year prior. "We really see a profound interest in MuCell technology right now," Braig said, "particularly in automotive." This has been driven, in part, by a push among OEMs and Tier suppliers to lighten up ahead of new, stricter fuel economy standards.

Many technologies are bidding to help cars lose weight, but not many are as proven as MuCell, according to Braig, who noted that some competitive lightweighting technologies are in their relative infancy or would require more drastic system and design changes. "MuCell has a proven process, today," Braig said.

Weight can be reduced in a plastic automotive part by 10%, typically, Braig said, and if a component or system is redesigned with MuCell in mind from the beginning, weight savings can go up to 20-25%.

Automotive sales made up 80% of Trexel's revenue last year, but Braig also sees opportunities in packaging, driven by cost savings, with molders able to increase output by decreasing cycle time. Other niches include aircraft interiors, a segment support by Trexel's recent deal with aerospace supplier, Vaupell, as well as in soft PVC and TPU, where MuCell can significantly improve energy absorption for applications like shocks in cars or soles in shoes.

Lightweighting challenge spans multiple materials

The system developed by Johnson Controls for the new Kia cee'd achieved the weight reduction without sacrificing safety by using a lightweight metal structure of high-strength, thin-walled steel for the front and rear seats. Johnson Controls replaced thick-walled seat pipes with wafer-thin metal frames made of high-strength steel. This adds stability to the split rear seat system.

Recent coverage on the PlasticsToday site has also reported success stories of plastic in combination with steel and we've covered our fair share of plastic composite developments contributing to the lightweighting trend as well. Moving forward, I'm sure we'll see a diversity of materials continue to support the weight reduction efforts of automakers.-[email protected]

Aluminum vs. steel tooling: Which material is right, and how to design and maintain?

With OEMs hammering their mold suppliers for ways to reduce cycle times, aluminum tooling offers one answer. With its ability to transfer heat from the mold much faster, many OEMs are choosing aluminum. Another benefit is faster machining times, which can reduce the mold-build time by 10-15% in some instances, according to Darcy King, president of Unique Tool & Gauge Inc. (Windsor, ON).

However, there are a number of criteria to consider when determining if an aluminum mold is the right tool for the job. According to King, the first thing that Unique looks at is whether or not the molder that will be producing the parts has experience with aluminum molds. "If the molder is experienced in running aluminum molds, that means an aluminum mold won't be challenging," King told PlasticsToday. "If they haven't had any experience with aluminum-only steel molds-they need some education in the process."

Al Standaert Darcy King
Al Standaert, Technical Sales Manager (Left) and Darcy King, President (Right) of Unique Tool & Gauge.

David Myers, VP of Sales for DRS Industries Inc., a Holland, OH-based mold manufacturer, concurred. "There's a learning curve to producing parts at production facilities that are only used for molding parts from steel molds," Myers explained to PlasticsToday. "Not only in how you process the parts but how you treat an aluminum mold versus a steel mold.  

"It's not a significant difference, but enough that it can cause problems. Your savings on the cycle time can be offset by the risk element inherent in the learning curve. We find ourselves supporting OEMs with aluminum tools and bringing in the production molder to educate them on aluminum tools," Myers added.

Unique primarily builds steel molds for the automotive industry, but has a long history of building aluminum molds as well. King said that the company also builds 'hybrid' molds that may be primarily steel but might incorporate aluminum inserts in a standing or deep-draw piece, or an area where it's difficult to get water resulting in a hot area that will affect cycle or hurt quality.

Aluminum or steel?
King explained there are several criteria in that will determine if an aluminum mold is suitable for an application. Part design/configuration is a major consideration. "A part has to be adequately designed for the molding process," said King. "We've built aluminum tools with lots of actions and/or poor shut-offs with no problem, but we might use steel shut-offs in an aluminum tool."

Unique Tool & Guage Inc. Part volume is also a critical factor when deciding whether to use aluminum.  "If you have an extremely high volume part, we might lean toward steel and/or at least have specific areas inserts made in steel," said King. "Sometimes we take the hybrid approach in a steel mold and, because aluminum is cost effective and conductive, we'll use aluminum in certain areas."

DRS Industries began life 30 years ago as a pattern shop but has evolved over the years to specialize in aluminum prototype and bridge tooling for both automotive and non-automotive applications. "Because we specialize solely an aluminum tooling for low-volume parts, everyone here is immersed in the aluminum world," explained Myers. "Our longest-lead items fall at about six weeks or less. Our customers can use that time savings to perform design iterations, make engineering changes or fast-track a bridge tool. They then rely on the aluminum tool for production parts, which means they can hold off on the steel tool until they've got the part validated, verified and learned the lessons from the aluminum bridge mold. Then, after all part design concerns have been alleviate, they can cut loose the steel production steel mold."

Aluminum mold criteria
Advancements in the various types of aluminum material suitable for mold manufacturing have gone a long way toward making it a more popular choice in many mold applications. Myers noted that when the company first started many years ago, QC7 by Alcoa was about the only suitable mold aluminum available. "Now there are three primary aluminum types we use today for any of the production molds that we build today, including Hokotol, Alumold 500, and QC-10 by Alcoa that replaced QC-7," Myers said.

Myers said that there are four things DRS looks at  when considering the suitability of an aluminum mold:

  1. The molded part material. Will it be a mild material like PP or TPO, or a more aggressive material such as an ASA or glass-filled Nylon, or maybe a higher-heat material such as Ultem? "We look at the material because it has an impact on the life expectancy of the tool," said Myers.
  2. Part geometry and cosmetics. "We look at surface-finish requirements - will it be grained, polished, etc. We also look at part features that will require tall, deep, thin details in the tooling. If so, we may insert those areas with steel," said Myers, noting that "each part is thoroughly evaluated and if the part geometry warrants the majority of the mold to be inserted with steel, it's probably not a good candidate for aluminum."
  3. Part volumes.  How many parts annually will be molded and what is the life of the program?  "We do stretch way outside what others do in aluminum in terms of volume," Myers commented.  "We produce aluminum tools that are grained or have highly-polished cavities and cores, which realize higher volumes. We haven't experienced any grain washout or polish issues but again you have to know how to process an aluminum mold properly. We've experimented with a lot of complex designs and new materials, and constantly push the envelope in that regard. There's a misconception that you're limited to just PP and TPO in aluminum tools. At DRS, we've had significant success with more abrasive materials."
  4. Who is going to run the tooling?  "Does the customer intend for us to design, build and run the mold or will the customer take it to an outside vendor? If they take it outside, does that company have experience with running aluminum molds? If not, we'll send tool and die person, and a process engineer to the molder to teach them how to process the tool and maintain it." DRS's molding division has eight injection molding presses ranging from 95-730 tons clamping force.

Critical maintenance issues
While there are not major differences in maintaining an aluminum mold vs. a steel mold, both Myers and King agree that there are some particularly critical maintenance issues with an aluminum mold. The parting lines should have particular attention paid to them.  "We tell the molders that certain cleaners should be used, and once-a-shift wipe down the parting lines so you don't get gas build-up," King noted. 

Recently, Unique Tool brought an automotive mold back in-house after it was taken out of production after just under a million shots. "It was the very first aluminum tool Honda ever built with us. We wanted to do more testing in our R&D lab," King explained.  "When we inspected this tool, the parting line looked like it was less than 6 months old instead of several years old. The resilience of aluminum is amazing. It shows you what aluminum is capable of if everything is engineered right, built right, molded right and maintained properly. You'll get some really good success with it."

Minnesota State Fair sends a message through a bottle

State fairs are known for insane food creations on a stick, rides that feel like they might fall apart, musical acts, auto shows, petting zoos, the list goes on and on. However, the Minnesota Pollution Control Agency wants to make sure those attending the state fair receive a lesson in recycling.

Presented by the Minnesota State Fair and the Minnesota Pollution Control Agency (MPCA), the Eco Experience at the fair brings together organizations, ideas, and hands-on activities to show what people can do at home to help the environment.

This year the Exo Experience features a 30-ft-long and 15-ft high tunnel of discarded plastic bottles that comprises the new Bottle Buyology exhibit. The purpose of the exhibit is to give people a wake up call about the amount of waste that is produced.

"This tunnel represents just 5 minutes of [bottle] generation in Minnesota," Wayne Gjerde, who manages the Minnesota Pollution Control Agency's (MPCA) recycling division, told the Minneapolis Star Tribune. "When people walk up to it, they say, 'Holy cow! That's disgusting.'"

About 46 plastic bottles are sold in Minnesota every second, with 2760 every minute. According to the Container Recycling Institute, Minnesotans generate nearly 1.5 billion plastic bottles a year.

"About 75% percent of those bottles are carelessly thrown away," the MPCA stated in a news release. "We need to recycle more!"

The MPCA estimates Minnesotans throw away 1.3 million tons of recyclable material (paper, bottles, cans, etc.) every year with a value of $312 million. It costs Minnesotans an additional $200 million to throw this material away.

The MPCA believes residents can actually help the economy by recycling more.

Approximately 37,000 jobs in Minnesota are directly and indirectly supported by the recycling industry. On an annual basis, these jobs pay an estimated $1.96 billion in wages and add nearly $8.5 billion to Minnesota's economy.

The MPCA status report indicates that the agency wants more Minnesotans to put bottles curbside in bins on recycling day and to start recycling programs at work, according to the Minneapolis Star Tribune article.

Personally, I think it's great the MPCA has taken such a visual initiative to showcase the need for recycling. There are tons of possibilities for recycled plastic bottles. From the world's longest bridge made out of plastic bottles and other household plastic waste to Nike Olympic uniforms made from up to 13 recycled bottles to plastic bottles that can be repurposed into recycled content for high-end glasses, shoes and bags - recycling gives plastic bottles a new life.

Instead of wearing shirts with the classic Nike slogan "Just Do It," maybe the PET and recycling industries should adopt, "Just Recycle it."

Petainer invests in PET production at its Swedish plant

Philip Sanner, group sales and marketing director for Petainer, told PlasticsToday the company is executing on its strategic plans and is "staying ahead of the game."

"Investment like this are mainly based on gaining technological advances, in order to continue to stay on the forefront of strategic investments and changes," Sanner said. "Reinvesting into our infrastructure and people allows us to position ourselves on strategic platforms that will allow us to increase our agility."

Petainer, headquartered in the Czech Republic, has manufacturing plants in Sweden, the Czech Republic and Germany. The company also features an R&D center in Sweden and sales offices in Germany and the UK.

Earlier this year, Petainer announced that the company had created the "greenest ever" refillable bottle. This refillable PET bottle is manufactured with more than 25% post-consumer recycled PET plastic. The company claims it has the same performance characteristics as a refillable bottle made entirely from virgin material.

Research has demonstrated that refillable bottles, which are returned to the retailer by the consumer once emptied then sent to the beverage manufacturer for washing and refilling, have a lower carbon footprint than one-way bottles that are thrown away after use, the company stated.

"They are 'eco-friendly' because they use up to 90% less virgin material per filling," Nigel Pritchard, group chief executive of Petainer, said at the time. "This performance is improved even further by the introduction of post-consumer recyclate, which means that the bottles now require less energy and other resources to manufacture."

Petainer, which manufactures both refillable and one-way bottles in PET, demonstrated that one-way bottles can be manufactured with about 100% recycled material.

"Petainer is clear about the need for innovation, we are looking for new and better ways to do our businesses, making sure we have a better environmental footprint," Sanner said. "Petainer is leading in the development and production of packaging materials made from sustainably managed resources, we do more than meet industry standards—we seek to raise them."

TPE resin prices, August 20-24: PE up $0.01-$0.02/lb; PP rises $0.005/lb; Isaac threatens to further restrict resin inventories

Polyethylene (PE) and polypropylene (PP) maintained their upward momentum with gains seen in both in the spot commodity resin markets. Spot-trading platform, The Plastics Exchange (TPE) noted that higher prices are supported by tight upstream supplies, rapidly rising spot monomer costs, and the potential for hurricane-induced damage and interruptions to petrochemical production in the Gulf of Mexico. PE producers are implementing a price increase in August, most have remained firm at a nickel, despite a lone producer easing its increase to just $0.03/lb. Polypropylene (PP) producers are passing along their $0.015/lb savings in polymer grade propylene (PGP) contract monomer costs in the form of reduced PP contract prices in August. The recent rally in North American resin prices is complicating high-volume export opportunities, according to TPE CEO Michael Greenberg.TPE resin prices, August 24, 2012

Energy markets ended the week with modest losses, as futures contracts roll to October. Crude oil reached above $98/bbl but eased to end the week $96.15/bbl, down just $0.17/bbl. Natural gas futures retreated from the week's high of $2.91/mmBtu, settling at $2.734/mmBtu, a net loss of $0.03/mmBtu. The crude oil : natural gas ratio was essentially steady at 35:1.

Ethylene's spot market continued higher even though the two cracker outages were resolved. Material for August delivery rose nearly $0.03/lb, most recently changing hands at $0.5775/lb. September ethylene was priced near August levels, and the forward curve steepened from there, with December ethylene priced just above $0.54/lb and the average for the entire year 2013 was around $0.50/lb. The gap between ethylene and ethane widened, boosting producer margins in the process. "Ethane ended the week with a loss of $0.03/gal at $0.32/gal ($0.135/lb), the low end of the week's range, expanding ethylene margins further to $0.44/lb - wow!," Greenberg exclaimed.

Polyethylene (PE) prices rose $0.01-$0.02/lb last week. While all grades are considered tight, HDPE remains the strongest of the group with very little spot availability. "Although there could be isolated instances where producers match the dissenting $0.03/lb increase for August, with ethylene prices sprinting higher and Tropical Storm Isaac entering the Gulf," Greenberg said, "there is no surprise that producers in general are standing firm to implement their full $0.05/lb price increase." Spot railcar availability has already been sparse and if the storm system leads to shut downs, Greenberg noted that the $0.03-$0.05/lb increase nominated for September "could have legs too." International traders seeking export resin at prices seen early in the beginning of the month are striking out, and resellers with inventory have pulled back offers or raised prices citing their replacement costs.

Propylene spot prices moved higher in fairly active trading. August prices bumped up but remained shy of $0.48/lb. Most of the week's transactions were concentrated in September, where prices rose above $0.50/lb, a gain of more than $0.02/lb. Forward prices also pressed higher, PGP for the fourth quarter changed hands at $0.51/lb, up $0.03/lb. Although spot has remained under contract pricing all month, with a storm system moving into the Gulf and the possibility of supply disruptions, Greenberg said there is some talk about a potential PGP price increase nomination for September. Spot refinery grade propylene (RGP) has been relatively stable, last trading around $0.36/lb.

Polypropylene (PP) spot supplies remain tight, allowing prices to rise another $0.005/lb and fully erase early month losses. Tight upstream inventories were evident several weeks ago as Generic Prime disappeared from the market. TPE noted there were some occasional offgrade railcars available on either side of $0.60/lb depending on quality, but material has moved quickly. Contract buyers who received a $0.015/lb break on August purchases are enjoying relatively rare savings versus spot buyers. Some processors are reporting sold out conditions for their railcar needs above their forecasted orders. Barring a significant weather-related disruption, September contract movement should be benign, but in the meantime, Greenberg explained, limited supplies combined with a potential Gulf hurricane could spell trouble for those with inadequate resin on hand.

Final thought from Michael Greenberg

Commodity resin prices deviated in August as polypropylene contracts shed $0.015/lb while polyethylene contracts gained $0.03-$0.05/lb. Spot markets for both material groups have been strong and have the potential to move still higher as the season's first major storm enters the gulf, threatening to shut-in oil, gas and potentially some land-based petrochemical complexes. With additional price increases on the table for September, material availability should remain tight, even if (and hopefully) Tropical Storm Isaac passes without major incident.

Ohio company engineers plastic scaffolds for successful implants

Ohio company engineers plastic scaffolds for successful implants

Use of plastic scaffolds seeded with stem cells is no longer strictly stuff of science fiction. The concept has moved from the research lab to human surgeries.

Two American companies developed critical technologies for the world's first and second successful laryngotracheal implants using stem cells taken from the patients' own bone marrow. The patients' bodies accepted the transplants without use of immunosuppressive drugs because the patients' own stem cells were used.

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Scaffold is seeded in Harvard Bioscience bioreactor.
The surgeries took place at Krasnodar Regional Hospital in Krasnodar, Russia. The patients were a 33-year-old mother from St. Petersburg and a 28-year-old man from Rostov-on-Don, who were in auto accidents and suffered from a narrowing of the laryngotracheal junction. Previous surgeries to repair the problem failed.

Soon after transplantation, both patients were said to be able to speak and breathe normally.

Nanofiber Solutions (Columbus, OH) designed and built the nanofiber laryngotracheal scaffolds to match the dimensions of each patient's natural larynx and trachea, while Harvard Bioscience (Holliston, MA) provided a bioreactor used to seed the scaffold with stem cells. Each bioreactor was also specifically adapted by Harvard Bioscience to the clinical requirements for each patient and was manufactured in the shape of the patient's original organ.

"Tissue engineering and regenerative medicine are exciting fields that hold much promise for effective medical solutions," said Ross Kayuha, CEO of Nanofiber Solutions. "Our nanofiber scaffolds provide an innovative and ideal platform to create an array of new clinical solutions." The company uses technology licensed through Ohio State University. Its cell culture products use polymer nanofibers to simulate the 3-D structure of human tissue.

Nanofiber Solutions 3D scaffolds are made of polycaprolactone (PCL) and range in thickness from 200-700µm. The nanofibers can be fully degradable or permanent depending on the polymer. Production of scaffolds for other types of hollow organs, such as intestines, blood vessels and kidneys are in the company's sites.

The Russian procedure represents the world's first and second successful use of synthetic laryngotracheal implants. It is Nanofiber Solution's second and third successful organ implants using plastic scaffolds within the last year.

The Russian patients were the first entering a clinical trial on regenerative medicine replacement supported by a  Megagrant of the Government of the Russian Federation, which is designed to involve leading worldwide  scientists with Russian universities. The transplants, which required more than a half-year of preparation, were performed on the first two patients enrolled in an ongoing clinical trial. The Russian Ministry of Health has approved a clinical protocol for an unlimited number of patients in this trial, all of which will involve trachea procedures.

The bioreactors were developed, manufactured and prepared by teams at Hugo Sachs Elektronik, a German subsidiary of Harvard Bioscience and at Harvard Bioscience.

Key participants were Dr. Vladimir Porhanov, head of Oncological and Thoracic Surgery at Kuban State Medical University (Russia); Dr. Jed Johnson, Nanofiber Solution's Chief Technology Officer who created the synthetic organs; Harvard Bioscience (Boston, USA) who produced the bioreactor; and Dr. Alessandra Bianco at University of Rome, Tor Vergata, who performed mechanical testing during scaffold development.

The principal aim of the $4.8 million, 2.5-year Russian government Megagrant program is to evaluate the molecular mechanisms and underlying pathways of tissue engineering and cell therapy for regenerating airways and lung tissue, and to carry out studies for the prevention and effective treatment of a wide range of diseases.

At least four more candidates for the laryngotracheal transplants have been identified.

Yet another Japanese Tier I slapped with fine

. Japan-based Nippon Seiki Co. (Nagoka) was fined $1 million for its role in a price-fixing conspiracy that lasted from at least as early as April 2008 until at least February 2010.

According to a statement on its website, Nippon Seiki said it would cut executive level salaries by 15-20% for a period of two months to punish management for the episode. It also stated that it had prepared a manual and would require its management to undergo continued training in order to prevent a recurrence.

According to a one-count felony charge filed today in the U.S. District Court for the Eastern District of Michigan in Detroit, Nippon Seiki engaged in conspiracies to rig bids for, and to fix, stabilize, and maintain the prices of instrument panel clusters sold to an automaker in the United States and elsewhere.

Nippon Seiki manufactures and sells a variety of automotive parts, including instrument panel clusters. The department said that Nippon Seiki and its co-conspirators carried out the conspiracy by agreeing, during meetings and conversations, to rig bids for, and to fix, stabilize and maintain the prices of instrument panel clusters, sold to an automaker in the United States and elsewhere, on a model-by-model basis. As part of the plea agreement, which will be subject to court approval, Nippon Seiki has agreed to cooperate with the department's investigation.

"For nearly two years, Nippon Seiki conspired to sell instrument control panels at collusive and noncompetitive prices, affecting the prices of many automobiles sold in the United States," said Scott D. Hammond, Deputy Assistant Attorney General of the Antitrust Division's criminal enforcement program. "The division will continue to hold companies accountable for these types of anticompetitive practices that harm American consumers."

Including Nippon Seiki, eight companies and 11 executives have been charged in the department's ongoing investigation into price fixing and bid rigging in the auto parts industry. Furukawa Electric, Denso, Yazaki, G.S. Electec, Fujikura, and Autoliv Inc. pleaded guilty and were sentenced to pay a total of more than $785 million in criminal fines. In July 2012, TRW Deutschland Holding GmbH agreed to plead guilty and is awaiting sentencing.

Additionally, seven of the individuals—Junichi Funo, Hirotsugu Nagata, Tetsuya Ukai, Tsuneaki Hanamura, Ryoki Kawai, Shigeru Ogawa and Hisamitsu Takada—have been sentenced to pay criminal fines and to serve jail sentences ranging from a year and a day to two years each. Makoto Hattori and Norihiro Imai have pleaded guilty and await sentencing. Kazuhiko Kashimoto and Toshio Sudo have also agreed to plead guilty. —[email protected]