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Decatur investing $11.4M in expansion, creating up to 70 jobs

Decatur Plastic Products Inc. is investing $11.4 million over the next five years in a two-phase expansion that will double its footprint in North Vernon, Ind., and create up to 70 new jobs by 2023.

The custom injection molder said April 11 that it has entered into a long-term lease agreement on a 50,000-square-foot shell building about a mile from its North Vernon headquarters and injection molding facility.

Phase one of the expansion is currently underway. The company is renovating and equipping the new building, which will be used for additional warehousing for finished goods and light assembly. Work on the building is expected to be completed in July.

In phase two, Decatur plans to expand the warehouse by an additional 50,000 square feet, bringing the total square footage to 100,000. The building expansion is expected to be finished by summer 2020.

Decatur was offered up to $475,000 in performance-based tax credits from the Indiana Economic Development Corp., contingent on job creation.

"We have won a significant amount of new business over the course of our ownership," Robert Riley, Decatur's president and chief financial officer, said during a phone interview with Plastics News.

The extra space will help the company stay organized while it launches that additional business, he said.

Decatur provides injection molding, flocking, assembly and finishing services as well as engineering and material assistance, primarily in the automotive market. Customers are auto suppliers such as Faurecia, PK USA and Heartland Automotive, among others.

The company has 24 injection molding machines in North Vernon. Press tonnages range from 55-1,574 tons. In addition to the North Vernon injection molding plant, it has a flocking facility. In 2017, Decatur invested $3 million in job training and an expansion at the two North Vernon plants.

The company also has two production facilities in Gadsden, Ala. — one for flocking and one for injection molding.

Riley's family — which includes his father, Gary Sr.; mother, Yu Cha; and brother, Gary Jr. — purchased Decatur from previous owner John Kussman for an undisclosed amount in August 2016.

"We're going to be up probably about 150 percent by the end of 2019 vs. where we were when we bought the business, in terms of overall topline revenue and output," Riley said.

Decatur is ranked No. 204 on PN's annual listing of North American injection molders, with estimated sales of $27 million in 2017. The company employs 185 in Indiana and about 285 in total in the U.S.

For 2018, Riley estimated the company had sales between $30 million to $31 million.

The Riley family also owns Ningbo Global Sourcing Co. Ltd., a full-service supply chain and manufacturing supplier that helps middle market companies source products and components from low-cost regions. The company is based in Ningbo, China, with additional locations in Malaysia and Fort Wayne, Ind.

"We actually started building our own tools, injection mold tools, in China," Riley said of the Ningbo Global Sourcing business, which now builds the tools in-house for Decatur. "To date, I would estimate we've probably built close to 100 of them over the past two to two and a half years."

Riley said the business has seen an impact from steel and aluminum tariffs, though it has tapered off a little.

"Even with the tariffs, you're still more competitive and faster in China than you are sourcing them locally in the U.S. because even a lot of U.S. tool builders will outsource the mold base work to China and then bring it over here and finish it," he said. "So they're still getting hit by the tariffs as well."

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» Publication Date: 11/04/2019

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