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Publish Date: Feb 2013,   Pages: 125,   Report Code: PL-115
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Plastic Custom Research Services (PCRS) has researched and published several reports since 1995 covering the North American industrial thermoforming business, most recently in 2009. Over the period November 2012-January 2013 we revisited this business, conducting a survey of 146 U.S. and Canadian thermoformers with 50% or more of their formed output devoted to consumer and industrial products other than packaging. One of our main objectives was to determine how these companies fared during the Great Recession of 2008-2009 and its aftermath. Secondly, in light of that experience, we wanted to ascertain what strategies these companies were adopting to build their customer base and grow their sales going forward.


We knew from previous research that the regional industrial thermoformers enjoyed vigorous growth in the 1990s. However, that growth dynamic faltered at the start of the new century when the U.S. economy experienced the dotcom crash and a minor recession. By 2003 sales of this group had recovered, and strong annual sales growth resumed through 2007. Then came the Great Recession. Sales of this group tumbled 14.4% in 2008, rebounded modestly in 2009, and then fell back slightly in both 2010 and 2011.


By 2011 the aggregate value of sales of regional industrial thermoformers was slightly less than $2.7 billion. Our survey suggests sales rebounded 3% in 2012 to reach $2.75 billion. Yet looking to 2013 less than half the survey respondents (45%) foresee an increase in their sales of industrial products whereas the other 55% foresee either no change, a slight sales decline, or there’s simply too much uncertainty in the current political economy to speculate as to how their sales will evolve in 2013 and beyond.


The factors influencing the financial welfare of regional industrial thermoformers are both endogenous and exogenous. The process provides relative ease of entry, so there are many small, under-capitalized players usurping market share. The process also yields few economies of scale expanding individual plant operations, which leads to a proliferation of plants with insufficient scale to meet evolving market demands. Then there are challenging external forces at work. The scope for thermoformers must be viewed in the context of the market environment in which they operate. First of all, since the turn of the century the U.S. economy has ratcheted down to a lower long-term structural growth rate. Household formation has slowed, and this has dampened demand for many durable goods the industrial thermoformers rely on for their sales. Secondly, globalization has adversely impacted all regional plastics processors – blow molders, injection molders, rotomolders, thermoformers – competing in the structural plastic part market space. And obviously foreign plastics processors compete in this market space as well.


Our sense is that regional industrial thermoformers need to re-evaluate their business models going forward. There are several major and niche industrial product markets with good current and future growth prospects; we identify many of these markets. Secondly, companies with a mix of custom and proprietary part programs seem to have weathered the recent economic storm reasonably well. Thirdly, we foresee a future where OEMs will exercise a preference for structural plastic part suppliers with multiple plastics processing capabilities as well as extensive secondary operations conveying additional aesthetic and functional value-added. Finally, we encourage regional industrial thermoformers to explore export opportunities beyond North America insofar as the global economy has been growing and will continue to grow faster than the regional economy.




Dr. Peter J. Mooney is the founder and president of Plastics Custom Research Services (PCRS). Dr. Mooney holds a Ph.D. in economics from the University of North Carolina at Chapel Hill, and he has covered the plastics industry as a technical/economic market research analyst and consultant since 1981. He is a member of several plastics industry associations including the Society of the Plastics Industry (SPI), the Society of Plastics Engineers (SPE), and the Association of Rotational Molders International (ARMI). He is also a member of the National Association of Business Economists (NABE). Since 2008 he has served as secretary and assistant newsletter editor on the board of directors for the SPE Rotational Molding Division (RMD). He has researched and written almost 100 multi-client reports, as well as over 100 single-client reports for domestic and global companies. In addition he has organized, chaired, and made presentations to numerous domestic and global conferences addressing critical issues confronting the domestic and global plastics industry.

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