Molded, Extruded, and Lathe-Cut Mechanical Rubber Goods

SIC 3061

Companies in this industry

Industry report:

This category covers establishments primarily engaged in manufacturing molded, extruded, and lathe-cut mechanical rubber goods. The products are generally parts for machinery and equipment. Establishments primarily engaged in manufacturing other industrial rubber goods, rubberized fabric, and miscellaneous rubber specialties and sundries are classified in SIC 3069: Fabricated Rubber Products, Not Elsewhere Classified.

Industry Snapshot

Molded, extruded, and lathe-cut goods are used in various types of machinery and equipment. End uses for these products exist in automobiles, oil and gas equipment, appliances, farm equipment, and construction machinery. About 600 firms in the United States make molded, extruded, and lathe-cut goods. Due to the diversity of end uses, the market is fragmented and no single company has dominated the industry. The sector also faces strong foreign competition. After 2002, the U.S. Census Bureau rolled this category together with that of "all other rubber product manufacturing" in its Statistics for Industry Groups and Industries.

Many of the products in this segment are custom-made to various end-user specifications. As such, manufacturers often sell them with a higher profit margin. Such customer orders have helped this sector show a higher rate of growth in shipment value compared to other industries.

At the beginning of the twenty-first century, the recovery of the U.S. automobile industry began to fuel growth in industrial rubber products, which find more than half their end uses in cars. Other areas of growth in the early to mid-2000s were manufacturing, mining, construction, oil and natural gas, appliances, and agriculture.

Competition from imports and other materials such as plastics, which cut processing time by eliminating the curing step necessary for rubber production, were expected to hold back overall growth. As automakers continue to ask for just-in-time delivery to decrease inventories, the advantage of plastics provides a competitive edge in some uses.

According to industry statistics, there were an estimated 343 establishments engaged in manufacturing molded, extruded, and lathe-cut mechanical rubber goods valued at $3.7 billion in 2008. Industry-wide employment was 14,048. The average establishment employed 44 workers and shipped $16.2 million in products. California, Ohio, and Texas were the leading producing states with nearly 32 percent in market share; however, Texas led in shipments that totaled $2.9 billion.

Background and Development

The term "molded goods" encompasses a wide-ranging group of products whose shape is determined by the mold in which they are produced. Markets using molded goods include automotive and other types of transportation, appliances, oil and gas fields, off-highway machinery, and equipment used in such industries as construction, farm, lawn and garden, and mining. Benefits of molded goods include resiliency, insulation, cushioning, flexibility, and vibration or noise dampening.

Among the many products produced in this segment of the industry are automotive and off-highway air springs; chassis bumpers; engine and truck mounts; automotive vibration dampers; weather-stripping; wiper blades; pedals and pedal pads; rubber marine bearings; bellows, grommets, and mounts used in appliances; drill pipe protectors; shock absorber mounts; conveyor wheels; pool table bumpers; and railroad-crossing pads.

The rubber mold, normally made from steel, is the most important component in the molding process, giving the part its shape and ensuring that it has the proper dimensions, look, and functions. The choice of molding process--compression, transfer, or injection--takes into account many variables because none of the three main methods can handle all applications. Some hybrid processes, combining two of the three molding techniques, have become popular in some uses.

Due to its relative simplicity, compression molding is the most widely used technique. The material is placed in the mold and compressed using hydraulic clamp pressure. When the cycle is completed, the clamp is released and the product is removed from the mold. The mold can be virtually any size as long as sufficient clamping pressure exists. This process generally has the least-expensive mold and yields minimal amounts of waste rubber. Drawbacks include having the longest cure time (the cycle it takes for the product to be formed), the number of finishing operations necessary to render the product usable, and the lack of control over meeting exact customer specifications.

Transfer molding is a more precise process. The material is transferred from a pot, normally located above the mold cavities, down to the mold at the desired time. The technique gives better tolerance control, ensures the mold is closed before rubber is introduced to eliminate exposure to the environment, can be used when other items are to be inserted into the rubber product, and sometimes offers a substantially shorter curing time. Transfer molding, however, leaves more waste, requires moderate secondary operations, and requires a more expensive mold.

Injection molding requires the most expensive press and molds but often yields the lowest overall cost to produce the part, as it gives more options for automation. Material is injected into a closed mold from an injection barrel. One injection system can be used to feed material into several molds, either by having the injector automatically moved to different molds, or by having several molds rotate to a fixed injection unit. The part removal operation is also a good candidate for automation. Other benefits include high-precision parts, lowest rubber prepping cost, shortest cycle times, and minimal exposure to the environment during the molding process. Drawbacks to injection molding include expensive tooling and the potential for large amounts of waste if proper precaution is not taken.

An extruder is a power-driven screw enclosed in a cylinder. In the extruded molding process, material goes in one end and is sent through the cylinder by a rotating screw. At the other end, the material is fed through a die, which is a steel mold designed to produce the desired shape of the product being made. Among the products made using extrusion are cables; wire insulation; door and deck automotive lid seals; window and glass channels in cars; wiper blades; and rubber tubing used in medical, automotive, and appliance applications.

Extruders have been in use for more than 150 years in this industry. Originally, the rubber going into the extruder had to be prewarmed so it could be conveyed through the extruder. This hot-feed extrusion method was time-consuming and required great amounts of labor to complete the warming process.

Earlier in the twentieth century, however, cold-feed extruders were developed. These machines accept material at room temperature and include components designed to warm and soften the material for final forming. These machines are sometimes three times longer than hot-feed extruders, but they result in faster cycles, lower labor costs, and more uniform products. Extruded goods are flexible and good for sealing. They offer the advantage of low-cost permanent tooling and high production rates. Extrusion dies to make prototypes can be produced swiftly and for little cost. Recent studies have emphasized new designs for more effective self-feeding of the material and higher output rates.

While non-automotive, lathe-cut goods are the smallest segment of the industry, automotive lathe-cut goods represent a larger segment. Lathe-cut products in the automotive industry include oil filter washers, fuel system components, disc brake washers, and electric and electronic parts. Other areas using these goods are agriculture, communications, filtration, material handling, printing, and pumps and valves used in water systems.

As automakers remained the single largest customer of molded, extruded, and lathe-cut products, their demands had a large impact on the industry. During the late 1990s, for example, it was common for manufacturers to reduce their supplier base. While in the past an automaker may have bought a single part from many firms, the same company became more selective in vendor selection, buying parts from fewer and fewer vendors. Auto companies became more stringent in their requests for high quality, on-time delivery, quick response to requests, and, as always, competitive pricing.

Automakers also began to ask suppliers of these products to provide the technical capability to develop a component from conception to finished product. This enabled vehicle manufacturers to cut their own development overhead and leave certain design work to companies with expertise in that particular discipline. Full-service molders and extruders, therefore, were expected to make the most gains.

While there have been an increasing number of companies in this industry gaining size, industry executives agree that there will always be a place for the so-called "job shops," which do custom work on products that often are short-run. These firms offer quick turnaround on prototypes and fill niche markets that larger molders cannot service cost-effectively. Job shops are often run by small entrepreneurs, carry lower overheads, and are highly flexible.

In the mid-2000s, rubber manufacturers were dealing with several challenging factors, including large increases in raw material costs and increasing prices of natural gas. Increasing demand and disruptions from Hurricanes Katrina and Rita in 2005 caused natural gas prices to rise nearly 90 percent between October 2004 and October 2005. Natural gas is used extensively in the rubber industry. Many manufacturers use steam to power presses, dryers, and other machinery, and often the boilers that produce that steam are powered by natural gas. According to one analyst, the 94 percent increase in natural gas costs during 2005 translated into a 3.5-cents-per-pound increase in the cost of producing a pound of rubber.

According to the Rubber Manufacturers Association, material costs were expected to continue to increase. Other expected trends in the U.S. rubber industry included a continuing increase in offshore manufacturing capabilities and demands for greater price reductions from automotive customers.

Current Conditions

Mechanical rubber goods producers employed 9,567 and shipped $561.5 million in products in 2008. Automobile rubber goods (mechanical) producers employed 3,121 and shipped $148.3 million in products. Manufacturers of appliance rubber goods (mechanical) shipped $4.3 million in goods, and medical and surgical rubber tubing (extruded and lathe-cut) producers shipped $31.2 million.

Both demand for natural and synthetic rubber fell dramatically in mid-2008 as the automotive and tire markets came to an abrupt halt in the worsening economy. From a high of $1.47 per pound in June 2008, world natural rubber prices fell to .57-cents per pound by December before rebounding to .74-cents per pound in April 2009. Although rubber prices were on the decline, "rubber buyers are not rushing to stock up at the current low prices, either because they lack the cash or they are uncertain about future demand," according to a June 2009 article in Purchasing.

Total natural rubber consumption was projected to reach 9.24 million metric tons in 2009, a 2.3 percent decline compared to 2008. Synthetic rubber was projected to fall 9.5 percent to 11.49 million metric tons in 2008. According to research firm Freedonia Group, global rubber consumption would likely advance 4 percent annually reaching 26.3 million tons by 2011.

Industry Leaders

Because of the fragmented nature of the industry, no single firm or small group of firms dominate. However, several companies have a substantial presence. The Goodyear Tire and Rubber Company had 90 facilities in 28 countries and had worldwide 2008 sales of $19.4 billion. The Cooper Tire & Rubber Company, a major supplier of molded goods for automotive vibration controls, had sales in 2005 of $2.7 billion and 39 facilities worldwide. Eaton Aeroquip, a company created when Eaton Corporation bought Aeroquip in 1999, was also significant. The company employed 8,000 workers and had 36 facilities in 11 countries; Eaton Corporation reported revenues of $15.3 billion in 2008.

Workforce

The mechanical and "all other" rubber goods industry employed 74,972 workers in 2005, down from 87,275 in 2002. The average hourly wage for the 57,693 production workers in 2005 was $15.70. The molded, extruded, and lathe-cut mechanical rubber goods industry employed 14,048 workers in 2008.

America and the World

Imports from Europe and Asia have played a significant role in the market. Some U.S. firms, in turn, explored service niches or specialty markets that have traditionally been harder for imports to penetrate than markets for commodity products.

Joint ventures, especially with Japanese-owned companies, also became prevalent. These helped U.S. firms gain business with both foreign automakers and transplant companies that make cars and other products in America.

Research and Technology

Plastic products were expected to continue to challenge rubber for end-product applications that require more stringent characteristics. As automakers design smaller engine compartments in an effort to improve fuel efficiency and work in conjunction with front-wheel drive systems, they are expected to demand better-performing products. As smaller compartments lead to hotter engine temperatures, automotive components will need to be made of materials with higher heat tolerances.

While traditional rubbers have continued to be used, other materials have been tested. Specialty elastomers, a synthetic rubber made for such specific uses, and thermoplastic elastomers, a material that is processed like a plastic but has the properties of rubber, are among the materials vying for increased usage. New fuels, mandated to reduce harmful emissions into the air, will also factor into material selections in the future.

New techniques will continue to evolve. One such predicted growth area is liquid injection molding (LIM) using silicone rubber. This process was unveiled in the late 1970s amid much hype as to how it would simplify life for molders. According to early literature, the liquid material went directly into the machine and the finished product came out, supposedly eliminating the need for several secondary operations necessary with traditional rubber molding.

While the reality of LIM did not quite meet its promise when it was first introduced, improvements in its technology increased its popularity. Molders of components for medical devices adopted the process, with many adding or expanding LIM capability. The draw for medical molders has been the ability to make a clean product, with the finished component emerging virtually untouched, that meets tight tolerances.

Cellular manufacturing also has gained in prominence. In this process, molding and secondary finishing operations all take place in one "cell," eliminating the necessity for the product to be moved to different areas of the plant. This improves quality, product flow, and efficiency, and it helps reduce staffing requirements.

A new, fully-integrated system for high-yield molding of trimless/flashless parts is the industry's newest technology, developed by Hull/Finmac Inc. in Warminster, Pennsylvania, and Trimless/Flashless Design Inc. (TFD) in Chantilly, Virginia. The system is a combination of a 35-ton compression press and a unique modular mold, a first for the rubber industry. The system's purpose is to reduce scrap rates and eliminate most deflashing operations, improving speed and quality in molding natural or synthetic rubber.

Industry products themselves were expected to continue to evolve. One such area is in the field of vibration control products for automobiles, which have traditionally been passive systems. With the use of a rubber mount, engineers can control a single frequency that causes vehicle noise or motion. More advanced mounts have been designed to control two frequency-related problems.

© COPYRIGHT 2018 The Gale Group, Inc. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. For permission to reuse this article, contact the Copyright Clearance Center.

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