Desma adapting to slowdown after best fiscal year

Fridingen, Germany – Rubber injection moulding machinery maker Desma is preparing for expansion while adapting its 604-employee global manufacturing operation to a sharp market-downturn, the company has announced.

Having achieved its “best fiscal year” in 2018, with sales up 18% year-on-year to €118 million, the Fridingen-based company is now seeing  “virtually non-existent market improvement,” said its 20 May statement

In particular, managing directors Martin Schuermann and Harald Zebedin reported “increasingly difficult” market conditions since last October.

Current order inflow is 35% below prior-year levels, due in part to declines  – in some cases “drastic” – in the automotive market alongside general global economic uncertainty.

Desma is, nevertheless, pursuing a three-year growth-plan: investing €22 million across its manufacturing facilities in Germany, Slovakia, India, China and the US.

The programme includes an already-completed purchase of a neighbouring site adjacent to Desma’s property in Fridingen, with an area of 33,000 sqm.

“This [purchase] was done to guarantee the necessary room for future expansion as part of the plan to secure the company’s site in Germany”, said Schuermann.

Furthermore, a €2.3-million automated lathe and milling centre has just been commissioned at the German site to help “increase value creation” and shorten lead-times.

At the same time, Desma is reducing its flexible-working-times contracts and considering the introduction of “short-time workforce” arrangements at some organisational units, said Schuermann.

The company, he added, is also using the current phase to make adjustments in terms of process-optimisation and product-development.

These include “massive investment” in a new ERP and PLM system that will standardise Desma’s business and production processes throughout the world.

The process is currently being implemented under the ’digital core’ project within the company, Desma added.