Engel: Achieving sustainability, circular economy with the right mind-set and technology solutions

Taming the challenges of the pandemic
The pandemic and new waves of reinfections from the Covid-19 have impacted economies and industries in unprecedented scale, yet the plastic supply chain has thrived. During the pandemic, plastics demand kicked, having proven their benefits in, for example, providing safety in food and consumer goods packaging, and food service products applications; and protection in single-use medical devices, medical components and personal protective equipment (PPE) applications.

These developments augured companies to bag sales amid the pandemic-triggered disruptions. Austrian injection moulding machine manufacturer, Engel, has reported having full order books. "We have genuinely sky-rocketed out of the crisis, and we will master the challenges that lie ahead well," according to Engel’s CEO Dr Stefan Engleder.

The change came about in November 2020. Engel reported the demand from the automotive industry has picked up after two difficult years. As a result, the company’s FY 2020/2021 came to a conciliatory end. The Engel Group generated EUR1.1 billion in sales revenues.

Although it said that sales revenues fell anew compared to the previous year with a minus of 15%, Engel is expecting growth for the current fiscal year. "If the upward trend consolidates, growth in the order of up to 20% is realistic," said Engel CSO, Dr Christoph Steger during Engel’s virtual press conference held June 22, adding that "Plastics are and will remain the material of the future – this is reflected in the strong and, above all, fast-growing demand.”

However, the situation was neither a walk in the park, especially since, as Engleder admitted to having to face with the challenge of delivery bottlenecks in raw materials and components. Although Engel is able to ensure global delivery capability owing to its international network of plants and the dual-sourcing strategy established several years ago, the cost gap is continuing to widen. “The markets are overheated, and rising inflation is aggravating this effect", said Engleder. "This will also have an impact on prices in machine manufacturing."

Demand increasing in all regions
Steger said, “The Americas and Asia – and China in particular – were the first to see the economy pick up again; while Europe is also clearly back on track."

The regional distribution of sales at the end of FY 2020/2021 reflects the impact of the crisis, according to Engel. Europe contributed 45% of Group sales revenues - well below the previous year's share of 54%; the Americas accounted for 30%, up from 25%the year before; and Asia for 23% up from 20% the previous year.

There were also shifts in the distribution of sales by business line: the Technical Moulding Division, which includes the domestic products, sports, games and leisure segments, experienced increased demand worldwide during the Corona pandemic, and thus, saw significant growth. Likewise, the Medical business unit has grown further.

Engel, which has processed Covid-19-related orders with higher priority since the beginning of the pandemic, affirmed that plastic products are making an important contribution to the fight against the pandemic.

Meanwhile, amid the strong order situation, there is still a degree of uncertainty that makes planning difficult. "We have to be prepared for markets becoming more volatile and demanding more flexibility from us. We have geared up for crises," said Engleder, referring to Engel’s global production network, and the stronger focus on decentralised expertise in sales, service and processing engineering that enable them to “act in a versatile way."

Emphasis on sustainability
Steger relayed that “from October 2020 to the present, amid the efforts to jumpstart economies as the global health situation improves, Engel has continued to further develop its solutions, investing in R&D in the same level as in the past. Sustainability has taken centre stage of our cutting edge solutions. We see ourselves as part of the solution for circular economy and enterprise sustainability management within the plastics industry,“

According to Engel, it has committed to sustainability, opting for the careful dealing with resources and the optimised and efficient utilisation of its products and solutions. In the last years, the company has developed strategies, technologies and machines, which help to put the principle of sustainability into practice with efficiency.

For Engel, sustainability is more than just hype. This was intoned by Engleder in his keynote session at the company’s recent e-Symposium event held 22-24 June. He pointed out how major initiatives and policies, such as the EU Green Deal, which are inclined towards health and environment, are now shaping the economies worldwide.

“The EU Green Deal has broad impact to the economy, with investments from EU, US, and China. Fiscal policies determine our actions more and more, “ he said.

He added that major economies earmark huge investments to so-called green goals – the EU has EUR 1 trillion by 2027; the US has US$3 trillion for its Corona investment programme; and China, targeting carbon neutrality by 2060 has US$180 billion.

Engleder also pointed out the megatrends that influence receptiveness on plastics. “Megatrends appear every three to four years, with trend cycles intensifying and growing into hypes. Hype cycles occur and they may be divided into five phases according to Basis Gartner Hype Cycle. As examples: the Industry 4.0, plastics ban, and marine litter- these topics were highly hyped before the Covid-19 crisis and now they seem to subside. The Green Deal, circular economy, and also the supply chain law are triggers and trends to be hypes. Where you have hypes, disappointments are inevitable, “ he said.

He explained that Engel is not going into that “hype” direction. “At Engel, we do not chase after the hypes, but we think long term. We invest on solutions to trends that we are convinced of. And we have the endurance to develop industrial solutions. We believe sustainability is more than just a hype. (Sustainability) is also part of Engel’s identity; we follow a holistic approach, a strong partner in the supply chain with energy-efficient and cost optimised injection moulding solutions. As part of the plastic supply chain, our solutions, which underscore digitalisation, enable circular economy. “ Englader said.

Taking lead in energy efficiency, recycled content processing
“Energy efficiency has always been a salient feature in our portfolio of solutions from electric driven units, ecodrive, and e-motion with kinetic buffering, duo speed and e-flomo/flomo, to the inject 4.0 solutions from iQ solutions to iQ process observer, “ Engleder said.

According to him, such solutions, for example the Victory 500/120 tech machine has improved to have currently an overall energy saving of 49%; and our all-electric machine introduced in the packaging sector, and the e-motion solutions compared to the hybrid.

On a related note, use of more recycled material content is also gaining traction. “As the plastic volume doubles by 2025, the share of virgin materials decreasing slightly. In 2050, about 60% of plastics will be based on recycled materials, either mechanically or chemically recycled. Therefore we are now dealing with processing recycled materials, “ he said.

“Our developments follow a close to the customer approach with solutions including multi-stage installations for recycling applications; and process technologies such as the skinmelt. Customers can engage Engel to develop solutions and applications that can meet their needs for a circular economy”, assured Engleder.

Digitalisation as enabler of sustainability
Meanwhile, digitalisation is the enabling technology for sustainability and decarbonisation, according to Engel. Engleder, citing a data by the Bitkom survey, said that moderate digitalisation brings 39% carbon reduction, and accelerated digitalisation brings 59% carbon,.

Engleder furthered that digitalisation is an enabler especially in closing the plastic loop by horizontal networking. The goal is not to downcycle but to recycle or even upcycle material.

Relatedly, Engel has established a Digital Solutions Sales Team, which sees the Engel Group bundle all sales activities for digital products and solutions from the inject 4.0 programme; and thus, benefitting customers to have a central contact for all topics relating to the digitalisation of injection moulding production.

Inject 4.0 includes products and solutions from all three areas of the smart factory – smart machine, smart production and smart service. These include the smart assistance systems from the iQ product family, shopfloor management solutions by TIG, such as MES authentig, and e-connect service solutions, such as e-connect.24 and e-connect.monitor.

"Our customers can look forward to holistic, requirements-driven consultancy for their digitalisation strategy and to matching solutions from a single source", said Engleder. "The three areas of smart machine, smart production and smart service are becoming increasingly meshed. Bundling expert knowledge in a single sales team takes this development into account." Engel's close-knit sales network is now available to all customers worldwide with products from both Engel and TIG.

Achieving sustainability is possible, especially that technologies are available to tackle it, Engleder said. “We already have existing solutions, which we have to utilise. However there are prerequisite. We all have to change our mind-set, We as part of the plastic industry have a contribution to make, especially in horizontal networking and collaboration, “ he said.

(IMA)

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