About Core Molding Technologies

Core Molding Technologies, Inc. and its subsidiaries operate in the engineered materials market as one operating segment as a molder of thermoplastic and thermoset structural products. The company produces and sells molded products for varied markets, including medium and heavy-duty trucks, automobiles, power sports, construction and agriculture, building products and other commercial markets. In general, the company achieves product growth and diversification in several different ways, including resourcing of existing structural products from another supplier by an original equipment manufacturer (OEM); obtaining new structural products through a selection process in which an OEM solicits bids; successful marketing of structural products for previously non-structural applications; converting alternative materials to engineered materials; successful marketing of structural products to OEMs outside of its traditional markets; developing of new materials, technology and processes to meet current or prospective customer requirements; and acquiring an existing business. The company's efforts continue to be directed towards all seven of those identified areas. Products Sheet Molding Compound (SMC) SMC is primarily a combination of resins, fiberglass, fillers, and catalysts compounded and cured in sheet form, which is then used to manufacture compression-molded products. The company incorporates a sophisticated computer program in the process of compounding various complex SMC formulations tailored to meet customer needs. The program provides for the control of information during various production processes and data for statistical batch controls. The company also sells SMC to other molders. Molded Products The company manufactures structural products using compression molding (52 presses), resin transfer molding (4 presses), and injection molding processes (24 presses). As of December 31, 2022, the company owned 80 molding presses, including 19 in its Columbus, Ohio facility; 23 in its Matamoros, Mexico facility; 19 in its Cobourg, Canada facility; 10 in its Gaffney, South Carolina facility; 4 in its Winona, Minnesota facility; and 5 in its Escobedo, Mexico facility. The company's molding presses range in size from 250 to 5,500 tons. SMC compression molding is a process whereby SMC is molded to form by matched die steel molds through which a combination of heat and pressure are applied via a molding press. Outer components and high strength reinforcing components are fabricated with this process. Visually appealing components are produced with vacuum assisted molding and through utilizing in-mold coating (IMC). IMC can provide an additional benefit of conductivity assisting in the process of post paint application along with reducing porosity and improving surface appearance. This thermoset process produces high quality, dimensionally consistent products and is typically used for high volume products. Direct Long Fiber Thermoplastic (DLFT) compression molding employs two molds, typically a core and a cavity, similar to matched die SMC molding. This is a process for compounding and molding thermoplastic materials with long fibers (typically, 0.5 inch or longer). Engineered thermoplastic pellets and performance additives are compounded in a screw extruder, to which chopped reinforcements (typically, glass fibers) are added and further extruded. A charge of material is cut to a precise weight, and this charge is directly moved to a compression or injection transfer process, where it is molded into a finished part. The process allows for direct processing of the compounded material, bypassing the expense and delay of producing an intermediate product (pellets or sheets) as is used in other fiber-reinforced thermoplastic molding processes. The D-LFT process is an attractive option for products that have highly complex geometry, require high strength and stiffness, and benefit from the recyclability of a thermoplastic resin. Vacuum resin transfer compression molding (RTM) process employs two mold halves, typically a core and a cavity, similar to matched die molding. The composite is produced by placing glass mat, chopped strand, or continuous strand fiberglass in the mold cavity in the desired pattern. Parts used for cosmetic purposes typically have a gel coat applied to the mold surface. The core mold is then fitted to the cavity, and upon a satisfactory seal, a vacuum is applied. When the proper vacuum is achieved, the resin is injected into the mold to fill the part. Finally, the part is allowed to cure and is then removed from the mold and trimmed to shape. Fiberglass reinforced products produced from the RTM process exhibit a high-quality surface on both sides of the part and excellent part thickness. The multiple insert tooling technique can be utilized in the RTM process to improve throughput based upon volume requirements. Structural Foam and Web Injection Molding (SIM) are low-pressure injection molding processes that develop high-strength, rigid parts at low weight. This is accomplished by mixing a foaming agent (usually, nitrogen gas) with the melted polymer (structural foam process), or by injecting nitrogen gas into the mold cavity immediately after the plastic resin is injected (structural web molding). Structural foam produces a cellular interior structure that can provide twice the rigidity of a solid plastic molding. The structural web process pushes the plastic out to the mold cavity walls, uniformly packing out the entire mold and hollowing out thicker sections to create products of varying wall thicknesses. As a result, structural web molded parts have a smoother, glossier finish than other low-pressure parts. Both processes give part designers flexibility when designing products that need strength and stiffness at low weight and also has the benefit of recyclability due to the use of a thermoplastic resin. Reaction Injection Molding (RIM) is a process whereby a composite is produced through the injection of a two- component thermoset resin system utilizing dicyclopentadiene (DCPD) technology. DCPD technology involves injecting a liquid compound into matched die aluminum molds to form the part. In this process the mold is prepared, closed and the liquid compound is injected into the tool then cured. Additional finishing is required when the part is designated for top coat painting. The RIM process is an alternative to other closed mold processes for mid-volume parts that require a high level of impact resistance. Hand Lay-Up is a process that utilizes a shell mold, typically the cavity, where glass cloth, either chopped strand or continuous strand glass mat, is introduced into the cavity. Resin is then applied to the cloth and rolled out to achieve a uniform wet-out from the glass and to remove any trapped air. The part is then allowed to cure and is removed from the mold. After removal, the part typically undergoes trimming to achieve the shape desired. Parts used for cosmetic purposes typically have a gel coat applied to the mold surface prior to the lay-up to improve the surface quality of the finished part. Parts produced from this process have a smooth outer surface and an unfinished or rough interior surface. These fiberglass-reinforced products are typically non-cosmetic components or structural reinforcements that are sold externally or used internally as components of larger assemblies. Spray-Up is a process that utilizes the same type of shell mold as hand-lay-up, but instead of using glass cloth to produce the composite part, a chopper/spray system is employed. Glass rovings and resin feed the chopper/spray gun. The resin coated, chopped glass is sprayed into the mold to the desired thickness. The resin coated glass in the mold is then rolled out to ensure complete wet-out and to remove any trapped air. The part is then allowed to cure, is removed from the mold, and is then trimmed to the desired shape. Parts used for cosmetic purposes typically have a gel coat applied to the mold surface prior to the resin-coated glass being sprayed into the mold to improve the surface quality of the finished part. Parts produced from this process have a smooth outer surface and an unfinished or rough interior surface. Assembly, Machining, and Paint Products Many of the products molded by the company are assembled, machined, and prime painted or topcoat painted to result in a finished product used by the company's customers. The company has demonstrated manufacturing flexibility that accommodates a range of low volume hand assembly and machining work, to high volume, highly automated assembly and machining systems. Robotics are used as deemed productive for material handling, machining, and adhesive applications. In addition to conventional machining methods, water-jet cutting technology is used where appropriate. The company also utilizes paint booths and batch ovens in its facilities. The company generally contracts with outside providers for higher volume applications that require top coat paint. Major Customers The company had five major customers during the year ended December 31, 2022, BRP, Inc. (BRP), Navistar, Inc. (Navistar), PACCAR, Inc. (PACCAR), Universal Forest Products, Inc. (UFP) and Volvo Group North America, LLC (Volvo). Major customers are defined as customers whose sales individually consist of more than ten percent of total sales during any annual or interim reporting period in the year. BRP provides a portfolio of industry-leading products comprising of snowmobiles, watercraft, on and off-road vehicles, power sports propulsion systems, as well as engines for karts, motorcycles and recreational aircraft. UFP supplies products to three industry segments: retail, industrial, and construction. Other Customers The company also produces products for other customers and industries, including medium and heavy-duty trucks, power sports, building products, industrial and utilities and other commercial markets. Sales to these customers individually were all less than 10% of total sales for interim and annual reporting during 2022. Geographic Information Substantially all of the company's products are sold in the U.S. dollars. Seasonality The company's business is affected annually by the production schedules of its customers. Certain of the company's customers typically shut down their operations on an annual basis for a period of one to several weeks during the company's third quarter. Certain customers also typically shut down their operations during the last week of December. As a result, demand for the company's products typically decreases during the third and fourth quarters (year ended December 31, 2022). Demand for medium and heavy-duty trucks, power sports, automotive, and commercial products also fluctuates on an economic, cyclical and seasonal basis, causing a corresponding fluctuation for demand of the company's products. Major Competitors The company faces competition from a number of other molders, including most significantly, Molded Fiber Glass Companies, Teijin, Ashley Industrial Molding, René Matériaux Composite Ltée (RMC), STS Group, and 20/20 Custom Molded Plastics. Research and Development For the year ended December 31, 2022, the company’s research and development costs, which are expensed as incurred, totaled approximately $1.6 million. Environmental, Climate Related Regulations and Compliance The company has Environmental Management Systems at all of its facilities and has obtained ISO 14001 certification at all facilities except for Cobourg, Canada, which complies with strict Canadian environmental reporting. As part of the company's environmental policy, all manufacturing employees are trained on waste management and other environmental issues. The company holds various environmental operating permits for its production facilities in the U.S., Mexico, and Canada as require by the U.S., Mexican and Canadian federal, state and local regulations. History The company was founded in 1996. It was incorporated in state of Delaware in 1996. The company was formerly known as Core Materials Corporation and changed its name to Core Molding Technologies, Inc. in 2002.