DIAB Inc. to restructure its U.S. operation

Changes will affect PVC foam and kit manufacturing at the facility in Desoto, Texas. DIAB sales and technical services and the Composites Consulting Group will remain intact, and Divinycell F production will continue.

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Jan. 1, 2013, has been named as the target date for a restructing of DIAB Sales Inc.'s U.S. operations. Announced by the DeSoto, Texas-based company on Sept. 17, this year, the move will impact PVC and kit manufacturing at the DeSoto facility, but the company says its sales force, technical services team, and the Composites Consulting Group will remain intact. DIAB says it will continue production of Divinycell F in the U.S. along with all finishing, certifications and document control. Additionally, DIAB's ProBalsa and Divinycell P products will remain without any changes.

DIAB Inc. will continue to custom finish the PVC cores in the Desoto facility, but increase the already existing sourcing of PVC blocks from Europe. As a result, DIAB will discontinue its PVC core material manufacturing in Desoto by the end of this year.

Because Divinycell foams were harmonized globally in mid‐2000 and most customers have qualified and received products from all of DIAB's factories, the company said it believes that its customers will experience no difference in product quality or service. DIAB says it intends to increase safety stocks to ensure a smooth transition during the restructuring process.

In regard to its kitting operations, DIAB Inc. says it will adopt an alternative strategy, forming alliances with third-party kitters, based on capacity, capability, geography and efficiency. The kit design function will stay with DIAB Sales' Technical Services group, which will develop customers' kit designs with full instructions. That package will be sent to DIAB's partners for kit manufacture and assembly.

DIAB cited a decline in the demand for kits in the wind energy and marine markets. As a result of the decline, DIAB will discontinue its DeSoto kitting operations at the end of 2012, with the exception of customer applications for developing markets.

Lennart Hagelqvist, DIAB president and CEO commented on the changes: "We are convinced that these changes will increase our ability to bring highly valuable sandwich solutions and expand in the U.S. marketplace. The impact on the DIAB customer base will be limited if any at all.”

“The vacuum created by the downturn in wind blade production in China and the imminent downturn in the U.S. wind blade demand has led us to optimize DIAB's operational capacity vs. demand over the next several business cycles," Hagelqvist continues. "Key in this change is to increase the utilization of our group PVC capacity and adjust according to current market demand." Because the Americas are an important market for DIAB, the company will maintain finishing, Divinycell F production and sales and technical competence close to its customers, he adds.

For more information contact:

Charles Previte, VP, Sales Americas, Tel.: (972) 228‐7632; E-mail: charles.previte@us.diabgroup.com.
Lennart Hagelqvist, CEO, DIAB Group, Tel.:+46 430 16300; E-mail: lennart.hagelqvist@se.diabgroup.com.
Jan Andersson, VP Marketing, DIAB Group, Tel.: +46 430 16300; E-mail: jan.andersson@se.diabgroup.com.