Stroh Prepares for a Rebound
Stroh Precision Die Casting consolidated its diecasting facilities and brought in new ownership to weather the recession and plan for re-growth.
Shannon Wetzel, Senior Editor S
troh Die Casting, Milwau- kee, and Stroh Controls, Mauston, Wis., had strong sales in 2008. A year later, massive constriction in the
marketplace left the two companies struggling. The plan for years was to consolidate Stroh Die Casting’s zinc and aluminum facilities with Stroh Controls under one roof. The com- pany decided it was time to put the plan into action, and in November 2009, the majority of the ownership was sold to a new company, Stroh Precision Die Casting LLC, with new management. “It’s a competitive business we are
in,” said Andy Stroh, the diecaster’s vice president. Now, the new company is work- ing to reinvent itself by establishing
a healthier business plan and a more robust niche in the market so it can take advantage of the economic rebound. According to Stratecasts Inc., the diecasting industry, includ- ing aluminum, magnesium and zinc production, is forecast to grow by 58% from 2009 to 2013, although it won’t quite return to pre-recession production volumes. Stroh’s situation echoes that of
many diecasters struggling to survive the most recent recession. The auto- motive industry—which accounts for about half of all diecasting shipments —is weak, other diecasting customers have gone out of business, and jobs continue to move to China and other lower cost countries. “The guys who have failed are typically diecasters that were produc-
ing tons of metal—commodities. They didn’t bring anything special to the party,” said Jim Merritt, an industry marketing and sales consultant. “The diecasters that are surviving are proac- tive and lead the industry.”
Stable Business Hits Rocky Patch Stroh Die Casting has been around
since 1903. It survived the Great Depression without laying off an em- ployee, according to Andy Stroh. When Mike Stroh took over the business as president in 1984, he began to reinvest in the facility, which hadn’t been re- capitalized in recent years. He brought in new furnaces, bigger diecasting machines and machining equipment to offer a full manufacturing system to customers. “We needed to fi nd a way to add
value to the product,” Mike Stroh said. In the 1990s, the company contracted
with several new customers following its business model of pursuing nonau- tomotive work, and the business grew. In 2007-2008, Stroh Die Casting
picked up a large, fi rst-tier military order, which bumped up its sales to more than $30 million in 2008—the most ever for the company. By then, the business had grown almost fi ve times from what it was when Mike Stroh took over as president. So why did the diecaster suddenly
Stroh Die Casting consolidated its zinc and aluminum facilities into a single location in Mauston, Wis., last year.
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fi nd itself on its heels in 2009? Besides an industry-wide 40% dip in overall diecasting production since 2006, some of Stroh Die Casting’s large military orders were short-term, and its tech- nology customers, which consisted of 28% of its sales, moved all of its busi- ness, including headquarters, to China.
MODERN CASTING / September 2010
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