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Published: Friday, 7/23/2004

OC boosts capacity at pipe plant in Mexico

Owens Corning said yesterday it has significantly boosted capacity at a factory in Mexico City that produces insulation for pipes.

The move helps to fill an industry-wide void created when a Johns Manville plant in Defiance was destroyed by fire in May, 2003.

The northwest Ohio plant produced 35 to 40 percent of insulation sold in the United States, Canada, and Mexico for wrapping around pipes used to heat and cool commercial buildings, according to the industry publication Insulation Outlook. The factory's destruction significantly disrupted domestic supply, the report said.

In the days after the Defiance fire, manufacturers rushed to find temporary solutions to fill the void. Johns Manville, of Denver, turned to a plant in Alabama.

Toledo-based OC, like other manufacturers, imported insulation from overseas producers.

"We had to bring it across the ocean and it proved to be too much of a logistics challenge," said Jeff Craney, vice president for commercial and industrial businesses.

The company's investment in its Mexican operation began after it bought out a partner in a joint venture in Mexico known as Vitro Fibras. OC paid $71.5 million for the operation that has since been renamed Owens Corning Mexico.

The Fortune 500 firm installed two additional production lines at the Mexico City operation, doubling the factory's capacity and boosting the company's capacity by 30 percent, Mr. Craney said.

Additional steps taken by OC to increase output of pipe insulation included production increases at a factory in Newark, Ohio and creation of a new distribution center in the Dallas area to reduce the load on an existing facility in Hebron, Ohio.

Johns Manville announced March 25 that it will build a plant to replace the ruined factory, but didn't say if it will be in Defiance.



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