Green Earth Packaging has assumed responsibility for all production at the EarthShell facility in Goleta, California, in the US and will now begin commercial production as an EarthShell licensee.
The Goleta manufacturing operation was developed by EarthShell Corporation and has been producing plates and bowls for EarthShell Packaging customers such as the Department of the Interior, Sodexho and other clients throughout the US.
Green Earth Packaging assumes responsibility for the Goleta manufacturing operations having demonstrated that the production lines are running at commercial levels and the achievement of targeted product quality standards. GEP will also continue to produce plates and bowls for Wal-Mart at the Goleta facility while it builds production at its permanent US manufacturing location.
The move comes as part of Earthshell's business plan objective to transfer its manufacturing operations to operating partners and is in line with its strategy designed to boost the struggling eco-packaging manufacturer and help it back to profitability after successive years of disappointing financial results. However, many industry observers believe that the company's recent moves to streamline its production with a series of licensing agreements should see the company's financial position strengthen in the future.
"Over the past several months we have contacted many customers in our market territory; they have a strong desire to purchase EarthShell products as soon as our production capacity comes on line. We are committed to aggressively building production to meet this market demand. Environmental products of this type make good sense for business and consumers everywhere," said Philip Ling, chairman of Green Earth Packaging and Green Packaging, sister companies licensed to produce EarthShell products.
"We have been diligent in understanding EarthShell's revolutionary technology and environmentally preferable packaging. Our decision to begin production in the EarthShell Goleta facility and expand our investment in manufacturing EarthShell products underscores our desire and interest to be a leading EarthShell operating partner. We believe this business will be very profitable," said Ed McDonald, chief executive officer of Green Earth Packaging.
GEP plans for the US facility to be operational in the first quarter of next year. This new facility will further enable GEP to service select segments of the US food service disposable market. The target of GEP and GP is to build capacity to produce more than one billion units of EarthShell products annually, estimated at more than $50 million (€51.25m) of market sales, with significant initial volume beginning next year. According to the licensing agreements, Green Earth Packaging and Green Packaging will pay EarthShell Corporation a royalty for all EarthShell products sold.
"EarthShell has completed what we promised the market by delivering to our partners and their customers a technology that makes possible the production of a new class of environmentally preferable products that can be sold at competitive prices and deliver a new level of profitability to this industry. We are very pleased to have finally reached this turning point," said Essam Khashoggi, chairman of EarthShell Corporation.
EarthShell is a development stage company engaged in the licensing and commercialisation of proprietary composite material technology for the manufacture of foodservice disposable packaging, including cups, plates, bowls, hinged-lid containers, and sandwich wraps. The packaging is designed with the environment in mind and is biodegradable.