Monthly Archives: September 2006

Scrap Pays the Bills

A recent conversation has me thinking that the old screw machine world has been turned on its head and the change is falling out of its pockets.

I was talking to an old machining client, and he mentioned that in the last quarter he derived more money from his scrap than from the components he had made. This fellow runs a sophisticated machining company—no dumb washers—so he adds a lot of value to his machined components. Still, this quarter his scrap brought in more dollars than his product. This is a testament to global sourcing and manufacturing efficiency, but it also may be pointing toward diminishing viability of metal machining in the age of scarce and expensive raw materials. If copper and brass prices stay over $3.00 per pound, we are going to see the engineers figure out methods to get around using them. We are beginning to see lead engineered away because of health and disposal issues. It could happen with copper, brass and stainless. Composites are changing aerospace and will soon make their mark in the automotive. The parts printing paradigm (see “Ex One Revolution below) addresses the scrap from machining with a scrapless process, which also trumps the messy fluids issues. Heading, EDM, injection molding, waterjet and laser are all pointing in the direction of scrapless part making.

Eaton Corporation recently closed a big brass fittings plant in Oklahoma because they felt that they could deploy their capital more efficiently than investing it in brass bar, chips and nipples.

Another statement about the price of scrap was made on eBay in a recent Graff-Pinkert auction. A used 1100 E, Burrett 30” chip wringer brought $13,000 in a competitive auction. Spinners rise in value when chips become more dear. This is the highest price I’ve ever seen for such a model. The recent commodities slide may temper the focus on chips, but as long as China is committed to its frantic infrastructure build out, brass and copper will be short, and scrap will stay hot.

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Ex One Revolution

For me, the highlight of IMTS was the Ex One exhibit. This company, led by former head of Extreme Hone, Lawrence Rhoades, and former CEO of Gleason Works Theaters John Burns, is revolutionizing the world of machining. Perhaps not revolutionizing, but replacing much of machining as we know it, using a three dimensional process, which incorporates a layering of metal powder by a version of inkjet printing.

Ex One is already using this process to make sand models for casting. It is also beta testing a similar mode of making dental crowns using gold powder added layer by layer to make a perfect crown in a fraction of the time as in the conventional process.

Rhoades envisions this approach replacing many of the dental laboratories making gold crowns. Dentists are already bringing the technology into their offices making the turnaround time a fraction of that with conventional methods.

Ex One’s vision of the world diminishes the role of Fed Ex and UPS because production would be on the site with virtually no waste.

Watch this video excerpt from interview I did with Mr. Rhoades. It will later appear in the print addition of Today’s Machining World.

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Today's IMTS Reflections

Mazak looks like a big winner. Their exhibit is almost always swarming, and they have focused on big machines well suited for the boom in energy production and distribution.

Haas seems crowded. They have a million machines and hordes of salesmen and technicians. I have done a sampling of attitudes of show attendees regarding the company and its products in light of Gene Haas’s indictment. I have found a general awareness of the tax problems, but the people I have talked to feel positively about the products and service. This seems to trump anger or dismay about the court case. Several people were sympathetic towards him, having fought with the IRS themselves. The exception was people in the machine tool field who seem to be delighting in Gene Haas’s problems.

I find it difficult to assess the attendance of this show. Aisles are not crowed. It often seems like more people are working the show than attending, but I know this is symptomatic of the dramatic decentralization of manufacturing in recent years. The GM and Fords are not sending big teams of people. Lean companies send key people because production must go on. IMTS 2006 may be a successful event despite comparatively low numbers. The people I have talked to, both buyers and sellers, are feeling successful and optimistic; it’s a buying climate. Midway through, it looks like this will go down as an excellent show for most exhibitors.

One of the weakest exhibits was by the organizing body of IMTS. Their IMTS TV on big beautiful plasma screens strategically placed was watched by nobody because it was a series of canned advertorial interviews, which reeked of inept PR. When will people ever learn that nobody has time for unauthentic fluff, whether written or on video?

AMT had booths at the front of the North hall. Great location near the hot dog seller, but I couldn’t figure out what their message was. There was a list of senators and a printed message about the R & D tax credit, but the call to action was unclear. AMT probably does good work, but nobody but the members of the club would know it from the display.

IMTS generates a lot of energy from the exhibitors and attendees. From my observation, AMT does a weak job of galvanizing the buzz of IMTS into anything that propels manufacturing in America forward politically and intellectually.

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New Life at Tornos

Welcome to the 21st century Tornos. At the Tornos press conference, I was impressed with Scott Kowalski, who has taken the reins at Tornos in America. Tom Dierks, who led Tornos for many years, was a fine person, but the business in America deteriorated under his watch. Market share slipped to also-ran status, despite having a superior piece of hardware to sell.

Tornos appears to realize the problem. They have improved the software by partnering with PartMaker and developing a Windows-based product.

They are building a “Center for Excellence” in Naperville, IL, outside of Chicago, which sounds like it will eventually be a home for the brand. They are taking a cue from Index, which moved from a cozy building in a small Connecticut town, to a state of the art plant near Indianapolis. Tornos has also granted a multi-spindle representation to Hydromat, which has a chance to really make something out of it.
Kowalski impressed me as a high energy mover and shaker. He has a clear idea of what he has to do – build the brand with service and support. Convince the best dealers that Tornos is on the rise again. Show passion and commitment to the customers.

I think this guy is really going to stir things up for the better.

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Three days and counting…….

Eight days of IMTS. Are you kidding? This is an idea from yesteryear. If you compressed IMTS to three days, everybody would come for those three days. Comdex, the National Hardware Show, big medical conferences – nobody does more than three or four days anymore.

The programming doesn’t even fill three days now. The weekend is slow, especially Sunday. Perhaps the downtown restaurants and hotels like the added traffic, but IMTS should be for the participants, not the city it is located in. And for the participants, eight days or six days is a big inconvenience and physically bone crushing.

We are in a period when manufacturing lives under constant pressure to reduce costs – go lean.

IMTS continues to be the show of excess – too big, too long, too expensive. This may temporarily serve the interests of the organizers, but ultimately the exhibitors will expect the same lean performance from IMTS as their customers demand from them.

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“Show Daily”: IMTS Dumbs Itself Down

Upon entering the main Hall at IMTS you are immediately invited to take the “Show Daily” pamphlet by an attractive young woman in a tight blouse and spiked heels.

For as long as I’ve been coming to IMTS, there’s always been Gardener’s “Show Daily”, a cheerleading shopper, which parodies journalism. It’s a compilation of advertorials barely masquerading as editorial copy. IMTS degrades itself by allowing the handout to be called “The Official Show Daily of IMTS 2006.” Perhaps people are dumbed down by years of pedestrian tripe, but for some reason some companies continue to spend lots of money to advertise in a rag that few but the totally bored out of their minds could read for more than ten minutes.

The IMTS Directory of Exhibits is another misfit. IMTS is doing a nice job with it’s web map and directory, but the book is a complicated jigsaw puzzle, full of fold out ads, which disrupt the flow of the listings. I find it a convoluted mishmash that is cumbersome to use at the show or after the show.

If you are looking for an exhibition, you cannot find it by going to the alphabetical listings near the back of the book. You will find a folded ad under the tab for Lyndex Nikken, which doesn’t seem to mesh with anything in that section. You will find folded maps requiring magnifying lenses to decipher the names.

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IMTS Web Grief

The great rip off of IMTS is the $1200 that McCormick Place charges to run an Internet connection to an exhibitor’s booth. Such a charge is absurd on its face, but even more heinous because at least where the TMW booth is located, we can buy the McCormick Place Wi-Fi signal for $10 a day. It is perfectly adequate for email and searching Google but a little slow for video.

The McCormick Place Wi-Fi points out how old school the IMTS-McCormick Place approach is, despite the kinder and gentler face the Teamster’s Union is presenting. On Tuesday, the day before the show, the union guys cruised around the big hall offering drinks to the sweating technicians setting up their exhibits.

Chicago is desperate to hold on to the giant convention business, but they continue to hold on to the abusive pricing tactics that has driven business to Las Vegas and Orlando.

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