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Global federation mooted to grow PM business
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Global federation mooted to grow PM business With US powder shipments down again last year, the development of new high-density powders for the motor industry should provide a much needed boost...
T
he intriguing possibility of the emergence of a global powder metallurgy federation was put firmly on the agenda at the MPIF’s PowderMet2007 in Denver last month. President Edul Daver and CEO Jim Trombino acknowledged the need for PM associations in Europe, America and Asia to co-operate more closely to build the business in a global market place. The remarks were made in the context of the efforts by PM associations in Japan, China, Korea and India to form an Asian PM Federation. It was time, said Messrs Daver and Trombino, for the associations representing European and American interests to broaden their reach in order to represent the entirety of Europe and the Americas. “It’s time for Asia, Europe and the Americas to collaborate even more effectively together to promote and grow PM world wide, quite possibly through a Global PM Federation.” North American iron powder shipments declined by around five per cent to 416 828 tons. The PM share of this also fell by about five per cent to 377 004 tons. Most observers do not look far for the reason: the continuing woes of Detroit and its haemorrhaging market share mean fewer sales for SUVs and light trucks and more for smaller family cars and crossover vehicles which use fewer, or lighter, PM parts. With General Motors displaced as the world’s biggest auto maker by Toyota last year, it comes as no surprise that the market share for the Detroit Three large US auto makers declined still further in the first quarter of 2007, down 3.7 per cent to 52.1 per cent.
10
MPR June 2007
Short Tons
NORTH AMERICAN IRON POWDER SHIPMENTS
Total 416,828
500000
400000
300000
PM Parts Total 377,004
200000
100000
0 1996
1997
1998
1999
2000
PM Parts
Shipments of copper and copper-base powders declined 9.4 per cent in 2006 to 21 789 short tons. The PM share of this amount dropped 6.4 per cent to 18 228 short tons. The state of Detroit auto manufacturing is partly responsible, so also is the loss of US domestic bearing business to manufacturers in South East Asia and the very high price of commodity copper. The continuing rise in the price of commodities such as copper and nickel are forcing a substitution trend towards non-nickel stainless steels and an increasing use of chromium in steels aimed at the automotive market. No relief from high prices is projected until new copper and nickel production capacity comes on stream next year. “Because of production cuts and shifts in OEM market shares,” Messrs Daver and Trombino continued, “the average PM part content in North American vehicles will experience it’s first reverse in decades,
2001
2002
Welding
2003
2004
2005
2006
Other uses
dipping slightly ( two – three per cent) to below 43 pounds weight in the 2007 model year. “The outlook for PM parts makes is mixed. Non-automotive niche product companies seem to be doing well when delivering higher-density and high-performance parts. On the other hand, companies focused on the automotive market may or may not be holding their own, depending on whether or not they are making parts for so-called ‘hot’ platforms such as the Ford Edge.” With North American auto production forecast to stay flat at about 15.3 million, 2007 could be labelled a “bottom-out” year for automotive PM, they said. “To survive and grow in the turbulent automotive market the North American PM industry must sell its benefits more aggressively to the transplant OEMs. Contributing to this endeavour the MPIF technical board is conducting an ambitious project to iden-
0026-0657/07 ©2007 Elsevier Ltd. All rights reserved.
NORTH AMERICAN SHIPMENTS OF COPPER AND COPPER BASE POWDERS Short Tons 30000 27000 24000
21,789
21000 18000 15000 12000 9000 6000 3000 0 1996
1997
1998
1999
2000
2001
PM Parts
tify every known automotive part that is being manufactured by PM. With this information we can better promote PM’s advantages for new auto applications as well as provide examples for conversions. And instead of talking about PM in vehicles in terms of weight, we should be in a position to talk about it in terms of numbers of parts. “We must also think more globally and become a serious player in the world-wide marketplace. The PM parts markets in China, Korea and India are enjoying double digit annual growth rates and many of the international OEMs have established production and procurement sites in these countries. “The Indian PM parts industry is growing at more than 15 per cent a year and with an average content of 5.5 to 6.6 pounds there would seem to be significant growth potential for other applications.” The Indian automotive components industry is projected to sustain a 17 per cent compound annual growth through 2014, they said. Auto production is growing at 15 to 20 per cent annually, and Tata Motors, India’s largest automaker, forecasts building two million vehicles annually by 2010. “These dizzying statistics spell opportunities for the North American PM industry. Should we begin building technical and business bridges to India, projected to be the world’s third-largest economy by 2020? The answer is definitely Yes!”
metal-powder.net
2002
2003
2004
2005
2006
Other uses
Other areas of the world are also experiencing exciting growth. PM parts production in China is reported to be between 10 and 15 per cent annually with Chinese parts manufacturers turning out 100 000 tons of parts a year. The typical Chinese-built car contains about 10 pounds of PM parts. Similarly, in Korea the PM parts market exceeds 50 000 tons with the average car taking 17.6 pounds of PM parts. While North America remains by far the biggest single market for iron powder shipments at 416 828 short tons, Japan and Europe are not far behind at 246 968 short tons and 196 241 short tons respectively. The rest of Asia and other regions of the world may account for as much as another 275 000 short tons, which puts the estimated global iron powder market at about 1.135 million short tons. “Like never before, our industry is being tested. The changing automotive market, globalisation and competition from lower-cost countries are all testing PM’s resilience and future opportunity,” said Messrs Daver and Trombino. “Let us not fear the challenges; our long-term competition is not other PM companies. It is other fabricating technologies and materials. We have to work together to grow the total PM pie so that each of us can have a bigger slice. “This can only happen by collaboration, by technological innovation, and possibly though a world-wide federation as a catalysing force.”
June 2007 MPR
11
Global federation mooted to grow PM business With US powder shipments down again last year, the development of new high-density powders for the motor industry should provide a much needed boost...
T
he intriguing possibility of the emergence of a global powder metallurgy federation was put firmly on the agenda at the MPIF’s PowderMet2007 in Denver last month. President Edul Daver and CEO Jim Trombino acknowledged the need for PM associations in Europe, America and Asia to co-operate more closely to build the business in a global market place. The remarks were made in the context of the efforts by PM associations in Japan, China, Korea and India to form an Asian PM Federation. It was time, said Messrs Daver and Trombino, for the associations representing European and American interests to broaden their reach in order to represent the entirety of Europe and the Americas. “It’s time for Asia, Europe and the Americas to collaborate even more effectively together to promote and grow PM world wide, quite possibly through a Global PM Federation.” North American iron powder shipments declined by around five per cent to 416 828 tons. The PM share of this also fell by about five per cent to 377 004 tons. Most observers do not look far for the reason: the continuing woes of Detroit and its haemorrhaging market share mean fewer sales for SUVs and light trucks and more for smaller family cars and crossover vehicles which use fewer, or lighter, PM parts. With General Motors displaced as the world’s biggest auto maker by Toyota last year, it comes as no surprise that the market share for the Detroit Three large US auto makers declined still further in the first quarter of 2007, down 3.7 per cent to 52.1 per cent.
10
MPR June 2007
Short Tons
NORTH AMERICAN IRON POWDER SHIPMENTS
Total 416,828
500000
400000
300000
PM Parts Total 377,004
200000
100000
0 1996
1997
1998
1999
2000
PM Parts
Shipments of copper and copper-base powders declined 9.4 per cent in 2006 to 21 789 short tons. The PM share of this amount dropped 6.4 per cent to 18 228 short tons. The state of Detroit auto manufacturing is partly responsible, so also is the loss of US domestic bearing business to manufacturers in South East Asia and the very high price of commodity copper. The continuing rise in the price of commodities such as copper and nickel are forcing a substitution trend towards non-nickel stainless steels and an increasing use of chromium in steels aimed at the automotive market. No relief from high prices is projected until new copper and nickel production capacity comes on stream next year. “Because of production cuts and shifts in OEM market shares,” Messrs Daver and Trombino continued, “the average PM part content in North American vehicles will experience it’s first reverse in decades,
2001
2002
Welding
2003
2004
2005
2006
Other uses
dipping slightly ( two – three per cent) to below 43 pounds weight in the 2007 model year. “The outlook for PM parts makes is mixed. Non-automotive niche product companies seem to be doing well when delivering higher-density and high-performance parts. On the other hand, companies focused on the automotive market may or may not be holding their own, depending on whether or not they are making parts for so-called ‘hot’ platforms such as the Ford Edge.” With North American auto production forecast to stay flat at about 15.3 million, 2007 could be labelled a “bottom-out” year for automotive PM, they said. “To survive and grow in the turbulent automotive market the North American PM industry must sell its benefits more aggressively to the transplant OEMs. Contributing to this endeavour the MPIF technical board is conducting an ambitious project to iden-
0026-0657/07 ©2007 Elsevier Ltd. All rights reserved.
NORTH AMERICAN SHIPMENTS OF COPPER AND COPPER BASE POWDERS Short Tons 30000 27000 24000
21,789
21000 18000 15000 12000 9000 6000 3000 0 1996
1997
1998
1999
2000
2001
PM Parts
tify every known automotive part that is being manufactured by PM. With this information we can better promote PM’s advantages for new auto applications as well as provide examples for conversions. And instead of talking about PM in vehicles in terms of weight, we should be in a position to talk about it in terms of numbers of parts. “We must also think more globally and become a serious player in the world-wide marketplace. The PM parts markets in China, Korea and India are enjoying double digit annual growth rates and many of the international OEMs have established production and procurement sites in these countries. “The Indian PM parts industry is growing at more than 15 per cent a year and with an average content of 5.5 to 6.6 pounds there would seem to be significant growth potential for other applications.” The Indian automotive components industry is projected to sustain a 17 per cent compound annual growth through 2014, they said. Auto production is growing at 15 to 20 per cent annually, and Tata Motors, India’s largest automaker, forecasts building two million vehicles annually by 2010. “These dizzying statistics spell opportunities for the North American PM industry. Should we begin building technical and business bridges to India, projected to be the world’s third-largest economy by 2020? The answer is definitely Yes!”
metal-powder.net
2002
2003
2004
2005
2006
Other uses
Other areas of the world are also experiencing exciting growth. PM parts production in China is reported to be between 10 and 15 per cent annually with Chinese parts manufacturers turning out 100 000 tons of parts a year. The typical Chinese-built car contains about 10 pounds of PM parts. Similarly, in Korea the PM parts market exceeds 50 000 tons with the average car taking 17.6 pounds of PM parts. While North America remains by far the biggest single market for iron powder shipments at 416 828 short tons, Japan and Europe are not far behind at 246 968 short tons and 196 241 short tons respectively. The rest of Asia and other regions of the world may account for as much as another 275 000 short tons, which puts the estimated global iron powder market at about 1.135 million short tons. “Like never before, our industry is being tested. The changing automotive market, globalisation and competition from lower-cost countries are all testing PM’s resilience and future opportunity,” said Messrs Daver and Trombino. “Let us not fear the challenges; our long-term competition is not other PM companies. It is other fabricating technologies and materials. We have to work together to grow the total PM pie so that each of us can have a bigger slice. “This can only happen by collaboration, by technological innovation, and possibly though a world-wide federation as a catalysing force.”
June 2007 MPR
11