600 Lathes moves the manufacture of standard machines to China.
Production at 600 Lathes' 250-employee Heckmondwike plant (Yorkshire, U.K.) now will concentrate on the T. S. Harrison 'electronic' (half-NC or combination) flatbed lathes and the Colchester Tornado multi-axis CNC production lathes, known in the U.S. market under the 'Storm' name.
This year, 600 Lathes will introduce its "sophisticated," high-performance, high-specification 'engine' lathes to the U.S. market. The aim, says chief executive of the 600 Group, Dr. Anthony Sweeten, "is to try to regain our market share in the U.S. as in the past." By sophistication Sweeten refers to the provision of variable spindle speed/constant surface cutting speed with "intelligent" digital read-out systems as the standard lathe control package.
Sweeten says that the 600 Group (www.600group.com) had decided that building such standard engine lathes in the U.K. for export is no longer viable: "We cannot sell low-cost/low-tech machines at Western prices." So a deal has been drawn up with the Dalian Machine Tool group to address volume production of lathes. 600 Lathes controls design, technology, manufacturing and distribution rights. Under the arrangement, 600 Lathes buys and brings the engine lathes to the U.K. to "add value"--such as affixing control systems. This operation has just started, and the first Dalian-built machines were on the Heckmondwike shop floor in early April.
"We do not see the Chinese machine-tool builders as competition," according to Dr. Sweeten. "The Dalian machines are being produced exclusively for 600 Lathes. Eventually, the Chinese market will also want 'sophistication,' the next generation
Sweeten adds that 600 Group will be maintaining control over the new engine lathes' reputation. "We had to re-equip the Dalian factory," he says. "These engine lathes have to be 'world class,' and the Chinese want to develop skills and technology levels acceptable to the West."
The arrangement is not a "joint venture" but rather is structured entirely on a commercial basis: Dalian sells the engine lathes exclusively to 600 Lathes, and Dalian can only sell the machines into the Chinese market when 600 Lathes says so.
At Heckmondwike, the standard lathe production plant has gone. Now the plant has been re-organized and re-equipped to concentrate on building the Harrison electronic lathes and Colchester Tornado/Storm CNC turning centers. "We are saving jobs and putting resources into what we are good at," says Dr. Sweeten. "We have gone through the worst recession in machine tools and we do not need to borrow money--we have worked hard to keep our cash."
To put the financials into some perspective, Sweeten remarks that the last "good" year for 600 Lathes in the U.S. market was 1998. Demand later bottomed out at 38% of the 1998 demand level, and 2004/5 will see demand going up. Sales of the Storm and Harrison lathes are doing well, and more advanced models are on the way.
Consequently there will a change in the direction of the 600 Lathes' U.S. market, with a program of reviewing and re-educating the distributor network is now underway. "We have no plans to abandon existing distributorships," remarks Dr. Sweeten. "Only to strengthen the existing ones and add on new distribution. We will be making announcements at Eastec."
Advances on the way include the Harrison Multiturn 4000, one of a series of CNC flatbed lathes built up to 19 in. swing by 10 ft. between centers. They have the GE Fanuc Series Oi CNCs with manual guidance and on-board CAM. These are coming through 600's U.S. operation, Clausing Industrial, (Kalamazoo, Mich.), which is selling large numbers into CNC shops at a "ball park" price of around $50,000.
Dr. Sweeten said that Clausing (www.clausing-industrial.com) is also doing very well on Storm sales. What will 600 Lathes show at EMO? Sweeten was not letting any secrets out, but suggestions of a flatbed CNC lathe with a milling spindle, a multi-turret Tornado/Storm, plus more developments in hard turning may be on the cards.
This reporter got the impression that the 600 Group's lathes activities are once more "going like a train." The Group may not yet in a position to divulge current financial performance--since it is in the period just before quarterly results are announced--but a financial improvement is in the cards.
From our European correspondent.