Identifying casting's challenges.

This 'roundtable' SWOT analysis - from the customer's viewpoint - tackles the hurdles that must be cleared for a solid future for metal castings.

Much attention has been placed recently on the need to expand metal casting markets vs. foundries' continued "scramble" for patterns in what has resulted in little beyond an industry cannibalization. Some of the answers lie within the industry's control while many others do not. The task, therefore, is easier said than done.

An engineer (a casting proponent, by the way) at a major U.S. company once was asked what it would take for his company to design with more castings. His response was, "the retirement of about 25 engineers who continue to poison others' views of castings." And when you consider that fewer engineers possess casting knowledge and experience, that newer, higher-tech-sounding materials have captured much attention and that OEMs are becoming even more price-driven (rather than manufacturing-driven), U.S. casting producers have a significant fight on their hands.

In Purchasing Magazine's annual 1999 Report Card (January 14 edition), castings once again took their perennial "hit on the chin" in 1998 with a score of 2.8 (out of a possible 4), down from 3 in 1997. Buyers cited problems of "porosity and cleanliness of facilities." The report also indicated that a main reason castings are sourced over alternative methods is because quality and competitively priced commodities can be purchased from overseas foundries as well - not exactly the ringing endorsement the U.S. industry wanted to hear.

In a production-oriented industry (making castings more affordable for buyers through production efficiencies), many foundries had not grown accustomed to true marketing of their castings. The late Jack Steele of Grede Foundries, considered by many to be one of the industry's pioneers in marketing, described it this way: "Marketing finds the hen house, sales gathers the eggs." Most agree that too many foundry "marketing" programs have involved "egg-gathering" only.

To understand the challenges ahead, AFS' Dave Kanicki and Mike Lessiter moderated a roundtable discussion with several Engineered Casting Solutions advisory board members to examine metal castings' strengths, weaknesses, opportunities and threats. Participants included: Dwight Barnhard, CEO, Superior Aluminum Castings, Inc., Independence, Missouri; Leo Baran, Executive Director, Diecasting Development Council (DDC), Rosemont, Illinois; Jack Pohlman, Vice President, Taylor-Pohlman, Inc., Orchard Park, New York; Jitendra Shah, President, K+P Agile, Inc., Naperville, Illinois; Al Steffe, Manufacturing Engineering Director - Castings, General Motors Powertrain, Pontiac, Michigan; and Edward Vinarcik, who recently joined Navistar International Transportation Corp., Ft. Wayne, Indiana, as a senior engineer (from Visteon Automotive, Dearborn, Michigan).

STRENGTHS

Steffe led the discussion by stating that castings' big whip is the process' versatility and flexibility. "You can cast unique features and meet nearly any expectation that the customer has, provided the customer doesn't restrict you too much," he said. Barnhard added that the ability to cast near net shapes for the least cost is a considerable strength as well.

Baran said you can name just about any product application and there's a metal casting process that can get you there. In addition to properties, he noted one strength over plastics as the drive is on to put more plastics parts "under the hood."

"One of the biggest buttons we've been pushing is recyclability," he said. "You still can't recycle all those plastics. As we move toward that 100% recyclable car, that will become a much greater issue."

Vinarcik mentioned one-stop processing. "People think of stamping as a near-net shape process, but it's not - you still need to make a sheet first. In casting, we truly go from liquid metal to the part in one step."

Shah focused on the consistency issue. "Castings are more consistent than fabrications. Once you've fine-tuned your tooling and established controlled process parameters, you'll get good reproducibility as long as the process isn't altered. Fabrications can introduce a lot of consistency problems." Barnhard confirmed that his castings are often rated more consistent that the extrusions to which they are mated.

Shah also said newer technology allows previously untouched applications to be met with castings. "Rapid prototyping and soft tooling technology can allow a customer to consider castings for small order castings. For some jobs where it made sense just to hog the part out of bar stock, we see smaller quantities coming to castings due to rapid prototyping methods."

WEAKNESSES

When asked to pinpoint the hurdles castings face, Pohlman immediately expressed concern over the industry's image. "The word 'foundry' seems to paint a bad picture of a dark ages industry with poor deliveries, quality, cost control and an overall nasty place to be. Most people don't understand today's process control, computerization, X-ray testing capabilities, automatic pouring and so on. This quality and delivery perception is out there and is tough to overcome."

Barnhard added that the key to battling myths is to show that they're false. "We do everything we can to get prospects and current customers into our facility so they can see white walls, expansive lighting, robots and PLCs running machines. They'll also see sand and people sweating, but they can see us doing it in a state-of-the-art method."

Steffe added that one of the critical areas GM continues to battle is the lead-time issue. Noting that while the foundry does not always cause the problems (such as design changes), he said that "it can still take too long to get a quality product. Too many times, we don't have that stable product to work with until we're in production. The other thing is consistency. We still have difficulties from our approved casting suppliers - poor quality coming in without any explanation of why. This gives the industry a black eye. When these things happen, you'll have a heck of time trying to overcome them."

Baran echoed the customer's lack of understanding why he can't have the parts "tomorrow." He also mentioned consistency and internal porosity problems that follow castings' low-tech perception. "The ultimate problem is pricing. The London Metal Exchange causes some volatility, and some feel they can't plan long-term because of it. I've heard them say, 'if all our designs are in aluminum and the price rockets, we'll be noncompetitive,' so they decide not to design with metal."

Vinarcik shared how he's heard castings defined as "metal surrounding porosity." "Castings are at the bottom of the food chain, so it's easy for machining and assembly to push problems down to the casting supplier - the easy scapegoat." He also added that he's seen recyclability used as a weakness because of the opinion that the unknown supply stream makes metal control impossible. "The bigger challenge for the companies like the Big Three is that the engineering community designs a casting that is totally unfriendly to the casting process. When it fails, it comes back and is redesigned for another process."

Shah added that another big hurdle is the lack of specifying knowledge. "A casting can hit the machine shop, and there'll be shouting about even the tiniest problem when in reality the casting was in spec." Or, he said, they'll often overspecify what is actually needed for the part.

Noting that most of the complaints GM has about castings involve aluminum, Steffe agreed with the widely-shared negative connotation of castings. Despite what can be unnecessary cost factors, Steffe said aluminum casting buyers' expectation are parts that are as sound, solid and pure as if machined from billets.

Vinarcik also has seen instances in which only an A-1 supplier could meet the needs of a difficult cast part design, but then the part was sourced to the lowest bidder, which "screwed it up." This, he said, causes the most damage. "It could have been done as a casting and qualified sources existed, but the company wasn't willing to pay for it." Ironically, he added, they were ultimately willing to pay for the failure.

Shah also zeroed in on the educational issues that will certainly impact the industry. "There's a real lack of education and knowledge about designing for castability. The lack of young graduates well-versed in foundry technology creates a bottleneck for the industry." He added that being a target of the EPA also has put the foundry industry in a less than enviable position.

Barnhard added another obstacle that the industry itself has created. "It's Conner Warren's (Citation Corp.) line that 'It's not your competition that knows its costs that are the problem, it's those that don't.' There's still a lot of garage-type shops out there working for wages, particularly those still using the same squeezer Grandpa operated. I lost a job I've made for 20 years because my customer found someone who would make it cheaper. Now, by the time that foundry finds out they can't produce it for that cost, it'll be a negative for all parties.

"That's a significant weakness - people who don't know their costs, and thus can't make a sound business decision of whether to take the work on. That's part of the reason they're still using Grandpa's squeezer."

OPPORTUNITIES

Talking of the opportunities that exist to expand the casting market base, Barnhard said the challenge is to "beat 'em to the punch" when parts are on the drawing board. "The plastics people often get there first and simply find a way through innovation to meet the design challenges. What we need to do is say, 'OK, I know you want to work with 1 [degrees] draft, let's see what we can do' and just get the part in our shops. We may find manufacturability issues that cause problems, but if we can battle through them, we can keep the job. Once you lose a job to another method, it's so difficult for a purchaser - especially those in price-driven organizations - to come back and admit that it didn't work out."

Baran mentioned the opportunities and attention that newer processes like squeeze, semisolid and thixomolding have garnered, showing advancement in the casting processes. "Three years ago, they were only in the academic fold and now they're real processes, even if they're expensive today. The automakers have made some endorsements and now they're becoming accepted.

Pohlman said the whole industry could benefit simply by communicating where the metalcasting process does not fit. "Too often, a part design is thrown at a particular process because a foundry said it could be done. When that process doesn't fit, that process is forever bad in the customer's mind. We have a great opportunity to educate them on what die castings are best for, what sand castings are best suited for, and down the line. Foundries are part of the problem. We'd be better off if we'd say, 'I can't do that - but Foundry XYZ runs a process that would be ideal for you.' We wouldn't ruin the future sourcing of parts as castings and would be more profitable because we'd be focusing on what we do best."

Asking what-ifs, Vinarcik suggested how a software package design tool could be developed to assist in this very problem. "Just think if the designer were asked a series of questions and would input data that could ultimately get to the root of the part need, including volumes, strengths, etc. It wouldn't even mention metal type or processes. At the end, the evaluation would say, 'For this volume, these three processes and these three families of alloys could meet your product design needs.' This way, it would simply steer the designer toward the right process and metal, rather than locking in to something before all the factors are considered. Then, to take it a step further, it could search the Casting Source Directory and provide a list of AFS corporate member foundries qualified to do the work."

Steffe also stressed that foundries must first "look in the mirror." Specifically, he said they could improve their lot simply by understanding the far-reaching impact when a foundry stubs its toes with a customer. "When bad castings arrive and scrap jumps up, the result at the customer is that you interrupt the machining line, shut down assembly of the parts and end up doing a costly visual inspection. Cause a disruption like that and it'll filter to the top of the organization pretty quickly. A black eye like that can take years for people to forget, if they ever do."

Further, he said that foundries must understand the purchasing function and the importance of shorter lead times, lower price and higher quality. "The only ones who can control that are the foundries - it's up to us to satisfy them."

THREATS

A discussion followed on what would happen if the industry continues on its current path, with no concerted effort made toward marketing and application development. "We'll ultimately do ourselves in," Shah said. "For instance, I can see steel and gray iron being eaten up by ductile iron, with the chain continuing down to aluminum, magnesium and so on. We must go out after plastics and fabrications so we grow instead of just transferring dollars from one foundry to another."

Another threat, said Vinarcik, is that Mexico, China, Poland, Brazil and the Soviet Bloc nations, to name a few, are all too hungry for the work currently cast here. "As more castings are moved offshore, the result will be a lot more people hurt and a lot more environmental problems. And when a manufacturer experiences a spill with castings made overseas, he'll have to deal with a long chain of supply."

"If we don't do something, we simply perpetuate more of the same," said Pohlman. "The casting industry won't see any short and quick end - there's too many progressive producers that will continue to make headway on their own. We'll just fight the same battle and get nowhere, and ultimately it'll take more individual resources that a company will have to absorb."

Steffe said that innovation is an absolute must. "If we don't provide opportunity for foundries to be successful and generate profit margins that can't be turned back into innovations, the industry will become stagnant."

Barnhard added that someday, perhaps not in his lifetime, plastics and oil eventually will be judged all the way back to the wellhead. "When this occurs, plastics will look a whole lot different than they look now - in terms of hydrocarbons, emissions, energy use and so forth."

The Purchasing Agent's Increasing Role

A discussion also centered around the increased role of the purchasing agent, which Barnhard said is a significant trend he's seen over the last 5-10 years, namely thanks to the initiative started by GM's Senor Lopez. "Our major customers are shopping us every day, and their purchaser is being paid a bonus on that."

It was clear that the group felt that the purchaser has little stake in what method is used. "But we've found that anything we can do in our life to make the purchasing agent's life easier is in our benefit," said Pohlman. "That's why we've aimed for the one-stop approach. We've broadened our offering beyond the casting to include the patterns, the castings, the machining, the finishing, the assembly."

Vinarcik added that purchasers typically have a list of approved casters (Ford Q1, QS 9000, etc.) that makes source decisions a "no-brainer." "It takes an act of Congress to change that list."

He added that much of the purchasing community is judged only on small pieces of the pie. "We need to move up a couple of levels and talk to someone who looks at the big picture - the total costs. Someone might not select a casting when looking only at the unit piece. But as you begin looking at the entire cost picture, castings can make a lot of sense. Unfortunately, I've seen a casting replaced by 14 parts because of a perceived unit cost advantage - but this ultimately added 14 times more work."

Baran added there's only one card to play - price. "In a lot of cases, that's it. They must have the best price and want assurance that it won't jump around in the years ahead."

Shah added that getting purchasers and all others for that matter, to change how they perceive the role of castings would be an enormous stride. "Today's castings are not commodities - they are engineered components and should be talked of only in that way."

New Educational/Marketing Tools for Industry

The meeting also fostered a lengthy discussion on the collaborative possibilities for improving the picture for the application of metal castings. While it's unlikely that metalcasting will ever possess the resources to do what the American Plastics Council or U.S. Steel Alliance have done, the feeling was that initiatives that have been handled by various segments of the industry could be better concentrated. This is something that hasn't come easy for an industry so defined by its independence. In fact, laughs were shared on AFS' early day efforts with an "AFS Castings Council," a project that had been described as "requiring a priest to start the meeting."

Baran shared what the DDC has done since its inception 13 years ago. The DDC is a separate arm of the North American Die Casting Assn., which promotes die castings through its web site, OEM design literature, product design seminars, and lead generation through the placement of advertisements in engineering magazines. It currently has 134 members, who pay a monthly sales-based fee for leads and other services.

Two AFS efforts came to fruition this year that are intended to better increase awareness on metal castings - Engineered Casting Solutions magazine and the "Metalcasting - Giving Form to Innovation" CD-ROM. Developed to communicate the capabilities of cast metal components to the manufacturing design, purchasing and educational communities, the 25,000-circulation quarterly magazine is in its third mailing this month. Its editorial content focuses on all metals and processes, and includes property data, profiles of progressive casting-using OEMs, and impressive product designs and conversions. It also offers a regular, focused channel for foundries to advertise their capabilities to component designers and purchasers.

The CD-ROM, unveiled during March's AFS CastExpo, is the fruit of the first AFS Marketing Div. project funded by the Society. The CD offers an interactive, multimedia presentation on conversions, the industry's economic and environmental impact, as well as sections on foundry technologies, processes, markets and career opportunities. Firms may also may customize the CDs with their firm's information for a nominal fee, resulting in another educational and sales development tool for foundries.