Tag Archives: Austempered Steel

Applied Process Inc. is Ringing in the New Year

Happy 2012!  Applied Process is ringing in the new year in a big way.  We raised our glasses and toasted a record 2011 and up and down the manufacturing landscape 2012 looks even better.  For all this we are very grateful…..but we’re not sitting still.  We’ve expanded capacity steadily over the last 18 months and are anxiously awaiting the commissioning of our Monster Parts™ Division.

The Monster Parts™ furnace equipment was arriving at Oshkosh this week and, lo and behold, the first truck led with a Hostile Duck hood ornament. Coincidence?  I think NOT!  After all, we are the HOME of Hostile Duck Iron™.

And what is that, literally, streaking across the Wisconsin sky?  It’s not a bird.  It’s not a plane.  It’s SUPER TANK capable of holding 200 tons of molten salt in a single charge!  (Soon you’ll be able to view the adventure of the Monster Parts™ line on YouTube…..stay tuned).  The Monster Parts™ furnace line will be commissioned in a few months and will be capable of running gross loads of up to 10 tons…..or skads of rangey parts up to 250 cubic feet per load.  When we say it’s a MONSTER, we mean it……and the MONSTER is coming soon.

We’re also pleased to announce (effective 31 December 2011) the sale of our AP Suzhou (China) facility to our minority partners David Chang and Andy Chen.  The Suzhou facility will be re-branded “Suzhou ADI” and, with its sister plant, Jilin ADI, will operate under technical license to Applied Process Inc..  We’re growing the pie east and west!

Dr. Kathy and the R&D crew, Vasko Popovski and the sales team and the Plant Manager Steves (Sumner, Metz and Gladieux) are working on lots of great new cost and energy saving conversions.  Since “lightweighting” is the new buzzword in the transportation industries we’re taking the lead, helping to develop cost effective, lightweight components in ADI, LADI,  Austempered and Carbo-Austempered™ steel.

We read the paper and listen to the talking heads on the news and we sometimes forget to look around us and see what’s really happening.  Some say “we don’t make anything here any more”.  They are misinformed.  We manufacture more stuff in the USA than any other country…….and it’s not even close.  Right now if you are in a US business involved in agriculture, mining/energy or manufacturing, times are pretty good……and getting better.  New, clever, equipment designs are increasing productivity on farms and in factories and making US made goods more competitive in foreign markets.  Those wealth-producing segments of the economy (ag, mining/energy and manufacturing) are the source of the nation’s wealth…….and they are rising even against strong tax and regulatory head winds.  What we do….Austempering…..is a process step in those segments.

Our mission is to “Grow the Pie”.  So the next time somebody asks me what I do for a living I could give them my elevator speech; “I’m in the heat treating business.  I specialize in the Austempering process.  I get paid to heat treat people’s parts.  But what I really do for a living is help customers convert components from one material process combination to a better, faster, cheaper one”.  Or it might just be easier to say; “I’m in manufacturing.  Creating wealth right here in the USA…..care to join me?”.  Now if the politicians would just get out of our way…..

Austempering is Riding the Wave of US Manufacturing Growth

We get paid to Austemper people’s steel and iron parts.  What we really do for a living is help current (and potential) customers replace one material/process combination with a better, faster, cheaper one.  Very often, that solution includes Austempered Steel, Carbo-Austempered™ steel, Austempered Ductile Iron (ADI), Carbidic Austempered Ductile Iron (CADI™), LADI™ or Austempered Gray Iron (AGI).  US manufacturers are discovering the benefits and thriving with the results.

According to an article in IndustryWeek.com (www.industryweek.com) by Carlos Cardoso, President, Chairman and CEO of Latrobe, PA based Kennemetal (www.kennemetal.com ), manufacturing is leading the recovery and our elected officials are finally starting to take notice.  Mr. Cardoso shares a long held belief of this author when he says, “To grow our economy, we have to make something or grow something, plain and simple”.  Amen.

Jobs result when wealth is created.  Jobs created by governments or handouts are gone when the budget or stipend ends.  Jobs resulting from wealth creation are self sustaining.  In fact, in 2009 the average manufacturing worker made 17% more than a non-manufacturing worker.  According to the same article, manufacturing supports 18.6 million jobs in the US, and employs 12 million workers (9% of the workforce) directly in manufacturing.

In a recent conversation with this blogger, Brian Beaulieu, CEO of the Institute for Trend Research (www.itreconomics.com ), an economic consulting firm, indicated that we can expect continued growth at least into the first half of 2013.  After that, the jury is still out.  Recent talk about an imminent “double dip” recession is not helping peoples’ confidence.  Brian exhorted us to, “Keep the faith…no economic bust for the next 22 months”.  There, Brian, it’s in writing, ready or not.  Readers of this blog will be looking back in June of 2013 to see how you did!

It’s also easy to get a little depressed when high profile, big wigs like Donald Trump say things like, “We don’t make anything here anymore”.  I like his moxy but he seems to be a bit of an economic idiot.  According to IndustryWeek.com the US is the world’s largest manufacturing economy, producing 21% of all manufactured goods worldwide…..and doing it with under 6% of the world’s population.  You wouldn’t know it to listen to the news, but the US produces about 1.5 times more manufactured goods than China with about one fourth the population.

As to the notion that manufacturing is declining and we are becoming a “service economy”; don’t you believe it.  According to the IndstryWeek.com article, US GDP and US manufactured goods have both grown by about seven times (in inflation adjusted prices) since 1947.  Look around.  Our manufacturing plants are humming and backlogs are sizeable.  Construction equipment production is up by over 60% this year.  Heavy truck production is up by 50% and there is a 115,000 unit backlog for Class 8 tractors.  Class 8 trailer manufacturers are working through a 100,000 trailer backlog.  Railcar orders will double this year and there’s a 12,000 car backlog.  John Deere could sell an additional 19 combines per week if they could just get the parts and build them fast enough.  In manufacturing, there’s plenty of good news to go around and Applied Process Inc. is glad to be working with our manufacturing partners to grow the pie.

Strap in.  If Brian Beaulieu is right, we’ve got plenty of work to do.  Like Mike Rowe of popular show “Dirty Jobs” says, “We Make America”.  So do we, Mike; so do we.

Austempering- A Critical Process for Lots and Lots of Heavy Trucks….if they could just build ’em.

Austempered steel and iron components are critical to today’s Class 8 Trucks (over the road trucks with load capacity exceeding 33,000 lbs).  Austempered Gray Iron (AGI) cylinder liners make diesels more durable.  Austempered Ductile Iron (ADI) suspension, powertrain and engine components make those systems quieter, lighter, more durable and cost effective.  (In fact, heavy truck is the number one market segment for ADI worldwide).  Austempered and Carbo-Austemperedsm components in heavy duty powertrains push their performance envelopes.  Applied Process is proud to be a world-wide leader in Austempering technology and the significant role we play in the production of world-class heavy trucks.

Today’s Class 8 trucks are lighter, more powerful (yet more efficient) and more durable than ever.  Tiered, increasing Federal engine regulations in the last ten years have caused sales to lurch initially up, and then downward, from over 350,000 units per year at the peak to less than 150,000 units last year.  But those regulations (and the Great Recession) are now behind us and demand is stirring.  With TransCore’s North American Freight Index running 10-15% ahead of last year month-to-month and fuel prices moderating, trucking firms are in a buying mood.  Heavy Duty Tucking reported on research by ACT Research that orders in the first quarter of 2011 are the strongest since 2006.  In fact, the article reports that the backlog (as of June) of orders for new, Class 8 trucks is an eye-popping 126,000 units……a 55 month high.

In an interview with Heavy Duty Trucking, Navistar’s Senior VP of North American Sales was quoted as saying, “There are a lot of orders out there, but I’m going to tell you something: they aren’t going to get built because (there) just isn’t the supply base out there to handle the kinds of increases we’re seeing”.  Ditto comments by the President and CEO of Daimler Trucks North America, Martin Daum made at the Mid-America Trucking Show.  Hebe referred to supply chain problems with “tier two and three” suppliers in places like India, China and Korea failing to deliver and then, “the whole thing falls apart”.  In the interview Herbe verbalized what we already know, that “A lot of production has also moved to Mexico in the past few years.  There isn’t the capability to ramp up capacity in those other countries like we have here.  It’s just not going to happen”.

Hmmm, that would seem to be an endorsement of US production capabilities.  If they went off shore for components and moved assembly to Mexico to save money and now cannot produce say, 50,000 additional trucks this year, I wonder how much money they actually saved?

So, this year in North America we’ll build 225,000 or up to 300,000 trucks depending on how well the Indian, Korean, Chinese and Mexican suppliers do?  Thank goodness for our Steady Eddy US manufacturing customers who are stretched to the limit, but supplying high quality components just-about-on-time. I’m all for sourcing parts in China for the Chinese market, or in India for the Indian market, or in Korea for the Korean market,  but do you think the Class 8 OEM’s might re-think sourcing parts in those countries bound for trucks built in North America?  I guess this year the answer to that question will depend on how much the “low-cost” outsourcing costs them in new truck sales.  Don’t mind me. I’m just the heat treater…..it must take a high-paid OEM bean counter to figure this stuff out.