Process Integration Boosts American Manufacturing
After the traditional summer slowdown in machine tool orders, it was encouraging to see the activity in September. With overall IMTS registration up 20 percent, and the number of visitors to our booth double the previous show, it was clear that we are in a vibrant U.S. manufacturing economy. The activity was lead by the aircraft and aerospace industries, followed by the contract manufacturers serving multiple industries. It was also encouraging to see the activity virtually equally divided between small, mid-size and large companies.
A common goal among companies of all sizes is process integration. There was high interest in the entry-level, five-axis machining centers. On the other end of the spectrum, manufacturers are looking at how they can push the envelope with entirely new applications. This might include in-process grind hardening of shafts on a turn-mill platform, for example. These technologies can eliminate specialized equipment and shorten time to delivery. This trend is driven by the increasing complexity of manufactured components, the need for process efficiency, and the chronic shortage of skilled machinists.
Delivering innovative technology is not our only focus. In a recent survey, almost half of our customers reported their biggest business challenge of the coming year to be finding qualified employees. Our corporate university focuses on skills development for those already on the job. The university faculty is also active in outreach to student organizations to develop the next generation of manufacturing personnel. Earlier this year, we launched a full-time apprenticeship program to make sure we have the capacity to support our customers in the near future. In turn, customers want to know how they can join this program.
During 2012, we continue to strengthen the global cooperation between DMG and Mori Seiki by integrating sales networks and procurement, and pursuing joint product development. The collaboration, now in almost every country, positions the companies to provide high quality products and services to manufacturers worldwide as quickly as possible.
With consumption of machine tools expanding globally, so follows the globalization of production bases and sales bases. It is important to manage the risk of currency exchange fluctuation with local procurement and production, and minimize transport leadtime and cost by producing machines in those regions with greatest demand. The Mori Seiki Manufacturing USA facility in Davis, Calif., began operations in July this year. Another in Tainjin, China, is scheduled to start operation in fall 2013.
The Davis plant is a prime example of this strategy. This 200,000-square-foot facility is the first Mori Seiki manufacturing plant in North America. Building machines in California means delivery times for key product lines will be drastically reduced. Manufacturing close to the customer helps us offer the most price-competitive solutions. And finally, it balances the global portfolio of DMG and Mori Seiki production, which until now has been limited to Europe and Japan.
Approximately 40 percent of all materials are currently purchased from U.S. suppliers. The remaining 60 percent includes components manufactured at Mori Seiki factories in Japan and other sources. The goal is to increase domestic content to as high as 70 percent.
The location just west of Sacramento, in Davis, was a logical choice. This has been the home of Mori Seiki’s research and development facility, called Digital Technology Laboratory (DTL). DTL has long been a software development and machine design resource for Mori Seiki factories in Japan. So in this case, manufacturing followed design, with many of the almost 100 engineers at DTL moving to new factory positions in machining, assembly and so on. This location also leverages our close relationship with the University of California campuses at Davis and Berkeley.
When fully operational, the factory will produce 100 or more high precision machines per month. With a focus on serving the North American market, the NHX4000 horizontal machining center is the first model in production in 2012. It will be followed by the larger NHX5000 and NHX6300. Future production plans include DMG-designed models, possibly the compact five-axis machines.
I encourage manufacturers to visit the new Mori Seiki manufacturing campus to experience the capabilities and advantages that DMG/Mori Seiki USA is providing for domestic users.