2008 Predictions. In retrospect the year 2007 will generally be fondly remembered by most captive and commercial heat treaters in North America and around the world.. Granted the wild ride that nickel pricing took us on, escalating energy costs and trials and tribulations within the automotive industry caused a certain amount of anxiety but overall it was a good year for most. Will it continue in 2008? This is our forecast for the upcoming year;  

-captive and commercial heat treaters on the US West coast will continue to see the good times roll as a direct result of the aerospace industry. Likewise Texas and the southern US will continue to boom because of the oil and gas industries. On the other side of the coin Michigan, Ohio and Canada will see heat treaters continue to struggle to some extent because of the downturn in the domestic auto industry, with Canada in particular struggling because of the increase in value of the Canadian dollar vs.; the US dollar. Don't get us wrong though, the large commercial shops in these areas will reap the benefits of continued outsourcing within the auto industry while the smaller operations will have "challenges" in 2008. Simply put to handle automotive volumes and specifications you need deep pockets. Outside of these geographic regions we are of the opinion that most areas will not change a great deal in 2008.

-after a slow year for acquisitions within the commercial field watch for a substantial increase in 2008 as a direct result of the increased profits of 2007. What better time to sell than when you're coming off of a couple of banner sales years?

-while most of the new furnace builders had a very good 2007 watch for a decrease in new orders from North America with some increase in new orders from overseas-due to the weakness in the US dollar. At the same time you will find European manufacturers of furnaces definitely struggling to sell into NA with Asian manufacturers remaining pretty much where they now are, an insignificant portion of the new furnace market. North American companies are not yet ready to buy new equipment from overseas companies with no proven track record and no established service network.

-one of the fastest growing segments of the heat treating business will be that having to do with wind generation. Already large used pit furnaces for windmill gears have become almost impossible to find, resulting in growth of the sale of new pit furnaces and batch IQ units.

-a trend that we remarked upon earlier this year was the switch from Nitrogen/Methanol to Endo generators due to lower costs from Endo generators. On this one we were dead on the money and a number of captive and commercial shops made the switch over the past year with more to follow in the very near future.

-while we do not see any enormous growth in vacuum carburizing in the near future certainly auto parts makers (in particular gear manufacturers) will continue to push for more VC as an alternative to traditional carburizing systems. While we are talking about technologies we continue to believe that Ion Nitriding will grow along with increases in the Induction field.

-our longest shot prediction? Nickel pricing will not see the enormous fluctuations that it did in 2007 and will remain fairly stable. But don't buy your alloy or not buy it based upon this prediction.

January 2008