Well the installation has been proceeding for the past few months and Atlantic expects to be bringing the VFS 2 bar unit on line in the very near future.
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Southwest Metal Treating Corp., (SWMT) Heat Treating Texas – Southwest Metal Treating is a family owned commercial heat treater in business for over 40 years run by Mr. Ryan Fussell. The company is full service in that it offers most heat treating processes including but not limited to; vacuum heat treating, carburizing, nitro carburizing, flame hardening, normalizing, stress relieving and Plasma Nitriding. Plasma Nitriding is a relatively new addition to the company in that it was added just a few months ago-a picture of which is included. The company operates out of a 50,000 square foot facility located on 7 acres. We feel quite comfortable including the firm on our list of the 50 largest in North America.
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From furnace builder SECO/WARWICK we have this fascinating report about how the company fared in 2021. The firm tells us sales in dollars, where the sales occurred and which markets were most successful for the company. We won’t keep you in suspense, in this report you find this statement; “New orders in between January and September 2021 totaled PLN 330 million.” At today’s exchange rates this translates to roughly $84 million USD.
“The year 2021 was one of the best years in the history of the SECO/WARWICK Group. Individual subsidiaries recorded significant increases in the order numbers, for example, in the Year of the OX, the Chinese company has seen record sales, especially in terms of sales of the lines for the manufacture of car battery coolers.
The American subsidiary – SECO/VACUUM, which celebrates its fifth anniversary this year, remains under the strong influence of a bull, a symbol of more than just a bull market. The company has secured (in the first three quarters of 2021) orders amounting to $15 million (a 56% increase y/y – $9.65 million). SECO/VACUUM forecasts that on a year-over-year basis, order number growth will reach 30%. In short, the SECO/WARWICK Group has strengthened its position as the first-choice company for metal heat treatment solutions.
About the Finances of SECO/WARWICK; There is no doubt that last year was a challenge, due to disrupted supply chains and overflowing production halls. However, this has not prevented SECO/WARWICK from succeeding. In 2021, the VAC (vacuum furnaces) and CAB (protective atmosphere brazing equipment) segments had the most orders completed, although the record-size contract carried out by the VME (vacuum metallurgy equipment) segment should also be highlighted.
The total value of the Group’s sales for the first three quarters of 2021 increased by 18% y/y to PLN 335 million, of which the Asian market accounted for the largest share (nearly 30%), followed by the US (27%) and the European Union (nearly 25% of sales).
American dream of growth, expansion and awards; Last year, the US subsidiary – SECO/VACUUM – secured dozens of orders, mainly from the aerospace industry and the tool industry where almost 75% (which is encouraging and gratifying) was constituted by returning customers. SECO/VACUUM will close 2021 with a 30% increase in the number of orders.
For the Group’s second American company – RETECH – 2021 was also successful. The move to Buffalo brings new operational opportunities and tremendous growth potential. RETECH is currently focused on introducing innovative solutions, such as advanced metal powder furnaces. At the same time, it continues to develop the PAM (Plasma Arc Melting) furnace segment, remaining the world’s leading supplier, offering a PAM furnace that has passed the rigorous testing required for titanium melting and refining technology for the aerospace industry.
In August, at one of the most important events summarizing the economic cooperation between the US. and Central and Eastern Europe “USA-Central Eastern Europe Investment Summit & Awards,” SECO/WARWICK received the award in the category “Most Successful Expansion on the American market.” The US market is a key sales area, hence the presence of as many as three subsidiaries there. SECO/WARWICK equipment operates in major US companies in such strategic branches as defense, power engineering, aerospace, and automotive. Our current order book indicates that the share in the North American market will grow significantly this year and will reach over 30% in subsequent periods.
The Year of the Ox – offensive of the subsidiaries; SECO/WARWICK China, had a record year, full of new orders. In 2021, the Chinese company sold as many as 15 CAB lines. This is a nearly 70% increase from 2020. The eight lines sold are solutions that will be used to manufacture battery coolers for electric and hybrid-electric vehicles, which is currently one of the most promising developments. The growth of the electromobility segment, legal regulations and the increasing awareness of the global society – associated with the need to care for the environment makes SECO/WARWICK have high hopes for the product line dedicated to battery coolers.
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We’ve just received news that FPM based out of Illinois has received their 18 month merit after having a Nadcap audit. FPM is also ranked 16th on The Monty’s 50 Largest North American Commercial Heat Treats 2021. For more details please click the link below.
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”MARIEMONT, Ohio (WXIX) – Fire caused $75,000 in damage to a Mariemont business overnight, fire officials say. Firefighters from both Mariemont and neighboring Cincinnati responded to a report of a fire at Cincinnati Steel Treating on Mariemont Avenue about 11:45 p.m. Sunday. A furnace caught on fire, resulting in heavy smoke and flames and a gas leak, said Mariemont Assistant Fire Chief Dan Copeland. It took fire crews about 45 minutes to extinguish the blaze. Four workers who were inside the business when the fire broke out made it safely out, according to the assistant chief. No injuries were reported.”
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The Industrial Heating Equipment Association (IHEA) provides on a monthly basis a very well thought out summary of the state of manufacturing in the US. As heat treating follows manufacturing these summaries can provide good insight into the future of our industry. The entire report can be found at IHEA Executive Economic Update Analysis – 2111.pdf
“December 2021; Over the last two years of economic crisis manufacturing has, to some extent, avoided the worst of it. This has not been the case for all manufacturers as there have been sectors that have been slammed hard by the recession in 2020 and the myriad of problems triggered by high growth recovery in 2021 but there have been trends that provided an unexpected benefit to other sectors. As we proceed into 2022 this pattern is likely to continue with more opportunity for gain in a wider variety of manufacturing segments.
Reason for optimism number one is the continued interest in reshoring and onshoring. The prime motivation for companies seeking to bring production back to the US has been the breakdown of the supply chain in 2021. It has become apparent that this is not a temporary phenomenon. The impact of the pandemic will last for years, geopolitical tensions are ratcheting up and the production cost advantages enjoyed by overseas markets have faded. More companies than ever have been seeking domestic producers.
Reason for optimism number two is the continued expansion of technology. The labor shortage in the US is not going away and the only realistic response is for manufacturers to turn more aggressively towards robotics and automation to do these jobs. The good news is that the technological gains have been impressive and the costs have become more manageable. The advance in technological expertise has allowed the US to regain a competitive edge.
Reason for optimism number three is the potential for global recovery. Exports account for over 15% of the total US GDP and that is about $2.1 trillion. Of that total, manufacturing accounts for over 83% of all goods exported. It is a huge part of the economy and if the rest of the world has started to see recovery that means that demand for these exports will rise accordingly. The vast majority of US manufacturing exports go to ten trade partners and all ten have been showing some definite signs of economic rebound.
Reason for pessimism number one is continued inflationary pressure. In general, manufacturers get hit harder by inflation than recession. The fact is that most manufacturers are selling into larger companies and assembly operations. Fully 75% of US manufacturers have less than 25 employees and are classified as small to medium sized businesses. They get hit by higher priced commodities and intermediate parts, higher logistics costs and higher labor costs and rarely have the opportunity to pass these hikes on to their customers. There is only so much of this inflationary environment they can handle. At this point the assertion is that inflation will start to recede by the second quarter but it will still remain higher than it was even in 2019. If wage inflation takes off and starts a wage-price spiral, the threat becomes even more pronounced.
Reason for pessimism number two is consumer retreat. The consumer was able to muddle through the recession in 2020 with a great deal of government help. The US spent the equivalent of the Japanese GDP ($5 trillion) on stimulus of some kind or the other. That allowed the consumer to keep spending and resulted in a massive increase in savings. At one point the global economy had over $7 trillion in excess savings and that was the cash that drove all the spending in 2021. The savings overhang is now depleted and there is no more such assistance in the cards. There is no more coming from Congress and the Federal Reserve has switched gears and is now oriented towards fighting inflation with reduced bond buying and higher interest rates. This means that consumers are basically on their own this time. If there is a downturn, they can’t expect a lot of help and that could mean a sharp reduction in their willingness to consume – services or goods. The latest outbreak of the virus has pushed consumers back to a more cautious position – not as drastic as that which took place in 2020 but restrained, nonetheless. The optimistic outlook holds that the omicron variant starts to fade by Q2 and consumers respond with another round of spending, but there are also those that assert the consumer will stay in semi-isolation for much longer. Beyond that, there is no reason that yet another variant will emerge as we are all familiar with how fast that can develop.
New Automobile & Light Truck Sales
New Automobile & Light Truck Sales The automotive sector continues to be the barometer for the economy as a whole. The drastic slump in sales that has marked the last year or so has been almost entirely due to supply chain issues rather than any real slide in consumer demand. There are some very interesting developments on the horizon. The supply chain issue has slowly improved although it remains a major inhibition. Six months ago, the carmakers were missing dozens of critical parts and assemblies, today that number has fallen drastically to just a few critical parts. The chip shortage has been easing and there has been an opportunity to catch up on some of the production but full operation at all factories and for all models is still seen as some months away. Meanwhile the demand for new vehicles has continued to build and car dealers assert they could sell their inventory in a matter of weeks if they could get it. The threat that most worries the sector now is inflation. Not only does this make the vehicles more expensive but if interest rates climb as expected the car loan will become more costly as well. The worst-case scenario would be a situation where inventories finally swell but vehicles cost more and loans become more expensive. It would be the opposite of what is happening now – high levels of inventory and lower demand
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Out in Racine, Wisconsin, commercial heat treater Hestia Heat Treat has made our news section a couple of times over the years as can be seen below. They grace our pages yet again for their new FNC furnace which can offer FNC, FNC + Post-Ox, and Gas Nitriding treatments. The furnace has working dimensions of 36″ x 32″ x 72″ with a 5500 pound capacity.
“October 2020 PRESS RELEASE Hestia Heat Treat, Racine Wisconsin To Add Nitriding Capacity; Out in Racine, Wisconsin, USA we see that commercial heat treater Hestia Heat Treat which was formerly Racine Heat Treat is making an impressive investment. Darius Szczekocki, the owner recently made the decision to invest in a new Nitrex gas nitriding system. For some background on the company we would refer you to the press release below which we published back in 2017 when Darius purchased the company. For more information about Hestia we would also suggest https://hestiaheattreat.com/“
“May 1/2017 Hestia Heat Treat, Racine, Wisconsin; If you are scratching your head asking who the heck Hestia Heat Treat is you are certainly not alone as we had not heard the name until yesterday. Hestia Heat Treat is the new name of Racine Heat Treat in Racine, Wisconsin, USA. Racine HT has been around for many years with at least two owners in the past few years, however very recently it was bought by a fellow by the name of Darius Szczekocki who brings to the company a new name and a wealth of experience. Darius has spent a number of years in the industry with companies such as Bodycote and most recently as General Manager at Bluewater Thermal another commercial heat treater. Hestia Heat Treat has a number of Ipsen batch IQ furnaces and vacuum units. We wish him the best of luck.
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In New York state, Pyrotek a captive heat treater show supplier metal components for batteries suffered a strong fire last week, lucking no one was injured; “WHEATFIELD, N.Y., USA – Niagara County fire investigators are looking into an industrial fire that happened Friday in Wheatfield. The fire happened at Pyrotek, a metal heat treatment company. According to an operations manager at the scene, the fire started in the furnace system, then spread to the building and throughout the plant. Pyrotek treats metals at a very high temperature in furnaces for products that are ultimately used in lithium-ion batteries. The plant was evacuated, and no one was hurt. Niagara County Sheriff’s deputies responded to the scene, along with members of Bergholz Volunteer Fire Company, Sanborn Volunteer Fire Company, and the Niagara Falls Air Reserve Station.”
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Below is a press release about Applied Thermal Technologies retaining their 2 year merit status with PRI/Nadcap. Applied Thermal Technologies also ranks 39th on our list of largest commercial heat treaters for 2021. https://themonty.com/articles/50-largest-north-american-commercial-heat-treats-2021-2/
In December of 2021, Applied Thermal Technologies, out of Warsaw, Indiana has retained its 2 year merit status with PRI/Nadcap. This is also the second audit in which we had our lab accredited for metallography, microindentation and near surface examinations. This is nothing but a team effort from management who put in long hours along with staff who are willing to work together and keep quality a top priority! Scope of heat treat can be seen here: https://www.appliedthermaltechnologies.com/sites/default/files/Scope-Of-Accreditation-Nadcap-Aerospace-Heat-Treating-Exp-2.29.24.pdf which includes many types of vacuum heat treating and brazing.
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January 6th of this year we kicked off our ongoing search to find the 10 largest single location captive heat treaters in North America, this can be found at Largest North American Captive Heat Treaters-Vacuum Carburizing (LPC) | The Monty As you can read we were a touch surprised to find out that a number of the largest are auto firms focusing on a single process, that being vacuum carburizing.
During the course of our research a number of readers offered thoughts, comments and ideas on the history of vacuum carburizing as it relates to the auto industry. While these comments focus more on commercial heat treaters doing vacuum carburizing it very neatly leads into how GM and Ford ended up slowly bringing vacuum carburizing in house.
The Bodycote and ALD legacies are still intact today as “contract suppliers” of LPC but to a much lesser extent than the halcyon days of 2006 – 2017. ALD still has most of the 37 installed chambers in the US and 18 installed in Mexico. Bodycote still maintains their facilities in Livonia MI and San Luis Potosí, Silao Mexico with more than 30 chambers collectively. GM has committed more than 20 chambers to a differential case LPC operation facility in Wyoming Michigan and has installed equipment in several transmission plants.”
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