Monday Morning Briefing
To start off the March 23, 2020 “Monday Morning Briefing” we are going to get all of the bad news out of the way first, namely everything to do with the “corona virus”. To start off it is obvious that everything to do with the heat treating industry in North America is slowing down in a hurry. As an example at the time this was posted the governors of California and Illinois had both issued “stay at home orders” which would appear to mean all manufacturing is effectively shut down. This means captive and commercial heat treaters and many industry suppliers will not be in production for at least two weeks. The virus has had some very strange effects including prompting auto parts giant “Linamar” to consider making ventilators in addition to auto parts as we can see in this news item; ”The CEO of Linamar says the shutdown of automakers will have an effect on its operations, while at the same time the company hopes to shift its focus on manufacturing much-needed ventilators for the health care sector. The federal government is working with manufacturers to boost production of medical equipment and supplies to handle the demand in the face of the COVID-19 pandemic. In a statement emailed to GuelphToday on Friday, Linamar CEO Linda Hasenfratz said the company is actively investigating the feasibility of manufacturing ventilators, working with a variety of partners. “Linamar is working closely with government, industry experts and other manufacturing companies to find a way to expedite expanding capacity for ventilators,” said Hasenfratz. “It is a top priority for us at the moment and one we are highly focused on.” In early March, Linamar established a task force to deal with COVID-19 and is now executing on an action plan.” Can you picture this Linamar facility in Guelph, Ontario with 25 AFC-Holcroft batch IQ furnaces making ventilator parts instead of transmission parts-we can’t.
Continuing on with “corona virus” news we see that Metal Treating Institute in the USA, an organization of many of the commercial heat treaters in the US and Canada is cancelling their spring meeting in Sonoma CA., because of the virus. Along the same lines MTI published this survey about what their members think of this crisis.
From Europe we are looking forward to a very good news press release about a major, major furnace system order being placed. We hope and expect to have something in the near future and you will read about it on “The Monty” first. These days we need more news items about furnace orders being placed and this one should fit the bill. Speaking of new orders we turn to the USA and Colombia for this one. The pictures below show a brand new Plasma Nitrider built by Ion Heat in Colombia which is in the process of being shipped to a customer in the USA. While we can’t name the customer yet we certainly will in the next few weeks. Ion Heat is a furnace manufacturer who we didn’t hear much about just a couple of years ago-that has changed as they ship more systems. By the way this system will be set up in a pit which explains why the HMI is so high in the picture below.
From McLaughlin Furnace Group we had this press release back in May of 2019; “McLaughlin Furnace Group Announces Pusher Furnace Order. McLaughlin Furnace Group based in Fort Wayne, Indiana is pleased to announce that they have received an order from a major truck component manufacturer for a two row, gas fired pusher furnace. The president and owner of the company Mr. Jeff McLaughlin had this to say about the order “We are very pleased that such a substantial manufacturer should have so much confidence in our ability to provide a state of the art system on time and on budget. This is a real milestone for our company and reinforces the fact that McLaughlin Furnace Group has grown to be one of the largest and most diversified in the North American furnace manufacturing industry”. McLaughlin Group expects the furnace to be installed and in operation the fourth quarter of 2019.”
The end customer as mentioned was Volvo Powertrain in Maryland, USA and McLaughlin has this update; “McLaughlin Furnace Group is pleased to announce that this furnace installation is now complete with the furnace meeting all of the customers criteria and requirements, on time and on budget.” The photos below show the partially completed project at Volvo and also Jeff relaxing after the job was completed.
Meritor Chicago (formerly AxleTech) has some surplus heat treating equipment. This auto parts manufacturer and captive heat treater maintains a large facility in the Chicago area, however some of the equipment has not been used for many years and is on the used market. While this includes some highly desirable Surface Combustion 36 X 72 X 36 batch IQ furnaces, they are older vintage and have not been used for quite some time which in this market is going to limit their desirability.
And to round things out we go back to a news item we had a week about how shipments from China to the rest of the world are resuming as factories there resume production. Of most interest to heat treaters are moly and alloy products sourced from the country. As it turns out it is entirely true that deliveries have resumed and are very much back on track-ahead of schedule in some cases. A small but very surmountable obstacle that we just learned about is that as shipments have resumed airfreight shipping costs have gone up slightly because of reduced flights from China meaning less competition. Well that didn’t occur to us although it should have-time will take care of this.