Casting buyers have noticed that finding suppliers with wide open capacity is more challenging than in the recent past. Following a couple of soft years, the metalcasting industry, along with U.S. manufacturing in general, experienced years of strong growth in 2017 and 2018. Foundry utilization—the amount of casting tons produced out of the U.S. metalcasting industry’s total production capacity—has gone up. But how exactly is capacity measured? The answer is: it depends.
The more traditional way to look at a foundry’s production capacity is to look at how many castings or molds can be produced on a molding machine within a time period. This time period could be a single shift, a full 24-hour day, or even an annual average.
“When I think of capacity, I think of production capacity,” said Keith DiGrazio, president, AFS Corporate Member Richmond Industries (Dayton, New Jersey). “Big picture for me is how many hours a day are we running our machines.”
At Richmond Industries, two automatic green sand molding lines operate on one shift per day. For rough capacity estimates, DiGrazio will tally up how much each machine is running in that shift. If one machine is running the full shift and the other is going about half a day, he figures his plant is at about 60-70% capacity. But capacity, DiGrazio pointed out, is a fluid thing.
“It’s silly for us to say we are at capacity,” he said. “If a customer asks [how much of their product we can accommodate], I just tell them to sell their products, and we’ll figure it out on our end, either by adding staff or going into a second shift.”
Foundries with multiple molding lines or processes can also reexamine how they are scheduling jobs to wring out additional machine time.
“We have four or five ways to make a casting and that can affect our backlog per machine,” said Gwen Krenecki, manager, Lodi Iron Works (Lodi, California). “Sometimes we can move things around if the size is allowed—we have a lot of options.”
Jobs can be moved to different machines, or patterns can be re-evaluated to produce more castings per mold.
“We have two different machines and we are constantly looking at the product mix to put out more molds using both machines,” DiGrazio said. “That’s why capacity changes. The current capacity doesn’t really count how many changes you can make to a current job. This last month was our biggest month ever. Compared to the same month last year, production was up 60%. I am amazed we got that much product out, but we did. Part of adding capacity is figuring better ways to get the product out.”
Staffing and production levels go hand-in-hand. When orders increase and it’s time to ramp up production, foundries will start to increase staffing to ensure lead times don’t get out of hand for their customers.
“Last year, we were under capacity and pouring one or two days a week, and we were staffed for that,” Krenecki said. “Now we are pouring 3-4 days, so we added more staff. It’s what cuts that lead time down as the backlog builds up. With a 5-10-person increase, we can double our capacity.”
Krenecki notes that in some cases, a busier foundry can mean better lead times for the customer, especially for low to medium volumes in specialty alloys.
“Metal type can dictate delivery time—it depends on how specialized the metal is,” Krenecki said. “Every time you change to a new material, there is a cost, so we try to pour the same material in a day. When we are slow, it might hurt our leadtimes because we might not have enough of a mix to pour a specific job. As we get busier, we are pouring more often.”
The scenario is similar for Tooling & Equipment International (Livonia, Michigan), a shop that specializes in quick turnarounds and prototyping.
“For multiple projects using the same alloy, we try to combine them,” said Oliver Johnson, president, TEI. “If it is a special alloy, we look ahead at all the projects we have and all the alloys coming in and try to do a common casting event.”
As a prototype shop, TEI doesn’t face high volumes that pushes capacity to extreme levels, but when orders are up, the casting and machining shop get busy.
Clever scheduling is necessary.
“What we supply in nearly every case is a finished machined part,” Johnson said. “The foundry is rarely a bottleneck in controlling lead time. It’s more typical that machining controls it—the time to manufacture the fixtures, programing, machining and proving out the parts. We are all about time compression, flexibility and speed to manufacture, so our set up is designed to be flexible.”
Calculating true capacity utilization is difficult and can vary by markets served, metals poured, and a plant’s flexibility to add shifts of work. But in an informal survey, most foundries report being at 65% or more, with a significant chunk operating at above 80% in 2018.
As of October 2018, the U.S. unemployment rate is 3.7%, and some metalcasters are finding labor the new limiting factor to production. One anonymous foundry noted it is operating at 70% capacity by plant/equipment availability but 120% capacity based on its current labor level.
A high volume foundry currently running three shifts is reporting a similar challenge. Typically, the plant defined capacity by the amount of molds the plant could produce. That is not the case anymore.
The labor supply has become more difficult over the course of the year, and foundries are looking at creative ways to attract and retain employees with incentives, lower health insurance costs for employees, and even recruiting outside the local area.
While metalcasting production trends are historically cyclical, and some economists are predicting the current economic expansion to slow, many foundries foresee staffing to be a continual challenge. The shallow employee prospect pool is not just for one area of the foundry. It’s been difficult to find engineering staff, as well.
Beyond employment levels, other factors that could affect capacity or leadtimes include the stalled delivery of materials needed to produce castings on the foundry end, and bottlenecks in time-consuming departments such as finishing and machining.
If capacity or lead times are a concern, buyers should talk with their casting sources. The metalcasting industry is diverse, and factors affecting lead time vary. Direct communication with the foundry could help ensure there is enough capacity to fill an order when it is needed.
Click here to see this story as it appears in the November/December 2018 issue of MCDP.