Although we recently covered plant closings, buyouts and consolidations roiling the forgings and castings industry, there have been few bright spots as pressure continues on an industry where high volumes are generally a prerequisite for survival.

A healthy metalcasting industry is critically important to a healthy bearing industry. The two component types are so fundamentally intertwined in product design, application and manufacturing that a weakened metalcasting industry necessarily leads to weakness across the bearing industry.

Today, there is very little profit remaining in most ends of the metalcasting industry; in 2006, the American Foundry Society estimated its members managed to net just 5%, and margins are significantly lower today.

article: U.S. Cast Parts Industry Pain
Alcoa announced it will shut down its automotive wheel casting plant and sell off several other divisions considered as non-core. While Alcoa will still produce forged wheels, the cast wheel plant in Beloit, Wisconsin will be closed by June 1, 2009. Approximately 260 people will lose their jobs in Beloit but the business unit remains up for sale. Alcoa is in the midst of a massive restructuring which cuts output, freezes wages, reduces its workforce by 15%, shutters several underperforming units and cuts capex in half.

Similarly, Superior Industries is also shutting down an aluminum wheel casting plant in Van Nuys, California and laying off its remaining 290 workers. Superior's headquarters are in Van Nuys, and it had been one of the area's largest manufacturing employers, at one time with over 700 in the plant. Lately, Van Nuys has been reduced to producing specialty and low-volume wheels. This past December, Superior closed a plant in Pittsburg, Kansas, laying off more than 600. Pittsburg's closing was announced in August 2008; it was the area's third-largest employer. In 2006, the company closed a cast wheel plant in Johnson City, Tennessee and laid off 500 workers. Layoffs had also plagued larger Superior plants in Fayetteville and Rogers, Arkansas, accounting for 30% of Superior's workforce before the Van Nuys announcement. In 2007, Superior opened a new plant in Chihuahua, Mexico, where costs are reportedly one third of what they are in the U.S. The company did not indicate what portion of its U.S. production has been lost to falling demand, and what portion has moved to Mexico. Superior also has a casting plant in Hungary to service the European market. Superior supplies most of the world's automakers and has a 30% market share in the U.S., but 80% of its sales are to Ford, GM and Chrysler.

Contech, as expected, has filed for Chapter 11 bankruptcy protection for its facilities in the United States. The move is part of a larger restructuring for all of its casting and forging operations, as the company hopes to reduce its operating costs more in line with current auto industry and industrial demand. Contech said it will continue operating and expects to exit bankruptcy later this year with an, "improved balance sheet and greater operating flexibility."

Neenah Enterprises announced the closing of its Dalton Corp. division plant in Kendalville, Indiana. Two other factories in Warsaw, Indiana and Stryker, Ohio are unaffected. Dalton produces large gray iron castings for HVAC equipment, engines, truck transmission cases, and large industrial equipment.

Neenah will also close its Gregg Industries division. Located in El Monte, California, Gregg produces cored iron castings, primarily for customers in the heavy truck and heavy industrial equipment markets.

The Nemak/Ford joint venture has formally closed its Essex Aluminum Plant in Ontario, Canada. Built in 1981 by Ford as a state-of-the-art caster, Essex supplied engine blocks, cylinder heads and other parts. Nemak, a Mexico-based aluminum metalcasting supplier to the auto industry, has 29 factories in 13 countries. Nemak became joint venture partners with Ford in 2000 and now owns 93%. The plant closing was announced in early 2008 along with the decision to move production to Nemak plants in Mexico. Since the announcement, Essex has pared down from 600 to 400 workers, producing cylinder heads. A skeleton crew of 32 will remain to shut down the facility. The nearby 320,000 square foot Nemak Windsor plant, casting aluminum engine blocks for Ford and GM, recently laid off 150 of its 230 workers in response to falling demand.

West Irving Die Casting has shut down both of its manufacturing plants: the home office and plant in Sandwich, Illinois; and a second facility in Owensboro, Kentucky. West Irving produced aluminum castings for various U.S. and Asian automakers.

TRW announced it is shutting down its only U.S. casting facility. A gray iron caster, Warrenton Casting Center was acquired by TRW in 2006. Located in Warrenton, Georgia, TRW is offering the facility turnkey and ready to go [click for the presentation material]. Warrenton's daily pour capacity is 600 tons, and it employs over 200 workers. Warrenton can also be converted to ductile iron, steel, or large casting. TRW's material underscores the severity and speed of the automotive downturn: "Nearly all the equipment has either been rebuilt or is new in the past two years."

The weak auto industry has also hit Canadian supplier Wescast. As part of a broader restructuring, is closing one of its two manufacturing plants in Wingham, consolidating production at the other. At a cost of more than $60 million and 140 jobs lost, the company hopes to save approximately $10 million per year. Wescast produces iron castings, primarily exhaust manifolds, for automakers across North America, Europe and Asia. The company has seven other facilities worldwide.

Metaldyne Corp. has closed its aluminum diecasting plant in Niles, Illinois. The plant began shutting down last July. It had been on the market for some time, following Metaldyne's acquisition by Asahi Tec. Two other plants have been sold: Farmington Hills, Michigan; and Greenville North Carolina. Metaldyne still has more than 30 plants in 15 countries.

Charlevoix Manufacturing Co., an aluminum casting company serving the auto industry, has shut down its operations. The company's plant and headquarters was in Charlevoix, Michigan.

Navistar International will be closing its Indianapolis Casting division, along with its Indianapolis engine manufacturing plant. The closure comes because Navistar will no longer supply Ford's diesel engines in North America. It will continue to supply Ford with diesels for South America, however. Navistar also supplies engines to other auto and truck manufacturers, and in the marine and industrial sectors.

Citation Corp. has laid off more than 20% of its workforce and shuttered a casting plant in Lufkin, Texas.

Griffin Pipe has mothballed its Florence, New Jersey plant which produced large diameter ductile iron pipe. In this case, the weak housing market is to blame rather than the weak automotive market. Florence will continue to operate as a distribution center and production facilities will remain in place, should future demand warrant bringing it online again.

General Aluminum, a division of Park-Ohio Industries, has indefinitely shut down its metalcasting facility in Richmond, Indiana, due to weak demand from the auto industry, formally laying off 85 workers. General aluminum casts and machines brackets, suspension parts, drivetrain and transmission components. The Richmond plant had been down to 49 workers, with 35 already on indefinite layoff. [WARN Act Notice; PDF format]. (disclaimer: the author once ran Park-Ohio's bearing manufacturing division).


Despite widespread problems, there are bright spots:


Mazak has expanded its manufacturing facility in Florence, spending $3.5 million to add 10% to its production floorspace there.

Mori Seiki USA has begun construction of a 100,000 square foot headquarters in Hoffman Estates, Illinois. It will also house the Chicago Technical Center, Machining Technology Laboratory, and Mori Seiki University.

Amada America opened its North American showroom, training and technical center in Schaumburg, Illinois. It is 135,000 square feet.

Citation Corp. has acquired Foseco-Morval, a lost foam pattern molding company based in Bessemer, Alabama. Citation will combine Foseco-Morval with its existing lost foam plant in Columbiana, Alabama and create a new umbrella division, Citation Lost Foam Patterns. The Bessemer plant had been shuttered by its former parent company, Vesuvius Group, as nonstrategic. Vesuvius has also closed a similar plant in Ontario, Canada.

Publicly traded Crane Co. in the U.S. has acquired German metalcaster Friedrich Krombach GmbH, for approximately $70 million. Founded in 1855, Crane has 12,000 employees and is a diversified manufacturer producing highly engineered systems and components for everything from aircraft and aerospace to retail vending equipment.