The 600 Group (UK, 5251R9N7; website) has announced it is winding down and will eliminate outsourcing production to China.

The company said despite continued efforts, even well-developed sources there have been unable to attain the necessary levels of quality and consistent delivery. In addition, 600 has suffered from rising warranty claims tied to its China-sourced components -- claims which are both expensive and negatively impact key customer relationships.

600 Group's long-term primary partner in China had been Dalian Machine Tool Group.

Originally founded in 1834, 600 Group is now the UK's largest machine tool manufacturer. In addition, the company operates an international group of engineering companies with 20 locations worldwide, primarily involved in the manufacture and distribution of machine tools, industrial lasers and other engineering products.

600 Group's Gamet Bearing division (website) is the UK's largest manufacturer of high-precision tapered roller and machine tool bearings where applications include lathes, machining centers and precision grinders.

Gamet manufactures super precision tapered roller bearings; single-row, double-row and constant preload versions; angular contact ball bearings; precision roller assemblies for metal rolling, metalfinishing and high-precision conveyors; ballscrew support cartridges, blocks and bearings; precision rotating centers for lathes and turning machines.

In addition to its traditional machine tool bearing lineup, Gamet is now targeting other industries where precision bearings are key components. Bearings are available in sub-micron precision, with ID radial runout within 0.5 microns, and assembled axial runout within 3 microns.

It recently ramped up production of large bore industrial bearings, up to 550mm ID and 680mm OD. Target markets for the large bore bearings are precision machine tools, oil and gas industry, grinding and turning machines, printing presses, and steel production. It is also moving into the market for bearings used in wind power generation equipment.

Concurrent with its China decision, 600 Group is now in the midst of reviewing and restructuring its entire supply chain, said David Norman, the CEO appointed in August 2008 to replace Andrew Dick. Mr. Dick is credited with bringing 600 Group back from the brink of disaster, but was also instrumental in the company's ill-fated deep dive into Chinese sourcing.

Mr. Norman said: "At the time of my appointment in August, it was clear that both the cost infrastructure of the Group and the machine tools' supply chain were in need of urgent attention. Considerable action has subsequently been taken and continues to be required to effect transformational change within the Group's operations, whilst concurrently taking additional defensive actions in light of depressed market conditions."

600 Group will also be simplifying its management and product structure to better focus on customers and product quality. A single team will be handling product development and sourcing, while another team handles sales and marketing. Focus will shift to offering customers access to the entire range of 600 Group branded products -- Electrox, Pratt Burnerd, Colchester-Harrison, and Gamet Bearings.

While the company said it has invested heavily in trying to source competitively from China, both in terms of product quality and cost, its partners there are unable to meet 600's exacting levels of performance and quality. In addition, the continuing problems with warranty claims related to China-sourced products have become a serious competitive issue for 600 Group.

Returning to its UK manufacturing base, 600 is making major investments there.

Mr. Norman said: "We will increasingly be going to market as a group rather than a collection of companies. Central product management will control the Group's marketing strategy to achieve maximum leverage of Group brands. The associated sales volume benefits will drive our outsourcing arrangements in addition to strengthening our manufacturing base in our three UK locations -- Heckmondwike, West Yorkshire; Colchester (home of Gamet Bearings), Essex; and Letchworth in Hertfordshire."

Finally, addressing the economic situation now pounding industrial suppliers, Mr. Norman said: "There is still a great deal of work to do but I believe that the Group will soon be in a position to take advantage of any recovery as well as opportunities which may arise from the global downturn."