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Forges Stay Focused on Growth in 2015

April 25, 2015 / , , , , , , , , , ,


Most metalworking companies started off 2015 with positive expectations. As the LENOX Institute of Technology reported in the 2015 Industrial Metal Cutting Outlook, early forecasts painted a positive picture, with manufacturing production projected to grow by 3.7% in 2015 and 3.6% in 2016.

However, recent reports have clouded expectations a bit. A mid-April outlook from the Manufacturers Alliance for Productivity and Innovation (MAPI), for example, stated that short-term outlook for industrial manufacturing is “murky” and “fairly bleak.” According to the report, manufacturing production fell by 1.2 percent during the first quarter of 2015, the first quarterly contraction in factory sector output since the second quarter of 2009. And even though there was a modest gain in factory output growth in March (0.1%), MAPI points out that production in key industry sectors such as primary metals, aerospace, and furniture contracted.

Staying Focused
Even with this sobering data, many manufacturers remain optimistic that 2015 will be a year of growth, even if it is only slightly better than last year. Two articles from Forge magazine give some specific reasons why forges can remain hopeful now and in the years ahead.

In its “Aerospace Industry Outlook,” Forge states that based on the 20-year projections from Boeing and Airbus, the long-term outlook for the aerospace industry (one of the forging industry’s biggest markets) is positive. While the demand projections between these two top companies differ slightly, both expect growth, which is good news for the forging industry.

“Whichever forecast you want to believe, many planes will be ordered during the next two decades,” the article states. “The world’s leading forgers, many of which are located in North America, will be asked to supply a wide assortment of forged products made of high-performance and lightweight materials.”

In a separate article, “North American Forging is Advanced Manufacturing,” the industry publication argues that the forging industry has several reasons to be confident in its future position in the metals industry. According to the article, forging is not only an enduring industry, but “is vibrant, technologically challenging and critical to the country’s economic health and defense.” The reason forging endures, the articles adds, is because it provides the parts for critical applications that cannot be produced by any other manufacturing process.

“If the application is important, it depends on a forging,” the article states. “Why would any designer choose any metalworking process not capable of providing the optimum combination of strength, toughness and fatigue resistance required of the application?”

Have a Plan
The point is that regardless of what current data shows, the long-term prospect for the forging industry is bright, which means that managers need to stay focused on growth. However, that means you need a plan. As any leading metals executive knows, success in today’s market requires a strategic plan focused on continuous improvement while also accounting for external challenges.

What does that look like? Below is a brief outline from Canadian Metalworking that will help forging executives create a simple but workable planning process for their business:

(For a more in-depth explanation of these steps, you can view the full article here.)

Are you ready for whatever 2015 brings? If you remain focused on growth and have a strategic plan in place, odds are you are more ready than you think.