the european foundry industry - global casting · pdf filethe european foundry industry iff...

- 1 - © CAEF, www.caef.eu

International Foundry Forum, 21 - 22 September 2012 in Prague - CAEF The European Foundry Association

The European Foundry Industry

IFF 2012 - Prague

CAEF - The European Foundry Association



The European Foundry IndustryStructure, Trends and SWOT Analysis

IFF 2012 - Prague

CAEF - The European Foundry Association



Production:� 15.7 m t

Value:� approx. 41 bn €

Employees:� 280,400 employees

Foundries:� 4,998 foundries

Fe: 12.2 m t; NF: 3.5 m t

Fe: 21 bn €; NF: 20 bn €

Fe: 169,600; NF: 110,800

European Foundry Industry Key Figures 2011

Bild

: S

osch

insk

i

Source: CAEF

Fe: 2,102; NF: 2,896



India10%

Rest of the World0%

Japan5%

Taiwan1%

Korea2%

CAEF16%

Brazil4%

Canada1%

Mexico2%

USA9%

China45%

Russia5%

Casting Production Main Regions

Source: CAEF, moderncasting, national associations, Data 2010



0

5

10

15

20

25

30

35

40

China CAEF USA Russia India Japan

Mill

. t 2000 2010

European Foundry Industry Fe-Castings – Second Worldwi de

+252% -24%+261%-38%-13% -34%

Source: CAEF (2000 incl. Turkey) , moderncasting, national associations

Impact of 2008/2009



0,0

1,0

2,0

3,0

4,0

5,0

6,0

China CAEF USA Japan India Russia

Mio

. t 2000 2010

European Foundry Industry NF-Castings – Second Worldwi de

-1,6% +257%-20%+7%+380% -17%

Impact of 2008/2009

Source: CAEF (2000 incl. Turkey) , moderncasting, national associations



Zinc1,3%

Grey Cast Iron41,4%

Ductile Cast Iron32,9%

Steel Castings6,2%

Copper Castings1,7%

Magnesium0,2%

Aluminium16,3%

European Foundry Industry: Materials

Source: CAEF



0

500

1.000

1.500

2.000

2.500

3.000

3.500

4.000

4.500

5.000

Switzer

land

Norway

Hunga

ryDen

mar

kFinl

and

Belgium

Sloven

iaPor

tugal

Austria

Sweden

United

King

dom

Czech

Rep

.Pola

ndSpa

in

Italy

Turke

yFra

nce

Germ

any

2010 2011

1.000 t

Europe: Ferrous Castings 2010/2011 (sorted by 2010)

Source: CAEF

Production volume 201112.231 million tons+ 9.3 %



0

100

200

300

400

500

600

700

800

900

1.000

Belgium

Denm

ark

Norway

Finlan

dSwitz

erlan

dPor

tugal

Sloven

iaSwed

enCze

ch R

ep.

Hunga

ry

United

King

dom

Spain

Austria

Turke

yPola

ndFra

nce

Italy

Germ

any

2010 2011

1.000 t

Europe: Non Ferrous Castings 2010/2011 (sorted by 201 0)

Source: CAEF

Production volume 20113.545 million tons+ 9.2 %



CAEF Number of Ferrous Foundries and Employment

26542414

2199 2175 2102

0

500

1.000

1.500

2.000

2.500

3.000

2005 2008 2009 2010 2011

num

ber o

f fou

ndrie

s

Source: CAEF

Foundries 2011:2009 = - 4.4 % Employees 2011:2009 = + 4.9 %

192200

161700169600

0

25.000

50.000

75.000

100.000

125.000

150.000

175.000

200.000

2005 2008 2009 2010 2011nu

mbe

r of e

mpl

oyee

s

Driven by automotive platform strategies and similar components:bigger units to manage high volume series



CAEF Number of Non-Ferrous Foundries and Employment

29602985

2754

2853

2896

2.600

2.650

2.700

2.750

2.800

2.850

2.900

2.950

3.000

3.050

2005 2008 2009 2010 2011

num

ber o

f fou

ndrie

s

Source: CAEF

Foundries 2011:2009 = + 5.2 %

126200

103800110800

0

20.000

40.000

60.000

80.000

100.000

120.000

140.000

2005 2008 2009 2010 2011nu

mbe

r of e

mpl

oyee

s

Employees 2011:2009 = + 6.7 %

Driven by automotive lightweight trends



Productivity in the European Foundry Industry 2011

Source: estimation by CAEF and BDG

• Ferrous castings: Average performance 55 tons per employeewith a range up to 103 tons

• Non-ferrous castings: Average performance 22 tons per employeewith a range up to 65 tons

• Sample companyTurnover 170,000 Euro per employeeAmount of material used 90,000 Euro per employeeGross profit 80,000 Euro per employee

Bild: Lickfett



Export quota European Foundry Industry 2011

Source: estimation by CAEF

• Export quota total (including deliveries inside Euro area)37 %

• Export quota Euro area23 %

• Export quota outside Euro area14 %

• = castings are produced where castings are needed:86 % delivered directly within the Euro area!

The end use of European castings is all over the world! Bild: Soschinski



Economic Status, Early Indicators and Driving Forces

Bild: Fotolia, Nesterov Vasily;



Source: Ifo-Institut, München

World Economic Climate August 2012

1

2

3

4

5

6

7

8

9

1 2 3 4 5 6 7 8 9

Upswing Boom

Downswing

QIV/2008

Recession

Present economicsituation

Economic expectations for the next six month

bad good

improvement

deterioration

Consolidated Upturn / Peak- Present economic stuation: good

- Economic expectations: optimistic

Cooling-down / Contraction- Present economic situation: satisfactory

- Economic expectations: deterioration

Through / Late Phase of Downturn- Present economic situation:deterioration

- Economic expectations: cautious

Recovery / Expansion- Present economic situation: improvement

- Economic expectations: improvement

QI/2006

QI/2008

QIII/2007

US Sub-primecredit crisis

QI/2009

QI/2010

QIII/2012QIV/2012?



0,8

0,1 0,1

-0,3

0,0

-0,2-0,3

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0,10,2

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-0,4

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0,2

0,4

0,6

0,8

1,0

1Q11

2Q11

3Q11

4Q11

1Q12

2Q12

3Q12

4Q12

1Q13

2Q13

3Q13

4Q13

EU Gross Domestic Product Quarter over QuarterChange in % qoq

Source: Eurostat, forecast 3Q 12 – 4Q 13 Dekabank



0,8

0,10,1

-0,3

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0,9

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0,00,00,00,1

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-0,7-0,8

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-0,4-0,3

-0,5

-1,0

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1,0

2,01

Q 1

12

Q 1

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14

Q 1

11

Q 1

22

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22

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24

Q 1

2

1Q

11

2Q

11

3Q

11

4Q

11

1Q

12

2Q

12

1Q

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3Q

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4Q

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3Q

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4Q

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1Q

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2Q

12

1Q

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2Q

11

3Q

11

4Q

11

1Q

12

2Q

12

EURO Germany France Italy Spain UK

EU Gross Domestic Product Quarter over QuarterChange in % qoq

Source: Eurostat, forecast 3Q 12 – 4Q 13 Dekabank



Source: Markit, Deka

Euro Area Purchasing Manager Index (PMI) Sept. 2012Industry Bottom Out?

Industry

Service



40

45

50

55

60

65

70

75

Sep 08 Jan 09 Mai 09 Sep 09 Jan 10 Mai 10 Sep 10 Jan 11 Mai 11 Sep 11 Jan 12 Mai 12 Sep 12 Jan 13

ferrous - expectations for six monthsnon-ferrous - expectations for six months

FISI – European Foundry Industry Sentiment IndicatorAugust 2012 – Expectations for the next half year

Source CAEF, Index May 2007 = 100

Ferrous castingsdriven by automotive (50 %)and engineering (25 %)

Non-ferrous castingsca. 75 % automotive



Building industry

Engineering

Railway

Vehicles78%

2%8%

4%

NF Fe

Steel industry

Electrical engineering

4%

54%

28%

4%2%4%

4%

Other

2%

6%

Source: BDG, CAEF

Typical Customer Structure for Castings in %:Importance of Vehicle Industry

Share varies between80 % and 37 %



Automotive Supply Current Status

• Heterogeneous situation in Europe –the OEMs in the south are suffering whereas others acting stable or dynamic

• Commercial vehicles recovering only outside of Europe

• Two major trends (IFF 2010) are continuing

– Market saturation in the Triad

– Climate policy

• Innovative castings and light weight are a relevant contribution to the energy and CO2 efficiency of products!



Automotive Global MarketProduction Forecast 2013

Source: JD Power, WARD´s Automotive, BAIRD

+4.8%

+0.7%

+7.0%+1.4%+3.0%

+6.0%+5.0%+4.3%

2013 Change in %



Automotive Global MarketKey Drivers


• Europe: Already high efficiency means key drivers areincremental changes and electrification

• US: 2016 targets achievable with current technologies;2025 targets require change in fleet mix,smaller engines and Evs

• China: Adopting EU standards with a lag;aggressively pursuing “low‐cost” electrification

• ROW: Most regions adopting EU standards with a lag

• Suppliers: Consumption and efficiency are the permanent challenge



Commercial Vehicles – Global MarketProduction Forecast 2013


2013 Change in %

+3.6%

+4.7%

+8.0%+0.0%+3.0%

+7.0%+7.0%+5.7%



Commercial Vehicles Global MarketKey Drivers

• US: For first time in 30 years, there are no EPA emission standards on the horizon in the US

• China/India: The “westernisation” of fleets in China/India drivescontent/share growth for western OEMs/suppliers

• Brazil: Secular growth in Brazil economy expected to bedriven by World Cup (2014), Olympics (2016)

• Opportunities for suppliers: Powertrain and fuel technologies as well asweight reduction and reduce friction



Building industry

Engineering

Railway

Vehicles78%

2%8%

4%

NF Fe

Steel industry

Electrical engineering

4%

54%

28%

4%2%4%

4%

Other

2%

6%

Source: BDG

Typical Customer Structure for Castings in %Importance of Engineering Industry

Share varies between86 % and 26 %



-10 -5 0 5 10 15

SpainPortugal

NetherlandsItaly

FinlandBelgium

UKDenmark

FranceSwitzerland

SwedenGermany

AustriaJapanWorld

USAChina

International Engineering Sales Forecast 2012

Source: national Institutes, VDMA

Change in % against previous year

September 2012: upward revision!



-60

-40

-20

0

20

40

60

Jan98

Jan99

Jan00

Jan01

Jan02

Jan03

Jan04

Jan05

Jan06

Jan07

Jan08

Jan09

Jan10

Jan11

Jan12

Jan13

Jan14

Economic Cycle General Engineering: Incoming Orders

Source: VDMA, Example Germany (share of 40 % in Europe)

Change in % against same quarter of the previous year

Signs of leveling out could lead to a moderate growth in 2013



General Engineering - US Wind power could suffer:Impact on heavy weight castings delivered from EU



General Engineering SupplyKey Drivers

• General Engineering is a follower of automotive regarding the high demands on foundries

• Western European Engineering OEMs will continue dominating their home markets (at least until 2020)

• Energy efficiency and other "green" concepts are getting more important in developed countries

• Foundries are required to deliver proactive ideas and components to facilitate the customers to reach these targets



• Passenger cars: In Europe moderate recovery on low level,Growth rates in the US and BRICs moderate

Commercial vehicles: Sales in Europe weakExport markets are still alive

• General Engineering: A small increase is possibleThe perspectives are depending from the castingintensity of the subsectors within general engineering.

• All fundamental trends published in „Castings 2020“ are intact.Questions are often the unresolved financing issues and the politicalframework!

Perspectives 2013 for European Foundries



Europe = Industrial Base for FoundriesSWOT Analysis

Strengths

• State of the art production technologies lead to high productivity

• Top level energy efficiency (cost awareness and policy driven)

• Top level OEMs and leading engineering customers nearby

• Heterogeneous company structure: Foundries as generalists and specialistsFoundries as hidden champions

• Trend to dual training (company and school) will increase the level of workforce

Picture: Fotolia




Weaknesses

• Suppliers with high dependency on strategical decisions of the customer industries

• Energy intensive production leads to dependency on energy prices(heterogeneous price level within Europe)

• Europe has no significant sources of important raw materials

Picture: MS




Opportunities

• Custom made castings and Customer oriented R & D

• Traditional: Cooperative industrial research between foundries, customers and universities leads to innovative production technologies, energy efficiency and new materials

• More intensive participation within the value chain

• Climate friendly products (e.g. for electrification trends in the vehicleindustry and regenerative energy)

• Hybrid materials to fulfil new customer demands(e.g. metal and plastics)

Picture: Fotolia




Threats

• Competition with substitution trends (carbon fiber, new plastics)

• Significant changes in the demand of „traditional“ components (e.g. powertrain)

• Looming shortage of skilled workers and engineers in some countries

• A lot of foundries have to cope with relatively scarce capital but need to innovate: Foundries have to take more and more R & D risks from their customers

Picture: Fotolia




Threats

• Competition with other materials (Carbon fever, new plastics)

• Significant changes in the demand of „traditional“ components (e.g. powertrain)

• Looming shortage of skilled workers and engineers in some countries

• A lot of foundries have to cope with relatively scarce capital but need to innovate

• Foundries have to take more and more R & D risks from their customers



Heiko LickfettCAEF The European Foundry Association

+49(0)211/[email protected]

If you have any queries please contact!



The European Foundry Industry – Yearbook 2011

the european foundry industry - global casting · pdf filethe european foundry industry iff...

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