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European mould industry: Towards a new competitive positioning Eduardo J. C. Beira J. Menezes Eduardo Beira Tool, dye and industrial moulds 5000 import export 4000 internal market 3000 2000 1000 USA Germany Japan Italy France Taiwan UK Canada Spain Switzerland -1000 Portugal 0 -2000 Eduardo Beira 2000 1998 1996 1994 1992 1990 1988 1986 1984 1982 1980 1978 1976 1974 1972 1970 1968 1966 1964 1962 1960 Industrial moulds exports (P) 70 60 50 40 30 20 10 0 Eduardo Beira 2001 1998 1995 1992 1989 1986 1983 1980 1977 1974 1971 1968 1965 1962 1959 1956 1953 1950 1947 Mouldmakers New entries (P) 10 9 8 7 6 5 4 3 2 1 0 Eduardo Beira 2000 1998 1996 1994 1992 1990 1988 1986 1984 1982 1980 1978 1976 1974 1972 1970 1968 1966 1964 1962 1960 Exports (P) 80% 70% 60% 50% 40% 30% 20% 10% 0% Eduardo Beira Exports (P) 30000 €/ton 25000 20000 15000 10000 5000 0 1960 1965 1970 1975 1980 1985 1990 1995 2000 Eduardo Beira Exports (P) 100% Brinquedos Matr.Construção 90% 2001 1992 1984 27% 18% 18% 12% 7% 7% 6% 3% 2% 14% 7% 15% 9% 34% 13% 1% 13% 7% 21% 9% 14% 6% 8% 28% 100% 100% 100% Mat. Eléctrico 80% 70% Ut. Domésticos Electrodomésticos 60% Elect./Telec. 50% Outros Embalagem 40% Ind. Automóvel 30% 20% 10% 0% 2001 1992 1984 Ind. Automóvel Embalagem Outros Elect./Telec. Electrodomésticos Ut. Domésticos Mat. Eléctrico Matr.Construção Brinquedos Eduardo Beira Eduardo Beira Portugal (I) according to USITC (2002) • Unique industry characteristic: – small industry dedicated almost exclusively to exporting • Strengths: – Specialist training colleges – Quick lead times, technological capability, price, and low labor costs – Quality, technology, service, skilled in producing high precision and complex dies and molds • Weaknesses: – Small domestic market with lowest productivity indicators (sales per worker) among ISTMA members – Lacks modern automotive and aerospace industries to stimulate technological advancement – Many die and mold producers tend to be small companies with limited financial and management resources Eduardo Beira Portugal (II) according to USITC (2002) • • • • • • Despite Portugal small size, it has emerged as a world leader in the production of industrial moulds Portugal is the eighth-largest producer of dies and molds in the world and it exports to more than 70 countries Portugal is also one of the world´s principal producers of precision molds for the plastics industry. Portuguese moldmakers are highly specialized, concentrating in different production areas such as mold cavities, mold bases, polishing, large molds, and precision molds Since Portugal joined the EU in 1986, the share of companies capable of manufacturing complex molds grew from less than 30% to more than 80% in 1997 Molds for less complex products such as toys and electrical appliances have been supplanted by more complex molds for the automotive, electrical equipment, pharmaceutical, telecommunications, medical equipment and computer industries Eduardo Beira Portugal (III) according to USITC (2002) • • • • • Recently several larger moldmakers in the Marinha Grande region have shifted from being solely tooling producers to become integrated suppliers of design and manufacturing services, principally for the european market Since joining the EU, Portugal´s mold industry has steadily evolved from a labor intensive industry to a capital intensive one It possesses world-class equipment produced in Germany, Switzerland and Spain The majority of companies have access to the latest generation of software, CNC and EDM machines, finite-element-analyst technology, machining centers, 3-D measuring machines, and DNC and CAD/CAM/CAE systems Many of Portugal mold manufacturers have instituted Simultaneous or Concurrent Engineering and Total Quality, and many qualified for ISO 9001 and 9002 certification Eduardo Beira • The strange case of the portuguese mould industry – No tradition of precision metal manufacturing industries • No local industrial equipments and automobile industries – No significant local moulding and plastics industry – Regional base – Poor commercial base – From a technical craft to a engineering discipline Eduardo Beira • Low cost was not the critical succes factor for the portugueses mould industry – Portuguese mould manufacturing model • • • • • No “toolmakers” Functional specialization Mould assembling vs part manufacturing Scalability / capacity easily available Shorter time to market • Importance of international buying agents Eduardo Beira Eduardo Beira Eduardo Beira Eduardo Beira Eduardo Beira 1950´s Plastic / material Technology Idea, concept Gravadores Part models Lathes Milling Copying Metal Technology Eduardo Beira 1960´s Plastic / material Technology Idea, concept Gravadores Part models Final Product Free form milling Metal Technology Eduardo Beira 1970´s Plastic / material Technology Part engineering drawings Mould design drawings Mould injection test runs Idea, concept Final Product DNC EDM Heat treatments Metal Technology Eduardo Beira 1980’s Plastic / material Technology Part design Prototyping Pilot runs Customer integration Idea, concept Final Product CAD/CAM CNC Metal Technology Eduardo Beira 1990´s Plastic / material Technology CAE Mould engineering Product engineering Part design & Prototyping Concurrent engineering Customer partnerships “Nypro” model Idea, concept Final Product CAD/CAM/CAE integration CIM Metal Technology Eduardo Beira 2000´s In mould decoration In mould assembling Multimaterial molding Cycle time optimization Plastic / material Technology First runs / moulding Product assembling Logistics and distribution Quality certification Idea, concept Final Product Product decoration Design for competitive price Real and virtual prototyping Rapid tooling High speed machining Sensors / Intelligente mould Metal Technology Eduardo Beira A growing puzzle of techologies Plastic / material Technology Idea, concept Final Product Metal Technology Eduardo Beira 2000 • Moulding and plastics assembling offshores to China • Mould manufacturing to China • The customers are dropping the european mould makers ... Eduardo Beira China Eduardo Beira China Eduardo Beira Luen Shing (PY) Industries Eduardo Beira 7000 moulds per year Eduardo Beira 2500 people Eduardo Beira Eduardo Beira !!! Eduardo Beira China Eduardo Beira Zhejiang mould city Eduardo Beira Eduardo Beira China Eduardo Beira Eduardo Beira Eduardo Beira Eduardo Beira Eduardo Beira China Eduardo Beira Eduardo Beira China 1400 imports 1200 exports 1000 800 600 400 200 0 1997 1998 1999 2000 2001 Eduardo Beira USA imports 18,0 16,0 14,0 china 12,0 germany taiwan 10,0 portugal 8,0 s korea italy 6,0 spain 4,0 france 2,0 0,0 2000 2001 2002 2003 2004 Eduardo Beira Japan exports to USA japan 100,0 90,0 80,0 70,0 60,0 50,0 40,0 30,0 20,0 10,0 0,0 2000 2001 2002 2003 2004 Eduardo Beira And now? • Our competitive values (versus China) – – – – – – Knowledge / experience Customer base and network / reputation Western based: close to the customers Culture / language Commercial experience Better in the “non standard” products Eduardo Beira And now? • The traditional mouldmaker mould is running out – Especially for “large” mouldmkers (>60 people) • • A new business model is needed A new commercial approach is needed Eduardo Beira • A new portfolio of skills and competences – Along the four directions – Anyway, an increase in complexity of operations and business – – – – More More More More engineering innovation integration services In mould decoration In mould assembling Multimaterial molding Plastic / material Cycle time optimization Technology First runs / moulding Product assembling Logistics and distribution Quality certification Final Product • AROUND THE MOULD Idea, concept Product decoration Design for competitive price Real and virtual prototyping Rapid tooling High speed machining Metal Sensors / Intelligente mould Technology Eduardo Beira – A NEW COMMERCIAL POSITIONING – More marketing • Different level • Different contacts • International networking – More commercial skills • • • • • Technology and engineering based Strong soft skills International trading 2+ languages mandatory Management of large and complex projects – New prospecting activities – More commercial investment • Non material • Higher financial and business risk Eduardo Beira • Restruturing – Higher funding needs – Reducing fragmentation by M&A – New actors? Eduardo Beira • Multinationals – OEMs and “first tier” • They will buy 70% of their moulds in low cost countries (Ásia) – Where large volume moulding is / wiil be based • Remaining 30% of high precision and high complexity moulds – – – – Concurrent engineering Certified quality Plastic and metal advanced technologies Long term partnerships Eduardo Beira • “Independent custom moulders” – From the margin to the core of the portuguese industry customer base? – Business policy implications • How to close deals? • And the network? Eduardo Beira • Two business approaches for the future – Multinationals / transnationals • • • • More integration and partnership Lower volume Complexity based specialization Non standard approach – “independent custom moulders” • more volume • Comercial arena to be (re)discovered • “engineering & tooling” based Eduardo Beira • Leverage the client base and industry networking • Reinforce the industry based cooperation and marketing • Reinforce the technologies competences – Key roles of Technology Centres Eduardo Beira • And the automobile industry? – A new phase of innovation and change • Opportunities and dangers • More cooperative? Eduardo Beira Eduardo Beira • Future will not be in technology and machines – Although they will be necessary • Future will call for a competitive repositioning of the business model – Non technical soft skills will be critical • Hope: the industry has a long tradition of change and flexibility – Customers are to be prized! Eduardo Beira • Thanks for your attention Eduardo Beira