Here's a story to warm the cockles of your heart and reaffirm the belief in one's country's manufacturing ability to hold its own in a highly-competitive global aerospace manufacturing industry.
Against a backdrop of fierce low cost overseas manufacturing competition, driven by the demands from the majority of aerospace of OEMs and tier 1 companies looking for continual cost down components, Columbia Precision is a shining beacon that says: hang on a minute; it might actually be more cost-effective to manufacture certain components in the UK.
However, there are fixed preconceptions and mind-sets to overcome. The fact and the act of moving production offshore to low cost economies has become ingrained in the psyche of many large aerospace organisations that simply go through the motions of shipping their components across the oceans. Columbia Precision's managing director, Neil Holmes provides some solid reasons why these companies should think again. If only they would give companies like his the chance to quote for the work, they might get a pleasant surprise!
“An international tier 1 supplier to the aerospace industry approached us to manufacture a small batch of ‘pre-development' complex precision prismatic machined components,” begins Holmes. “Once the production process was eventually proven, the parts were earmarked for offshore production by a low cost manufacturing economy, which is ultimately what we were competing against to keep the product once it went into full production.”
The precision components comprised a cylinder, manifold and a piston assembly for a non-specified actuation unit on an aircraft programme. After some initial tweaking of the design by the customer – supported by some useful cost reduction input from Columbia, Holmes says his company was then asked to provide a price for approximately 25 production units per month.
“However, the customer informed us that they intended to initially manufacture the components in-house because the production volumes were growing. By this time we had gained a lot of knowledge of the product itself and the special tooling required through our relationships with the tooling suppliers. Eventually they realised that they couldn't manufacture them in-house at the cost they were looking for.”
Holmes says that by this time, the quantities had grown to 30-40 per month, so to strengthen its claim to keep the work at Columbia, it invested in a Matsuura MAM 72 35V, 32-pallet 5-axis vertical machining centre with laser component checking and tool monitoring. Columbia also specified a 250-tool magazine to provide the option of running the machine tool ‘unmanned' overnight.
“The customer then decided to move part production to an overseas low cost manufacturing facility to take more cost out of the job, so we asked whether we could make a counter bid to keep the work at Columbia. They agreed, informing us that the volumes were ramping up to 50-60 per week, which underlined the product's success in the field.
“Obviously, we had to increase our production rates and improve our machining techniques to help further drive down costs. We also worked closely with our material suppliers to modify the material form and improve the efficiency of our chrome plating processes. Ultimately, we had to explain to all our suppliers that if they wanted to be a part of a successful programme, then they would have to take cost out of their element of their processes too.”
Storm before the calm
The whole saga then took an unexpected turn when Columbia's customer announced it wanted Columbia to share the production of the parts with a low cost economy, but that ultimately it would eventually migrate offshore permanently. There then followed a transition period where Columbia wound down its production whilst the low cost manufacturing facility was ramped up.
“But when our customer scrutinised its product quality, cost and delivery costs they realised they were having serious problems competing with where Columbia already was in terms of producing the parts cost-efficiently, and whilst they could machine the parts, they couldn't produce the levels of quantities required per week.
“They struggled with the production until finally they asked us to sign a five-year long term agreement with annual cost-downs. To meet their cost down expectations, we continue making tooling improvements, re-engineering our CNC programs, and making more hours available on the Matsuura and additional machine tools within the production cell. We also reduced our heat treatment costs by taking the stress-relieving operation in-house rather than subcontracting out. All the parts undergo non-destructive testing and passivation within our AS 9100 Rev C accredited and Nadcap-approved facility. The only operation we subcontract out is chrome plating.”
All in all, any company looking to offshore production of its parts needs to look at trade-offs involved. For example, in addition to potentially unreliable quality issues, the component price point needs to be carefully assessed so that any potential shipment delays, cultural differences and language difficulties are all built into what could initially look like an attractive low cost.
“The whole experience of working with us has turned our customer's head and they are now more aware that the UK can compete with low cost economies. It hasn't been an easy road because we've installed new processes, plus funding investment in our own processes too. We're confident we can compete with offshore competition and maximise the return from the overall life of an aircraft programme, which gives us more confidence to invest in value-added processes, such as the NDT plant and our heat treatment furnace. We've secured more work with this customer, work that would have gone to low cost economies.
“It's possible that there will be some customers unwilling to consider our personal success story with this customer - unless they actually experience it first-hand. I've got a great team around me that enjoy the challenges of enhancing the technology we have at our disposal and making it work to its maximum potential.”
The tide is turning
I end by asking Holmes if he detects a sea change of UK opinion that suggests OEMs and tier 1s are reconsidering their low cost economy manufacturing strategies, and instead looking to re-shore instead of offshore more of their components in future.
“We don't always get the opportunity to quote for large production contracts, because there is a mind-set that UK manufacturing companies are automatically more expensive than their offshore counterparts,” he concludes. “I try and re-educate potential new customers by asking them for the opportunity to quote for the job. We may not always be as competitive, but they may be surprised. I'm sure that geographically, many OEM/tier 1 companies would rather keep their part manufacture in the UK, but sometimes other forces can dictate that the part goes offshore. What are the key advantages for keeping the work local? No time differences, zero or minimal shipping costs, no language barriers, and if there are problems, UK-based manufacturers are in the right place to react quickly. Customers ignore these advantages at their peril.”
www.columbia.uk.com
