Market and Technology Trends in the Global PM Industry

APMA 31 October, 2011

Per Engdahl, Hgans

Date

| Name

Content
1. The Global production of Metal Powders
2. Development of the Iron based Metal Powder Market
3. Development of the Automotive Industry
4. Technology trends in the Automotive Industry
5. Global trends in the PM Industry
6. Future development of the PM Industry-Success Factors
7. Conclusions

2 | 2009-05-07

1. The Global Production of Metal Powders

3 | Date

Production of Metal Powders, volume

Fe
Zn
Al
Ferroalloy
NdFeB
Cu
Pb
HSS+Tool steel(HIP)
WC
Ni
Co
SS+HSS,WA (excl HIP)
Cr
Mo
WC
Ti
HSS+Tool steel(excl HIP)
Mg
Sn
Ta
Au,Ag,Pt,Pd

Applications
Structural parts
Soft and hard magnets
Welding electrodes
Bearings
Tools
Contact materials
Rocket fuel
Batteries
Surface coating
Super alloys
Pigments
Catalysts

200

Hgans estimate 2008

4 | Date

400

600

800

1000

1200

1400

Tons

Production of Metal Powders, value

NdFeB
Fe
WC
Co
Ni
Mo
Al
HSS+Tool steel(HIP)
Au,Ag,Pt,Pd
Cu
Zn
W
Ferroalloy
Ti
Pb
Ta
Cr
SS+HSS,WA (excl HIP)
HSS+Tool steel(excl HIP)
Sn
Mg
0

200

Hgans estimate 2008

5 | Date

400

600

800

1000

1200

1400

1600

1800

MEUR

2. Development of the Iron Based Metal Powder Market

6 | Date

Development of the total Global Iron Powder Market

1400
1200
1000
800
600
400
200

Hgans estimate

7 | Date

2010

2009

2008

2007

2006

2005

2004

2003

2002

2001

2000

1999

1998

1997

1996

1995

1994

1993

1992

1991

Global Iron Powder Market

0,09%

The global production of Iron

Powder represents less than 0,1 % of
the total production of iron and steel
Crude iron
Iron powder

99,91%%

8 | Date

Global Iron Powder Market

Total Iron Powder market
24%

Approximately 75 % of all Iron

Powder is used for PM (pressed an
sintered components.
PM
Others

76%

Hgans estimate 2010

9 | Date

Other applications are welding

electrodes, hot-bags, oxygen
absorbers, chemical and
metallurgical.
Approximately 70 % of PM is for
automotive applications

Global Iron Powder Market

Global Market for PM powders, 2010

Asia is the largest market for PM .

32%
Americas

48%

Europe
Asia

20%

Hgans estimate 2010

10 | Date

There are no fully reliable figures of

the Chinese PM market and the
estimate is based on a combination
of many different sources and
calculations.

What drives the Market for PM components?

Automotive ~70 %
1. Vehicle production (no of units)
2. Weight of metal powder based components per vehicle
Type of vehicle (car, SUV, motorcycle, electrical, hybrid), 0,5 40
kg/unit
Engine and vehicle design
PM penetration level
Big differences between different regions
Other applications ~30 % (Power Tools, Lawn and Garden, Recreations,
Home Appliances, Furniture, HVAC, Pumps, Motors, Hydraulics, Locks,
Arms)
GDP
Technology development
PM penetration level
11 |

Relative development of global Vehicle and Iron Powder sales

12 | Date

3. Development of the Automotive Industry

13 | Date

Global Light Vehicle Sales

14 | Date

Production of cars & LCV in major regions

Production of CARS & LCV's
WORLDWIDE

x 1000 units
35000
30000
25000
20000
15000
10000
5000
0
2006

2007

2008

Europe
E Asia

15 | Date

2009

2010

2011

N America
Japan

2012

2013

2014

S America
Others

2015

Production of cars & LCV in the top 5 countries

Production of CARS & LCV's
Germany - USA - S Korea - Japan - China

x 1000 units
28000
24000
20000
16000
12000
8000
4000
0
2006

2007

2008

Germany

16 | Date

2009

2010

USA

2011

S Korea

2012

2013

Japan

2014

2015

China

 The shift of innovation hubs towards Asia Markets is a

logical trend, automotive is just the next industry
Japanese and also Korea companies are well established as
global automotive companies and will to continue to grow in
export markets
China is the largest producer and also the largest markets
for vehicles. The market and technology development is,
however, still dominated by global automotive companies from
USA, Europe, Korea and Japan.

17 | Date

4. Technology trends in the Automotive Industry

18 | Date

Drivers of change
Environmental legislation
Emissions: less and cleaner
Recycling
Fuel efficiency
Downsizing - reduced weight
Performance: increased horse-powder/liter (today >100 hp/l)
Increased life
Cost reductions and logistics

19 | Date

Environmental outlook, Euro 5-6

CO2 emission (g/km)

200
150
Actual

100

Target

50
0
2005

20 | 20111017

2008

2012

2020

This leads to and reinforces

Smaller and more efficient engines/less cylinders
Increased share of diesel engines(especially in Europe)
Use of direct gas injection
Increased compression
Use of turbo-chargers
General weight reduction higher strength materials
Lower wear surface treatments
Easy recycling
Cost efficient and environmental friendly materials and alloys
JIT deliveries and short development times
Global support and cooperation, but local supply
Standardization of materials
Cost reductions
Development of hybrid and EV technologies

21| |
201
1-

There are many examples of contributions from the

PM industry
P/F con-rods
Bearing end-caps
VVT
EGR
Light weight pulleys
Stainless steel flanges
Gasoline pump elements
Oil pumps with variable flow

22 | Date

Composite cam shafts

Valve seat inserts
Common rail (diesel injection)
Gasoline injection
Power steering
Rolled teeth gears
Inductors for electrical drives

5. Global trends in the Global PM Industry

23 | Date

Why use PM?

Environmentally friendly process

Near net-shape in few steps
Elimination of scrap
Lowest per unit cost in long series
Broad range of alloy compositions with
unique properties
Design freedom
Robust manufacturing process
Close dimensional tolerances

PM is to a large extent a cost effective

technology

24 |

Cost effectiveness

24

Raw material utilization and energy requirement of

various manufacturing processes

25 |

25

Global trends in the PM industry

Components
Very complex shaped components specifically designed for PM
(VVT, Carriers)
Automotive applications dominates but non-automotives
applications have the same growth rate.
Medium densities are still dominating and growing but the growth
rate of high density components is much higher. Higher strengths
Soft magnetic components for EV and hybrid applications
Big interest and high activity level for heavy loaded gears

26 |

Automotive PM Applications, existing & potential

VVT
Synchronizing
parts

Cam
lobes
Con
rods
Turbo
charger

Transmission gears

| 27

111017

Shock
Absorbers

Moving the limits example

- Gears based on PM
Project target: To make Powder Metal based
gear solutions the first choice for future highperformance load carrying gears.
Automotive transmission gears: 70
million cars x average 13 gears
(assumed average 5 speed
transmission) x average weight of 600
g = 500.000 tons
Engine timing gears: 70 million cars
x average 2 gears at 300 g average
weight = 42.000 tons
Other applications, marine, heavy
vehicles, motorcycles, industrial gear
boxes etc. could be another ~ 300.000
tons

The total market size is almost

as big as the existing PM
market
28 |

Global trends in the PM industry

Materials and processes
Use and development of Integrated powder solutions supplied as
customer specified press-ready mixes:
Including machinability enhancing additives
Including specially designed lubricants
Based on advanced mixing and binding technologies
Use of lower alloying content but improved processing and higher
densities (less Cu and Ni).
Higher strength (density, alloy design and processing)
Increased use of Cr alloyed materials
Use of joining technologies(e g brazing) to produce complex
shaped parts

29 |

Global trends in the PM industry

Market
Content of locally produced PM components per vehicle
kg/car

25

20

15

10

0
USA

30 | Date

Japan

Europe

China

Global trends in the PM industry

Market
China is today the largest producer of automotives and production of
components will be transferred from other regions. All major automotive
producers and system suppliers have a strategy to localize production and
sourcing. The primary reason is logistics (lead time, capital employed )
In China, there are however, limitations in capacity and especially
competence and know-how to produce high quality PM components , which
limits the development of production.
Focus on logistics, inventory control and JIT deliveries.
Global partnership but local supply solutions
Increased production in South East Asia and India. Interest for Indonesia.

31 | Date

6. Future development of the PM Industry-Success Factors

32 | Date

How to develop the PM industry

Success factors
Co-operation suppliers/PM
manufacturers/end users.
Industry/Universities. Join forces.
Focus on improved properties and
tolerances
Marketing of the PM technology to
end-users (training and education)
Quality image
Knowledge about the applications
and competing technologies
Time to market and right timing
Productivity improvements
Improve knowledge level (education,
training and recruitment)
From replacement to innovation
33 |

2011-12-13

Properties
Complexity
Tolerances

Time

33

7. Conclusions

34 | Date

Conclusions
Powder Metallurgy is a growing market. The development is
driven by continuous introduction of new materials and
technologies.
Powder Metallurgy has essential advantages compared to
competing technologies high material utilization, design
capabilities, unique material
The development of technology within automotive industry and
also other areas , driven by higher material and energy costs,
increases opportunities for Powder Metallurgy technologies.

35 | Date

Global competition benchmarking

Tons
160 000 000
140 000 000
120 000 000
100 000 000
80 000 000
60 000 000
40 000 000
20 000 000
0

Machining

36 | Date

Ferrous
Castings

Forgings

Ferrous Powder
(PM)

What does this means?

We in the Powder Metallurgy Industry must utilize our resources in a
smarter and more efficient way than our competitors to drive our
technology forward.
Key words are:
Cooperation in the whole value chain. Join forces!
Technology and development - Innovation.
Properties and tolerances
Quality
Timing
Knowledge
Recruitment and training

37 | Date