Thursday, October 11, 2001

Makino responds to reduced market

New machine line smaller, priced lower

By Mike Boyer
The Cincinnati Enquirer

        Hit hard by the slump in the machine tool industry, Mason's Makino is introducing a new line of lower-cost machines to tap a broader market.

        The unit of Japanese-owned Makino Milling Machine Co. is introducing a lower-cost version of its A55E high performance 15-inch horizontal machining center.

        Called the a51, the new unit is about 30 percent smaller than the A55E and costs about 30 percent less, said Don Lane, Makino president. The high-end A55 machines typically cost in the range of $350,000 to $375,0000.

        The company, which recently trimmed about 50 jobs and announced plans to move its die/mold sales office from Mason to Detroit, introduced the a51 at a two-day customer expo that concluded Wednesday at the Mason headquarters. The event, which drew about 400, featured exhibits by Makino and a number of its suppliers.

        By next September's International Manufacturing Technology Show in Chicago, Mr. Lane said Makino will introduce lower-priced versions of all its products — vertical and horizontal machining centers and electric discharge machines. Makino provides machines to the aerospace, automotive and general machining markets.

        After peaking at more than $6 billion in 1998, the U.S. machine tool market is down about a third this year due to the slowdown in manufacturing.

        Mr. Lane said the market for machines that cut and form metal is at its lowest level in almost 20 years.

        “We're in a very significant slowdown in business,” he said. That includes not only the United States, but also Europe and Japan.

        Through August, machine tool orders totaled $1.8 billion this year, down 31 percent from a year ago, according to the latest monthly report compiled by two industry trade groups, the AMTDA, American Machine Tool Distributors, and AMT, Association for Manufacturing Technology.

        August orders totaled $207 million, down 39 percent, from the $340 million reported a year ago, the trade groups said.

        Order activity slowed even further in the wake of the Sept. 11 terrorist attacks, particularly in the aerospace industry where customers such as Boeing Co. and GE Aircraft Engines have announced job cuts, Mr. Lane said.

        “We're going to sell our way out of it,” he said, noting that the lower-cost machines that Makino will be introducing will tap a bigger market.

        He said the company began the multimillion-dollar reengineering effort after the last Chicago machine tool show a year ago. A couple of major customers made the request.

        He said the new machines will have fewer parts and fewer options, but will have the high-speed machining capabilities of Makino's high-end machines. Makino produces its machine tools in Japan, but the equipment is tailored to customer requirements at the Mason plant, which employs between 250 and 275.


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