MT Magazine November/December 2023

WHAT HAPPENS WHEN DISRUPTION COMES TO YOUR INDUSTRY? IF YOU SUPPLY AUTOMOTIVE, YOU'RE LIVING IT. IF YOU DON'T, COUNT ON SOMETHING TO PROFOUNDLY CHANGE YOUR BUSINESS. by Gary S. Vasilash | 13

MEMBERSHIP, PRIVILEGES, AND OPPORTUNITIES by Douglas K. Woods | 01

'SMART(ER) SHOP' OFFERS BYTE-SIZED SOLUTIONS by Bonnie Gurney | 22

TRAGEDY OR COMEDY: THE ECONOMIC STORY IN DATA by Chris Chidzik | 25

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NOVEMBER/DECEMBER 2023 THE ECONOMICS ISSUE VOLUME 2 | ISSUE 6

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MANUFACTURING TECHNOLOGY

650+ Members in the Manufacturing Technology Community

Our members make, sell, service, and supportU.S. manufacturing technology in a global market. We advance the industry byfacilitating t he adoption of transformative technologies,producingcommunity events,promotingMT standards,supporting international business growth, and enhancing industry knowledge. Make the most out of your AMT membership. Reach out us at membership@AMTonline.org. th id t b f ilitti h d ti f t f ti f i h l i l b l k W d

A VIEW FROM THE WOODS

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Membership, Privileges, and Opportunities

A date that probably doesn’t mean anything to you, but which had huge consequences, is March 12, 2020. On that day, a “containment area” within New Rochelle, New York, was established, which, among other things, prohibited large gatherings of people. It was the first coronavirus

This is something that AMT can – and does – help companies manage. For example, while there are many sources of data that you can find in a Google search, there is no specific source like the U.S. Manufacturing Technology Orders (USMTO) program that AMT administers. It focuses specifically on demand for manufacturing technology in the United States, Canada, and Mexico. Of course, many companies want to do business beyond the borders of North America, so AMT has established offices and technical centers in Shanghai, China; Chennai, India; San Sebastian, Spain; and Monterrey, Mexico. This allows an AMT member to establish a foothold in these regions, one that offers assistance and guidance for everything from sales support to hiring local employees. This 1987 slogan from American Express (that you’re undoubtedly familiar with) seems fitting: “Membership has its privileges.” For AMT, that includes: • We have AMT staff that focuses on legislation and lobbying. • We have an economics team that provides member companies with current and projected data. • We have connections with venture capital firms • And, of course, we organize and execute IMTS, objectively one of the most important manufacturing technology events in the world. Yes, there are many organizations that deal with manufacturing and technology. But none, I believe, has as extensive an offering or as comprehensive a commitment as AMT (let’s face it – opening and maintaining a facility in Shanghai isn’t something to be taken lightly). And members have access to the resources AMT has established and continues to develop, resources that help companies increase sales and reduce costs. What’s more, AMT provides the possibility to meet people, to attend meetings, and to contribute to things that may become an industry standard (e.g., MTConnect). Those are privileges – privileges that can become tremendous opportunities. Membership is what you make of it. And you can make – personally, professionally – a great deal. interested in manufacturing technology. • We have people who perform research.

related restriction in the United States. Soon thereafter, we all became familiar with a product invented in 2011 that few of us were aware of and which became an important tool to get our jobs done: Zoom. In 2020 AMT had to cancel IMTS for the first time in 73 years. We created other venues to support the manufacturing technology industry – IMTS spark and IMTS Network. While those channels provided tremendous value to those who took the time to connect, the connections that are fundamental to events like IMTS and other meetings and conferences that AMT holds are – and I am not exaggerating here – priceless. You can’t look into someone’s eyes and shake their hand on Zoom. And if there is one characteristic that I think is absolutely essential to AMT, it is the fact that it is personal, whether it is at an IMTS, where you can be with customers and colleagues from around the world, or at an advisory committee meeting, where you are working one-on-one with people to advance your area of interest. I’ve had a long affiliation with AMT, one that goes back to 1994. At the time, I worked at a company making special machines, and it was recommended to me that the company join the association. From the start, I attended meetings. Committee meetings (for a group that focused on special machines – much to the benefit of my company). The AMT Annual Meeting, which put me face to-face with C-level executives for companies that I otherwise would have never had the chance to meet. I met peers, some of whom have become lifelong friends. In all cases, the opportunity to spend time with people was beneficial on both personal and professional levels. Those connections are certainly priceless. And I found that what I gained from my association with AMT to be so important and that I liked it so much that, yes, I became president in 2009. Meeting people and making connections are certainly valuable to any business. And when the people are within one’s area of business – like manufacturing technology – it can have positive knock-on effects. But the complexity of business today has a lot of elements that are difficult for companies – be they Silicon Valley automation startups or multinational machine tool manufacturers – to navigate.

Douglas K. Woods President AMT – The Association For Manufacturing Technology

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Masthead

Editorial Team

Executive Team

Membership & Sales

Kristin Bartschi Director, Marketing & Communications kbartschi@AMTonline.org

Douglas K. Woods President dwoods@AMTonline.org Travis Egan Chief Revenue Officer tegan@AMTonline.org Peter Eelman Chief Experience Officer peelman@AMTonline.org Becky Stahl Chief Financial Officer bstahl@AMTonline.org Tim Shinbara Chief Technology Officer tshinbara@AMTonline.org

Bill Herman VP, Sales & Membership bherman@AMTonline.org Technology Benjamin Moses Senior Director, Technology bmoses@AMTonline.org Intelligence Ian Stringer VP, Data Strategy istringer@AMTonline.org Smartforce

Mary Cecile Neville Director, Content mcneville@AMTonline.org

Chris Downs Director, Audience Development cmdowns@AMTonline.org

Kathy Webster Managing Editor, Content kwebster@AMTonline.org Dan Hong Writer/Editor dhong@AMTonline.org

Catherine Ross Director, Community Engagement cross@AMTonline.org Advocacy Amber Thomas VP, Advocacy athomas@AMTonline.org International Ed Christopher VP, Global Services echristopher@AMTonline.org

Elissa Davis Writer/Digital Community Specialist edavis@AMTonline.org

Jacob McCloskey Graphic Designer jmccloskey@AMTonline.org

Tiffany Kim Graphic Designer tkim@AMTonline.org

Hailey Sarnecki Graphic Designer hsarnecki@AMTonline.org

IMTS

Peter R. Eelman Chief Experience Officer peelman@AMTonline.org

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Michelle Edmonson VP, Exhibitions medmonson@AMTonline.org

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Bonnie Gurney VP, Content & Partnerships bgurney@AMTonline.org

Want to learn more about AMT membership? To learn how to make the most of your AMT membership, email us at membership@AMTonline.org.

JOIN AMT

Mark Kennedy Senior Director, Exhibitor Services mkennedy@AMTonline.org

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AMT – The Association For Manufacturing Technology 7901 Jones Branch Dr. Suite 900, McLean, VA 22102-3316 Tel: 703-893-2900 | Fax: 703-893-1151

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Table of Contents

Click See what’s trending on AMTonline.org

07

Manufacturing Matters Get details on the latest industry news

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AMT Upcoming Events Important manufacturing technology dates and events to bookmark

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What Happens When Disruption Comes to Your Industry? by Gary S. Vasilash

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Recession on the Horizon? The State of Manufacturing

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‘Adventures with: Peter, Travis & Nicole’ — an EMO Show Report by Peter Eelman

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‘Smart(er) Shop’ Offers Byte-Sized Solutions by Bonnie Gurney

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Tragedy or Comedy: The Economic Story in Data by Chris Chidzik

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Automation Within Reach by Stephen LaMarca

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Some Interest(ing) Trends by Chris Chidzik

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COVER DESIGN Tiffany Kim | Graphic Designer

INFOGRAPHIC DESIGN Recession on the Horizon? Jacob McCloskey | Graphic Designer

MT Manufacturing Technology (ISSN # 2836-2896), November/December 2023, Issue 6, is published bi-monthly by AMT – The Association For Manufacturing Technology, 7901 Jones Branch Drive, Suite 900, McLean VA 22102. Periodicals Postage Paid at Merrifield, VA and at additional mailing offices. POSTMASTER: Send address changes to MT Manufacturing Technology at 7901 Jones Branch Drive, Suite 900, McLean VA 22102.

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Click MT Magazine is more than just paper pulp and ink. Explore our content on AMTonline.org and engage with discussions on a wide array of topics affecting manufacturing technology now.

Different Is Better: 10 Tips To Build Your Personal Brand Quick question: What is stopping you from being the next big manufacturing influencer? The short answer is nothing. The long answer involves building your personal brand to set yourself apart as the next big thing. Take these 10 tips and don’t forget us when you make it big! AMTonline.org/article/different-is-better-10-tips-to-build-your personal-brand

Embracing the Skills of Individuals With Autism for Machining

Talent can come in all different types of packages. Allis Manufacturing found this out when they decided to tap into an often-overlooked population: people with disabilities. Allis worked with The Uniquely Abled Project to hire a 19-year-old CNC machinist with autism who took to the task like a duck to water. Learn more about the UAP and their work! AMTonline.org/article/embracing-the-skills-of-individuals-with-autism-for-machining

AMT and SME Announce New Strategic Partnership in Workforce Development

Put ‘er there, partner! AMT recently announced a partnership with SME focused on the next generation of manufacturers. Former AMT Vice President Greg Jones will now work at SME along with products like Tooling-U, CMTSE, and MT Sales Fundamentals as well as the Student Summit at IMTS. This partnership helps our industry make bigger strides toward solving manufacturing workforce challenges. AMTonline.org/article/amt-the-association-for-manufacturing-technology-and-sme announce-new

Registration Opens for IMTS 2024 We are so excited to announce that registration for IMTS 2024 is officially open! This year’s theme of “Inspiring the Extraordinary” promises you’ll be amazed by the lineup. With a new partnership with SPS, the return of the IMTS+ Creators Lounge, and the introduction of IMTS Sectors, IMTS 2024 features everything you love about the show – and some new things to love as well! AMTonline.org/article/registration-opens-for-imts-2024

NEWSLETTERS Subscribe today at AMTonline.org/resources AMT

THE NEWS, STORIES, AND UPDATES YOU NEED. ALL IN YOUR INBOX.

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TECH REPORT Forget clickbait! AMT Tech Trends podcast hosts Stephen Lamarca and Benjamin Moses pull the news items that matter. Whether it’s 3D printed houses, robots on Mars or Le Mans and F1 racing, the Tech Report always keeps it fun and interesting. manufacturing technology industry content curated by AMT experts. Keep up to date with breaking news, white papers, analysis, market surveys, breakdowns, and actionable items from around the globe. At AMT, we mind your business.

MANUFACTURING MATTERS

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Manufacturing Matters Check in for the highlights, headlines, and hijinks that matter to manufacturing. These lean news items keep you updated on the latest developments.

TECHNOLOGY

What’s Clearer Than Dollar Signs? Technology and economics are intertwined, and a company’s interest in new technologies often depends on if it allows them to make more of something, make something more efficiently, or make something more valuable. This return on investment is a common way to assess the viability of technology implementation. Other common factors to consider are maintenance, upgrades, and end-of-life replacements. A few often-overlooked liabilities are the cost of security and opportunity cost of depreciated/obsolete technology. These days, the industry is changing its financial model of equipment to increase visibility of value and improve upkeep. This transparency of financial risk will enable manufacturers to better formulate their investment strategy. While some say, "If it ain't broke, don't fix it," maybe it should be: "If it ain't current, it's broke."

INTELLIGENCE

An Economic Balancing Act The U.S. economy currently hangs in a delicate balance. The Federal Reserve’s stringent monetary policy, aimed at controlling inflation, is designed to slow down economic momentum, raising concerns over increasing unemployment – a key indicator of a potential recession. An increase in unemployment can lead to reduced consumer spending, lowering demand across various sectors and heightening recession risks. However, a recent Wall Street Journal survey showed slight optimism, as experts reduced the immediate recession probabilities from 54% to 48%. This subtle but positive shift hints at a somewhat improved economic outlook, aligning with the sentiments expressed by economists at AMT’s MTForecast conference, which was held in early October in Detroit. They predicted a likely but shallow recession in the early part of 2024, but one of the firms has subsequently revised, taking recession out of their base case. The predominant challenge involves fine-tuning monetary policies to reduce inflation to the Fed’s targeted 2% without tipping the economy completely on its head and instead guiding it toward the sought-after soft landing. Stay in the Loop: The Smartforce Student Summit Coming Soon to Your Inbox Save the date! The highly anticipated Smartforce Student Summit, co-sponsored by AMT and Tooling U-SME, will take center stage inside Level 2 of the East Building of McCormick Place at IMTS on Sept. 9-14, 2024, continuing its 25-year history of delivering memorable experiences that inspire thousands of students to pursue manufacturing careers. Now MT Magazine readers can keep up with the nation’s foremost event for MT education by visiting IMTS.com/smartforce to join our email list. Or follow us at @IMTS_Smartforce on Instagram and Twitter to get the latest news, receive exclusive previews of student-friendly exhibits, and catch up on the Smartforce Blog featuring all things workforce and education, alongside updates from student robotics clubs nationwide. Want to get involved with the 2024 Smartforce Student Summit? Contact Catherine “Cat” Ross, AMT’s director of community engagement, at cross@AMTonline.org. SMARTFORCE

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ADVOCACY

Manufacturing Innovation Fuels Economies Global economics and manufacturing are tightly interwoven. Manufacturing plays a crucial role in the economic landscape affecting a country's GDP, trade balance, infrastructure development, innovation, and overall economic strength. At the heart of this is innovation, which can catalyze economic development. The infusion of cutting-edge technologies and methodologies into industry propels efficiency and productivity. Streamlined processes, from automation to data analytics, increase output while minimizing costs. Job markets evolve, demanding a skilled workforce. This dynamic shift not only fuels employment but also cultivates expertise, positioning the workforce as a global asset attracting foreign direct investment. Moreover, innovative manufacturing has a ripple effect across other sectors, triggering advancements in logistics, research, and development. Technologically advanced products enhance global competitiveness, leading to exports and a better trade balance. Jobs, GDP, trade, economic strength: It’s all tied into manufacturing, so be proud. Spending Fight Impacts Manufacturers President Joe Biden signed a bipartisan spending bill that will fund the government at current levels until early next year. The “laddered” continuing resolution, an unusual approach from newly minted House Speaker Mike Johnson, R-La., funds four departments and related agencies through Jan. 19 and the remaining eight through February. The intent is for the two deadlines to allow sufficient time to complete all 12 of the individual appropriations bills despite significant disagreement between and within parties on funding amounts. The timing of the funding plan has implications for manufacturers because it influences prospects for a year-end tax package that could include important tax changes. Lawmakers from both parties and chambers have been working on a deal that would extend 100% bonus depreciation, restore expensing for R&D costs, and provide relief on business interest deductions. Attaching a tax bill to the spending package is no longer an option. However, the January and February deadlines for the 12 must-pass funding bills provide additional opportunities to get tax relief for manufacturers over the finish line. INTERNATIONAL

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AMT Upcoming Events Learn more or register at AMTonline.org/events. Your datebook will thank you.

IMTS Exhibitor Workshop January 30-31, 2024 | Chicago, Illinois IMTS

MTForecast 2024 October 9-11, 2024 | Chicago, Illinois INTELLIGENCE

MTForecast breaks down the latest industry news, forecasts, and trends. Industry leaders, executives, and key decision-makers connect and learn better business strategies through customer industry insights, economic forecasting, and deep dives into market data.

Building a successful exhibition booth at IMTS 2024 begins at the complimentary Exhibitor Workshop. Get all your questions answered by IMTS producers and veterans, develop engagement strategies and business plans, go over logistics and show tips, and much more.

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Formnext Chicago April 8-10, 2025 | Chicago, Illinois FORMNEXT

The Manufacturing For Growth (MFG) Meeting is the ultimate gathering of manufacturing technology minds, bringing together a community of solutions and solvers. Learn how to keep pace with growing demand, make lifelong connections, and see what opportunities lie on the horizon.

Formnext is known as the international meeting point for the next generation of intelligent industrial AM production. The new show creates one event in the United States dedicated to all aspects of additive manufacturing and industrial 3D printing. SPS is a renowned global trade event for the automation industry and represents the complete spectrum of smart and digital automation – from simple sensors to intelligent solutions, from what is feasible today to the vision of a comprehensively digitized industrial world. SPS September 16-18, 2025 | Atlanta, Georgia SMART PRODUCTION SOLUTIONS

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011 ARE WE THERE YET?

Nan0 BYTES

See what we can do?

like shattered embers

Once, only

dreams could fill

the waking distance

swirling above

between soil and sky

Written by Dan Hong // Illustrated by Jacob McCloskey

a forge on

FROM

When we are

breathless nights.

left to our own

To touch the wide expanse

We stood on tall shoulders

devices

and sewed together

to dream.

beyond soil,

sky, and breath.

We h e y keep dreaming with us in 2024!

a world quickly shrinking

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What Happens When Disruption Comes to Your Industry? If you supply automotive, you’re living it. If you don’t, you can count on something changing your business in a profound way.

BY GARY S. VASILASH CONTRIBUTING EDITOR

"The greatest danger in times of turbulence is not the turbulence – it’s to act with yesterday’s logic." – Peter Drucker

The U.S. household appliance market – everything from washing machines to air conditioners, water heaters to refrigerators – had a valuation of some $55.3 billion in 2022. Certainly a big market that can’t be overlooked by anyone in manufacturing.

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The Cruise Origin is electric and autonomous. It currently offers driverless rides in San Francisco, Phoenix, and Austin. General Motors, which owns Cruise, has petitioned the National Highway Traffic Safety Administration to permit the building of Origin vehicles without things like steering wheels because there is no driver involved in the operation of the vehicle. That’s disruption. (Image: Cruise)

• In 1876 the first four-stroke gasoline automotive engine was invented, and 10 years later, in 1886, Carl Benz began commercial production. • The 1901 Model C Packard featured a steering wheel rather than a tiller to control the direction of the wheels. And now the internal combustion engine (ICE) is giving way to the electric motor. General Motors has petitioned the National Highway Traffic Safety Administration for the ability to mass produce Cruise Origin AV vehicles without steering wheels. Suddenly an entire industry – OEMs as well as suppliers – is facing changes to what it’s been doing for more than a century. Or more to the point: They have the choice to face those changes or pretend they are not happening. And suffer the consequences. So, while the focus here is on the auto industry and the situation that it finds itself in – a situation unlike any other time in its history – the purpose is to use this as an example – an extreme one, perhaps – of what is being faced by manufacturers in industries across the board. Your industry may not have its Tesla. Yet. Consequences of Disruptions Paul Eichenberg, a consultant who focuses on strategic, operational, and systems issues, points out that the auto industry over the past few decades has been focused on lean manufacturing and asking: How do we make what we make better? While that was certainly beneficial for companies – after all, it was how they were able to make money – it is no longer sufficient given that, in the past few years, Tesla has disrupted not only products but processes as it has led the way for mass produced electric vehicles, driving the transition being made

But then there’s another market of more than moderate interest: Automotive. In 2023, automotive has an estimated manufacturing market size of $104.1 billion, or nearly twice that of the household appliance segment. While more than 99% of U.S. households have a refrigerator and “only” 92% have a motor vehicle, the average price of a new fridge is $1,500, and a new vehicle is over $48,000. Clearly the automotive market is important. According to the Alliance for Automotive Innovation, a trade organization representing OEMs and suppliers in the United States: • For every dollar spent in vehicle manufacturing, an additional $3.45 of economic value is created. • More than $75 billion in U.S. investments have been announced by auto manufacturers (and let’s face it – the auto industry since 2021 has been dealing with the consequences of COVID and the chip shortage). • Vehicle and parts manufacturing accounts for 6% of all U.S. manufacturing and 11% of the durable goods manufacturing subsector. All of this is prelude to the fact that, according to the U.S. Department of Energy, “Today’s [refrigerator] models have better insulation in the cabinets and sealing around the doors and they use more efficient compressor motors and new refrigerants.” And while everything from IoT capability to smudge-proof surfaces are available to refrigerators, the auto industry has embraced CASE (connected, automated, shared, electric), an acronym that pretty much characterizes why there is over $75 billion in investment. Arguably, the home appliance industry's products and processes are undergoing improvements. The automotive industry is undergoing disruption. To get a sense of the magnitude of the changes, consider this:

Dealing With Disruption “We define disruption as the displacement of businesses, markets, and value networks as the result of economic, societal, environmental, political, regulatory, or technological changes. Technological innovations can, in addition, serve as catalysts to accelerate other disruptive forces.” – AlixPartners Dan Hearsch, a partner and managing director who has a specialization in manufacturing operations with AlixPartners, a global management consulting firm, says disruption puts organizations out of their normal operating environments, and an issue that it causes, or is characterized by, is a high level of unpredictability. While changes are simply characteristic of the way things occur, Hearsch says there is a marked acceleration of change, and it’s happening in unexpected ways that are challenging industries across the globe. He uses an example from the pandemic that may seem trivial but is really to the point: the run on toilet paper. Did Procter & Gamble or Kimberly Clark see that coming? That simple circumstance made it clear how the supply chain has a level of fragility. Of course, on a more “professional” level, there was the chip shortage, which, Hearsch says, continues to resonate today and has necessitated a rethink of sourcing, inventories, and internal capabilities. Primary factors contributing to disruption include: • Regulations • Economic conditions • Technological developments • Environmental, social, and governance issues • Employees In a global survey of 3,000 executives within the categories of Aerospace & Defense, Automotive, Consumer Products, Energy & Power Generation, Financial Services, Healthcare & Life Sciences, Media & Entertainment, Retail, Technology, Telecom & Cable, AlixPartners found that 98% of companies are now changing or expect to change their business models in the next three years to address disruption. That said, 85% say they are finding it increasingly difficult to know how to start dealing with disruption – and 70% of the CEOs are worried about their jobs as a result of disruption.

Yes, the GE Appliances Café 4-Door French-Door Refrigerator features built-in Wi-Fi and works with the company’s SmartHQ app, but fundamentally the advances in refrigerators have been predicated on change, not disruption: An internet-enabled refrigerator is still a refrigerator. But an Internet-enabled vehicle, while still a mode of transportation, conceivably becomes something that drives rather than something that’s driven. That’s disruption. (Image: GE Appliances)

by the major players in the industry, which has had profound consequences on production. Consider, for example, forgings. Eichenberg says that this is a roughly $90-billion global industry. But ICEs account for about half that, and the remaining markets really have no high-volume applications – at least not automotive style volume. A given forging company, Eichenberg suggests, may have become one of the best in the world, fully embracing lean, and is operating presses 24/7, providing parts, say, to General Motors. And it has developed a highly efficient business model to do so. Things are good. Or seem good. “What happens when the reason for that business model no longer exists?” Eichenberg asks. What happens when ICE volumes decline – and they are declining. Or consider wiring harness manufacturers. Eichenberg notes the original Tesla Model S has some 3 kilometers of wiring in its harness – and the Model Y has about 100 meters. While that may provoke nothing more than a shrug and an excuse (e.g., “We don’t supply Tesla.”), he points out that Ford and General Motors are pursuing the same approach. If this approach to minimization becomes more prevalent in other components, then there is an issue for those beyond wiring. “What happens …?” And then there are the so-called gigacastings Telsa is employing to create front and rear underbody structures (and will likely be using to create an entire underbody for a forthcoming smaller vehicle). These parts are produced with large high-pressure aluminum die casting machines – as in 6,000 tons and greater. These large castings eliminate the need for literally hundreds of stamped parts as well as everything that goes with assembling those stampings into larger structural components. (If you’re in the stamping, tooling, welding, or associated business, consider the

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which they can do better planning – and planning based on data is something that Harbour says is essential. But planning goes beyond keeping the factory floor operating at an optimal tempo; it includes determining what other things can be done. She suggests that managers need to have staff – whether internal or external – who can assess what alternative industries are good fits for the company’s capabilities. Dave Andrea, principal on the Plante Moran automotive strategy team, focuses on suppliers and manufacturing and agrees about the need for companies to look to other industries, something that may be completely foreign to them: “Auto is so large that companies have not needed to create relationships with other sectors.” However, there is one group that a company can leverage in terms of looking for new technologies, prospects, and suppliers: the board of directors. Generally these board members have external visibility that is otherwise limited – or lacking – within a company. Andrea suggests that just as companies have advanced engineering staffs, they should create something of an advanced purchasing activity that will look at new suppliers that can address new customer requirements. But both Harbour and Andrea point out that automotive has historically been such a big part of the business for any given company that replacing that volume will be difficult to say the least. And both Harbour and Eichenberg say that there are some company owners and executives – even at companies making fuel systems for ICEs – who don’t want to acknowledge that things are changing. It is easier for them – for now – to ignore it. Eichenberg suggests that the auto industry is in a cycle of disruption that will last for the next 20 years. Companies that have a three-year planning window are not going to see what’s on the horizon for them. Or possibly even what they’re in the midst of. Again: You may not have a buck’s worth of business with automotive. But you can count on disruption sooner rather than later.

implications.) Eichenberg acknowledges that there is certainly plenty of casting expertise in the auto industry today. But the casting equipment is a fraction of the size of that being used to produce gigacastings, and to make the transition would be costly. In a situation where money is hard to get, this change may be hard to make. Eichenberg points out that other OEMs are pursuing their versions of gigacastings, so this is something that will become a trend, not a fad – something that is going to become more of the norm. And that norm will have a tremendous impact on entire sectors, with some seeing their business diminish and others growing. For example, for the admittedly low-volume forthcoming Cadillac CELESTIQ, GM is building the underbody with six precision sand-cast aluminum components, each of which will cut stamped part count by 30 to 40 components – or from 180 to 240 stampings per vehicle. “What happens …?” Consider companies that had done solid business chrome plating plastic grilles. There is no grille on a Model Y. Nor are there grilles on the Mustang Mach-E or the Chevy Bolt. And those EVs that continue to have a grille – like the BMW i7 – don’t have a shiny one, Eichenberg says, because the chrome signifies old tech. “What happens …?” So, What Do You Do? There is a theory in biology named “punctuated equilibrium.” It argues that there are times when evolution goes from being fairly stable to a sudden change. Arguably we are in a state of punctuated equilibrium, one that started on June 22, 2012, when the Tesla Model S was introduced. What can be done to handle these changes – or benefit from them? Laurie Harbour, president and CEO of Harbour Results, a consultancy that focuses on manufacturing, operations, and strategic management, says there are several things that manufacturing facilities can do: “Flexibility is the most critical piece, the ability to react to the unexpected.” She says leading companies her team works with are investing 8% to 10% capex on automation and software technology. The first is helping manage labor. The latter is providing a means by

Then ask yourself: “What happens …?”

If you have any questions about this information, please contact Gary at vasilash@gmail.com.

This suite of vehicles from Tesla has had a disruptive effect on the global auto industry. Initially global OEMs pooh-poohed the Model S when it appeared in 2012. Now there isn’t a company that isn’t trying to replicate what Tesla is doing, both in terms of product and process. During the first six months of 2023, according to S&P Global Mobility figures, Tesla sold 325,291 vehicles in the United States. That is more than the next 19 OEMs – including GM, Ford, Mercedes, and VW – combined. That’s disruption. (Image: Tesla)

FEATURE STORY

NOVEMBER/DECEMBER 2023

17

IS

AMT provides the tools and resources to capitalize on opportunities. Navigate shifting market conditions with the latest data surveys.Reach your goals with insights from top economic, market, and political analysts and forecasters. Find the insights you need. Learn more about AMT membership at AMTonline.org

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THE ECONOMICS ISSUE

18

U.S. Manufacturing Technology Orders (USMTO) is a statistical program administered by AMT that collects data on the demand for manufacturing technology in the United States, Mexico, and Canada. Comparing USMTO data to industrial production data in past recessions provides interesting insight into what to expect in future downturns.

NET CHANGE IN EMPLOYMENT — BEGINNING TO END OF RECESSION *2016 was not an officially designated recession but very negative for manufacturing.

ALL INDUSTRIES

MANUFACTURING

Recession

Number (Thou)

Percent

Recession

Number (Thou) Percent

2001 2008 2016* COVID

2001 2008 2016* COVID

-1,643 -7,290 3,200 -21,668

-1.24% -5.23% 2.25% -14.22%

-1,293 -2,031 -7 -1,376

-7.10% -4.78% -0.06% -10.76%

Months between the industrial production trough and the the trough of USMTO orders following a recession .

2001 Recession 2008 Recession

Units Value

18 22

6 5

USMTO covers 229 unique manufacturing technologies and provides key insights into the manufacturing technology market.

F THE STATE OF NG MANUFACTURING G

than September 2023. 7

MONTHS since 1985 that industrial production has been higher

NOVEMBER/DECEMBER 2023

19

USMTO UNITS ORDERED (12-MONTH MOVING AVERAGE) AND INDUSTRIAL PRODUCTION

5,000

110

INDEX OF INDUSTRIAL PRODUCTION

4,500

4,000

3,500

100

3,000

2,500

2,000

90

1,500

UNITS ORDERED

1,000

500

0.00

80

3/1/11

1/1/17

1/1/10

7/1/13

5/1/12

1/1/03

4/1/01

2/1/21

9/1/21

7/1/99

2/1/14

8/1/17

3/1/18

4/1/15

6/1/16

5/1/19

9/1/14

11/1/01

11/1/15

8/1/10

7/1/06

10/1/11

6/1/02

2/1/07

Recession 3/1/04 10/1/04 5/1/05

7/1/20

8/1/03

9/1/07

12/1/12

2/1/00

4/1/08

9/1/00

6/1/09

6/1/23

11/1/22

4/1/22

12/1/19

11/1/08

10/1/18

12/1/98

12/1/05

Units Ordered

Industrial Production

USMTO data typically responds on a lag compared to industrial production data, with order values dropping first, followed by number of units. This may indicate that purchasers are buying lower-value machines before slowing purchasing altogether.

VALUE OF USMTO ORDERS (12-MONTH MOVING AVERAGE) AND INDUSTRIAL PRODUCTION

$900,000

110

INDEX OF INDUSTRIAL PRODUCTION

$800,000

$700,000

$600,000

100

$500,000

$400,000

$300,000

90

$200,000 VALUE OF ORDERS

$100,000

0

80

3/1/11

1/1/17

1/1/10

7/1/13

5/1/12

1/1/03

4/1/01

2/1/21

9/1/21

7/1/99

8/1/17

2/1/14

3/1/18

4/1/15

6/1/16

5/1/19

9/1/14

11/1/01

11/1/15

8/1/10

7/1/06

10/1/11

6/1/02

2/1/07

5/1/05

7/1/20

8/1/03

9/1/07

3/1/04

12/1/12

2/1/00

4/1/08

9/1/00

6/1/09

6/1/23

11/1/22

4/1/22

12/1/19

11/1/08

10/1/18

12/1/98

12/1/05

10/1/04

Recession

Value of Orders

Industrial Production

hitting their peak. 17

192 192K

MONTHS of decline in the value of USMTO orders since

INCREASE in manufacturing employment since USMTO order value peaked.

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YOUR ROADMAP FOR A SUCCESSFUL IMTS Get all your IMTS exhibitor questions answered, develop engagement strategies and business plans, go over logistics and show tips, and much more at this free event!

COMMUNICATE Write effective press releases, leverage social media, and connect with targeted audiences. MARKET Create the perfect marketing campaign for your business. EXECUTE Learn the ins and outs of setting up the best booth possible.

SCAN HERE

TO LEARN MORE

IMTS

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‘Adventures with: Peter, Travis & Nicole’ — an EMO Show Report

BY PETER EELMAN CHIEF EXPERIENCE OFFICER

IMTS 2024 Exhibitors: See You in Chicago

How does the European market look relative to the United States? Are they facing some of the same challenges in workforce development? What about technology introduction? And what is so different about a big trade show in Europe versus IMTS? To explore business and cultural differences, tune in to “Adventures with: Peter, Travis & Nicole,” a new IMTS+ video miniseries that is part business and part travel vlog. This video digs into those questions during a trip to the EMO show, which took place in Hannover, Germany, this September. You can find all the “Adventures with:” videos on IMTS+ at IMTS.com/ AdventuresEMO and on the IMTS LinkedIn, Facebook, and Instagram pages. EMO is often considered the IMTS of Europe. With that in mind, IMTS wanted to give the North American audience a view of EMO through three different perspectives. Our series features IMTS rock star Nicole Wolter, president and CEO of HM Manufacturing and chairperson of the Technology and Machining Association, visiting EMO for the first time; Travis Egan, AMT’s chief revenue officer, who works closely with AMT members and OEMs; and me, Peter Eelman, AMT’s chief experience officer and IMTS show boss since 1996.

We’re looking forward to seeing you at McCormick Place in Chicago on Jan. 30-31, 2024, for the IMTS 2024 Exhibitor Workshop. Complimentary to all exhibitors, this event is your opportunity to meet with IMTS staff and vendors to maximize your investment. There are tracks for operations, sales, and marketing staff. Register at IMTS.com/Workshop.

and automation systems Here are some highlights and insights offered in these EMO adventures: • Even though Germany is renowned for its tradition of skilled trade apprenticeships, Germany and Europe also have the same labor challenges as the United States. • To address the issue, EMO has a big focus on digitalization, robotics, and extending automation beyond the machine (much like IMTS). Each episode of “Adventures with:” features new equipment that addresses these issues. • One of the themes from EMO is companies placing a greater emphasis on reducing their carbon footprint. A particular machine launched at EMO may have the same features as one introduced at IMTS, but in Europe, a reduction in energy consumption is a bigger selling point. • Women leaders in manufacturing face similar challenges as they build their careers. Nicole Wolter’s conversation with Barbara Colombo is a must-watch interview for aspiring young women in manufacturing. Visit IMTS. com/EMOWomenLeaders to watch now. Building Relationships European trade shows emphasize socializing. Many exhibitors have a sit-down biergarten or cafe. Larger exhibitors may even offer a full lunch service. You may discuss business during lunch but recognize that Europeans value relationships. They take the opportunity to get to know people at shows like EMO, so don’t pass up an opportunity to linger over an espresso. If you happen to enjoy beer, raise a glass and toast your business companion with a hearty “ein prosit!” (A toast!) Cheers to Future Adventurers If you’re interested in international trade shows and learning more about the European manufacturing industry and newly introduced products, tune in to sip, savor, and explore more “Adventures with:” episodes on IMTS+ at IMTS.com/ AdventuresEMO.

(L-R) Peter Eelman, Nicole Wolter, and Travis Egan attend the EMO Gala at the Herrenhausen Gardens in Hanover.

Similarities and Differences We connect with companies and people that are familiar to IMTS audiences, including: • Mike Cicco, president and CEO of FANUC America Corp. • Brendt Holden, president of HAIMER USA • Gisbert Ledvon, vice president of marketing at HEIDENHAIN North America • Alexander Zoller, president of ZOLLER Inc. • Jelle De Roovere, managing director at RoboJob GmbH • Barbara Colombo, CEO of FICEP Spa and president of UCIMU-SISTEMI PER PRODURRE, the Italian association of manufacturers of machine tools, robots,

If you have any questions about this information, please contact Peter at peelman@IMTS.com.

THE ECONOMICS ISSUE

IMTS+

22

‘Smart(er) Shop’ Offers Byte-Sized Solutions BY BONNIE GURNEY VICE PRESIDENT, STRATEGIC CONTENT & PARTNERSHIPS

Connected Solutions Filmed at the Autodesk Technology Center at Pier 9 in San Francisco, the second episode focuses on the benefits of a connected shop. The Autodesk team demonstrates the productivity and quality benefits possible with CAD-CAM software featuring built-in (and free!) drivers for Haas, Mazak, and other CNCs. In an era where too many shops write post-processor information on a sticky note and pray for good outcomes after pressing the cycle-start button, this episode drives home the benefits of a modern digital workflow. It also features a malicious penguin and channels “Young Frankenstein” to convey key points – you’ll just have to watch to appreciate the context.

What can you do about cybersecurity when you are both the shop staff and the IT staff? Could a rented robot solve inspection challenges? Take 10 minutes and find out how to address these

issues and more by watching Season 2 of the IMTS+ Original Series “Smart(er) Shop,” brought to you by Autodesk, which premiered Oct. 26 on IMTS.com. “Smart(er) Shop” features Ryan Kelly, the general manager for AMT’s San Francisco Tech Lab, and Adam Allard, senior manager of technical environments at Autodesk, who oversees Autodesk Technology Centers across North America. Kelly and Allard offer up three budget-friendly, easy-to implement ideas for small and medium-sized shops. They focus on technology, but you don’t need to be an IT wizard or automation expert to take advantage of the “byte-sized” solutions featured in Season 2. Cybersecurity Tips From MxD According to the National Association of Manufacturers (NAM) article “Ransomware Attacks Increasingly Target Manufacturers,” manufacturing is the target for nearly a quarter of ransomware attacks. To address this, the season premiere of “Smart(er) Shops” features MxD, the national digital manufacturing and cybersecurity institute based in Chicago. The MxD team highlights six security practices from its free cybersecurity playbook that anyone can implement. Learn how to deal with tailgaters (someone riding your tail to enter a facility on your security badge), use encrypted USBs, set up allow-listing software, and more. For shops pursuing Cybersecurity Maturity Model Certification (CMMC 2.0) to obtain defense contracts, this two-part episode is a must-watch.

Co-hosts Ryan Kelly (left) and Adam Allard visit Autodesk to explore the benefits of a connected shop.

Rental Robots for Quality Control Episode 3 takes the team to Topcon Position Systems, a leading global manufacturer of positioning systems for construction and agricultural equipment. Kelly and Allard learn that while human brains are great at recognizing patterns, they are lousy at concentrating on repetitive details, which creates a vexing inspection problem. Using a robots-as-a-service solution from Rapid Robotics paired with an AI-driven vision system from Elementary, Topcon has eliminated a QC issue that plagues many manufacturers. The best part: The solution hits the company’s operating budget for about the daily cost of a lunch for two. Level up your operations without breaking the bank or needing a wizard’s degree in technology by tuning in to Season 2 of the IMTS+ Original Series “Smart(er) Shop,” brought to you by Autodesk, on IMTS+ at IMTS.com/SmarterShop.

MxD is the national digital manufacturing and cybersecurity institute.

If you have any questions about IMTS+, please contact Bonnie at bgurney@AMTonline.org.