Forecast


Global Investment Casting Market Conditions Beginning To Stabilize After 2009 Lows


by Ron Williams, Richard Hirst, The Blayson Group Ltd.


Total world investment casting sales


in 2009 were down by 14% overall to U.S. $8.9 billion with regions faring dif- ferently. North America and Europe fell by 16-20% while Asia varied from 0% to -25%.


‘High added value’ aerospace and


IGT castings performed well until mid 2009 rescheduling of orders reduced sales to the aerospace sector. Industrial gas turbines remained ex-


tremely strong until October 2009 when a sudden and dramatic downturn occurred. China was notable for maintaining its


overall sales with a substantial increase in high added value castings offsetting the fall of 50% in commercial casting sales. Underlying this performance is the cre- ation and success of the newly formed China Aviation Industry Corporation.


Sales by Market Sector Figure 1 shows the makeup of sales


by region. As usual the ‘high added value’ sales in the west dominate and generate some two thirds of the revenues, while Asia with 75% of the world’s investment casting foundries, generates a mere one third of the overall revenues. It is impor- tant to note however that the increase in manufacturing of aerospace components in China is beginning to make a change to this balance.


Aerospace Rescheduling has resulted in a drop


in sales of up to 20% through 2009; how- ever order books remain strong with Air- bus, for example, having 3,500 aircraft on order and Boeing in a similarly strong


8


The chart above shows the make up sales by region. As usual the ‘High Added Value’ sales in west dominate and generate some two thirds of the revenues, whilst Asia with 75% of the W investment casting foundries generate a mere one third of the overall revenues. It is importa note however that the increase on manufacturing of aerospace components in China is begin make a change to this balance.


January 2011


position. In addition, new models are being introduced to the market by both companies. Sales of engine spares were down but are now recovering. Looking forward it seems that pro-


duction levels will remain roughly at cur- rent levels into 2011.


Industrial Gas Turbines The industrial gas turbine (IGT) mar-


ket remained very strong until the third quarter of 2009. Since then rescheduling of orders has resulted in fall in production of some 30% with resulting substantial job losses in United States and Europe. The downturn would seem to be due to three factors: 1. Overstocking of spares by origi- nal equipment manufacturers. 2. Rescheduling of new power projects due to the global downturn. 3. Reduced spares demand; with the recession came a slowing of usage of


Sales by Market Sector 2009, US$M


turbines, which have extended servicing periods. In the long term, the continued de-


mand for power generation is expected to return sales to former levels, but 2011 is expected to remain at present levels.


Automotive Car and truck sales were immedi-


ately and badly affected by recessionary pressures from mid 2008. The sector suf- fered many job losses, and in some cases companies used long shut downs to mini- mize costs and reduce stocks of unsold vehicles. It appears that the Asian automo-


tive industry was much less affected and in India, for instance, sales dipped only slightly and temporarily. In the United States and Europe, gov-


ernment scrappage schemes that boosted car sales through 2009 have ceased and sales seem to be holding up well, espe- cially for smaller fuel-efficient cars. Tur-


Figure 1: Sales by Market Sector 2009, U.S.


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