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Fabricated Metals Production Still ‘Fab’

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YOUNGSTOWN, Ohio – The region’s fabrication and machine shops today boast a diversified customer base that supply clients throughout the country, and in some cases, the world.

These shops aren’t the massive manufacturers that dominated northeastern Ohio’s industrial scene the first half of the 20th century. Most are small businesses – employing fewer than 100 people – that succeeded in remaining productive and competitive by adopting advances in technology and more efficient management.

“We’re heavily invested in CNC equipment,” says Mike Kovach, president of City Machine Technologies Inc. in Youngstown. CNC (the acronym for computer-numerically controlled) technology is nothing new, but it is consistently evolving with enhancements in software development and equipment.

All of these improvements allow for precision cutting and fabrication operations that produce a finished part within very tight time frames, as evidenced at City Machine, Fargo Machine Inc. in Ashtabula, and Conison Tool & Die Inc. in Boardman.

CMT, for example, owns a sophisticated laser measurement system that can scan a component as large as a 747 jet, Kovach says. Then, programmable software translates the dimensions of the piece and recreates the part on a computer screen. “The software can draw the component just by the metrics taken by the laser,” he says. The data then command various machines to perform the functions essential to refurbish or machine the part.

In today’s market, quick turnaround is essential to winning business and maintaining market share, Kovach says. “You used to have about a month [before an order could be filled]. Now, customers are looking for finished work in days, sometimes hours.”

All of the industries his company serves are time-critical, Kovach says. City Machine fabricates, reconditions, machines and repairs equipment used by steel companies and power generation plants. The company has also produced large equipment used in air-handling systems in malls and hospitals.

“Their budgets are tight,” Kovach says. “When they need it, they need it now and quick. It’s often crisis management, especially in the power industry.”

Business increased during the fourth quarter, Kovach reports, took a slight dip in February, but now appears to be back on track. “I do have deep concerns over the power industry,” Kovach relates, because the industry is closing so many of its coal-powered plants, replacing them with natural gas-fueled operations. “They’re retiring these coal plants too quickly,” he asserts.

City Machine sees its customer base overall as remaining very strong in the eastern United States and Canada. It once shipped products to customers in Egypt and parts of southwestern Asia, but political unrest in these regions ended that business.

“We’re running three shifts a day and have between five and 10 people working on the weekend,” Kovach reports. “That’s kind of been the rule over the last three weekends.”

City Machine employs about 75, Kovach notes. The challenge is to attract younger workers to fill the ranks of employees close to retirement. “Our big concern is hiring young talent,” he says.

According to the U.S. Department of Labor’s Bureau of Labor Statistics, roughly 30,000 people in the Youngstown-Warren-Boardman Metropolitan Statistical Area are employed in the manufacturing sector. Of that number, 6,900 were working in primary metals manufacturing as of October 2013, which includes machining and fabricating.

That’s a far better statistic than in May 2009 when the industry was slammed during the Great Recession. That month, employment in the region bottomed out at 5,900 in metals manufacturing.

However, that sector in this region has suffered considerably over the last 25 years. In June 1990, for example, roughly 23,500 were employed in primary metals manufacturing in the Mahoning Valley, according to Labor data. It has steadily declined ever since.

This decline can be attributed to several factors, including plant shutdowns, an increased reliance on automation, the changing nature of manufacturing, and the loss of population over the last two decades in northeastern Ohio.

Yet a rebounding economy, along with specialty services made possible with technologically advanced machinery, has helped some of the smallest machine shops become productive and competitive, allowing them to survive.

“We’re small – just five people,” says Larry Fargo, president of Fargo Machine, Ashtabula, a company established in 1989. “But, our equipment is all computer-controlled so we can get a lot of production out.”

The company specializes in using a water-jet cutting technique, Fargo says. Such cutting is used on materials particularly sensitive to the high temperatures produced through other methods. At the same time, the water-jet technique allows a machinist to cut clean, intricate parts in the metal without disturbing its properties.

“The equipment uses high pressure water to cut steel, stainless steel, aluminum, plastic or foam,” Fargo notes. Since few shops in northeastern Ohio own such a machine, Fargo says a considerable amount of his business is providing water-jet cutting for other machine shops. “It’s become our specialty,” he relates.

Last year proved to be “a very good year” for the company, Fargo says, and this year is shaping up even better: “I just looked at our numbers and sales are 35% higher than last year at this time. It looks like things will be strong for the rest of the year.”

The company has a wide base of customers, including firms that manufacture parts for door hardware, the commercial building industry, and even canoes. “We’re very diverse, and all of our customers are extremely busy,” Fargo says. “We’ve got two months of backlog work. And our quote level is high. These are both good indicators that we should be busy this year.”

Recently, the company worked with sculptor Michael Murphy to create a piece for Nike Town in Chicago. Fargo Machine water-cut shapes plated with gold into patterns of shoes that, when positioned together, created the iconic image of the Nike Air Jordan “Jump Man” figure. A similar project is slated for Manhattan. “We did the cutting and machining for both those projects,” Fargo says.

Ed Straub, president of Conison Tool & Die in Boardman, says his small shop is also anticipating a strong year. His company specializes in manufacturing extrusion dies for many industries. “We make parts for just about everybody,” he says. “Automotive, the tech industry, some military parts. We manufacture a little bit for everyone.”

Some of the jobs with a higher profile came after 9/11, Straub recalls. A Connecticut company Conison had worked with asked it to manufacture the dies needed to form new structural steel parts for many of the heavily damaged buildings near the World Trade Center. “There were a lot of buildings damaged, and we made 42 dies to replace a lot of the structural steel parts that were damaged,” he says.

Conison has invested in new technology such as CNC machines and wire electrical discharge machining, or EDM, equipment, Straub says. “We try to stay current on what’s out there,” he says. “We have what the bigger shops have, just less of it,” he laughs.

A sizeable amount of Conison’s business is manufacturing the components used to produce computer parts. “Automotive is hot right now, but technology is the main force behind what we do,” Straub says.

The majority of the company’s business is conducted outside of Ohio, he adds. “Last year was a very good year for us,” Straub says. “I don’t know about 2015 yet, but I like our customer base. I like what’s happening in the area and the growth that I’m seeing. I’m glad to be a part of it.”

Pictured: City Machine Technologies Inc. fabricates, machines, reconditions and repairs equipment used by steel companies, power-generation plants and other industries.

Published by The Business Journal, Youngstown, Ohio.