$4M Expansion at Ellwood Specialty Steel Part of Plan to Capture Market
NEW WILMINGTON, Pa. – Ellwood Specialty Steel Group broke ground Oct. 8 on a $4 million distribution facility that will allow faster delivery of its aluminum products to customers, while also grabbing a bigger piece of the market.
The 20,000-square-foot expansion at its plant on Honeybee Lane, just off state Route 18, is scheduled to be complete in April or May. It will employ two or three workers initially, with more being hired as second and third shifts are added, said Ellwood Specialty Steel President Judy Shaffer.
The expansion will work in conjunction with Ellwood’s new aluminum plant in Hubbard, which began operations in August. That addition to the Ellwood portfolio – it was the first time the 110-year-old company had ever made its own aluminum product – allows the company to get into the automotive and aerospace markets.
Shaffer estimated the market for aluminum billets and slabs at $100 million. Ellwood Specialty Steel’s goal is to grab $10 million of it within a few years and ramp up to 50% of the market within a decade.
“The new addition will allow us to store and process billet, which is a new product line for us,” Shaffer said. “ We currently can supply steel and aluminum, but we’re expanding into forging stock for forgers.”
Gary DeBlasio, director of operations of Ellwood Specialty Steel, said the addition will improve work flow and give Ellwood Specialty Steel “a competitive advantage” in delivering.
“This allows product to be shipped in a few days versus weeks, and in volumes they need,” Shaffer said.
As for the new production capability brought by Ellwood Aluminum in Hubbard, she said, “It’s important for us to be fully integrated in the supply chain, from melt to distribution.”
Speed, said director of operations Gary DeBlasio, is crucial in this industry.
“[Customers] want the product shipped the same day, and the majority of it will be. And if not, then in a day or two,” he said. “If we get an order early in the morning, we’ll be able to get it out the same day. That helps [our customer] reduce his lead time and better serve his customers.”
Mark Kaszer, Ellwood Specialty Steel’s director of sales and market development, said the addition will move the company ahead of its competition.
“If you look at the traditional way the market is served in this line, It’s done with a customer placing an order from a casting [company],” Kaszer said. “The value of Ellwood Special Steel Group is we will [already] have the aluminum in stock. … If a customer calls and says he wants aluminum in 18-inch diameter cut into 10-foot pieces, we’ll take that order, send instructions to our shop, and they’ll cut it and package it and ship it that day.”
Ellwood Specialty Steel has 110 employees system-wide, including 50 in the New Wilmington plant.
The expansion will house a variety of equipment to move, cut, and load aluminum billets, including an 80,000-pound tong lifter, a 92,000-pound forklift, a 15-ton crane and a high-speed aluminum lathe capable of handling aluminum billets up to 32 inches in diameter and 25 feet in length.
About 12,000 square feet of the addition will be fully enclosed and the remainder will be a loading area lean-to.
Pictured: Ellwood Specialty Steel Group product manager Rich Polenick, director of sales and marketing Mark Kaszer, director of operations Gary DeBlasio, President Judy Shaffer, operations engineer Jonathan Bernhardt, Lee Michael Industries Inc. President Brian Herr and Frank B. Taylor Engineering consulting engineer Brian Rogers at Ellwood’s groundbreaking on Thursday.
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