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Distribution Industry News Archives:
News from the week of Nov. 8, 2004

Timken adds greases to industrial line
Machine tool consumption continues recovery
PTDA selects new execs for 2005
United American Sales hires Jon Prior as sales manager
Kaman Industrial Technologies sees gains in Q3
Productivity increases 1.9 percent in third quarter
Manufacturers Alliance predicts expanding economy
Unemployment holds relatively steady in October
Airgas purchases A&R Welding Supply

Timken adds greases to industrial line
Timken expanded its line of industrial lubricants to include ultra-high speed spindle grease, food-safe grease, synthetic industrial grease and multi-use lithium grease.

In addition to protecting bearings from heat, wear and corrosion, three of these specially formulated lubricants offer synthetic base oil technology. This helps promote longer overall grease and bearing life, as well as a wider operating temperature range compared to conventional greases. In addition to the synthetic greases, Timken multi-use grease rounds out the offering as an economical solution for less demanding applications.

"Bearing life ratings have increased throughout the years, making the lubricant a limiting factor toward total bearing life," said Dave Pierman, product manager of lubricants/lubricant delivery systems. "Increasing the lubricant life through synthetic technology creates a total product package that is more commensurate with today's expected bearing life."

Each Timken lubricant is designed to be application- and environment-specific. For example, the ultra-high speed spindle grease is designed for bearings in machine tools for drilling or grinding that experience ultra-high speeds and extreme temperatures.

Food safe grease is a semi-synthetic product that is H1 and Canadian Food Inspection Agency (CFIA) certified. It offers the food and pharmaceutical industries protection against hot and cold temperatures, moderate to high speeds, medium loads and incidental food contact.

Timken's synthetic industrial grease is intended for use in extreme temperature, severe loads, corrosive and slow- to moderate-speed environments like those found in wind energy main bearings, pulp and paper machines, marine applications or general heavy industry.

Multi-use lithium grease is suited to handle moderate speed, temperature and water, and light to moderate loads, such as in pins and bushings, water pumps, track rollers or other general industrial applications.

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Machine tool consumption continues recovery
September U.S. machine tool consumption totaled $389.2 million, up 89.8 percent from August and up 74.6 percent from the total of $222.86 million reported for September 2003, according to the American Machine Tool Distributors' Association (AMTDA) and the Association For Manufacturing Technology (AMT).

With a year-to-date total of $2.1 billion, 2004 is up 42.2 percent compared with 2003.

"Manufacturing in the U.S. continues to show signs of a strong comeback," said Ralph J. Nappi, AMTDA president. "Machine tool orders in September hit their highest level in four years with all regions of the country showing growth. The recent re-election of President Bush will further solidify the comfort of manufacturing with continued capital investments."

U.S. machine tool consumption is also reported on a regional basis for five geographic break-downs of the United States.

At $55 million, September machine tool consumption in the Northeast was up 102.3 percent compared to August's $27.2 million and up 98 percent compared to last September. At $312.6 million, year-to-date machine tool consumption was 52.7 percent higher than the comparable figure in 2003.

September machine tool consumption in the South totaled $42.9 million, 27.5 percent higher than the $33.6 million tallied in August and 36.2 percent higher than the total for September a year ago. The year-to-date total of $314.8 million was off 1 percent compared to 2003 at the same time.

At $162.8 million, September machine tool consumption in the Midwest was 156.5 percent higher than August's $63.5 million and 46.6 percent higher than the total for September 2003. With a year-to-date total of $853.7 million, 2004 is running 43.2 percent ahead of 2003 at the same time.

Totaling $72.5 million, September machine tool consumption in the Central region was up 50.6 percent compared to August's $48.1 million and 115.4 percent higher than the September 2003 figure. With a year-to-date total of $386.5 million, 2004 machine tool consumption was 58.7 percent higher than the comparable figure for 2003.

Machine tool consumption in the West in September rose to $56.1 million, a 72.1 percent rise over August's $32.6 million and 196.1 percent higher than the September 2003 total. The year-to-date total of $279.4 million was 89.6 percent higher than the 2003 total at the same time.

The United States Machine Tool Consumption (USMTC) report, jointly compiled by the two trade associations representing the production and distribution of manufacturing technology, provides regional and national U.S. consumption data of domestic and imported machine tools and related equipment.

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PTDA selects new execs for 2005
The Power Transmission Distributors Association (PTDA) elected its officers, board of directors and Manufacturer Council for 2005 at the recent 2004 PTDA Industry Summit in Orlando, Fla.

John R. Neal, vice president of marketing for Root Neal & Company in Buffalo, N.Y., was elected to succeed Don R. Latham, president of Canadian Bearings Ltd. in Mississauga, Ontario, as PTDA’s president in the coming year. Neal, the association’s first vice president in 2004, served on the board for the past five years and was active in the association since 1992.

Andrew H. Nations, president of Bearings & Drives Inc. in Macon, Ga., will be PTDA’s first vice president in 2005. Nations served on the PTDA board since 1998 and as treasurer in 2002 and 2003.

Jeffrey H. Pickelman, owner and CEO of Northern Industrial Supply Inc. in Saginaw, Mich., will be PTDA’s second vice president in 2005. He served as a director and board liaison to the Employee Development Committee in 2003.

John Masek, vice president of human resources for Bearing Service Inc. in Livonia, Mich., will serve as PTDA’s treasurer in 2005. Masek is an original member of the Employee Development Committee and served as committee chair in 2002 and 2003. He currently serves as ex officio member of the PTDA Foundation Board of Trustees.

William R. Demmel assumes the duties of PTDA’s Manufacturer Council chair for 2005, replacing James Lamb, vice president of marketing and sales for Drives Incorporated of Fulton, Ill. Demmel served on the Manufacturer Council since 2002 and as vice chair in 2004.

Richard A. White, executive director for Flexible Steel Lacing Co. in Downers Grove, Ill., became Manufacturer Council vice chair for 2005. He currently serves on the council.

The remaining delegates serving on PTDA’s board of directors in 2005 include:
• Craig Faber, president of Miller Bearings Inc. in Orlando, Fla.;
• Wayne Law, executive vice president of purchasing and distribution for Motion Industries Inc. in Birmingham, Ala.;
• Stephen Philpott, president of Bearing Belt Chain Co. Inc. in Las Vegas;
• R.P. Racine, chief operating officer of Gopher Bearing Co. Inc. in Saint Paul, Minn.;
• Drew Tucci, director sales for Eastern Bearings Inc. in Manchester, N.H.; and,
• Helen Yost, general manager of The Rowland Co. in Philadelphia.

Additional PTDA Manufacturer Council members for 2005 include:
• William A. Childers, president and chief operating officer for NSK Canada Inc. in Mississauga, Ontario;
• John A. Hegel, president and CEO of Minarik Corp. in South Beloit, Ill.;
• Peter J. Horn, director special markets for Federal-Mogul Corp. in South Field, Mich.;
• Jim Little, national sales manager of industrial aftermarket for NTN Bearing Corp. of America in Mount Prospect, Ill.;
• Robert Ruland, president of Ruland Manufacturing Co. Inc. in Marlborough, Mass;
• John H. Stewart, president of Duff-Norton in Charlotte, N.C.; and,
• Wendell Witten, director of sales and product support for Warner Electric Division Colfax Power Transmission Group in South Beloit, Ill.

The PTDA Foundation 2005 board of trustees was also elected.
• David J. Witwer, general manager for Minarik-Midwest in Strongsville, Ohio, will serve as president.
• Charles W. Hibbett, president of sales and distribution for Emerson Power Transmission Corp. in Ithaca, N.Y., was elected vice president.
• John Masek, vice president of human resources for Bearing Service Inc. in Livonia, Mich., will be treasurer.

Additional trustees of the foundation include:
• J. Craig McAtee, executive director for Cuyahoga Community College in Cleveland;
• Justin Aschenbrenner, vice president of power transmission for Gates Corp. in Denver;
• Robert Callahan;
• Robert J. Daniel, general sales manager for The Timken Company in Canton, Ohio;
• Kenneth Miko, vice president of sales for BDI in Cleveland;
• John R. Neal, vice president marketing for Root Neal & Company in Buffalo, N.Y.;
• Robert M. Oberholzer, chairman of Shingle & Gibb Co. in Moorestown, N.J.;
• W. Penny Omnès, vice president of external affairs and corporate relations for BC Bearing Engineers Ltd. in Burnaby, British Columbia; and,
• Barbara J. Ross, director of sales and marketing for Klozure Dynamic Seals, a division of Garlock Sealing Technologies in Palmyra, N.Y.

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United American Sales hires Jon Prior as sales manager
Jon Prior joined United American Sales Inc. as western regional sales manager. Company president Joe Sodini announced Prior’s appointment from the company’s Wilmington, Ohio, headquarters.

“We’re pleased that Jon has agreed to join UASI,” Sodini said. “His vast experience in the safety industry brings an added dimension to our sales efforts. We expect his demonstrated ability in management will also benefit the company, bringing us fresh thinking and experience in the same package. Jon’s responsibility encompasses Washington, Oregon, California, Nevada and Arizona. Obviously, his knowledge of western markets is an asset.”

Prior served as a territory sales manager for a manufacturer of hearing and respiratory protection equipment for industry and health care markets before joining UASI.

He was also national sales manager for a California-based firm that provides face protection equipment for industrial, firefighting and rescue customers worldwide. Prior’s experience also includes other sales and customer service positions for firms selling to safety and firefighting customers. He earned a bachelor of science degree from Arizona State University.

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Kaman Industrial Technologies sees gains in Q3
Kaman Industrial Technologies reported third quarter net sales of $149.3 million, an increase over net sales of $122.6 million the year before. Operating profit reached $5.5 million, up from $2.8 million during the third quarter last year.

For the first nine months of the year, Kaman Industrial Technologies generated net sales of $440.2 million, up from $364.7 million during the first nine months of 2003. The company posted operating profit of $16.3 million, an increase over $9 million the year before.

"The strong results for Kaman's Industrial Distribution segment reflect a strengthening U.S. industrial economy along with the impact of expense reduction, process improvement, and lean thinking initiated by the company during the manufacturing recession years of 2001-2003," said Paul R. Kuhn, chairman, president and CEO of Kaman Corp, the parent company of Kaman Industrial Technologies. "Kaman's strategy of expanding its geographic footprint through selective acquisitions and branch openings also contributed. In the third quarter the company acquired Brivsa de Mexico, a small Monterrey, Mexico distributor, expanding the company's ability to serve its national account customers with operations in this important Mexican industrial center."

He added: "The industrial environment continued to be strong throughout the quarter even though some of the leading indicators have softened in recent periods. Sales in the natural resource-oriented western U.S. economy contributed to the sales growth as the demand for basic resources has remained high and U.S. dollar exchange rates stimulated the export market. East and central regions also produced strong results, while the southern markets are expected to contribute to results as hurricane damaged facilities are brought back on line."

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Productivity increases 1.9 percent in third quarter
Productivity grew at a 1.9 percent annual rate during the third quarter of 2004, according to the Labor Department. Output grew 4.1 percent in the third quarter and hours worked rose 2.1 percent.

Productivity increased 3.9 percent in the second quarter of 2004, as output grew 4.2 percent and hours rose by 0.3 percent.

Productivity increased 4.3 percent in manufacturing in the third quarter of 2004, as output grew 4 percent and hours of all persons fell 0.3 percent. In durable goods, productivity grew 5 percent as output increased 6.3 percent and hours of all persons rose 1.3 percent.

The hourly compensation of manufacturing workers increased an average of 4.4 percent during the third quarter of 2004, reflecting increases of 3.9 percent in durable goods and 5.1 percent in non-durable goods.

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Manufacturers Alliance predicts expanding economy
The Manufacturers Alliance/MAPI projects solid growth in the next two years for the U.S. economy and expects the manufacturing sector to continue to outpace the overall economy.

But the pace of growth is likely to decelerate, in relation to 2004, at least in the next year.

The Manufacturers Alliance/MAPI Quarterly Economic Forecast predicts inflation-adjusted gross domestic product (GDP) growth to be 3.9 percent in 2004 and 3.4 percent in 2005. The new prediction for 2004 is down from 4.5 percent in the August forecast, while the new 2005 outlook is down from 3.7 percent in the August outlook. The November forecast looks at 2006 for the first time and predicts GDP growth to be 3.3 percent.

“The surge in oil and other commodity prices and rising penetration from imported goods is taking its toll on the industrial sector,” said Daniel J. Meckstroth, chief economist for the Manufacturers Alliance/MAPI. “Economic growth and industrial activity will now grow more slowly than we previously expected for the rest of this year and in the first half of 2005. We continue to expect that business capital investment will be an important contributor to economic growth—a sign that business is confident about future business prospects. We also expect to see growth in exports that are faster than for imports in 2005 and 2006, and this will stabilize the trade deficit.”

Manufacturing activity should continue to grow faster than the general economy, with industrial production growth expected to increase 5.2 percent in 2004 (down from 6 percent forecast in the August projections) and 4.1 percent in 2005 (down from 5.7 percent in the August forecast).

Industrial activity is predicted to accelerate to 5 percent growth in 2006. The largest percentage gains will come from a rebound in the high-tech sectors of manufacturing. Computers and electronic products are expected to rise 17.3 percent in 2004 and 13.7 percent in 2005.

Non-high-tech industries will grow moderately this year and next, at 4 percent and 3.3 percent, respectively.

Real investment in equipment and software should increase 11.6 percent in 2004, 9.3 percent in 2005, and 8.1 percent in 2006, growing several times faster than the general economy. Net exports also should contribute to economic growth. Inflation-adjusted exports should rise 8.3 percent this year and 8 percent next year, while imports are expected to increase at a more moderate 9.5 percent in 2004 and 5.2 percent in 2005. This is partially due to expected depreciation of the dollar.

The forecast also envisions the unemployment rate remaining relatively stable, averaging 5.5 percent in 2004, 5.3 percent in 2005, and 5.4 percent in 2006.

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Unemployment holds relatively steady in October
Employment increased by 337,000 in October, and the unemployment rate inched up to 5.5 percent, according to the Department of Labor.

The manufacturing sector lost 5,000 jobs in October; it has changed little since May. Manufacturing added 82,000 jobs during the February-May period. The manufacturing workweek and factory overtime were down by 0.1 hour, to 40.7 hours and 4.5 hours, respectively.

National Association of Manufacturers president John Engler attributed weakness in the manufacturing employment picture to unwise government policies that drive up the cost of labor, advances in technology that reduce the need for labor, and a growing shortage of applicants qualified to work in modern manufacturing.

"The external costs associated with taxes, health care, litigation, regulation and soaring energy prices add 22.4 percent to the cost of labor in this country," Engler said. "High costs of production at home plus unprecedented global competition are forcing more and more manufacturers to adopt advanced technology to reduce the need for labor."

He added: "As our industries become more high tech, they are finding it increasingly difficult to find qualified labor. Our schools are not equipping young people with the science, math, computer and communication skills they need to work in modern manufacturing. There is a serious educational gap that must be addressed if we are to retain and enhance our world leadership in manufacturing."

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Airgas purchases A&R Welding Supply
Airgas Inc. acquired the assets and operations of A&R Welding Supply Inc., an industrial gas and welding supply distributor with two locations in San Luis Obispo, Calif., and Paso Robles, Calif.

The acquisition closed Oct. 29 and the two branches began operating as part of Airgas West, one of 13 regional companies within Airgas.

Three brothers, Dave, Tom and Tim Erbstoesser, founded A&R nearly 20 years ago and built it into a business with more than $4.5 million in annual sales. All three brothers and about 15 other employees of A&R have joined Airgas West.

“We are excited about welcoming the Erbstoessers and their associates to the Airgas West team,” said Max Hooper, president of Airgas West, which is headquartered in Lakewood, Calif. “These two new branches will strengthen our reach along the central coast with a team of associates who know their customers well. We also look forward to offering customers in these markets a full range of Airgas’ products and services.”

“This acquisition is the sixth one completed so far this fiscal year, including the acquisition of the BOC U.S. packaged gas business at the end of July,” said Airgas chairman and CEO Peter McCausland. “Total acquired annual sales have now topped $250 million for the year, as we continue to demonstrate our core competency in completing acquisitions big and small.”

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