Heller Management Cautiously Optimistic for 2014
Reporting record sales, the half-billion euro independent German provider of machining center-based manufacturing solutions has invested strongly in new product development and looks forward to an active 2014.
Heller Machine Tools
Troy, MI-- As a leading manufacturer of machining centers and complex manufacturing systems, the HELLER Group (www.heller.biz) in 2012 booked a total of EUR 592m, achieving a 25% increase in sales volume, recording the highest sales in the history of the company. With an overall performance of EUR604m, the company, for the first time, surpassed the EUR600m mark. It is looking forward to even better performance in 2014.
HELLER Group management, including Klaus Winkler, CEO, and Manfred Maier, COO, presented the company’s observations to the press at the leading machine tool industry trade event EMO 2013 in Hannover.
Group sales increased again by 6% in the first half of 2013. However, for some time HELLER has noticed its customers everywhere are taking more time for making investment decisions, resulting in order intake during the first 6 months of 2013 below that of 2012.
On a more positive note, strong project business at HELLER has resulted in an increased receipt of orders which will have a positive effect in the year 2014. The company is cautiously optimistic in its assessment of the current situation and again expects an increasingly positive order intake due to its innovative machine tools that introduce high levels of productivity to automotive, aerospace, and general machinery markets. Automotive represents about two-thirds of HELLER’s orders.
In addition to its newly expanded headquarters plant in Nürtingen, the company has production locations in Troy, Michigan, the United Kingdom, Brazil, and China with sales and service locations near HELLER customers around the world.
Buying decisions taking longer
“In all markets worldwide we are observing that investors are somewhat hesitant to make investment decisions,” said Mr. Winkler. “This applies to North and South America, but also to the Asian market. Companies in China implemented ambitious growth plans with their investment decisions in recent years and now need to generate growth to ensure utilization of these newly created production capacities. However, this may happen very quickly considering the fact that the Chinese automobile industry has by far the highest growth rates worldwide.
“Soon, the Chinese may also succeed in entering other Asian markets. The first steps have already been taken: HELLER has been exporting to India since 1954. The growth of the population alone suggests enormous potential for India and with that for investments in the economy. However, the country is also dealing with massive structural problems and recently clearly missed the growth targets it had set for itself. Machine tool consumption in Thailand, Malaysia and Indonesia has grown. We will continue to target this market, but other Asian markets could provide greater potential in the short and medium term,” Mr. Winkler said.
HELLER noted that in terms of growth momentum, Europe lags behind other regions in the world. The debt crisis is far from over. The current situation in Italy, Spain, and also France is particularly alarming. These countries still have numerous structural problems to solve and high youth unemployment rates pose a threat to the economic future. Despite all this, Europe remains HELLER’s most important market and will regain stability in the long run, Mr. Winkler said.
Reduced dependency on Europe
In recent years, HELLER has gradually reduced its dependency on exports to Europe and positioned itself in the world market. “At the same time, we succeeded in increasing our export volume to Eastern Europe,” Mr. Winkler said. “Basically, the balance in Europe in terms of consumption of capital goods will continue to shift from West to East. Despite great uncertainty, Russia holds enormous potential for our business in the medium term. We are tapping into this potential with our own subsidiary in Yekaterinburg.”
German industry, characterized by companies from the Mittelstand, has a great deal of substance and will continue to play a significant role in the world market, according to HELLER. This remains true for domestic production as well as for German companies establishing production capacities abroad. “We have the potential to cater to the needs of these companies as our customers worldwide,” Mr. Winkler stated.
Substantial investments are basis for an international production network
HELLER has been taking an integrated approach to the value-added chain and its optimization for years. The result is a manufacturing process and international production network comprising production locations close to the markets in Germany, England, Brazil, the US and, since this year, China. Today, the company operates a versatile global production and procurement network which is continually expanded, optimized, and invested in.
In 2012, the company made numerous investments, including a 25% expansion of assembly floorspace at the company's headquarters in Nürtingen and construction of a production facility in China, officially opened in October 2013. In comparison to 2011, capital expenditure was doubled, including further investments in facilities and equipment. At the same time, development expenditure was increased by more than 10% with a focus on the diversification of the product range, enabling the company to better serve its existing customers and expand business into new target groups.
HELLER’s product range includes a wide range of machines and services for the most diverse manufacturing requirements. Complete solutions from stand-alone machines through to turnkey manufacturing systems costing EUR150m--new machines and full-service agreements through to retrofits.
It is among the top 5 global providers of horizontal 5-axis machining centers for milling and mill/turning processes today. In the areas crankshaft machining and light-duty powertrain HELLER is among the 3 most important partners in the global market and, for customers from the segments heavy-duty powertrain on- & off-highway and agriculture, HELLER is worldwide the most important supplier of productive manufacturing solutions.
New developments at HELLER.
The increased investment in development by HELLER will focus on the diversification of the product range, enabling the company to better serve its existing customers and expand business into new target groups, including customers from outside the company's traditional clientele from the automotive industry, reported Manfred Maier, HELLER COO.
Three new developments and numerous product enhancements provide a completely revamped product portfolio for 4-axis and 5-axis machining and combined milling/turning. Another addition is a completely new small machine with easily changed tooling for the milling of small, light-duty crankshafts.
In terms of its turnkey competence for engine block manufacturing systems, HELLER is offering systems for the coating of cylinder bores on the basis of twin-wire arc spraying technology already successfully introduced in the market. Under the name HELLER CBC (CylinderBoreCoating), HELLER has introduced the process into the process chain of crankcase manufacturing. First systems are already in operation for high-volume production in Germany and Japan. At the production location in Nürtingen, the HELLER CBC Technology Center is operating a flexible system showing the current state of development that can also be used directly for customer projects.