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Key takeaways from the 11th International Congress of Spring Industry
The 11th International Congress of Spring Industry, held on September 29, 2023, in Barcelona, Spain, brought together over 120 participants, including spring makers, suppliers of machinery, raw materials, and services for the spring-making industry, along with key speakers who delivered engaging presentations on a wide range of topics.
The event, organized by the Spanish Spring Manufacturers Association (ASEMU) for ESF (European Spring Federation), featured a diverse and comprehensive program that addressed critical issues in the spring industry and related fields.
I had the privilege of attending the conference as expometals played a role as one of the sponsors of this event. Having documented the proceedings, I am pleased to briefly present the key findings of the conference to potentially interested readers, as it shed light on topics of significant interest, from the state of the spring industry in various European countries (and beyond) to the challenges and opportunities that companies in the spring-making industry are encountering. There are quite a few swords of Damocles hanging over the heads of manufacturers of springs and other finished products! Let's delve deeper into the subject.
European Spring Federation overview
The European Spring Federation represents a substantial network of more than 200 companies with over 16,000 employees and a collective turnover exceeding 2.4 billion euros. The federation's primary goal is to enhance the skills and performance of European spring companies, which, with their relatively small size, have shown remarkable resilience over the years but now face some critical situations that may undermine their competitiveness, as highlighted by ESF President Paul B. Vogtland in his opening speech.
New legal requirements on product safety and liability
Among the most pressing issues the spring industry is facing, some are legal and bureaucratic in nature and born in the bosom of the European Union. They were the subject of one of the key presentations by Daniel Wuhrmann, an attorney-at-law from Reusch Rechtsanwaltsgesellschaft mbH in Germany. He discussed the European Union's new product safety and liability regulations, including the General Product Safety Regulations (GPSR) set to take effect around the end of 2024. These regulations place different players in the supply chain, such as manufacturers, importers, and distributors, on the same level. One key aspect of GPSR is the introduction of the concept of 'Substantial modification', where any significant alteration to a product categorizes it as a new product, placing responsibility for its safety on the modifier. In practical terms, this means that if you purchase used machinery and make modifications, as is often done to meet specific needs, you will be held to the same safety obligations as manufacturers of entirely new machinery. These new norms also expand the list of requirements for manufacturers and importers, including risk analysis for each product, retaining technical documentation for a decade, and undergoing conformity assessment. Furthermore, in the event of a product recall, even after the standard two-year warranty period, suppliers will be required to offer replacement, repair, or a refund, irrespective of any contractual warranty claims. Even if spring makers do not sell to end users, this will affect their customers, who could retaliate against them.
Another aspect to watch out for is the ongoing revision of the Product Liability Directive. Liability comes into play when products are defective and things go wrong. The revision of this 1985 standard aims to modernize and streamline rules, with a growing emphasis on consumer interests. A notable change that raises concerns is the adjustment of the so-called 'burden of proof', which refers to the obligation for one party in a legal dispute to provide convincing evidence to support their claims. The shift toward a more US-style system, with a lower burden of proof for claimants, may have substantial implications for businesses, leading to changes in contracts, increased demands for risk analyses, and the retention of related records for extended periods. The Corporate Sustainability Reporting Directive (CSRD) and the Chemical Compliance regulations are also currently undergoing updates, potentially posing challenges for spring makers and related companies.
Carbon Border Adjustment Mechanism (CBAM) as seen by spring makers
Speaking of challenges, Christian Vietmeyer, CEO of Wirtschaftsverband Stahl- und Metallverarbeitung e.V. (the German trade association representing the interests of the steel and metal industry), addressed the Carbon Border Adjustment Mechanism (CBAM), focusing on its background, purpose, and impacts. For the few unfamiliar with CBAM, it is the EU initiative on carbon-intensive products designed to prevent carbon leakage, generate revenues, and encourage behavioral changes in third-country producers. It initially applies to selected imported raw materials, including steel and aluminum, with the transition period running from October 1, 2023, to December 31, 2025. During this time frame, importers of CBAM goods must submit quarterly declarations reporting embedded carbon emissions. After the transition period, companies importing CBAM goods will need to register as 'authorized CBAM declarants' and annually report embedded emissions, subject to verification by accredited entities. While springs and metal finished products are not currently within CBAM's scope, the anticipated increase in steel and aluminum costs, coupled with the introduction of new sustainability regulations, is poised to have a direct impact on the spring industry and those involved in it.
The state of the spring industry worldwide
The congress featured key representatives from spring industry companies across 15 different countries, who shared insights into the economic situations in their respective nations and discussed the opportunities and challenges confronting spring makers. In general, in Europe, the situation is not rosy, and some countries like Germany and Poland are already officially in recession. Though inflation seems to have started moderating - at high levels – most of the speakers reported that order books began to thin out after the summer, if not before. The economic situations of the spring industry in various countries share some common themes and concerns:
• Automotive sector: a significant factor for many countries' spring industries, while it remains stable or even growing in some places, it faces challenges due to changing consumer preferences, electromobility, and geopolitical factors.
• Green initiatives: green transition and environmental concerns are creating both opportunities and conundrums. Springs used in green technology, such as solar, wind, and electric vehicles, are on the rise, but compliance with green standards and sustainability regulations is becoming increasingly pressing.
• Labor force: finding skilled labor is a common issue, and making the industry attractive for young generations is a recurring concern.
• Inflation: inflation rates are a concern in several countries, affecting consumer spending and production costs.
• Export challenges: global economic uncertainties, including the war in Ukraine, can impact
exports and cause supply chain disruptions.
• Market segments: different segments of the spring industry are experiencing varying levels of activity. Some industries, like aeronautics and pharmaceuticals, are more buoyant, while others, such as construction and traditional automotive, face challenges.
Italy’s outlook: an insight of Mr. Silvestri, President of ANCCEM
Mr. Silvestri, President of the Italian association of reference for spring manufacturers, provided a comprehensive overview of the economic situation in Italy. Despite a 3.9% GDP increase in 2022, growth slowed to 0.6% in H2 2023. Inflation has been a critical issue in Italy over the past year; in terms of industrial production, Italian industry recorded a -2.7% in H1 2023, YoY, while the metal sector faced a -3.7% contraction due to reduced exports. Despite the decline in production and orders, the unemployment rate dropped to 7.4%, but 70% struggle to find skilled staff.
Italy’s spring industry, stable with 152 firms and 5,000 employees, is facing both prospects and challenges. The EU 191.5 billion euro Recovery Plan represents a major opportunity for Italy, particularly for mechanical industries. However, volatile trends and fluctuations in raw material prices could lead to profit erosion due to varying negotiation schedules between spring makers, customers, and raw material suppliers.
Two voices out of the chorus emerged during the 11th International Congress of Spring Industry:
India: The Made in India initiative has successfully reduced the dependency on imported steel and springs, leading to the domestic production of critical springs. However, India still relies on foreign CNC coilers. The country boasts a substantial pool of skilled labor, but it faces challenges such as high interest costs and a general rise in expenses.
Japan: Japan's spring industry is intricately tied to the automotive sector, representing a significant portion of its sales. The first half of 2023 witnessed a resurgence in automobile production, nevertheless, Japan is also grappling with declining exports in the Asian region.
In the picture: the Can Travi Nou restaurant in Barcelona, which hosted the closing dinner.
Keynote speech: the points of contact between screenwriting and selling
Keynote speaker Jack Vincent, an accomplished screenwriter and author, delivered a captivating speech that revolved around applying classic screenwriting models to the sales process. Through his presentation, Vincent adeptly reimagined traditional storytelling archetypes, such as the hero, the villain, and the mentor, in the context of sales strategies. Vincent's S.C.O.R.E© Selling Method offers a structured and systematic approach designed to empower sales professionals. Besides enhancing their ability to secure successful deals, this method emphasizes the importance of cultivating enduring customer relationships by encouraging sales professionals to confront and address client pain points.
Advancing industry standards: insights from Dr. Andres Weinrich on ISO227/TC Status
Dr. Andres Weinrich, Technical Referent of VDFI and Chairman of the ISO Technical Committee (TC) for Metal Springs, delivered a valuable speech on the current status of ISO227/TC. The committee plays a crucial role in standardizing metal springs, covering various aspects such as product tolerances, terminology, test methods, and process technology. Eleven ISO standards have been published to date, with four norms currently under review or in development. Dr. Weinrich underscored the significance of these international standards and their far-reaching impact on industries worldwide. He emphasized how standardization simplifies market access, enhances product quality and safety, represents industry interests, and reduces risks by ensuring legal security.
Innovative fatigue testing and lightweight materials deployment: research insights
Sergi Parareda, a researcher specializing in metallic and ceramic materials at EURECAT in Barcelona, delivered an insightful speech on "Fatigue Fast Testing Methodologies to Optimize Part Design and Boost Lightweight Materials Deployment in Chassis Parts." Heavy trucks, comprising only 2% of the vehicle fleet, are responsible for a staggering 30% of CO2 emissions. This stark reality underscores the urgent need to lighten these vehicles to reduce their environmental impact. Specifically, the focus has been on optimizing chassis and suspensions, pivotal components in achieving this goal. The speaker highlighted the drawbacks of conventional fatigue tests, which are time-consuming and impractical in the fast-paced automotive industry. Collaborating closely with Scania, the researchers successfully developed a rapid fatigue testing method, even securing a patent for their groundbreaking work. Furthermore, their research endeavors extended to developing a portable device for in-situ testing that promises to revolutionize the testing process, making it more accessible and applicable in real-world scenarios.
In conclusion, as highlighted by President Vogtland in his closing speech, the hoops the spring industry has to jump through, both within the European Union and on a global scale, underscore the need for a fair transition toward greener standards, especially for medium and small enterprises like spring makers. While variations exist in factors such as electricity prices and wages across the EU, the industry's resilience and performance compared to the broader economy remain noteworthy. To successfully address these challenges, knowledge exchange and the creation of strong links within the industry are and will remain crucial.
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