Mori Seiki

US AEROSPACE MANUFACTURER COMPETES GLOBALLY THROUGH AUTOMATION

While viewpoints vary from wildly optimistic to a cynical fatalism, most of those in the know agree that US manufacturing is navigating a critical juncture. Markets with low labor costs have courted away much work traditionally performed by American companies. Pessimists say that the loss must be accepted as this business can not be regained. Others, though, aspire not only to slow the trend, but to reverse it. QPM Aerospace exemplifies the potential success that such efforts can attain.

While inefficiencies exist in many industries, aerospace has traditionally performed well below average in this area. Steady demand coupled with relatively long-term pricing contracts provided a cushion that created too laid back of an approach in many instances. Often, those within the industry took for granted that the work would always be there. In the wake of 9/11, airlines demanded lower costs to offset their financial losses and that expectation trickled down through the aerospace industry. QPM Aerospace, a manufacturer with facilities in Portland, Oregon and Monroe, Washington, found itself well suited to this challenge.

“In the mid 90s, we began reevaluating common practices within the aerospace industry,” explains Mike Dunlop, CEO of QPM Aerospace. “We became determined to eliminate inefficiency within our machining operations. We developed entirely unique software for monitoring our processes, standardized on high-quality Mori Seiki machinery and made a concerted effort to maximize productivity through automation.”

At the start of its quest, QPM Aerospace began looking to identify any defects in the manufacturing process. At that point, manufacturers in the industry merely evaluated parts on a go/no-go basis. As long as parts met the required minimum specifications and tolerances, no one paid attention to variances within the parts produced. QPM Aerospace wanted better than the bare minimum.

“At that point, instability in the processes being used required the dedication of vast amounts of time and money to inspection,” says Mr. Dunlop. “We wanted complete stability and reliability in our operations. To achieve that, we began shopping for software that would identify any defects in our manufacturing processes.”

When QPM Aerospace found that no such software existed, it created its own. The end result was NetInspect, a program that has been spun off and is now offered to other manufacturers for monitoring the capability of their processes. With the system, all traditional measuring devices, such as height gauges, calipers, and micrometers are monitored via network connections, so that all measurements are stored and analyzed. This wealth of previously discarded data is then used to track trends and identify areas for improvement.

With NetInspect implemented, QPM Aerospace moved towards eliminating instability created by machinery. The company decided to standardize machines so as to reap the benefits of every machinist being qualified to run any machine. After evaluating all the options, the company selected Mori Seiki.

“The Mori machines offer high performance and the repeatability that is vital to our philosophy,” says Mr. Dunlop. “Additionally, we knew that we wanted to move towards pallet pools once our processes were completely stable. Mori Seiki’s focus on supporting automation made it an easy choice.”

Pallet pools benefit the user through the practice of attaching part fixtures to horizontal machining center pallets. Pallets are then stored in a pallet system consisting of pallet stands, setup stations, machining centers, and a rail guided vehicle. Ultimately, pallet pools eliminate first article inspection and minimize setup times.

The Mori Seiki machines have provided the exact repeatability and stability that QPM was searching for. Internal defect rates have been reduced to 100 parts per million, approximately a 5.1 sigma level. It has been over two years since the company has shipped a single external defect. With an industry standard of 2500 external defects per million, the performance of QPM Aerospace’s machines and process is unheard of.

Once processes had been completely stabilized through the use of NetInspect and the integration of Mori Seiki machines, QPM Aerospace moved forward with plans to automate production. During the late 1990s, two Mori Seiki LPPs (Linear Pallet Pools) were installed, each containing 16-pallet capacity. A third l6-pallet LPP was installed in 2004. Constant efforts at improvement have yielded impressive results.

“We have multiple Mori Seiki machines that, through the benefits of the pallet system, experience virtually no downtime,” says Mark Kuzmovich, operations manager at QPM Aerospace. “Machines are averaging 23 to 23.5 hours of spindle time in a typical 24 hour period. We run lights out and, literally, the only times these machines are not cutting are during tool changes and pallet rotations.”

Most obviously, these levels of productivity and reliability reduce labor costs per part to levels comparable to overseas competition. The increased capacity afforded by high levels of automation spread fixed costs over a far greater quantity of products, reducing overall cost per part. This boost in productivity has allowed QPM Aerospace to win work back from foreign competition, leading to steady growth in sales.

“To give an example, we have a job that consists of a set of eight aluminum splice plates for a 737 blended winglet,” says Mr. Kuzmovich. “On two four-axis verticals, total cycle time for a set would be just under 65 hours. Once we put this job on the pallet system, our cycle time dropped to 26.8 hours. That”s a typical level of reduction we see when we switch a job to the Mori Seiki machines and pallet pools.”

Reduction of setup time has also eliminated the costs of keeping an inventory of parts. In the past, the ratio of setup to machining time dictated minimum lot sizes once a job was running, regardless of the quantity of the current order. In addition to the cost of storing these excess parts, revisions to part design are a normal occurrence in aerospace, and these design changes would often cause existing inventory to be written off as scrap. Using the pallet systems, QPM Aerospace can easily pull up the program for a job and run a lot of just one part, eliminating vulnerability to revisions in part design.

Lights out manufacturing also affords QPM Aerospace the ability to easily accommodate shifts in demand. Rising fuel prices have led to a burst of demand for titanium shims used in a winglet that increases fuel efficiency by 6% on 737s. Within 2 months, production increased from 3 sets per month to 35 set per month.

“We simply reallocated some of our resources and dedicated a cell with a Mori Seiki SH-630 horizontal machining center to the part,” explains Mr. Dunlop. “Without the flexibility we’ve attained through automation, we couldn’t have handled the additional work. Through the reliability and efficiency of Mori Seiki, we set the part up and have been running it for a year and a half without a single defect, including the first run.”

Opponents of automation insist that it replaces American jobs. QPM Aerospace proves that this does not have to be the case.

“Our labor costs have moved from 18% of a part to 2.5%,” says Mr. Dunlop. “We’ve watched this eliminate the supposed benefits of taking work overseas and it’s allowed us to win work back from offshore competition. Our work orders have increased steadily enough that our workforce has attained constant growth. Our employees today have higher levels of job security, receive more advanced training and are better compensated than ever before. If we hadn’t shifted, the work they’re doing today would most likely be done overseas.”

Since implementing automation, QPM Aerospace’s growth has been impressive. In the mid 90s, annual sales came to a little over $400,000. Today, this number has swelled to $18 million. Rising demand from airplane manufacturers has led QPM Aerospace to a conservative forecast of $50 million of annual sales within four years. This expansion will be achieved primarily through the integration of additional Mori Seiki machines and pallet systems within QPM Aerospace’s existing Portland facility. Through its dramatic success, QPM Aerospace demonstrates that it is within the power of American manufacturers to eliminate the threats posed by foreign competition.