Added value instead of tonnage - What remains in the foundry in the end?

The foundry industry in the area of tension between supply chains, transformation and climate protection.

Pressemitteilung | Reading time: min

A reflection by Dr. Fynn-Willem Lohe, General Secretary CAEF at the 64th Foundry Conference at the ÖGI in Leoben

Directly in the morning after the very atmospheric Foundry Evening during the 64th Austrian Foundry Conference in Congress Leoben, Fynn-Willem Lohe already had his appearance at 9 o'clock. In the plenary speech on the topic: What's left in the end? Added value instead of tonnage! In the end, it was supposed to be about much more than just a cost analysis of the foundry industry.

First, Fynn-Willem Lohe showed the canon of the work of CAEF, which he has chaired as Secretary General since the end of 2020. In addition to meeting work along the various sectors, such as automotive, wind energy or general mechanical engineering, the CAEF establishes networks and compiles statistics on the industry and on topics such as BREF or NEPSI.

Increased turnover - hardly any profit - Foundries need to become more development partners

The presentation then explores the question of why the foundry industry has hardly made a profit in 2021 despite large increases in turnover. The main reason is the significant cost development, primarily in raw materials and energy. This inflated turnover when it was passed on to customers. Experience has also shown that it is difficult to pass on cost increases. Thus, according to him, key figures based on gross profit are more suitable. The main appeal, however, is the following: Foundries should become much more of a development partner for customers and material savings are a real added value for customers and should be valued and valued accordingly.

The multiple challenges force innovation

In addition, the challenges around the EU Green Deal, Fit For 55 or even Sustainable Finance will force foundries to become more innovative and to devote themselves to new casting solutions. After European casting production slumped by around 20% in 2020, the current recovery trends are not bearing fruit everywhere. While the mechanical engineering sectors and in particular the customer industries of agricultural machinery were pleasingly robust and even expanded during Corona, the international vehicle markets are clouding the picture considerably. Europe saw a 31% drop in new registrations in the year to February compared to 2019. And within new registrations, cars with an electric or hybrid powertrain now account for over 30 %; here the cast for the powertrain is almost completely eliminated.

But there are also new shores. According to Lohe, there is considerable market potential in the field of energy storage or heat pumps, for example. Inertia mass storage, compressed air storage and the like will be needed decentrally and in many places in the future. The race for the best technology is still open, but it won't work without cast iron, Lohe continues. Within the framework of the EU Taxonomy on Sustainable Finance, houses are being decarbonised. This requires an enormous number of heat pumps. From a current share of around 10 % of final energy demand, this share will have to rise to at least 20 % by 2050 in order to achieve the climate targets of -95 %.

Similar potentials arise in one of the core sectors of our industry, wind power. After hesitant expansion developments in recent years, often due to long approval procedures and extensive petitions from citizens, the switch has been flipped in many countries, at least in the legislature. This would result in double-digit growth rates for the European wind turbine foundries.

Fynn-Willem Lohe ends his speech with an illustration of the current situation in the world. Three years ago, many things would have been unthinkable. Neither Corona, nor the war in the Ukraine, nor that a man, Elon Musk, would be transporting astronauts to the ISS with his SpaceX rockets instead of NASA. Moreover, Mr Lohe was deeply impressed by Sanna Marin, the young Finnish head of government, who could conjure up a veritable threat of war for her country by declaring her membership in NATO. Despite all the economic problems around gas supply and supply chains, the value of peace and the current suffering in Ukraine should never be forgotten.

About the Austrian Foundry Conference - 25 years of successful cooperation ÖGI and University of Leoben

The 64th Austrian Foundry Conference took place in Leoben at the famous Montan University.

With 290 participants from Austria, Germany and other European countries, the experts from the entire casting value chain gladly accepted the offer of the attendance event again. Excellent lectures, networking and warm hospitality characterised the all-round successful event.

As the ÖGI President Dipl.-Ing. Gerhard Schindelbacher, who will retire at the end of the year, announced at the gala evening of the congress, he is handing over the reins after 25 years to his designated successor, the excellently networked Dipl.-Ing. Christa Zengerer, currently still Managing Director of ACstyria Mobilitätscluster GmbH.

The delegates, colleagues and friends thanked Schindelbacher with great applause and hoped that he would continue to serve industry and research in other capacities in the future.

Company Info

CAEF - European Foundry Association

Hansaallee 203
40549 Düsseldorf

Telephone: +49 211-6871217