Cutting Tools, Machine Tool Accessories, and Machinist Precision Measuring Devices

SIC 3545

Companies in this industry

Industry report:

This category covers establishments primarily engaged in manufacturing cutting tools, machinists' precision measuring tools, and attachments and accessories for machine tools and for other metalworking machinery, not elsewhere classified. Establishments primarily engaged in manufacturing hand tools, except power-driven types, are classified in the cutlery, hand tools, and general hardware industries.

Industry Snapshot

The cutting tools, machine tool accessories, and precision measuring devices industry faced increased global competition and more demand for better, longer lasting tools and accessories. Extensive development of tougher cutting tool materials and coatings was the driving force of change in the industry, along with improved cutting tool design that extended performance. Increased emphasis on quality control was affecting the measuring device segment through demand for electronic gauges that link to statistical process control software packages. Modular tooling designs affected the accessories segment.

While this industry has paced itself to match industry demand for productivity improvements, it also has dealt with its own problems. The influx of foreign competitors to the market has been staggering, forcing cutting tool and measuring device manufacturers to look introspectively at their own operations. Process improvements and increased development became commonplace practices to remain profitable in the 2000s.

The United States produced $6.0 billion worth of machine tool accessories in 2009. About 2,800 establishments employed 50,900 workers, with the largest numbers in Michigan, Pennsylvania, and Illinois. About 97 percent of establishments employed fewer than 100 workers, although companies employing more than 100 people accounted for almost 50 percent of total industry sales.

A downturn in the machine tool industry does not necessarily correlate to the health of the cutting tool industry. Generally, cutting tool sales are viewed as an economic indicator of the nation's manufacturing productivity level. The difference primarily is capital expense. A corporation may decide to purchase a used machine tool over a new one in recessionary times. However, if a company is cutting metal, the cutting tools wear or break and must be sharpened or replaced with new cutting tools. Therefore, the productivity of a metal cutting company generally is directly related to the purchasing levels of machine tools. However, longer lasting cutting tools are being manufactured with specialized coatings that extend the wear life of the tool--sometimes as much as four times the normal wear. With improved cutting tool materials and geometry, the volume of machine tool sales will inevitably drop because the tools are designed to reduce the frequency of replacement. Likewise, improved engineering design of metal castings intentionally reduce the amount of removable machine stock, requiring less cutting tool activity.

Background and Development

The background and development of cutting tools, accessories, and measuring devices is closely tied to the history of machine tool development. The first gear-cutting mechanism was designed by Leonardo da Vinci. However, no evidence indicates that it was ever built. Through the clock-making industry, the demand for precision gears and precision measuring devices grew. As time-keeping devices became more popular, production techniques were developed to meet the increasing demand. Metal removing devices were available with very small teeth, which served more as rotary files than chip-forming, cutting tools. Yet it was not until the mid-1800s that the first cutting tool was developed.

Phoenix Iron Works of Hartford, Connecticut, created the first tool to really form a metal chip, thereby cutting the metal. The tool had 56 teeth placed around its nearly 3-inch diameter. The teeth were chipped by a hammer and chisel. While effective, the tool required too much labor when it needed sharpening. In 1864, the Brown & Sharpe Co., later the Brown & Sharpe Manufacturing Co., developed the first cutter that could be sharpened by grinding the face without altering its shape. To date, the elements of this design are still in use.

In the mid-1990s, there were about 1,900 establishments in the industry, an increase of about 9 percent over 1990. In 1995, the industry shipped $4.8 billion in products; more than half ($2.6 billion) consisted of small cutting tools for machine tools and metalworking machinery; 22 percent ($1.1 billion) consisted of precision measuring tools.

In the late 1990s, Worcester, Massachusetts-based Norton Co. developed the AVOS (Allows View of Surface) design, whereby it punched holes in the cutting blades to view through. The company also triangulated the rotating blades to improve vision as well as for brief breaks in the cutting process where the blade loses contact with the surface, allowing it to "breathe," as airflow swarfed out the grinding zone. This reduced heat and friction by 25 percent, improved the finish, and increased the life of the tool.

End mill design evolved into more specialized geometries for certain material applications. For example, when milling aluminum, a standard, two-flute, high speed, steel end mill was used. However, studies showed that using a three-flute end mill on aluminum grants ample space for chip formation while allowing a feed rate increase of up to 50 percent. This tool design change increased productivity by allowing aluminum to be machined faster without increased tool breakage.

New tool coatings also improved performance. Cubic boron nitride coated tooling inserts were gaining ground on carbide and ceramic inserts in areas like high production milling of cast iron. Polycrystalline diamond (PCD) coated inserts also gained acceptance, largely due to research and development efforts in PCD film technology. PCD is especially suited for ultrahard cutting applications. Titanium nitride coatings also can provide significant benefits--including lower machining cost per part, longer tool life, higher feeds and speeds, improved finished part quality, and reduced tool deflection.

Another example of improved tool wear through coating was polycrystalline cubic boron nitride (PCBN). This innovation, when applied to turning inserts, threatened to replace many grinding operations. Used to machine hardened steel, PCBN turning inserts have no equal. Referred to as hard turning, the insert comes within or surpasses the accuracy and surface finish once reserved for grinding operations. The surface is improved because hard turning burnishes the surface, ending in a cleaner, rust- and crack-inhibitive surface.

Quick change and modular tools were also making inroads in the late twentieth century. Flexibility and adaptability, which these tooling configurations offered, had been emphasized by customers over the years. Rapid precise tool changes saved downtime and enabled the tailoring of production schedules, thus using personnel and machine tools more efficiently. Modular tooling systems standardized spindle-to-tool interface connections, offering reduced hardware inventories.

The value of hand and edge tool shipments grew from $7.3 billion in 1999 to $7.6 billion in 2000. The value of cutting tool and machine tool accessories shipments grew from $5.1 billion to $5.6 billion over the same time period. The cost of materials for both industry sectors also increased. By 2007, industry shipments in the hand and edge tool manufacturing sector had dropped to $6.7 billion. Shipments of cutting tools and machine tool accessories also decreased, to approximately $5.3 billion.

Current Conditions

Like many other sectors of the U.S. manufacturing industry, machine tool makers struggled to recover from the economic recession of the late 2000s. The effects were felt around the world, as every major manufacturing country experienced a decline in machine tool consumption in 2009 as compared to 2008. (Consumption is figured by adding a country's domestic production and imports together then subtracting exports.) According to a report by Production Machining, the United States consumed less than half the value of machine tools in 2008 the following year. Still, the country remained number three in the industry worldwide behind China and Germany.

By 2010, some had hopes of a recovery. According to Metalworking Insiders' Report, orders for machine tools and other manufacturing technology in the United States were up 22 percent in February 2010 as compared to a year earlier. Douglas Woods of AMT told the magazine in May 2010, "the market has turned and is slowly recovering from the worst single year downturn in our industry's history." The central U.S. showed the strongest growth in early 2010, with monthly orders rising 32 percent to $53 million, followed by the Midwest, up 26 percent to $43 million.

Industry Leaders

Washington, D.C.-based Daneher Corp. led the industry with 2009 sales of $11.2 billion. Latrobe, Pennsylvania-based Kennametal generated $1.9 billion in 2009 sales. Other important players included Global Industrial Technologies of Coraopolis, Pennsylvania, and General Cutting Tools of Chicago.

Workforce

According to the U.S. Census Bureau, the cutting tool and machine tool accessory manufacturing industry employed 34,284 workers in 2007, down from 46,182 in 2000. About 35,556 people were employed by the hand and edge tool industry, as compared to 39,106 in 2000. Approximately 71 percent of employees in both industries were production workers. The average hourly wage of the cutting tool and machine tool accessory production worker was $32.08

Occupations in this industry were expected to decline as the twenty-first century progressed. Those facing the most significant reductions (more than 10 percent) included tool cutting operators, assemblers and fabricators, machine builders, precision inspectors, and metal forming operators. Small increases in a few occupations were expected, including industrial production managers, mechanical engineers, combination machine tool operators, numerically controlled machine operators, and machinists.

America and the World

Global competition was fierce in the manufacturing industry in the 2000s, especially in the auto industry. Although the Americans have experienced difficulty in the marketplace where Japanese cars reign supreme, the Europeans face greater challenges. Although work ethics differ among cultures, so does the level of sophisticated machine tools and cutting tools. In order to bridge this gap, European manufacturers may order higher standard machine tools, cutting tools, and accessories and increase the order quantities.

The advent of International Organization for Standardization (ISO 9000) certification brought global uniformity to quality standards. Most European countries adopted ISO 9000 regulations as official. On a global level, ISO certifications were becoming increasingly necessary to remain competitive. In the United States, many of the larger companies and organizations--such as Caterpillar, York International, and American Petroleum Institute--developed their own quality standards. Once a company becomes a potential supplier for the larger company, a quality audit is performed at the potential supplier's facility. Depending on the customer-supplier base, it is possible for a company to hold several quality certifications, each with its own unique requirements. The benefit to obtaining ISO certification is that it represents a quality level that is understood throughout the world. ISO certifications are reviewed and reaudited every six months. The cost of compliance is one of the major obstacles to applying for certification. However, the cost of noncompliance in the future could mean fewer business opportunities, as ISO could become a general requirement for contract awards both domestically and internationally.

Research and Technology

Cryogenic treatment, or the deep freezing of cutting tools, became more commonly used in the 2000s to make metals more resistant and longer wearing, as well as helping them to have better electrical properties. Liquid nitrogen is often used for the process, as it is readily available and inexpensive. The process involves reducing the temperature of components to about -244 degrees F for an extended period of time. Microprocessors help prevent thermal shock, whereby the part would be basically destroyed. The results have been outstanding. Carbide inserts last two to eight times longer than untreated inserts. Blades for cutting abrasive rubber last up to 37 times longer. Carbide dies stay in service for months, rather than weeks, before needing to be sharpened. Even nylon stockings seem better able to resist runs better.

Technology in the industry continued to expand into the 2010s, and industry participants struggled to keep up. As Mike Chenevert of Swissline Precision Manufacturing, a firm that produced more than 2.5 million medical, aerospace, energy, and other high precision components, told Production Machining in 2010, "It's easy to become completely overwhelmed with the number and variety of cutting tools and tooling options on the market. I spend time every day reading about cutting tool technology and researching the latest improvements."

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