Speed Changers, Industrial High-Speed Drives, and Gears

SIC 3566

Companies in this industry

Industry report:

Firms in this industry manufacture speed changers, industrial high-speed drives, and gears. Hydrostatic drives are classified under SIC 3594: Fluid Power Pumps and Motors; automatic transmissions are in SIC 3714: Motor Vehicle Parts and Accessories; and aircraft power-transmission devices are found in SIC 3728: Aircraft Parts and Auxiliary Equipment, Not Elsewhere Classified.

Industry Snapshot

This industry provides basic mechanical power transmission components used in most industrial machinery. According to Dun & Bradstreet's 2010 Industry Reports, 273 establishments employed 9,200 workers in the industry. Total annual sales were $730.2 million in 2009. Eighty-two percent of establishments employed fewer than 50 workers, although firms employing more than 50 workers accounted for more than 67 percent of total industry sales. Top employing states in the industry were Wisconsin, Ohio, Minnesota, New York, and Illinois. Wisconsin was also number one in terms of industry revenue, followed by Massachusetts, Ohio, and Illinois.

Background and Development

Typical manufacturing includes metal grinding, cutting, degreasing, and surface finishing (including hardening). Such metalworking includes basic metal-shaping, heat treatment, and metallurgic modifications using chemicals during processing.

The origin of the gear concept remains uncertain. It was not one of the basic five "simple machines" defined by Hero of Alexandria (the wheel and axle, the lever, the pulley, the wedge, and the screw), but it probably evolved from the screw. Until the Industrial Revolution, craftsmen used the gear primarily in small mechanisms like clocks, or to guide and locate machinery components. The idea of using it to transmit power in larger machines did not gain prevalence until the nineteenth century in England.

In America, the technology and the expertise of local artisans to produce quality gears lagged behind Europe until near the end of that century. In 1896, F.W. Fellows patented a gear-shaping machine that could turn out a wide variety of gears quickly and cheaply. The rise of the "American system" of mass manufacturing on an assembly line made such tools quickly popular, displacing the traditional hand-chiseled and filed gears of Europe. These two machine concepts became the dominant technology used in the manufacture of almost all gears in the United States and elsewhere.

By the 1990s, however, the advantages of mass production faded in the face of demands for more flexibility in the design and delivery of individual part orders. Gear manufacturers shifted to heavily automated production systems using statistical process control (SPC), computerized numerical control (CNC), and just-in-time (JIT) philosophies. These systems allowed greater precision and faster production shifts. Three-dimensional, computer-digitized master components maintain closer tolerances than can be achieved even with a skilled craftsman and allow the same master to be used as a benchmark at production facilities around the globe.

In 1995, industry shipments reached $2.1 billion, according to the U.S. Department of Commerce's Annual Survey of Manufactures, up from the 1992 value of $1.8 billion. In 1992, there were 256 companies in this industry, with the largest four companies still accounting for 28 percent of the total value of shipments. In 1995, firms in this industry averaged 142 employees per establishment, although the largest four establishments (by sales) each had 900 employees or more.

Since the industrial process of making large quantities of gears produces large amounts of waste by-products, the Environmental Protection Agency (EPA) targeted the industry as a waste minimization opportunity in the early 1990s. In particular, it noted that the use of trichloroethane as a degreasing agent needed to be replaced with other chemical solvents or a more advanced technology like ultrasonics. Trichloroethane is one of 17 chemicals listed by the EPA as an industrial toxin. International agencies have identified trichloroethane as an ozone-depleting substance contributing to global warming. For this reason, production of trichloroethane for emissive uses was banned in 1995 under amendments to the Clean Air Act of 1992. Chemical manufacturers have attempted to preserve sales by offering alternative chlorinated solvents as replacements to trichloroethane.

The industry demonstrated slow but steady growth throughout the late 1990s, with the value of shipments increasing from $2.4 billion in 1997 to $2.5 billion in 2000. Companies in this industry downsized at the turn of the new century; the total number of employees decreased from 16,182 in 1997 to 15,477 in 2000. Over a quarter of the industry's shipments were generated by only four establishments. Trends affecting this industry during the included automation production technology and government restrictions on industrial waste.

Current Conditions

The late 2000s and early 2010s saw increased trade activity in this industry. According to Supplier Relations US LLC, the value of related imported products from 81 countries was equal to 80 percent of U.S. production in 2009. Exports to 158 countries were valued at 40 percent of U.S. production.

Like many U.S. manufacturers in the early twenty-first century, producers of speed changers, industrial high-speed drives, and gears dealt with increasing demands to reduce waste and make more efficient use of energy. Many companies responded by incorporating new, high-tech devices that would show positive results. For example, ABB, a maker of industrial drives, devised a system whereby the amount of energy being saved while using the drive's energy-efficient parameters was displayed on a screen. As stated in the February 2010 issue of Food Trade Review, the screen displays "energy savings of the application in kWh and MWh; the cost of the energy saved in a local currency; and the carbon dioxide (CO2) emissions equivalent of the energy saved."

Industry Leaders

Industry leaders in the early 2010s included Rockwell Automation Inc. of Milwaukee, Wisconsin, with 2009 sales of $4.3 billion; Regal Beloit Corp. of Beloit, Wisconsin, with revenues totaling $1.8 billion in 2009; and Baldor Electric Co. of Forth Smith, Arkansas, with sales of $1.5 billion in 2009. Other important players were MagneTek Inc. of Menomonee Falls, Wisconsin, which had 2009 sales of $98.2 million, and the Process Motion Control division of RBS Global Inc. in Milwaukee. Overall sales for RBS Global were $1.8 billion in 2009.

Workforce

Employment in this industry peaked in 1974 at 27,000, then dropped to 17,400 in 1986 before recovering to 19,300 by 1988. Employment has steadily fallen since that time, however. In 2000, the industry employed 15,477 people, and by 2008 there were only 14,233 workers in the industry.

© COPYRIGHT 2018 The Gale Group, Inc. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. For permission to reuse this article, contact the Copyright Clearance Center.

News and information about Speed Changers, Industrial High-Speed Drives, and Gears

Research and Markets Adds Report: Speed Changer, Industrial High- Speed Drive, and Gear Manufacturing Industry in the U.S. and its International Trade
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