Industry News is provided as a service to our customers and others interested in chrome plating. It covers various topics that are important to our industry.
Please check back regularly for updates.
Chromic Acid Supply Is Tight (3/24/08)
Most platers are aware of the frequent price increases for chromic acid. In some cases, there has also been a tightening of the supply leading to slower deliveries. The global supply/demand balance is now exceptionally tight.
There have been chromic acid shortages and fluctuating prices in the past and, unfortunately, we expect this trend to continue for some time to come.
The reason is easy to understand, its all about the simple economics of supply and demand. The world demand for chrome is increasing, much of it from China and South America. And, the chrome production plants are operating at capacity. Meanwhile, the chrome ore and the energy needed to convert it into chromic acid continue to escalate.
It’s hard to believe given today’s concept of JIT delivery, but years ago many leading chrome platers would buy and store an entire year’s need of chromic acid at one time.
This provided them with several benefits. They would be buying in larger quantities and therefore receive a lower price, they could time their purchase with the market and benefit from its fluctuations and they had it on hand when they needed it. They recognized that this one commodity was critical to their operation.
We suggest that you take a serious look at your chrome needs for 2008 and 2009 and take steps to ensure your supply.
Maintaining Profitability ( 10/20/06 )
Some hard chrome shops are not as busy nor as profitable as they were 20 years ago. Part of this is due to the exodus of manufacturing overseas and part is due to the existing regulatory climate. In addition, the cost of doing business has gone up with labor, energy, materials and related overhead items forever increasing. As an example, chemical costs have been steadily raising with no apparent end in sight. Much of this is due to the commodities market and the demand from China. Most shops are hard pressed to increase prices as their customers are looking for cost reductions instead.
The secret to survival in these difficult times is to become stronger, leaner and more competitive. This can be done by maximizing efficiency, avoiding wasted steps and eliminating non-profitable items. The savings from these areas can then be directed into increasing the marketing and sales efforts. A detailed analysis of the actual production cost and the risk/reward ratio will show where the weak spots are.
The consolidation of plating shops is actually beneficial as there will be more work to be plated by fewer job shops. The shops that survive this period will be in a much better position to command their price and will become more profitable. The secret now is to compete on quality and delivery, but not on price.
One way to lower costs and increase profits is using a chrome bath that’s more efficient and has lower operating costs. Some platers still think the old standard 100:1 bath is the most economical; this is not the case anymore. The newer high efficiency baths plate at a much faster rate and have lower rejects. This alone can increase sales by over 60% or lower costs by 40%.
The technical issues with the high-efficiency baths have all been solved, so there is no reason to delay taking advantage of the benefits available. These baths also provide deposits that are brighter, smoother and harder. These features can be used to promote your quality and service which will result in bringing more work into your shop.
There is a general misconception that continued operation of a bath high in impurities is less expensive than replacing it. What some don’t realize is the increased energy costs needed to plate with significant levels of iron, copper or trivalent. Combine this with the higher reject rate and the overall poor deposit quality and its easy to see how using a fresh bath makes sense. It’s possible to make-up a new low concentration/ high efficiency bath and recoup the costs in a very short period of time. Again, speed, efficiency and quality are everything in today’s business climate.
The best way of using a high efficiency bath is to buy a separate catalyst that’s used with generic chromic acid. This gives you the lowest cost and the most control while also allowing you to tailor the bath to your exact needs.
OSHA (Cr VI) PEL ( 8/4/06)
A final OSHA ruling became effective on 5/30/06 which significantly lowered workers exposure limits to hexavalent chrome. The maximum PEL is now 5.0 ug/m3 of air as Cr(VI), with an action level of 2.5 ug. These are eight hour time weighted averages as measured with an approved and calibrated personal air sampling pump. The Cr(VI) analysis needs to be performed by an OSHA accredited laboratory.
The compliance deadline for all the requirements, except engineering controls, is 11/27/06 for shops with 20 or more employees, and 5/30/07 for those with 19 or fewer employees. Future monitoring can be avoided if two tests are performed more than seven days apart and both are below the 2.5 ug action level.
Some shops have been tested with readings below 0.2, which is comfortable 12.5 times below the 2.5 action level. Others have readings exceeding 10 ug., so it all depends on the particular set-up as there are numerous factors affecting the amount of Cr(VI) in the shop air.
Contact us if you need to have your testing completed. We can provide a calibrated pump and have an accredited laboratory handle the analysis, all at a very low cost. In addition, we can make recommendations on easy ways to lower the Cr(VI) levels should this be needed.
Hex. Chrome Alternatives ( 7/7/06 )
Driven by the environmentalists, the push to find a hard chrome replacement was in full swing by 1990. Many processes have been proposed including, to name a few, flame spray (and HVOF), ceramics, vacuum deposition and several off-the-wall alloy coatings.
Some process developers claim hard chrome is over-engineered for many of its current uses. Their reasoning is a need to justify the use of their coating. It’s pretty rare when a hard chromed component fails because of a deficiency in its properties. Hard chrome has been used successfully for over 75 years now and frankly, its hard to imagine a more practical coating ever being developed. Most of the “replacements” suffer from high investment costs, a larger floor space requirement, increased operational costs, higher reject rates, and in many cases an even larger environmental or worker safety problem.
The only practical process that comes close to hard chrome is a nickel composite with silicon carbide sub-micron particles, known as Electroplated NiSiC. This offers some distinct advantages including a plating speed that’s 10 times faster than chrome at half the current density. The operating costs are lower than hard chrome due to the high rate of deposition and throughput. A shop considering its adoption, however, should consider its higher investment requirement and the time & cost of changing their customers over.
Hard chrome is a straight forward and non-complicated process. It wears extremely well, is inexpensive to apply, is easy to control, is easily strippable and can be Zero-Discharged. What more could you ask for in a low friction - wear resistant coating? A drop-in hard chrome replacement does not exist, and never will. A wise old professor once said
“ If you want it to look like chrome and work like chrome, then you had better use chrome”. Truer words were never spoken.
Foreign Competition ( 6/9/06 )
The number of hard chrome job shops in the USA has declined by over 50% since the late 1970’s. Part of this is due to our ever more stringent regulatory climate, but the largest part is because of globalization.
The Chinese receive vast amounts of capital from large USA companies that is used to modernize their factories. Most of this is provided by the large national and international conglomerate chemical suppliers. They provided them with the funding and the technology needed to compete against you. Think about this for a minute, the large companies you may have supported for years took their profits and invested them in another country to compete against you. To find out, all you have to do is ask them if they have a branch in China.
Ask yourself if you really want to buy from the large company that established and supports your competition. Wouldn’t you rather deal with another company, one gives better service and whose goals are aligned with yours?
Globalization Increases ( 5/12/06 )
The trend of offshore manufacturing continues to erode business in the USA. Globalization has grown at a pace that was unheard of only five years ago. Many products that were once produced and plated in the USA are now being done overseas. The amount of plating has declined in the USA even though the hard chrome industry is less affected by this than other industries are. Mexico was one of the first outsourcing countries, now China and other Asian countries are our primary competitors.
Its estimated that as many as 1,750,000 American jobs will be lost to offshore manufacturing by 2010. China’s industrial coatings will exceed 4,000,000 metric tons by then. China’s industrial output is growing 15% annually and this growth is expected to continue until at least 2015. Some of the factors driving this trend are cheap labor rates, energy costs that are 50% below ours, an unfair currency exchange and lax environmental & worker safety laws. The result, the Chinese are selling hard chrome for a mere $0.02/mil. sq. inch. Unfortunately, our own Congress has allowed this to happen; we are at odds trying to understand how the bureaucrats could be so short sighted. Don’t think this trend will end with China because India is our next economic threat.