Manufacturing AUTOMATION

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SKF to consolidate North American manufacturing plants


August 23, 2016
By Manufacturing AUTOMATION

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Aug. 23, 2016 – SKF recently announced plans to consolidate its manufacturing facilities in North America, including the closure of its sites in San Diego, Calif., and Baltimore, Md.

According to the global supplier, production will be transferred from the group’s site in Hanover, Penn., to Flowery Branch, Ga., and the move will consolidate production of spherical roller bearings and large size roller bearings into existing bearing manufacturing operations in Flowery Branch.

Meanwhile, production of rings and seals for aerospace applications will be relocated to Hanover from SKF’s existing factory in Baltimore. Manufacturing and development of condition monitoring solutions will be moved from SKF’s existing site in San Diego to other sites in Europe, offering “customers better condition monitoring solutions, faster, as the development team will be centralized in the same region, close to the rest of SKF’s technical competence centres across Europe. A technical support team will remain in San Diego, but in a separate facility.”

“With a stronger, more efficient manufacturing base, the group will be better able to serve its North American customers,” said SKF in a statement.

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A total investment of SEK 150 million (roughly C$23.2 million) will be made in upgrading machinery and manufacturing processes in Hanover and Flowery Branch, it added. Restructuring costs are expected to amount to around SEK 300 million (about C$46.3 million), of which around SEK 100 million (approximately C$15.4 million) will be accounted for during Q2 2016 and the remainder as they occur, said the company, adding that the consolidation is expected to generate full year cost savings of around SEK 220 million (about C$34,014,486.11 million) from 2019.

“These activities will strengthen our position in North America, making us more competitive and better able to support our customers, by improving the utilization of our manufacturing assets. They also provide the foundation for investments in the further development of our manufacturing processes and technologies,” said Luc Graux, president, bearing operations.

Consolidation of the sites in Hanover, Flowery Branch, Baltimore and San Diego is expected to take approximately 18 – 24 months. As well, the Y-Bearing and Units production channels in Puebla, Mexico, which serve North American customers within the agriculture segment, will be closed, with production transferred to other SKF sites.