© SKF Group 5 September 2013Slide 0
Industrial Market, Strategic Industries
© SKF Group
Speakers
25 min
Rakesh
Makhija
President
Strategic Industries
15 min Rutger
Barrdahl
Director
Railway and Off-highway
15 min Ole K JødahlDirectorIndustrial Drives
5 min Key business message & Summary15 min
Q&A
CMD 2013
© SKF Group
Agenda
Strategic Industries agenda & overview
Significant news
Strategy and market direction
Value and Cost leadership
Asset Life Cycle –
‘every business must have a service
business’
SKF BeyondZero
Outlook and key business message
CMD 2013
© SKF Group
26,2%
22%0,04%
51,4%
Industrial Market, Strategic Industries
Net Sales 2012 = SEK 20,204 million
No. of employees = 19,096
Full responsibility for sales to both OEM and end users, as well as business development, manufacturing, and engineering
% of net sales by geographical area (2012):Middle East, Africa
Asia, Pacific
North America
Europe
CMD 2013
Film
© SKF Group
Voice of the Customer –
what is important to them
Energy efficiency
Reliability
Cost reduction
Uptime
Partnership
CMD 2013
Significant news
© SKF Group
Aerospace
Significant news
Long-term contract worth SEK 900 million with Turbomeca
Awarded key bearing programs with the industry leaders (Pratt GTF, Bell 525, Eurocopter
X4, Safran
LEAP X)
Renewed long-term agreements with major partners such as GE and Agusta-
Westland
SKF Aerospace Innovation Centers with Penn State Erie, The Behrend
College, and a co-Chair with INSA Lyon dedicated to the study of lubricated interfaces in aerospace
CMD 2013
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Railway
Start up of production and global launch of a new range of Tapered Roller Bearing units (AAR) for freight cars, strengthening our role in the large freight wagon markets.
Major orders of wheel set bearings (TBU) for very high speed trains (>300 km/h) in China, with the customers Tangshan Loco and Changchun Railway Co.
Very strong overall growth in our Chinese railway business for passenger train applications.
Significant news
CMD 2013
© SKF Group
Renewable Energy
Three-year agreement signed with Siemens Windpower
for supply of the new generation SKF Nautilus bearings
Success with SKF WindCon
systems to Vestas
Services in multiple markets
Supplier and development partner to David Brown Wind for gearbox development
for a multi-megawatt
offshore wind turbine model
SKF in forefront development in the ocean
energy market with supply agreements with several manufacturers of wave and tidal turbine devices
Launch of the SKF Wind Industry Quality Standard
Significant news
CMD 2013
© SKF Group
Traditional Energy
Extended service contract with two major oil producers on the Norwegian shelf, SEK 40 million over 5 years
Service contract with major USA oil & gas pipeline (20,000km) in the US,
3 years SEK 20 million
Contracts for condition monitoring, bearings and maintenance services with a major Latin American oil company for SEK 20 million over 3 years
Supplying Magnetic Bearing technology for two new major off shore projects in Australia for the Ichthys
Gas Field
Significant news
CMD 2013
© SKF Group
Industrial Drives
Received large prototype orders from major Chinese and American air-blower customers for our new high speed permanent magnet motors using magnetic bearings
Tripled seal sales to a leading German gearbox producer. We are the main seal supplier to several of their manufacturing locations
New product start of Full Complement Cylinder Roller Bearings in a market that was traditionally dominated by our competitors in Germany
Significant news
CMD 2013
© SKF Group
Precision
Large order achieved in material joining applications for Automotive industry, to supply SKF Electromechanical Cylinders (based on SKF superior roller screw technology)
Global launch of new telescopic pillar for ophthalmic and infant care devices
Initiated Super Precision bearings production in Charleston, US to better serve the North America machine tool market
Machine Tool Competence Centre in Shanghai
Significant news
CMD 2013
© SKF Group
Lubrication
Equipped BEUMER belt conveyer complex for unloading iron ore vessels in Malaysia with 100 SKF automatic lubrication systems
Secured Oil Circulation System
and Grease lubrication systems for three new machines at Metso
Paper Sweden AB
Supplying 25 Automatic Lubrication System including installation, testing and documentation to the Norwegian Public Roads Administration
Photo: BEUMER Group GmbH & Co. KG
Significant news
CMD 2013
Strategy and market direction
© SKF Group
SI agenda –
short to medium term
• Making growth happen –
profitably• Every business must have a service business• Manufacturing Development –
cost, quality, and safety• Execute SI organization efficiency programs –
footprint, stock optimization, and cost reduction
• China, Germany, USA, and India• M&A• SKF BeyondZero
portfolio• Building a great SI organization –
meritocracy, excitement and vibrancy
Value and Cost Leadership –
the road to sustained leadership
CMD 2013
© SKF Group
IdeaDesignDevelopManufactureOEM Supply
- Operator Inspections (technology & processes) - Condition Monitoring & prognostics- Remote Diagnostics & Onsite Investigations-
Maintenance & Reliability Engineering- Mechanical Services / Troubleshooting- Root Cause Failure Analysis - Reliability analysis & improvement assessment
-
Concept evaluation
& simulation-
Detailed calculations & virtual testing -
Design validation & real testing -
Series production -
Factory Acceptance Test
> OEM Asset
End User Install
OperateMonitor
MaintainRepair
Restore
- Commissioning > Site Acceptance Test- Asset Register development & spare parts plan- Maintenance strategy deployment
End User Install
Capture the full potential of the asset life cycle
CMD 2013
© SKF Group
Asset life cycle management for wind industry
Specifications(Active involvement in standardization committees and other industry bodies)
Manufacturing and testing•Customized mainshaft
solutions(Nautilus, Self aligning / CARB and rigid)•Industry specific gearbox offerings;(HC-CRB, separable HC-CRB, black-oxidized)•Generator solutions;
(XL-hybrid bearings, Insocoat
bearings)•Sealing solutions, Lubrication systems
Design and develop•Engineering Consultancy Services•Calculation and simulation tools•Design development partnership with turbine manufacturers•R&D and testing activities
Operate and Monitor•WindCon
monitoring system•Remote monitoring services•Lubricants•Mechanical & Training services•Asset Efficiency programs
Maintenance & Repairs•Bearings & seals replacement parts•Gearbox Spare part kits•Gearbox refurbishment services•Logistic services
Installation•Alignment services•Bearing mounting services
CMD 2013
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Value built around Asset Life Cycle Management
Idea
Des
ign
Dev
elop
Man
ufac
ture
Inst
all
Ope
rate
M
onito
r M
aint
ain
Repa
ir
Rede
sign
OEM END USER
CMD 2013
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Value propositions for wind aftermarket
Spare parts
Driveline services
Condition based maintenance
Remote monitoring & Asset Management Services
CMD 2013
© SKF Group
Availability –
Spare Parts Management Program for wind
SKF Spare Parts Management
Lead time Availability
Spare parts for gearboxes, main bearings, generators,…• Bearings• Housings• Seals• Lubrication systems
As wind farms age, the O&M cost increase
In order to maintain turbine performance and reliability, a Spare Parts Program is needed to ensure
•
Availability of key and critical components
•
Short lead times and committed service levels
CMD 2013
© SKF Group
Actively develop and implement new, efficient solutions and services
Root cause failure analysis on large drive train components like main shaft and gearbox
Development of upgrade packages
Wind turbines specific improvement programs
SKF driveline services
Offer
Drive line service offers:• Upgrading instead of replacing• Bearing remanufacturing• Application analysis• Training
LCOE reduction by early involvement!
Levellized
Cost of Energy (LCOE) -
Driveline services for wind
CMD 2013
© SKF Group
Reduce maintenance –
Condition Based Maintenance for wind
Condition Based Maintenance
WindCon
+ Active WindCon
Vattenfall
–
Vestas
V80 –
Esbjerg Sweden
Maintenancecost
Availability
CBM enables value positioning in terms of: • Upgrading customer assets• Increasing power output• Increasing uptime
Clear industry trend to equip multi MW WTGs
with condition monitoring systems
Large utilities upgrade their wind farms with CMS
Market focus still on hardware
Values lies in the efficient remote diagnostic capabilities and expertise.
CMD 2013
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Maintenance complexity
Bus
ines
s im
pact
1
23
4
Condition Monitoring Electrical Motor Monitoring
Advanced DiagnosticsTurbomachinery
& PumpsMechanical Support
Alignment, BalancingMaintenance strategy
Oil and gas services
CMD 2013
© SKF Group 5 September 2013Slide 24
Magnetic Systems services
Installed base:Large installed base and growingWorldwide organization
Activities:Field support service (tuning, commissioning, assistance)Spare partsRetrofit and upgradesMaintenance & training
Success factors:Short lead time and service level commitmentCompetent service organizationNew Collaborative Business Model
© SKF Group
Probabilistic risk assessment (PRA) is a systematic and comprehensive methodology used to evaluate risks associated with complex engineered systems and facilities. In a PRA, risk is characterized by two quantities:
the magnitude (severity) of the possible adverse consequences, and the likelihood (probability) of occurrence of each consequence.
SKF (ERIN) has established a proven track record as the leading provider of Probabilistic Risk Assessment (PRA) consulting services to the power industry.
Traditional Power services
CMD 2013
© SKF Group
Lubrication -
service
Rautaruukki
Steel Mill, Raahe, Finland
20,000 lubrication points automated by SKF
“Ruukki
Metals OY has signed a lubrication service contract with SKF in Finland.
The service covers several areas of the mill and is worth 500,000 euro”
Ruukki
CMD 2013
© SKF Group
Lubrication
–
Top of Rail (TOR) Conditioning Systems
We undertake full responsibility for installation, commissioning, including civil works.
CMD 2013
The SKF BeyondZero
portfolio
© SKF Group
The SKF BeyondZero
portfolio –
Strategic Industries
Servo actuator SKF E2DGBB
High endurance Slewing bearings
Dry lubrications for conveyor belts
Energy efficient blowers
Active magnetic systems
CTBU low friction seal
SKF solar linear actuator
Sour gas compressor bearings
ELI spherical plain bearing Food line Y-bearings
Cylinder lubrication unit Titanium bearings for
Aerospace
SKF Nautilus
SKF Solar Hub
SKF Flowline
SRB + CARB
CMD 2013
Business Unit presentations
Outlook and key business message
© SKF Group
Performance 2011 –
2013 YTD
2011
Net
sales
Operating margin
20 807 SEKm
20 093SEKm
13.9%(14%) restated
9.8%(10.2%)
2012
9 348SEKm
9.2%(11.2%)
Half year 2013
10 792SEKm
9.8%(10.7%)
Half year 2012
CMD 2013
© SKF Group
Market trend per industry
Aerospace:Strong demand driven by single aisle demand, Boeing and Airbus, supporting a stable, high, build rateContinuing growth in RIC
Railway & Off-highway:Railways: Asia coming back on growth track, Europe and USA in stable modeSKF: Continued strong Agri
businessContraction in mining related business
Renewable energy:SKF: Renewable Energy in a phase of business recovery, positive projectionsOngoing quick globalization of industry, with new emerging markets developingTrend of expanding turbine sizes and wind industry going offshore
SI overall outlook:•
Modest improvement in overall business environment•
Speed of change will differ between segments•
China growth expected to improve•
Drive life cycle growth strategy
CMD 2013
© SKF Group
Market trend per industry
Traditional energy:Deepwater and subsea
exploration & production continue to be growth areasNatural gas boom impacting future investments in transportation (pipelines)Hydraulic fracturing technology now being implemented in UK and China
Industrial Drives:Modest global business growthEnergy efficiency importance increases -
The BeyondZero
portfolio and our new launches supports the growthSKF: New range of application specific performance solutions
Precision:Moderate business recovery with higher growth in USA, China and IndiaSKF: Increase regional manufacturing footprintSKF: Ongoing product cost reduction programs
Lubrication:SKF: Increased focus on key developing segments (Agriculture, Oil & Gas)SKF: Integration and synergy-building continue according to planSKF: Focused on key growth markets (Russia, Asia, and Latin America)
CMD 2013
© SKF Group
Key business message –
Strategic Industries
Growth drivers•
Every business must have a service business•
China, Germany, USA, and India•
The SKF BeyondZero
portfolioCompetitive advantage
•
Life cycle management•
Five technology platforms•
Global footprint with local competenceCost efficiency
•
Manufacturing Development –
cost, quality, and safety•
Execute SI organization efficiency programs –
footprint, stock optimization, and cost reduction
•
Business Excellence across SI
CMD 2013
© SKF Group
The Value and Cost Leadership Equation
1930 Oil & Gas Journal ad
valued
CMD 2013