Casting company molds future
LA Aluminum enjoys sales growth, to erect buildingSeptember 9th, 2010
HAYDEN LAKE, IdahoLA Aluminum Casting Co., of Hayden Lake, Idaho, is riding a string of strong sales years that helped it glide through the recession and is expected to continue.
The company, which casts specialty parts from aluminum alloys, boosted its sales by 25 percent in 2008, matched that growth in 2009, and likely will add another 25 percent to its revenues in 2010, says Michelle M. Richter, its sales and marketing director. It declines to disclose its sales figures.
"We're aggressively growing the company," Richter says. "I've got my tooling department buried for the next two years" with the designing and making of molds to produce parts.
Soon, Polin & Young Construction Inc., of Coeur d'Alene, will start constructing a 10,000-square-foot additional building for LA Aluminum at its location near Coeur d'Alene Airport, Richter says. She says that steel structure, which should be completed before winter, will be expandable and will enable the busy casting company, which is dealing with a space crunch, to keep an inventory of certain parts that it plans to begin offering for sale on the Internet.
LA Aluminum employs 50 people now, but projects that its employment will rise to 80 in three years, Richter says. It had no layoffs during the recession and added eight people then.
Two weeks ago, the company received a $300,000 piece of equipmenta Mazak CNC Vertical Milling Center. The device is the third major piece of CNC, or computer numerically controlled, machinery to arrive at the plant in the last 18 months. The other two, both also made by Mazak, of Florence, Ky., were lathes, one with an 8-inch parts-holding chuck, and the other with an 18-inch chuck. Altogether, the three machines cost $800,000, she says. They speed up machining of parts and molds.
LA Aluminum's signature part is the nut ring, a circular or sometimes oval part that is cast with stainless steel threaded inserts, or nuts, in place so other parts can be affixed to the ring.
The company says the cast-in-place thread inserts give better strength to critical sealing surfaces and save customers the machining time that it would take to place them in the ring.
Richter says the company's nut rings "are used in fuel cells in almost every airplane and helicopter flying; it's like the opening for a fuel tank." Boeing, Airbus, and most other aviation manufacturers buy the parts, she says, adding, "Each customer has their's made a little bit differently."
The U.S. military uses LA Aluminum's nut rings and other parts the company makes in bladder-like fuel tanks of up to 210,000 gallons, Richter says. She says military uses its smallest bladder tanks, which hold 500 gallons, to get both fuel and water to the front lines in Afghanistan by pulling the tanks behind vehicles or dropping them from helicopters. The company, which does a lot of work for the military, makes an effort to hire veterans and has received awards for doing so.
"We also make parts for wind turbines," though the turbines are smaller than the big ones in utility wind-turbine farms around the Northwest, Richter says. The smaller turbines generate about 400 kilowatts of electricity, and are used at farms, cabins, homes, and on boats, she says.
For them, LA Aluminum makes tail fins that attach behind the housings on which the turbine blades spin and keep the blades facing into the wind. The tail fins are being manufactured in the U.S. again after having been made in China for a time, as are many other products in a trend known as "onshoring," says Richter, who was quoted recently in a USA Today story on the trend. "We're doing so much more onshoring" at LA Aluminum, she says.
LA Aluminum also makes parts for traffic lights, dental and medical equipment, instrumentation housings, hydraulic valve components, nuclear power plants, oil and gas drilling rigs, and other uses, serving a total of more than two dozen industries.
"Our customer base is very diverse. That's one reason we have done better during the recession than some other companies," says Richter.
She says she tells other companies, "Everybody should have something that they make for the government" because orders from the government and from industry tend to be countercyclical.
The "LA" in the company's name is a legacy of its roots in Southern California, where it was founded in a Quonset hut in 1947 by Robert and Helen Oswald, Richter says. At first, Robert Oswald made sales calls, while his wife melted and poured aluminum, Richter says. In 1972, the company moved to the Coeur d'Alene area, where the Oswalds had vacationed for some time and where they knew land prices were far lower than in California. The Oswalds made a number of real estate investments here, including in Spokane, she says.
Their son, Bob Oswald, took over the company when he was just 26 and still owns it.
Given the company's rapid growth, recent machinery purchases, and planned building project, Richter says that Oswald has told her, "I don't know many CEOs in their 60s who would be willing to invest so much money in their company." Yet, LA Aluminum's rapid growth is helping to drive such decisions, says Richter, a five-year veteran with the company.
Oswald, she says, still advises the company in many ways, but isn't as active in it as he once was. "He's a good person to call on if we get into a pickle or can't figure out how to make a part," she says. The new building will be owned by REO Properties, an Oswald family-owned real estate company that will rent it to LA Aluminum.
The company has thrived in part because it makes permanent-mold castings, in addition to casting with mold cores made from sand or doing die casting, which more commonly is used to make plastic items. The latter two methods of mold casting can leave metal parts porous and not as strong as when they're made with permanent molds, she says. Permanent molds, made of cast iron, can be used over and over, reducing costs and allowing for high production rates and higher strength properties. They also allow casting parts with thinner walls, which reduces the parts' weight.
The company pours its molten aluminum alloy at 1,300 degrees Fahrenheit into metal molds that it has preheated with flame to 800 degrees. Its technological capabilities are evident in a tour of its manufacturing operation. In addition to bins of bright-metal parts, sand-mold cores, and numerous pieces of equipment, the company has big machines called heat baskets that can heat parts to 1,000 degrees for six to eight hours to disperse the elements in the aluminum evenly. The parts then are cooled quickly so the elements in the metal remain dispersed, which increases the parts' strength and durability.
In addition to casting and heat-treating parts, the company makes molds, machines parts, coats them, paints them, and sometimes assembles them and ships them for customers. While the company doesn't sell parts in the international market, a lot of its customers do. Many are American and Canadian original equipment manufacturers, Richter says. An original equipment manufacturer, or OEM, produces complex equipment, such as a computer, from components that it usually has bought from other manufacturers.
LA Aluminum's new CNC machines make the company more efficient. The latest unit, the vertical milling machine, features a large circular device mounted on its top that rotates to deliver one of up to 48 different tools to the milling apparatus to handle different jobs. The machine changes tools quickly, reducing setup time for a job, which is one of LA Aluminum's major expenses.
Also, the company has built a booth for a new process called dry ice blasting, which roughens the surface of a mold where the aluminum is poured into it. That roughness keeps an oxide layer from forming on part of the metal. The company just now is starting to train workers in using dry ice blasting, says foundry foreman Dave Bullock.
When dry ice turns from a solid into a gas, it expands 700 times, causing an explosion at the surface of the mold and roughening it in the desired area, he says. Dry ice blasting produces no dust, unlike sandblasting, in which abrasive sand is projected with forced air against a surface, Bullock says.
LA Aluminum runs three 10-hour shifts a day, with its shifts overlapping so workers have time to set up machines for use during their shift, put them back in storage, or prep them for the next pour. Production runs vary daily, so different combinations of machines are employed each day, Richter says.
The company now is working to land a contract to make an axle housing for a military four-wheel drive vehicle from aluminum rather than iron, which would reduce the vehicle's weight considerably and meet a Pentagon goal, Richter says. It's also providing a quote to make a part for a windmill turbine manufacturer.