Polish low-cost base working for Euromag customers

Low costs and high skills are helping Euromag SA of Poland grow into one of the largest and most technologically advanced magnesium die-casting foundries in the region.

Established in 2005, the company is on track to become one of Europe’s biggest foundries. “The global use of magnesium applications is growing at a rate of 15-20 percent annually. Our experienced team of engineers is supported by recognized experts from Germany, Norway and the USA,” says Grzegorz Bielowicki, president of the board of Euromag.

For the automotive industry, the company supplies parts like gearboxes, transmission elements, engine elements, covers, cylinder-hear covers, auxiliary modules, fixation components, steering column elements, steering wheels, airbag components, components for brake systems, and a number of other functional and decorative parts.

Automotive Industries (AI) asked Bielowicki to which countries the company planned to expand.

Bielowicki: Euromag operates in Poland, a relatively low cost environment. The use of a proprietary lean and efficient hot-chamber casting technology makes it possible to compete in markets such as the USA and India. We will continue seeking more business from the overseas destination and expand our manufacturing base in Poland. In a more distant future we will consider investments in Mexico in order to serve the North American automotive market.

AI: Please tell us a little about your company’s expansion plans and where you see Euromag in five years time.

Bielowicki: The initial capacity of four 400-ton casting machines is in process of tripling by late 2008. The machine size will range from 280 to 800 tons and all casting cells will be fully automated by the date. The company will be listed in the stock exchange in two years but the owners will retain the control stake in the company for at least another five years.

Euromag strives to strengthen its position in the markets of small to medium size magnesium cast components, typically thin walled, of complicated shapes with elevated technical specifications, like for example very low porosity, where the hot chamber technology is the most effective and efficient. Specifically, Euromag aspires to become a significant player in the car’s steering wheels market, where Euromag’s experience and capability is particularly strong.

Euromag works in a partnership with the alloy producer Advanced Magnesium Technologies from Australia on process development of casting electroplateable parts. We expect this line of business to increase sharply in the coming years, particularly for decorative application involving until recently zinc and ABS (plastic).

AI: By how much is your automotive business growing?

Bielowicki: The Automotive Industry is the strategic market for Euromag and the company is fully aligned to service automotive clients. At the moment the share of production for Tier 1 and Tier 2 customers is at 60 percent. We will strive to maintain this mix. We see increasing interest among automakers in magnesium parts. Euromag assists with design and we can cast prototypes using existing aluminum or zinc dies with only slight modifications.

AI: How important is quality to Euromag and how do you maintain quality consciousness in your facilities?

Bielowicki: The company has the ISO 9001:2000. Management systems at Euromag are already compliant with ISO TS 16949. The certification requires a few moths more to establish a baseline. Otherwise Euromag would certify immediately.

AI: Euromag has become a member of the American Chamber of Commerce. What are the benefits?

Bielowicki: Membership at AMCham is a natural affiliation for an American investment abroad. The US ownership of Euromag brings solid management skills and sound financial controls, which are the important differentiators in the casting business in Central Europe. US based companies are the leading investors in Poland and, many of them run industrial operations. Networking through AMCham also allows us to identify potential clients, provide references and facilitate further contacts.