Euromag strengthen its position in the markets of small to medium size magnesium cast components

The Polish Euromag SA is one of the largest, high-tech magnesium die casting foundries in the region. Recently, the company joined the ranks of the prestigious American Chamber of Commerce or AmCham. “The Chamber acts as an intermediary in establishing business relationships that enhance the position of our company in the world of business. Participation in the monthly meetings will help us to create and promote our brand on the international arena,” said Grzegorz Bielowicki, president of the board of Euromag.

The AmCham was set up in 1991 as a non-profit and nonpolitical organization. The organization’s charter is to attract foreign investors to Poland as well as to promote American commerce, investments and industry. Currently, more than 300 companies are part of AmCham, including Whirlpool, Hewlett Packard, or Coca Cola.

The association is made up of companies registered in the United States or joint-venture companies. International companies operating on both the Polish and foreign markets can also become members of the trade body.

Euromag’s entry into AmCham, is expected to boost the company’s global presence. Euromag has been working hard at expanding in markets outside Europe – recently, it signed a contract with Japan’s Makita. Makita is a leading manufacturer of professional electric tools on the global market. Similarly, Euromag is keen expand its business with automotive companies.

Euromag has one of the largest and most technologically advanced magnesium die-casting foundries in Poland.
Established in 2005, the company currently has four die-casting cells. This is expected to go up to 18 over the next few years which will give Euromag the distinction of being the one of the largest magnesium die-casting foundries in Europe.

“Our magnesium components have been supplied to the automotive, machine and electric tool and IT industries. Recently the number of deliveries to other users of metal components (up to now- cast of zinc and aluminum) is growing. The global use of magnesium applications is growing at a rate of 15-20 % annually. Our experienced team of engineers brings to Euromag a wealth of knowledge acquired in the leading automotive companies and is supported by recognized experts from Germany, Norway and the USA,” says the company.

Euromag has positioned itself as being a supplier of dedicated to clients looking for all kinds of magnesium solutions. The automotive industry is a core area for the company. It manufactures automotive 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. The use of magnesium in automotive parts has been growing rapidly because it is lighter and thus makes automobiles more fuel-efficient.

For Euromag, quality is of utmost importance. The company has the ISO 9001:2000 quality certification and by 2008, is expecting to receive the ISO TS 16949 certification. “The company utilizes a state-of-the-art, perfectly equipped laboratory. Among the elements of the advanced quality control infrastructure, possessed by the company, there are: spectrometer, CMM measuring machine and X-Ray chamber for defectoscopy,” says the company.

Automotive Industries spoke to Grzegorz Bielowicki, president of the board of Euromag SA.

AI: To which countries do you hope to expand Euromag’s presence?

Euromag operates in Poland, a relatively low cost environment. The use of a proprietary hot-chamber casting technology, very lean and efficient, enables exporting components to the USA and as far destinations as 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 North America and SE Asia.

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

Euromag was established in 2005 and started operations in June 2006. The initial capacity of four 400 tone casting machines is in process of tripling by late 2008. The machine size will range from 280 to 800 tones and all casting cells will be fully robotized by the date. Current employment of 55 will increase to 100. The company may be listed in the stock exchange in 2 years but the owners will retain the control stake in the company.

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.

Innovation is expected to open new markets. Euromag works in a partnership with the alloy producers 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).

Euromag is already the largest and most modern independent magnesium foundry in Poland. The organization is young but draws on extensive experience of our multinational consultants and process engineers. We have all the reasons to believe that our strong growth will continue over the next several years and is likely to accelerate due to increasing captive demand from large, existing clients.

AI: Currently, how much of your business comes from the automotive industry? By how much is it growing?

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 reaches 60% and we will strive to maintain this share, as the minimum. We observe increasing interest among automakers in magnesium parts, considered more and more often as a value engineering option. Current aluminum and zinc designs are being given the second look and the designs for magnesium are being evaluated. Euromag is offering consulting of these designs suggests changes and casts prototypes on existing aluminum or zinc die after only slight modifications. Given the above, we are very confident, that the automotive share of our business will steadily keep above 60% in the years to come, along new capacity increases.

AI: Please tell us what Euromag has to do to get the ISO TS 16949 certification? How important is quality to Euromag and how do you maintain quality consciousness in your facilities?

Management systems at Euromag are already compliant with ISO TS 16949. The certification requires a few moths more of a baseline, otherwise Euromag would certify immediately. Since we supply processes of our clients, everybody in the organization needs to understand what the processes is, how to measure it and then how to improve (as the ISO TS standard requires it, by the way). Everything starts with the understanding that only capable processes are able to produce good parts. Perfect quality is a must and the management system compliant with ISO TS is the way of managing automotive business these days.

AI: What benefits do you think Euromag will gain from being a member of the American Chamber of Commerce?

Membership of The American Chamber of Commerce is a natural affiliation for an American investment abroad. The US ownership of Euromag is perceived as conducive to solid management skills and sound financial situation which are the important differentiators in the casting business in Central Europe. US based companies are one of the leading investors in Poland and, many of them run industrial operations. Personal network available through The American Chamber of Commerce allow identifying potential clients, providing references and facilitating further contacts. Often times the contact started in Poland result in new business opportunities abroad, some of them in the USA.