As many a consultant might say, the best way to rid oneself of high material cost is to not design it in, in the first place! Though MetalMiner frequently looks at the range of metals categories from a strategic sourcing perspective, it would behoove us not to discuss various metal product innovations particularly when they have (or claim to have) the ability to reduce costs. Last week, Carpenter Technology announced a new material, PremoMetÃ¢â€žÂ¢ Alloy that claims could serve as an alternative material to cobalt-containing steel alloys.
Judging by cobalt prices for the past year, identifying lower cost alternatives might make good business sense:
Courtesy of MetalPrices.com
The target applications for these materials include power train components in heavy-duty diesel engines (including on-highway over the road trucks), off-road (construction type vehicles) and large marine engines. The new EPA determination that greenhouse gas emissions causes people harm probably helps some of the buying communities as weight reduction and engine efficiency improvements help reduce such emissions. According to Mike Wilkes, Market Manager, Automotive at Carpenter, “Manufacturers will therefore need to specify higher strength metals for their light-weighting projects in order to achieve lighter weight. The lighter components will need to maintain performance requirements. Mike suggested life-cycle costs can be reduced by purchasing less material per part. In addition, the substitute material should allow for longer engine life and lower fuel consumption.
All of those arguments sound good on paper. But how do purchasing organizations reconcile the fact that specifying proprietary alloys and products can result in higher prices over the longer term? Simple, according to Carpenter enter into a long term supply agreements to allay concerns.
If you are a metal producer and have a new product on the market, drop us a line. We’d like to hear about it at lreisman(at)aptiumglobal (dot) com.