Adapted from a case study provided by The Lincoln Electric Company, a manufacturer and supplier of welding equipment. Lincoln Electric was approached by their customer with the request of how they could work together to reduce their cost of weld wire, a consumable in welding. Their customer indicated that they felt that they were going to have to move their manufacturing operations overseas unless they were able to reduce their consumables cost.
Lincoln Electric worked with the customer on a thorough cost analysis.
Their cost analysis showed that the cost of manual welding this part in the U.S. was $.86/part. The cost to manually weld the part in China would be $.30/part.
When the consumable cost was completely eliminated, the cost of manually welding in the U.S. was still high, at $.69/part. This lead them to conclude that that even if the weld wire consumable was free, there was no way they were going to make enough of an impact on their overall costs to prevent them from moving to China.
This in turn led the customer and Lincoln Electric to do a thorough cost analysis using robotic arc welding. What they found is that with robotic arc welding, their costs went down to the equivalent of manufacturing in China, $.30/part.
This U.S. manufacturer found that what used to take 1.23 minutes of weld time became .61 minutes of weld time using robotic welding. This significantly reduced weld time, increased throughput and lowered costs substantially.
They also found that what used to be 1.52 minutes of non-welding, non-productive activity was reduced to only .50 minutes of non-welding activity. This significantly reduced non-value added/non-productive time and lowered costs substantially.
In addition, the customer found that robotic welding had a significant impact on higher quality and improved process control.
The customer was not looking forward to the anticipated lead times that they were told to prepare for when manufacturing in China and shipping back to the U.S., and they were confident that they made the right decision by investing in robotic arc welding automation and keeping their manufacturing in the U.S.
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