Wind Turbine Components Case Study - Dragon Sourcing

© 2008 Dragon Sourcing. All rights reserved1

Case Study – Wind Turbine Components

January 2012


Agenda

1. Gear Components

2. C-Parts & Castings

3. Next Steps

Appendices


A methodological screening of 34 Gear Components potential suppliers resulted in the invitation of 3 suppliers who quoted for a couple of references

34 34

5

5

73 3

1(refused NDA)

Identified Screened on thephone

Responses to RFI NDA signature Quotationsreceived

Visited

No reply, but wouldn't have passed this stage

Declined to participate

• Produce gear up to Ø1200-2000mm

• Can do the machining

• Size (employees & turnover)

• Production capabilities (Hobbing, Shaping & grinding machines)

• Testing capabilities

Supplier Identification

Phone Screening

Request for Information

Signature of NDA

Request for Quotation &

Analysis

Supplier Visit (eventually)

14

Key screening criteria

# of suppliers

High level profile of the 3 suppliers invited to quote

4

The 1st quotations received vary in a range of 30%

5

4 917 4 6165 837 5 556

1 831 1 993 2 709 2 580

5 904 6 399

8 001 7 970

2 6693 235

4 265 4 245

1 309 1 282

803 647

0

2 000

4 000

6 000

8 000

10 000

12 000

14 000

16 000

Tianshan Heavy

Industry

Suzhou Asia

Pacific

Dalian Qiming

Tianshan Heavy

Industry

Suzhou Asia

Pacific

Dalian Qiming

Tianshan Heavy

Industry

Suzhou Asia

Pacific

Dalian Qiming

Tianshan Heavy

Industry

Suzhou Asia

Pacific

Dalian Qiming

100 pcs/year 300 pcs/year 100 pcs/year 300 pcs/year

Hollow shaft assembled Sun shaft

Sum of Material cost (EUR) Sum of Manufacturing cost (EUR) Sum of Margin (EUR)

See next page comments on these quotations

Detail of quotations

6

Va lue s

R o w La be ls

S um of M a teria l co st

(EU R )

Su m of M an ufa c tur ing

cos t (E U R)

S um o f M argin (EU R ) T o ta l (EU R )

H o llo w s ha ft as sem ble d100 p cs/yea r

Tians han He a vy Indu stry 4 917 5 904 10 821Suzhou A sia Pac ifi c 4 616 6 399 11 015Da lian Qim in g 5 837 8 001 1 309 15 147

300 p cs/yea rTians han He a vy Indu stry N ot Q uote dSuzhou A sia Pac ifi c N ot Q uote dDa lian Qim in g 5 556 7 970 1 282 14 808

S un sh aft100 p cs/yea r

Tians han He a vy Indu stry 1 831 2 669 4 500Suzhou A sia Pac ifi c 1 993 3 235 5 228Da lian Qim in g 2 709 4 265 803 7 777

300 p cs/yea rTians han He a vy Indu stry N ot Q uote dSuzhou A sia Pac ifi c N ot Q uote dDa lian Qim in g 2 580 4 245 647 7 472


Agenda

1. Gear Components


3. Next Steps

Appendices

8466

32

12(Castings RFI, no NDA)

15 (signed)

12(Declined to respond)

7

Identified suppliers Reached and screenedon the phone

Invited to sign NDAprior to RFQ (1)

Responded to RFI/RFQ(1)

Visited

8

Out of 39 phone pre-selected suppliers, only 12 ended responding to the Castings & C-Parts RFI/RFQs; the remaining 27 declined

• Annual capacity>8000 tons (Castings) or >4000 tons (C-parts)• Number of employees>70-100 p.• Has experience with casting nodular (must have for Castings &

C-Parts) or grey iron (for C-Parts)• Automatic line (must have for C-part)• Heat treatment should be in house (much preferable for

Castings)

Castings RFI & C-Parts RFI/RFQC-Parts RFI/RFQ

Castings RFI

Main reasons:•Can't meet requirements•Insufficient capacity / too busy with current clients•Refuse NDA

Total :39

Key screening criteria

(2) RFI without prior NDA for Castings(1) NDA and RFI/RFQ for C-Parts only

Responses :12Declined: 15

1. Gear Components


2.1. Castings Suppliers2.2. C-parts Suppliers

2.3. Castings & C-parts Suppliers

2.4. C-parts quotations


Agenda

Castings suppliers profiles – General Information

10

Supplier 1 Supplier 2 Supplier 3 Supplier 4 Supplier 5 Supplier 6 Supplier 7No. of employees 1000 220 130 200 1050 800 110Size of work floor (m²) 70 000 18 000 28 000 25 000 240 000 480 000 43 000

Turnover(RMB)2006 357 mio - start from 2008 25 mio - - 56 mio2007 430 mio 80 mio 36 mio 400 mio - 62 mio2008est. 580 mio 100 mio 5 mio - 500 mio - -

Sales breakdown (% of sales) in 2007

Domestic 60% 25% 30% 70% 25% 50% 100%Western countries 7% 3% 70% 10% 25% 25% Japan 10% 50% 0 5% 25% 25% Rest of the world 23% 22% 0 5% 25%

Experience in the wind gear industry N N Yes, for a spanish company N N N N

Top 5 clients

1Industry Oil field equipment Machine tool Reductor box Machine tool Machine tool Mould of motocar

Client Weatherford Mazak 、 Toshiba(Japan) SEW(Germany) Anyang xinsheng

machine tool MAZAK MITSUBISHI Shanghai filiale

Changchun No1 motocar

2Industry Crane Machine tool Machine tool Machine tool Generate

electricity Mould of motocar

Client LIFTKING OKK 、 SEIKI 、MAKINO(Japan)

Shenyang Zhongjie

Ningjiang machine tool GE Wartsila engine Baoding

Changcheng

3Industry Engineering

mechanism Injection machine CNC machine tool Compressor Gas engine Mould of motocar

Client TCM Milacron (US),LG (Korea) HAAS(US) Shanghai Fusheng

industry Wartsila Engine Kawasaki Heavy Industries, Ltd Beijing Xingyu

4

Industry Left fork Diesel engine for shipment Engine Compressor Machine tool

Client MITSUBISHI&CAT

yanmar 、 hsnshin (Japan) Toshiba,

MitsubishiHitachi air-conditioner Ingersoll rand

Shanghai third machine tool

factory

5

Industry Airport equipment Metallurgy Heavy machine Machine tool

Client Tengda Cincinnati(US) 、Danieli (Italy) From US, Italy Tektronix

Yancheng Hengli machine tool

factory

Certification ISO9001 & ISO14001

ISO9001 ：2000 、 ISO14001 ：

2004 、 ISO/TS16949 ：

2002 、 GB/T28001-2001 、 BV

ISO9001 ISO9001 ： 2000 ISO9001 ： 2000 ISO14001 ISO9000 ISO9001 ： 2000

Annual production capacity of big castings (tons) 70 000 12 000 24 000 8 000 30 000 19 000 5 000

Range (min-max) of castings you normally produce(kg) 30 ～ 10000 50-35000 200-30000 200-6000 100-30000 200-30000 20-20000

Most interesting suppliers

Castings suppliers profiles – Production Equipment

11

Supplier 1 Supplier 2 Supplier 3 Supplier 4 Supplier 5 Supplier 6 Supplier 7

Pattern workshopManual machines 10 in sub-contractor only make wooden pattern,

metallic pattern can be made in our sub-contractor

CNC-machining centres 0 in sub-contractor

1 CNC machine center,5 axes CNC gantry high speed milling machine

4, sub contracted

Melting Cupola / Induction furnaces 6

2 sets 7T cupola 、 2 sets 5T induction furnaces 、 1

set 15T holding furnace

2sets 10T/H Cupola 1 set 7.5T/H induction furnaces, can all use simultaneously

1 set 3T/h, 1 set 2T/h Medium frequency induction furnaces, 1 set 5T/h cupola

4 Induction furnaces

1set of 3t ， 1 set of 7t, 3 sets of 10t cupola

1 set of 3ton, 2 sets of 15ton induction furnaces

1 set 5T/h cupola, 2 sets 4T/h medium frequence induction furnaces

Core making Coreshooters 25-500 litres 0

1 set 40T/H ， 1 set 20T/H ， 1 set 10T/H,

manually

Moulding Manual, semi-automatic,automatic

5 automatic vacuum molding line; 1 lost wax molding line; 1 manual

clay sand line; 1 furan line is being built now, should

be ready in June.

Manual production line with Furan sand resins

Manual, furan resins, 6ton ladle, 8ton ladle, 10ton

ladle

1 set 5T/h resin production line, 2 sets 10T/h resin production line

Manual production, Furan resin Manual line furan resins

1 production line with furan sand resin, 2 mobile resin

sand Mixer

Fettling Shot blasting 6 2 Rotating shot blasting 2 sets 10T, 1 set 30T

2sets of 3720 blast cleaning machine with hook, 1 set 3110 Blasting cleaning machine roller, a lot of manual used grinding wheels

1 shot-blast cleaning barrel 5 1 set 10T shot blasting, 1

set 16T sot blasting

Heat treatment

Furnaces with programmable controll

1

heat treatment kilns

Yes

Stress relieving 3 1 1 1 1 YesFerritizing YesNormalizing 1 sub-contracted Yes

Surface treatment Painting Y Y Y Y Y YesDipping machine YesDrying chambers

Machining

Machining centres 1

in sub-contractor

Machining items are being set up, there are already processing equipment: Gantry Planer, gantry

milling, end-milling and boring fall, and so on.

sub-contracted

Vertical turning machines 2 Y

3D-coordinate measuring

3D-coordinate equipment 1 1 1 for small size


Castings suppliers profiles –Technical experience & testing capabilities

12

Supplier 1 Supplier 2 Supplier 3 Supplier 4 Supplier 5 Supplier 6 Supplier 7You have experience with casting nodular ?（ Y/N ） Y Y Y Y Y Y Y

You have experience with grey casting? （ Y/N ） Y Y Y Y Y Y Y

Number of people in the quality control department 100 15 10 12 40 20 4

Do you check all new patterns by 3D-coordinate measuring equipment? (Y/N)

Don't check every pattern by 3D-

coordinate measuring.

N N Wooden pattern manual test Y N N

Are you famiaiar with EN 12890 norm for patterns? (Y/N) no Y Y Y Y N

Do you have material chemical testing equipment: spectrometer? (Y/N) Y Y Y Y Y Y

20-channel direct-reading

optical spectrum analyzer

Do you use the spectrometer in every melt ？(Y/N ) Y Y Y Y Y Y Y

Do you have material laboratory for heat treatment?(Y/N ) Y N Y Y Y Y

If yes,

Do you have hardness tests?(Y/N ) Y Y Y Y Y Y

Do you have microstructure tests?(Y/N ) Y Y Y Y Y Y

Do you have paint thickness checking after surface treatment? (Y/N ) N

according to customer's requirement

N Y Y N N


1. Gear Components


2.1. Castings Suppliers

2.2. C-parts Suppliers2.3. Castings & C-parts Suppliers

2.4. C-parts quotations13

Agenda

C-Parts suppliers profiles – General Information

14

Supplier 1 Supplier 2No. of employees 84 320Size of work floor (m²) 20 000 20 000

Turnover(EUR)2006 46 mio 40 mio2007 57 mio 55 mio2008est - 75 mio


Domestic 60% 2%Western countries 35% 92%Japan 0 3%Rest of the world 5% 3%

Experience in the wind gear industry N Yes, Gear box, transmission

Top 5 clients

1 Industry Valve Gear boxClient SITI (Italy)

2 Industry Pump Gear box,transmissionClient LENZE (Germany)

3 Industry Construction mechanism fittings TransmissionClient INTERROLL (Danmark)

4 Industry Motocar fittings Auto partsClient General Motors

5 Industry Pump Spare partsClient Brisan

Certification ISO:9000:2001 ISO 9001:2000 TS16949Annual production capacity (ton) 4000 12000


C-Parts suppliers profiles – Production Equipment

15

Supplier 1 Supplier 2

Pattern workshop Manual machines in sub-contractor in sub contractorCNC-machining centres

Melting Cupola / Induction furnaces 1 medium frequency induction furnaces

Cupola 2 sets, induction furnaces 4 sets

Core making Coreshooters 5-50 litres 3 Vibrating moulding machine 8 sets


Semi-automatic line with Furan sand resins Manual line with Furan sand resin

Fettling Shot blasting 1 shot-blast cleaning barrel, 2 normal shot-blasting 3

Heat treatment

Furnaces with programmable control

in sub contractorStress relieving 1Ferritizing Normalizing 1

Surface treatmentPainting Y

in sub contractorDipping machine Drying chambers 1

Machining

Machining centres 1 8

Vertical turning machines 8 horizontal turning machines , 1

CNC milling machine, several planing machines and grinding machines

5

3D-coordinate measuring 3D-coordinate equipment N 1


C-Parts suppliers profiles –Technical experience & testing capabilities

16

Supplier 1 Supplier 2You have experience with casting nodular ? （ Y/N ） Y Y

You have experience with grey casting? （ Y/N ） Y Y

Number of people in the quality control department 3 15Do you check all new patterns by 3D-coordinate measuring equipment? (Y/N) Y Y

Are you familiar with EN 12890 norm for patterns? (Y/N) Y Y

Do you have material chemical testing equipment: spectrometer? (Y/N)

No spectrometer but we have C ， S and Multi-element analysis

equipmentY

Do you use the spectrometer in every melt ？ (Y/N ) Y

Do you have material laboratory for heat treatment?(Y/N ) Y Y

If yes,Do you have hardness tests?(Y/N ) Y Y

Do you have microstructure tests?(Y/N ) Y Y

Do you have paint thickness checking after surface treatment? (Y/N ) Y Y


1. Gear Components



2.2. C-parts Suppliers

2.3. Castings & C-parts Suppliers2.4. C-parts quotations

17

Agenda

Castings & C-Parts suppliers profiles – General Information

18

Supplier 1 Supplier 2 Supplier 3No. of employees 200 300 2200

Size of work floor (m²) 50 000 24 600 230 000

Turnover(RMB)2006 18 mio 55 mio 450 mio2007 19 mio 60 mio 600 mio

2008est 20 mio 70 mio


Domestic 20% 100% 90%Western countries 35% 0%

10%Japan 0% 0%Rest of the world 45% 0%

Experience in the wind gear industry N N N

Top 5 clients

1 Industry Test instrument Machine tool Client Intra-Automation Gmbh Shanghai machine tool group

2Industry Flanges and valve parts Machine tool

Client Transuaal Ruber Co.,Ltd Shanghai heavy machine tool factory

3 Industry Castings Family electrical machines Client Global Market Technology Sumsug(suzhou)

4 Industry Castings and machining Client Nanotech Industries Ltd

5 Industry Steel Bearing accesaries Client BCI engineering

Certification ISO9001-2000 ISO9001 14001 18001 ISO9001, TS16949Annual production capacity (ton) 5 000 10 000 180 000

Range (min-max) of castings you normally produce(kg) 0.1-3,000 1-3,000 2,000-13,000


Castings & C-Parts suppliers profiles – Production Equipment

19

Supplier 1 Supplier 2 Supplier 3

Pattern workshopManual machines Several a lot Manual machine for wooden pattern

CNC-machining centres 2 CNC-machining centers, 1 CNC milling machine in sub-contractor

Melting Cupola / Induction furnaces

1 set 5T cupola, 2 sets 3T induction furnaces, 4 sets 0.2-

1T induction furnaces

1 set 1 T/h medium frequency induction furnace, 2 sets 5T/h cupolas, 1 set 10T/h cupola

2 sets Melting furnace from Germany Junker 5T/H, 2 sets Holding furnace from America industotherm 5T/H; Cupola 5 、 7 、 10 T/H 10sets, Sand mixer 11sets, Sand reclaimation system from Germany 25T/H 3 sets

Core makingCoreshooters 5-50 litres 2 GFA Core making line from Germany 10T/H;

IMF Core making line from Italy 15T/HCoreshooters 25-500 litres 1


Manual, SANDBOX size can be based on product size,

Furan sand resins

Manual line, use clay sand, soluble glass, furan sand

resins

GFA resin sand moulding line from Germany, Box size 2000*1400*550/550 MM; GF air

impact moulding line from Switzerland Box size 800*600*250/250 MM

Fettling Shot blasting 3 5 30 、 40 T/ H 4 sets

Heat treatment

Furnaces with programmable control 2 Homemade heat treatment

kilnsin sub-contractor

Stress relief , Heat treatment, Vibrating treatment Stress relieving

Ferritizing Normalizing

Surface treatment Painting YDipping machine Drying chambers

MachiningMachining centres Pro machining Lathe, Planing machine, milling

machine, drilling machine, grinding machineVertical turning machines 4 1600mm-5000mm vertical turning machine.

3D-coordinate measuring

3D-coordinate equipment 3D coordinates measured by

testing organizations


Castings & C-Parts suppliers profiles –Technical experience & testing capabilities

20

Supplier 1 Supplier 2 Supplier 3You have experience with casting nodular ? （ Y/N ） Y Y Y

You have experience with grey casting? （ Y/N ） Y Y YNumber of people in the quality control department 5 5 45

Products are qualified according to EN473 Ultra Sonic inspectors 2-5? 2-4 N N

Do you check all new patterns by 3D-coordinate measuring equipment? (Y/N) Y N N

Do you famialiar with EN 12890 norm for patterns? (Y/N) Y N N

Do you have material chemical testing equipment: spectrometer? (Y/N) Y N Y

Do you use the spectrometer in every melt ？ (Y/N ) Y N Y

Do you have material laboratory for heat treatment?(Y/N ) Y N Y

If yes,Do you have hardness tests?(Y/N ) Y N Y

Do you have microstructure tests?(Y/N ) Y N YDo you have paint thickness checking after surface

treatment? (Y/N ) Y N N


4 of the 5 suppliers invited to quoted effectively responded to the C-parts RFQ

Group Supplier Castings RFI C-parts RFI C-parts RFQ

C-partsSupplier 1 n/a Yes Yes

Supplier 2 n/a Yes Yes

Castings & C-parts

Supplier 1 Yes Yes Yes

Supplier 2 Yes Yes Yes

Supplier 3 Yes Yes Not interested by C-parts

22

Bearing caps have consistently been quoted by 3 of the 4 suppliers; the Intermediate Flange quotations still need to be clarified

23

11 12 15 16 11 16 12 13 16 23 13 2340 40 41 50

3850 44 55 59 63 55 59

106131 137

154125 137

7 6 323

522

7 6 723

6

2214 7 7

32

6

3021

4410 9

428

20

93

115

4583

110

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4

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200

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300

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200 pcs/year 500 pcs/year 200 pcs/year 500 pcs/year 200 pcs/year 500 pcs/year 200 pcs/year 500 pcs/year 200 pcs/year 500 pcs/year

Bearing Cap Ø310/132x56 Bearing Cap Ø400/264x54 Bearing Cap Ø500x113 Bearing Cap Ø780/531x48 Intermediate Flange Ø720/330x140

Sum of Material cost (EUR) Sum of Manufacturing cost (EUR) Sum of Margin (EUR)

Wind Turbine Components Case Study - Dragon Sourcing

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