The magazine of Friedhelm Loh Group

The magazine of Friedhelm Loh Group

Innovation – Stahlo

Making progress

Strategy. The construction project for the new Gera works shows how Stahlo is responding to changing market needs. Having twice the number of machines as the old site will help the state-of-the-art steel service centre boost its annual capacity to around 400,000 metric tons. A large proportion of the processes at the site will run automatically.

Text Markus Huneke ––– Photography

What was once a green field is now a brown plot. On a tour of the site, Guido Spenrath points out exactly where the main production area of the steel service centre is being built. Apart from initial preparations, there is pretty much nothing to see. However, the Managing Director of Stahlo Stahlservice GmbH & Co. KG has it all mapped out in his head – the rail link that will bring in the coils, the largely automated system of cranes that will forward them on and the location of the slitting lines. The whole intralogistics system.

Stahlo, a subsidiary of the Friedhelm Loh Group and one of the most advanced and largest manufacturer-independent steel service centres in Germany, is currently gearing up to build an entirely new factory at its Gera site – right next door to its current premises. Production operations at the new site are slated to start in early 2019. “After careful analysis, it turned out that Gera is the ideal location, close to the important markets. One key factor in the decision was also the workforce at the site, which we were keen to hold on to,” explains Spenrath.

The investment fits in with the new strategic alignment of the steel service centre. “Stahlo has grown a great deal over recent years,” points out Spenrath. The new works are set to be a growth site that will see Stahlo not only double the size of the ­machine park, but also increase annual production capacities to approximately 400,000 metric tons. The construction of the new site comes at a time when industrial production is undergoing far-reaching changes – particularly in the automobile industry. By building the new steel service centre, Stahlo is offering solutions for the emerging challenges. Four examples:

High and ultra-high strength steels are on trend

The automobile industry is relying on lightweight construction to help it meet emissions requirements, and high and ultra-high strength steels are ideal materials. According to a recent white paper from Eurometal, the European association for steel distribution, the proportion of these steels being used in automobile manufacturing is set to more than double by 2030. What’s more, the components made from these steels are getting thinner and narrower. Stahlo is already set up to meet this trend and has been processing ultra-high strength steels up to 1,400 MPa in Gera since 2004. By way of comparison, standard steels exhibit a strength of up to around 500 MPa. A second splitting line is to be set up at the new site that will be able to process steels up to 1,900 MPa. “That is unique in the whole of Europe,” says Spenrath. “The new plant will also enable us to feed in wider material and produce narrower,” continues the Managing Director.

Electric vehicle manufacturing also uses these lightweight materials. According to Eurometal, steel service centres should adapt their strategies to these changes and consider investing specifically in processes designed to meet this demand. Stahlo, incidentally, has already taken its first steps towards electromobility – and is leading the way as a supplier for a new electric delivery vehicle.

Alternative materials on the up

Besides lightweight steel construction, manufacturers are increasingly also looking at alternative materials. Aluminium is particularly important for automobile production – and is a growing trend.  Consultants at McKinsey estimate that, by 2025, European vehicle manufacturers will be using around 770,000 metric tons of sheet aluminium products. That would be about ­double the volume being used today. ­Eurometal therefore recommends that ­European steel service centres consider, among ­other things, processing sheet aluminium products.

“We can manufacture slitted coils up to 1,900 MPa at the new site. That is unique in the whole of Europe.”


Guido Spenrath
Managing Director of Stahlo

That’s “mission accomplished” for Stahlo then. The steel service centre has been expanding its experience in processing smaller volumes for some time now. “We’re still not processing large volumes, but we’ve got the process in hand,” says Spenrath. And Stahlo is building on this experience. Both the new contour cutting plant and the slitting lines can process aluminium and stainless steels as well as high and ultra-high strength steels.

Investing in technology is a must

Industrial production as a whole is placing ever more stringent requirements on the parts it needs. Right at the top of the list of demands for strip steel and punched parts are precision processing, maximum process automation and short-notice availability at all times. According to Eurometal, steel service centres have no other choice than to ensure their facilities always reflect the state of the art.

Stahlo is investing a total of 45 million euros in the Gera site. In addition to the new contour cutting plant and slitting lines, a significant chunk of that money is being put into technical equipment that at first seems almost unremarkable. One example of many is the new, largely autonomous crane system in the coil store. It makes intralogistics much more efficient, partly by helping the warehouse to optimise itself.

IT – the basis for everything

Cutting-edge IT is pretty standard these days – at least in theory. However, Eurometal has highlighted the fact that most steel service centres are currently running a sub-optimal IT landscape. Inefficient and opaque processes put the competitiveness of service centres at risk. Stahlo has done its homework. From the very start, it has been careful to keep ahead of the pack on IT, too – as part of the Friedhelm Loh Group, you could say it is a matter of honour. The steel service centre uses SAP.

Stahlo also wants the new site to go a bit further, with a big share of processes and workflows running on a largely automated basis. Operating and machine data will also be seamlessly captured in future. As a result, the company will be able to update customers on the status of their orders on request and better analyse problems in the plant – so that they can subsequently be prevented altogether.

Steel service centres must be able to meet customer requirements with increasing flexibility – and usually do so straight away. Eurometal believes a readiness to enter into solid partnerships and collaborations is a key to competitiveness. Spenrath has an example to show just how fast and flexible Stahlo can be in responding to demands: “A major car maker got in touch in the afternoon with an urgent technical problem. A plant had ground to a halt. We were able to help, and manufactured and delivered their parts in the space of a day and a half,” recounts the Managing Director. This readiness to assist propelled Stahlo from a supplier of spare parts to a firm series supplier for automobile production.

Stahlo has been consistently enhancing its reputation as a technology pioneer. For example, the company is working with a material supplier – a steel works – and makes its plants available for testing new grades of steel. It is an arrangement that benefits both sides. The investment in the new site sends out an important signal to customers, partners and the market: Stahlo is forging ahead!

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