D&L Foundry Goes Big
An additional facility on its site in Washington state brings new business in large castings.
Denise Kapel, Senior Editor
(Click here to see the story as it appears in the February issue of Modern Casting.)
Market timing can make or break a metalcasting business. The benefits of strategies such as diversification and pursuing business that is immune to one or more threats tend to become most evident when the economy takes a downward turn. And for those that can weather the financial storms, recovery often involves branching out further into new areas. For D&L Foundry and Supply, Moses Lake, Wash., being ahead of the game enabled the company to wait out the downturn and emerge well positioned to ramp up a new operation in step with demand.
A relative newcomer in the U.S. metalcasting industry, D&L poured its first casting in 1991. “We had a pretty good run for 15 years,” said Jason McGowan, president. “We couldn’t make enough. Each year, we were trying to scratch out whatever capacity we could, making improvements, constantly trying to grow. So, it was a big eye opener in 2008 [at the beginning of the recession] when we had to put the brakes on. None of us had any experience with that. I don’t feel like we lost any market share, but people who bought 100 castings were now buying three.”
D&L pours gray iron castings such as manhole frames and covers, inlet frames and grates, monument rings and covers, valve boxes, tree grates, and airport frames and covers. Ductile iron represents about 10% of its casting volume. It also offers fabrication for steel construction items.
With municipal customers requiring “Made in America” branding on their products, offshoring is less of a concern than it is for other metalcasters. The company’s ability to provide quality product quickly also is a strong point. In some markets, McGowan notes India currently presents the greatest competition in terms of pricing pressure. But with much of the company’s work increasing to supply domestic infrastructure improvement projects, until the Great Recession hit, management was planning to expand.
“There were several of us looking for new sites near some of our other markets and considering whether to expand our facility here in Washington,” said McGowan. “We were just starting to look ahead to the next 10 years, and within two months we were thrown into full reverse.”
Doubling Down on a Good Plan
“Because of the variety of sizes and more underground construction every year, such as utilities, there’s a greater demand for larger castings,” said McGowan. “So, for us to meet the entire demand for the marketplace, we needed to increase our capacity to make large castings. We saw this need in the early 2000s and started making plans to make this addition to our facility.”
The new, multimillion-dollar metalcasting facility would stand onsite as a separate operation pouring castings larger than those made in the original plant. The existing D&L facility is an all green sand operation, and ultimately the decision was made to replicate it in the new plant.
“One, we wanted that capacity when we were ready,” said McGowan. “Secondly, we wanted the duplicity of similar induction melt shops, so when we worked with our supplier, we were very specific that we wanted things to be identical both operationally and mechanically. Our teams knew what to expect, so it tuned down the training portion of it.”
“We committed to purchasing a building and went through the engineering,” said McGowan, “all in time for the economy to come to a screeching halt.”
With the permits for the new plant in place but construction on hold, D&L’s single, private owner passed away in 2009. His heirs chose not to continue to operate the foundry as it was, so they marketed it in 2011 and came to a purchase agreement with a former competitor that May.
“They needed our manufacturing and we needed their marketing, and it’s been love ever since,” said McGowan.
After the sale was completed in 2011, the permits on the new D&L facility were going to expire if the project didn’t move forward. Having sold the idea once to the previous owner, McGowan found he was well prepared to present it again to the new ownership.
“We reevaluated the timing, the permits and the leg work we’d already done on the new construction,” said McGowan. “It was nice to be able to look at it again. There wasn’t any significant change, but we developed it and made sure it was what we wanted it to do.” The new ownership chose to move forward and keep it all going through the downturn, so McGowan and his team dug in and started construction. “When it was time to go again, it hit the ground running,” he said.
Making the Most of Existing Resources
“We’re in the middle of nowhere, so we’ve become pretty resourceful,” said McGowan, who has been with D&L for more than 22 years. “Out of necessity, we’ve become pretty self-sufficient with modifying equipment and making things work.” Employees were involved in developing and building the new plant.
The D&L team started collecting equipment, purchased both used and new systems and integrated them in the new plant.
The electrical system was a major cost saver. A scrap supplier was dismantling a former wood mill that had just made electrical updates, so D&L sent a crew out to recover a significant amount of that infrastructure for the new facility.
The conveyor system was another area where employees played a large part. “We built many of the conveyor units or modified ones from elsewhere and assembled with our staff here,” said McGowan. “It all came around by our ingenuity and willingness to look at things differently.”
“The pouring operation is very similar to the other facility, but in mold handling, we chose a more modern approach in using all electric drives and positioning systems,” said McGowan. D&L did all of its own electrical controls and a computerized monitoring system. “We have anything from our muller to how our sand is being controlled to what parts we’re to be running, our production schedule, the different pieces of equipment to the overall status of the facility,” said McGowan. “It’s very similar to what we’re already doing in the other building, so anybody can come look at this screen and have an immediate status of what’s going on in the area.” They can track reject rates and we can base process improvements and maintenance plans on the data. “It helps us have good communication over multiple shifts,” he added.
Using components common to those in the existing plant, from gear boxes to drive systems and wear parts, simplifies maintenance and repairs.
While the new, 31,000-sq.-ft., facility is a standalone operation for larger castings, using a 54-sq.-in. flask, it integrates with D&L’s existing machining, finishing, shipping and other departments.
“The old plant uses 42 and 36-inch flasks,” said McGowan. “With more and more underground construction, utilities for example putting more underground, there’s been a trend toward larger castings. It’s the same customers but their demands have been changing. That’s what drove us to add the larger flask size. But now we have an opportunity to do more with it.”
Greater Capacity and Poised for Growth
It’s been a year since the new facility poured its first casting. Today, D&L Foundry & Supply’s operations can produce up to 140 tons of castings a day for its customers on the West Coast.
“We’ll probably do about 52 million pounds this year,” said McGowan. “We still have a third shift to fill as demand increases, and there are improvements we can make, but it’s added some capacity and really opened up some good markets for us.”
The original expansion plan was based on the demand from municipalities with larger sizes D&L hadn’t been able to cast. And the new facility has not only allowed them to engage in those markets, but to diversify into new jobs outside construction casting, such as industrial OEM work.
“[The ownership company] had strengths we didn’t have and we had strengths they didn’t have, so we saw that immediately,” said McGowan. “Our ownership has exposure to markets we hadn’t previously had. So they own other manufacturing facilities, foundries and also have strong marketing to source castings globally.”
D&L is a standalone business, but as part of a larger group that is making or sourcing castings, it has additional resources to serve its region. “In both facilities, we have work that crosses over with our parent company,” said McGowan. “It was a little bit of a leap of faith by the ownership, it was a lot of money to spend, and we still were getting to know each other and hadn’t yet recognized all the benefits. It’s worked out well. We survived and we’re thriving.”