Strong and versatile Ovako Group

STRONG AND VERSATILE

The Ovako Group, headquartered in Stockholm, Sweden, is a leading European producer of engineering steel for clients in the bearing, transportation and engineering industries. Victoria Hattersley talks to Carl-Michael Raihle, president of Ovako Tube & Ring in Hofors, Sweden.

The roots of Ovako in Sweden date back to the 17th century, but today the group has a multinational presence with 11 production facilities and sales companies in Europe, the USA and Asia.

There is a great deal of synergy between all group divisions in order to meet any customer demand, as Mr Raihle explains: “In terms of Ovako Tube & Ring (OTR) we operate from one site, but Ovako has three steel mills and OTR can source material from any of those mills, depending on the alloy or size or other specifications needed. We have a very wide range of internal alloys and can also source from steel suppliers outside the group. We can basically offer whatever the customer wants.” Wide range of tubes and rings

Ovako’s basic range of hot and cold-rolled tubes runs from 25 to 250mm thickness and can be provided in a variety of surface types from around 100 different kinds of alloys. “We also offer pre-components, where our tubes will be cut to specific dimensions and surface treated in order to

meet the customer’s requirement. We will keep customer-specific pre-components in stock so they can be delivered on a just-intime basis.”

The company is also able to produce an extremely wide range of rings, in heights varying from 100 to 1100mm and diameters from 150 up to 4000mm. These can be rolled in either profiled or contoured shapes, depending on what the customer’s project demands. Ovako is able to cut costs for its clients by carrying out a lot of the profiling in its rolling mills so there is a less machining for them to do onsite.

Mr Raihle explains: “By supplying premachined parts we can save a lot of material as the ring or tube will fit the machine as closely as possible. This cuts costs for both ourselves and our clients. Many of our clients are also increasingly asking for their products to be ultrasonically tested by us for internal defects before they are delivered.”

Many Ovako Tube & Ring clients operate in the bearings industry. Here its long-term customers include all the major players, such as Timken, SKF and Schaeffler. Mr Raihle believes that this segment is stable with few new companies in this sector.

Continued investment

To meet increasing demand from clients, Ovako is currently in the process of making two large investments at Hofors. The first involves a major upgrade of the tube mill. The second is the construction of a new ring rolling mill which will be capable

of making rings 4m in diameter. This new mill is being developed specifically to serve the growing wind power sector – an area in which the company hopes to expand in the new few years.

These and other investments represent an ongoing, long-term project for Ovako. “Our new tube mill will involve a rolling or reduction step which will give us clear benefits. We will be able to improve product quality and have more flexibility in our production, which will give us greater size ranges.”

The importance of R&D

In addition to its investment programmes, R&D is a very important part of Ovako’s growth strategy. The company works continuously to improve its steel quality, particularly the cleanliness, as Mr Raihle tells us: “We are always trying to enhance the cleanliness of our steel to improve its mechanical properties. This is important in areas where you have high demand on properties, such as mining and bearings.” In such areas, there could be severe consequences if there were a mechanical

failure. If there are dirt or oxides in the steel they will form oxide particles which could cause fractures. The more of these you have, the shorter the life span of the component. “With a bearing or a rotating piece of equipment with a flexible load, if there are too many oxides in the steel it will break earlier and need replacing. With a cleaner steel the component will last longer.” Global expansion

Ovako has always been a leading European player, but in the future it will focus also on global expansion. In China particularly it is hoping to win new clients in the wind power, mining and oil and gas sectors.

The company is aiming for growth, and Mr Raihle concludes: “Our target is to grow 5 per cent each year. One of our actions to achieve this is growing our sales force globally as well as continuing to upgrade our production facilities. We already have sales teams in the USA and Asia but we will be strengthening these, and in China we will also build a service centre.” n