The world looked very different 30 years ago, when Ulrich Peters started working for MTU.
“There was a little woods inside the factory grounds where the night shift used to go and watch the deer,” he said with a smile.
Mr. Peters, director of production at the Munich-based engine manufacturer, has seen countless changes over the past three decades, beginning with the first computers and the lists employees had to sign to use them.
The trees are long gone, computers are everywhere, and MTU is now at the forefront of digitalizing its entire production processes, known in Germany as “Industry 4.0.”
Hall 77 of the MTU plant offers a glimpse into next-generation manufacturing. People are few and machines are many. All of the individual machine tools in the hall and the equipment needed to handle materials and finished products communicate with each other through advanced sensor and computer systems.
“We are right smack in the middle of Industry 4.0 here,” said Walter Sürth, who is in charge of production in the hall.
Competitive advantage is hard to find in the machine tool business, firms have to make improvements across the production process. Heinz-Jürgen Prokop, Head of Association of German Machine Tool Manufacturers
In the hall, MTU’s machine lathes, running on Siemens software, produce “blisks,” an acronym for Blade Integrated Disks. Blisks are engine components that combine a rotor disk and engine blades. They are increasingly used in compressors.
MTU opened its blisk center three years ago, but is steadily expanding its capacity. The company recently upped its output to 3,500 blisks a year, with plans to further increase it.
For machine-tool manufacturers, digitalization is a chance to offset weak demand. It's becoming increasing difficult to carve out a competitive advantage in the machine tool business, according to Heinz-Jürgen Prokop, head of the industry association VDW. So firms, he argues, have to make improvements across the production process as a whole.
Mr. Prokop claims German manufacturers have an advantage, because they have a firm grasp of processes across the industry. “No one knows these production environments better than we do,” he said.
Siemens technology is at the heart of many machine tools, including the blisk lathes at MTU. The numbers of its high-priority "Digital Factory” division are impressive: In the first quarter of 2016, revenues climbed to €2.5 billion ($2.7 billion), with an operating return on sales of about 17 percent.
The Munich-based engineering group recognized early on the growth potential of Industry 4.0, according to Klaus Helmrich, a member of the Siemens management board. The company, he said, has made substantial investments in digitalization all along the value-added chain - to the benefit of its customers.
It is no coincidence that aerospace has long been at the cutting edge of digitalization. “The geometric forms we need are very demanding, and the material is put under tremendous pressure,” MTU's Mr. Peters said. Components, he noted, are expected to become increasingly lighter, with the weight savings becoming a key selling point for new engines.
One effect of all this is the increased use of blisks in civil aviation, since their one-piece construction is lighter than older components, which were assembled from separate disk and rotor blades. But tolerances in blisk manufacture are a matter of hundredths of a millimeter, all of which is impossible without computer aided manufacturing.
Open software interfaces are crucial in Industry 4.0, according to Joachim Zoll, head of Siemens’ machine tool division. For MTU and other clients, he said, it is crucial to be able to build in their own software developments.
For the aerospace industry, 3D printing technology offers an easier way to manufacture individualized, highly complex components. MTU, for instance, now uses selective laser melting to make boroscope imaging tools for Pratt & Whitney engines for the new Airbus A320neo aircraft. A boroscope, a component of the turbine casing, is used to periodically check the engine blades for wear and tear. Previously, boroscopes could only be made by casting or milling.
“But there are still hurdles to overcome,” Mr. Prokop warned. The material properties in any printed component have to exactly match what foundries can already produce, and 3D has to prove itself economically. The right scale of production is key – batches that are too small make little sense, but neither does full-scale industrial production.
“In terms of mass production, we still have a long way to go to bring unit costs down to a competitive level,” Mr. Prokop said.
Axel Höpner is the head of Handelsblatt's Munich office, focusing in particular on Allianz and Siemens. To contact him: [email protected].