Sheffield Forgemasters into its Third Century of Production
SFIL’s 10,000-ton press in action
More than two centuries ago – 1805, to be exact – a U.K. miller with a water mill on Millsands set the foundation for Sheffield Forgemasters International Ltd. (SFIL). That miller’s name was Edward Vickers, whose operation was close to the center of Sheffield. Vickers, together with other members of his and the Naylor family, started SFIL, which by 1850 produced nearly 40,000 tons of steel – more than half the world’s production at that time.
Rolling armor plate during a visit by Queen Victoria in 1897
In the 1860s, Tom Vickers designed the facility’s giant crucible melt shop, developed the Mayer molding method for castings and installed one of the first Siemens’ open-hearth melting furnaces for quality bulk steel. In 1865, Vickers’ giant River Don Works was built. It had the largest crucible melting shop of its time and was able to melt and pour a single 20-ton piece. Cast-steel bells became a significant product, with Vickers exporting them around the world. The largest bell ever made at River Don was the 74-inch San Francisco fire bell, which weighed nearly 2.5 tons. By 1870, the River Don Works was one of the two largest engineering steel enterprises in the world, rivalled only by Bochum in Germany.
The latter half of the 19th century was a time of rapid and voluminous growth in the railroad industry in the U.S. Consequently, much of Vickers’ success was due to U.S. demand for railroad equipment. Yet this business was soon to be lost due to massive new facilities – such as those of Carnegie in Pittsburgh, Pa. – that were built to serve this market.
In response to this development SFIL bought its first heavy forging press in 1882, a move that led to its diversification into armaments. The company also branched out into shipbuilding, with a shipyard at Barrow to build ironclads, dreadnoughts and early submarine designs. Even today, SFIL is a supplier of critical items for Great Britain’s nuclear-submarine program.
The operation continued to grow into the 20th century. By World War II, output reached new heights in support of the war effort. In fact, the River Don Works was a key target – though largely missed – during the Sheffield blitz. This plant was vital to the war effort as the only forge capable of producing crankshafts for the Merlin engine, which powered both Spitfire and Lancaster aircraft designs.
After the war, the business developed a new range of products, including turbine rotors and boiler drums for power stations and ships; railway suspensions and couplers; high-performance rolling mill rolls and other steel-plant products; and components for the world’s first nuclear power station at Calder Hall.
The River Don Works was re-nationalized in 1967 into British Steel. New business was developed, including castings for the offshore oil industry. The prototype node casting, now one of SFIL’s most iconic products, is displayed outside the works on the Forgemasters’ traffic island.
In 1983, Firth Brown amalgamated with the River Don Works to form the private-sector company Sheffield Forgemasters, employing a workforce of 6,500. Within three years and despite an annual turnover of £100 million, the company recorded annual losses of approximately £20 million. In 1984, shareholders of Forgemasters wrote off their investments, fired the entire board and brought in new management and a survival plan. With British Steel due for privatization in 1987, Sheffield Forgemasters’ management agreed to a management buyout.
The company’s success through the next decade was somewhat the result of dramatic increases in export sales. Queen’s Awards for Technology and Export were also received. In 1998, the company was sold in two parts to American buyers – the aerospace business to Allegheny Teledyne and the River Don and Rolls businesses to Atchison Castings.
Atchison’s management failed to develop the business, and, in 2003, its whole enterprise went into liquidation. However, a major turnaround at River Don enabled local management, led by chief executive Dr. Graham Honeyman, to acquire the business in a management buyout. It took two years of negotiation to overcome major hurdles, including a difficult market and pension problems, before management was able to complete the acquisition in 2005. The successful buyout saved the business from liquidation, preserving 600 jobs and creating a new long-term strategy for growth into niche markets.
Activity in the rolls department in the 1950s
Into its Third Century
The company, now in its third century, remains at the forefront of technology for forgings and castings for heavy engineering across the globe. “Following the buyout in 2005, SFIL has gone from strength to strength,” Dr. Honeyman said. “We now have one of the biggest order books the company has ever seen and an award-winning, apprentice-trained workforce, putting valuable specialist knowledge back into the British steel industry, something we see as vitally important for the future of the industry.”
SFIL, having succeeded through a shared vision and against all odds, is now an inspiration to other companies as a champion of U.K. and global manufacturing. Exports now accounts for 70% of its business. In recent years, the company’s forge, under the management of operations director Gareth Barker, has increased its profitability, reduced its maintenance costs, increased its machinery usage rate, invested in key new machinery (including five overhead cranes) and reduced energy costs.
Barker, who started his career at SFIL at the age of 19 as an apprentice, is currently the company’s youngest-ever divisional director at 30. He has asked SFIL’s sales team to sell more work for the forge, which is already challenged to match its productivity.
“Every day brings a different challenge at Sheffield Forgemasters,” Barker said, “and I feel privileged to have seen, and been part of, the company that has grown and achieved fantastic results since the management buyout.”
Large-scale investment to update machinery and improve efficiency is an ongoing priority at SFIL, and the levels of internal investment on product innovation, training and research and development (R&D) exceed industry averages to keep the company ahead of its worldwide competitors. The adoption of a technology-based business has seen the company plow substantial resources (5-10% of profits) into its R&D program.
“R&D is an area of focus for the future, so our investment there is crucial,” Dr. Honeyman said. “The dedicated R&D department’s work is key to putting SFIL at the forefront of global engineering.” Two major projects have underscored this investment drive – a new 4,000-ton forging press and the North Machine Shop. Both projects are aimed at strengthening SFIL’s ability to service key global markets.
Large lathes at work
Reaching Global Markets with World-Class Products
SFIL is actively pursuing strategies for diversification and growth. Rather than finding the development of economies in the Far East a threat to its existence, the company has capitalized on its ability to provide a world-class product. It supplies key power-generation components to China, India and Brazil. As a case in point, SFIL is now an approved supplier to Petrobras, Brazil’s state-owned oil and gas giant. The company has offices and agents across the globe, covering every commercial continent with particular presence in Europe, Asia, the Americas and Russia. Australasia is its newest target.
An analysis of the company’s top-five export markets during the past three years shows Germany with 38% of SFIL’s output, China with 32%, Russia with 8%, Norway with 6% and Spain with 4%. Europe has provided 72% of export sales, Asia 25%, North America 3% and fractional percentages to other countries. SFIL traded in 29 countries during this period.
SFIL has a 20-plus-year history with Chinese customers, having established its reputation for advanced technology and processes, quality products and service to China, and has secured approximately $140 million worth of business in the last 10 years. SFIL currently operates a unique trade accord with Harbin Electric Company and has nearly $10 million with Chinese suppliers for new equipment for its new heavy machine shop.
Flame-cutting excess material from large forgings at SFIL
Dr. Honeyman believes that the skills and resources required for the U.K. to lead the world in high-technology markets are available. He feels that investment in his company has to continue, even in recessionary times, because progress demands it.
“The philosophy of this company has long been that we can only succeed in our chosen markets by excelling and delivering the highest quality and most technically innovative products available,” Dr. Honeyman said. “This company, the future of its staff and its strategic position as a market leader in large-scale forged and cast engineered products is inexorably dependent on our ongoing investment program and the quality of people we employ. Our aim is simply to be at the top of the technology tree.”