Shop finds CAM package boosts productivity and profit

June 11, 2008
Even manual machining operations gain from CAM program Gary Buie, president and general manager of PEMCO One of the most compelling justifications for computer-aided manufacturing (CAM) is that it helps end dependence on ...

Even manual machining operations gain from CAM program

Gary Buie, president and general manager of PEMCO

One of the most compelling justifications for computer-aided manufacturing (CAM) is that it helps end dependence on skilled programmer-machinists to maintain production.

These skills are scarce to nonexistent in many rural areas, as drillrig rebuilder PEMCO of New Mexico Inc. ( found out. Confronting a business boom, it could not get the people to keep up with demand.

PEMCO found a solution for this bottleneck in Edgecam from Planit Solutions.

The Edgecam software quickly began generating dramatic results in both productivity and output. It also is helping to drive a business transformation at PEMCO to new levels of competitiveness with better customer service, shorter delivery times and lower pricing.

“The technical help we have gotten from Edgecam and ECAD (the Edgecam reseller) has been tremendous.” Garry Buie, president of PEMCO, said.

Edgecam ( is based in Southfield, Mich. Planit is headquartered in Bath, England. ECAD is based in Midland, Texas; it also resells Autodesk Inventor, which PEMCO also uses.

The problem PEMCO had was hiring and retaining skilled machinists.

Skilled machinists who are looking for work are almost nonexistent where PEMCO is located — Hobbs, N.M., in the southeastern corner of the state.

“The shortage of programmers held us hostage,” Garry Wilson, CADD specialist and PEMCO’s primary CNC programmer, said. That shortage was aggravated by a new multibillion-dollar uranium enrichment plant that located just a few miles from Hobbs.

Programming was a big production bottleneck on the heavily used SwedTurn that is 27 years old. Both a replacement and a CNC retrofit had been under consideration.

“That is a very solid, very tight, very well-built machine with almost no wear, but the programming was completely obsolete,” Buie said.

A new SwedTurn would have cost about $320,000 and a retrofit about $47,000.

“The retrofit would have taken six months, and having it out of production that long would have cost us between $100,000 and $220,000 in lost business. That is our only machine for larger turned parts,” Buie said.

What impressed Buie about ECAD was the knowledge and willingness the company showed to work with the shop. Steve Duke, account manager for ECAD, knew about the SwedTurn. He ran one as a machinist many years ago, Buie noted.

PEMCO rebuilds cranes, derricks and of truck-mounted drill and work-over rigs and their key power components such as scoping rams, hydraulic cylinders, heads, valve bodies and sprockets.

“Our niche in the business for 40 years has been to produce obsolete parts,” Buie said.

“None of our customers ever brought us a drawing We are onehundred- percent reverse engineering,” Billy Ganaway, general shop foreman, said. That means PEMCO had to manually measure every part and draw it by hand.

Prior to buying and implementing Edgecam, PEMCO’s production methods were equally “manual.”

Parts were machined directly from hand drawings on conventional, non-CNC machine tools or they were run on CNC machines that were programmed manually.

Machinists keyed raw-stock and finish dimensions directly into the machine tools’ controllers as G-codes. That was costing PEMCO many hours of production per week per machine.

Manual or online programming hurt PEMCO’s productivity and output in two other ways:

Machinists had been holding speeds and feeds to one-fourth or even one-tenth of what cutting-tool suppliers recommend. This excess of caution had kept PEMCO cycle times uncomfortably long while shortening cutting-tool life.

Complicated parts were avoided because of programming difficulties. CNC machinery is most effective on complex parts, so PEMCO was missing a sizable payback opportunity.

Amid a boom in oil and gas drilling with crude-oil prices at an all-time high, rigs are in high demand. Even old units are being pressed into service, driving up demand for PEMCO’s services.

The company has five CNC machine tools and employs 25 people in its machine shop and 60 total. The acronym stands for Permian Engineering & Manufacturing Corp.

The second local energy boom — uranium enrichment — made PEMCO unable to keep pace.

Under contract to the U.S. Department of Energy, URENCO, A European consortium that makes enriched uranium for nuclear power generation, is building a multibilliondollar National Enrichment Facility (NEF) in Eunice, N.M.

In an area where skilled workers have always been scarce, URENCO has hired over a thousand people in the past two years, and expanding local businesses and URENCO suppliers hired hundreds more.

The heart of PEMCO’s difficulty was manual programming.

“A-T-M programming for simple parts only took 20 to 30 minutes apiece,” Wilson said.

“But complex parts required anywhere from four hours to two days and sometimes even three days. Some parts were nightmares to program at the machine,” he added. The PEMCO solution was straightforward: Computerize the programming with three Edgecam packages — Production Mill and Production Lathe plus Solid Machinist for Inventor. Solid Machinist is designed to goof-proof CAD-to-CAM integration by opening Edgecam inside Autodesk Inventor.

“We started using Inventor in mid-2006 to increase our productivity by drawing our existing assemblies and parts. Offline CAM was the natural progression and Edgecam fit our needs better than any other package,” Wilson said.

“Even the most limited offline use of Edgecam led to big gains,” he added.

Ganaway said that the initial gains were tremendous, even before machinists were trained, before the postprocessors were finished, and before the machines were fully reconnected.

They attributed part of this to Edgecam’s ease of use and ease of learning.

Amid myriad distractions of combining PEMCO’s two machine shops, Billy Rodgers, machine shop foreman, said he found time to learn Edgecam.

“It was simpler than I thought it would be and I had almost never used a computer before,” he reported. “Now I do 90 percent of my CNC jobs on Edgecam. Only the very simplest jobs are still programmed online,” Rodgers said.

PEMCO’s production gains from Edgecam can be summed in two sets of numbers:

25 percent to 75 percent reductions in shop costs, production times and delivery times.

Three-fold to four-fold gains in throughput and productivity.

“Deliveries of just about everything we make have speeded up at least 25 percent,” Wilson said.

“For jobs that repeat, we are as much as 75 percent faster,” he added. Here are additional Edgecam specifics from the machine shop:

CNC tooling costs have fallen sharply despite higher output.

Buie credited that to PEMCO’s success with offline CAM.

Success with Edgecam encouraged the other CNC machinists to use the optimum speeds and feeds recommended by cutting-tool suppliers.

The most dramatic example is in turned shafts. A large one that took four hours to program online and machine on the SwedTurn took 15 minutes with Edgecam. That’s a 16-fold gain in productivity.

Cost savings translate into big price reductions.

A typical SwedTurn job is a large valve body with 24-inch O.D. and about 16 inches long.

“Under the old methods, we would have had to sell a part like that for around $5,000. I have a quote out now for 10 of them at $2,700 apiece,” Buie said.

The CNC scrap rate has dropped from as high as 5 percent to almost zero for jobs run with Edgecam, saving thousands of dollars a year.

Production gets under way sooner as programs are written and proofed faster offline.

PEMCO’s remaining manual machining benefited, too.

Seeing the dramatic gains made by Edgecam, machinists on the manual machine tools realized they could greatly increase their own speeds and feeds.

“They began to machine parts in one-half to one-fourth of their previous times. We have seen a speed-up in production from at least 25 percent to as much as 75 percent,” Wilson said.

“After we began using Edgecam to estimate the time required to machine new parts and after we learned to trust its feeds and speeds. We were able to reduce most of our initial cost estimates by half,” Wilson added.

Yet, even with lower prices, he said the shop’s profits are up because it quotes better and gets more jobs with better margins.

“For example, we now know we can actually profitably machine one part,” Wilson said.

“We are making parts we never would have machined before. We are bringing in new work from competitors and from companies we were never able to sell to before,” Buie said.

Meanwhile PEMCO is getting its ISO-9001 certification.

PEMCO also is chewing into its order backlog even as new business rolls in.

“We were eight to 12 months behind where we should have been,” Buie said. More important for a company that invested several hundred thousand dollars in machine tools in recent years, machine shop sales are headed up —t o as much as $5 million in 2008 from $3.5 million in 2007.

PEMCO’s embrace of Edgecam underscores a larger trend in machining replacement parts.

Most of these equipment rebuilders are switching to CAD and CAM although most of their business remains reverse engineering. The advantages of converting “manual” methods to digital are too big to ignore. The same is true in moving from online A-T-M machine tool programming to offline CAM.

This article was prepared for EdgeCAM by Jack Thornton, MINDFEED Macomm, and edited by Bruce Vernyi, Editor-in- Chief. Thornton can be reached at 505/ 690-0828 or [email protected]

15 Gains From Using Edgecam at PEMCO

  • Direct shop costs are one-third or one-fourth of pre-CAM levels.
  • Machine shop productivity is up 25 percent to 75 percent, and in one instance as much as 16X or 1,600 percent.
  • Edgecam’s cost was recouped on just one turning job.
  • A six-month, $47,000 retrofit job was avoided.
  • Production bottlenecks were eliminated.
  • Productivity and output are no longer held hostage to the programmer scarcity.
  • Productivity gains enabled price cuts and speedier deliveries for greater competitiveness.
  • Manual machining has been speeded up 25 percent to 75 percent.
  • Profitability is now assured even on quantity-one orders.
  • Scrap rate with offline CAM fell to zero.
  • Perishable tooling costs have dropped.
  • Hiring and training costs for operators are reduced.
  • The out-of-control order backlog was whittled down.
  • Demonstrably greater precision attracts work from competitors and even OEMs.
  • Diversification is underway with big projected sales gains.

Latest from Shop Operations

Stephan Pietzko | Dreamstime
Sirinarth Mekvorawuth | Dreamstime
Sergey Gavrilichev | Dreamstime
BiancoBlue | Dreamstime
Divinesky27 | Dreamstime