Four truths facing the global power transmission industry

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The year 2023 will be momentous for the gear industry as we experience volume and demand pressure, company consolidations, global market expansions, and continued employee retention and attraction issues.

As with anything, there’s some good news and some challenging news, and I have always found that the turning of the New Year is a good time to step back, reflect on what we are seeing at AGMA, and wanted to share a few thoughts with the Gear Solutions community.

Here are four truths facing the global power transmission industry:

1: AGMA expects gear sales volumes to decline in 2023. The year 2022 experienced growth, but we expect a slower economic recovery, and perhaps even a recession — which will put downward pressure on sales in products that use gears, as well as the machine tools needed to make gears. With gear bookings, sales, and capital expenditures down, it will be a year for AGMA members to focus on core customers, add value via training, flexible terms, and enhanced customer service.

The good news? It will be a short slowdown, with 2024 looking upward. AGMA believes infrastructure spending and focus on supply chain risk minimization will bring sales upward for the following year. So, stay strong! Go visit your core customers and leverage AGMA events to strengthen your networks.

2: AGMA expects the trend of industry consolidation to continue. AGMA’s board reviewed internal statistics in 2022, and we found 40 different mergers and acquisitions occurred over the past 10 years. These deals were with known AGMA members — so we probably missed a few more where non-members were changing hands. At the same time, the AGMA board looked forward, and we predict another 40 will change hands over the next 10 years. Guess what? We already had 12 mergers in 2022, so we are well on our way to reaching that short-term target.

The good news? Fewer companies mean the impact on our first trend may be minor. Gear companies might actually grow and not be hurt from a slow down in gear purchasing as they strive to target new markets and add capacity via acquisition. Keep your ear out for AGMA’s Gear Market Report, which will help shape some thoughts on this trend in the coming year.

3: AGMA has the word American in its title, but without question the power transmission world is a global game. Even if you do not export, Google’s math makes finding competition — global competition — easier. Over the past few years, global sales declined due to COVID and shipping issues facing the world. But those are now over, and according to AGMA’s Gear Market Report, global sales as a percentage of overall sales are now ahead of where they were in 2019. AGMA continues to be more than 28 percent global in terms of membership, but we feel the association is 100 percent global because all our members either export or compete with imports.

The good news? If you are a global player, you are in the right position. If you are staying domestic, you may do outstanding… but you may also experience increased margin pressure and global competition. MPT Expo, Gear Technology, and Power Transmission may be your vehicle to hedge your bets.

4: AGMA expects the industry to continue to experience tremendous employee challenges. We aren’t alone in this, everyone has stories about losing an employee for more money across the street, or they have hired someone, only to have them ghost on Day 1 or Day 3. It’s a tough market, period.

From a retention standpoint, AGMA advises you support your team with education and training. Give them the information and knowledge they need in order to be the best employee they can be. Also, pay them. It’s an inflationary issue, but increasing pay, and giving them tools that support their future, are critical value drivers for any team member.

It’s going to be a challenging year, but we are an industry up for a challenge. AGMA will go into its 107th year proud to have adapted, evolved, and adjusted with the different issues facing our members. We will do the same in 2023 — we are here for you, and we provide support and services that can help you address these truths.

Upcoming Training Opportunities

Bevel Gear Systems Design
February 7-9, 14-16 | Virtual Course

Learn how to design and apply bevel gears systems from the initial concept through manufacturing and quality control and on to assembly, installation, and maintenance. Engage in a practical hands-on guide to the bevel gear design, manufacture, quality control, assembly, installation rating, lubrication, and, most especially, application.

Gearbox CSI: Forensic Analysis of Gear & Bearing Failures
— Useful Tools for Optimizing Gear Design
February 28-March 2 | Philadelphia, Pennsylvania

A good understanding of individual failure modes and the failure scenarios that led to the actual system failure is an essential
skill to designing gear/bearing systems that will operate properly for their full design life. In this course, we will define and explain the nature of many gear and bearing failures and we will also discuss and describe various actual failure scenarios. In addition, a detailed primer on bearing technology prefaces the failure scenario discussions. You will gain a better understanding of various types of gears and bearings. Learn about the limitation and capabilities of rolling element bearings and the gears they support. Grasp an understanding of how to properly apply the best gear-bearing
combination to any gearbox from simple to complex.

Loaded Tooth Contact Analysis
March 7 | Virtual Course

Evaluation of loaded tooth contact and development of tooth modifications using commercially available software to improve Khb and optimize power density. Two real life gearing examples will be presented in the course, one will have a cantilever mounted pinion, the other a shaft pinion straddled non-symmetrically by bearings. Both examples demonstrate component deflections under load that significantly reduce tooth mesh contact that is then corrected with developed helix and profile modifications. Other gear performance optimization tools will also be briefly discussed: profile shift, isotropic finishing, shot peening, accuracy, and material selection.

Epicyclic Gear Systems
March 28-30 | St. Petersburg, Florida

Learn and define the concept of epicyclic gearing. The course includes some basic history and the differences among simple planetary gear systems, compound planetary gear systems, and star drive gear systems. Cover concepts on the arrangement of the individual components including the carrier, sun, planet, ring and star gears, and the rigid requirements for the system to perform properly. Critical factors such as load sharing among the planet or star gears, sequential loading, equal planet/star spacing, relations among the numbers of teeth on each element, calculation of the maximum, and optimum number of planet/star gears for a specific system will be covered. Provides an in-depth discussion of the methodology by which noise and vibration may be optimized for such systems and load sharing guidelines for planet load sharing.

2023 AGMA/ABMA Annual Meeting

The 2023 AGMA/ABMA Annual Meeting will be at Disney’s Grand Floridian Resort & Spa in Lake Buena Vista, Florida, near Orlando. Join your peers for a three-day event that will allow you to get out of the office, gain a fresh perspective, and hear from subject matter experts while networking at one of Disney’s luxurious resorts. Don’t miss out on this great opportunity to connect with other top-level executives and share your perspective on how to drive the industry forward.

More info: www.agma.org/events/agma-abma-annual-meeting

Join an AGMA Technical Committee

Shape the gear standards of tomorrow, today. Join more than 300 of your gear industry colleagues by volunteering on at least one of AGMA’s 23 technical committees. The expert knowledge in AGMA’s current catalog of more than 100 documents boosts American and worldwide business. AGMA technical committees are also your vehicle to participate in development of more than 50 ISO gear standards, as many AGMA committees have a secondary function as technical advisory groups to ISO. To join a committee, you need to be a member of AGMA and email us your interest at tech@agma.org.

Calendar of Events

February 14-16 — Bevel Gear Systems Design    Part 2 Online Virtual Course

February 15 Powder Metallurgy Committee WebEx

February 16 — Aerospace Gearing Committee — WebEx

February 21 — Bevel Gearing Committee — WebEx

February 21-22 Enclosed Drives for Industrial Applications Committee Chicago, Illinois

February 28 Wormgearing Committee WebEx

February 28-March 2 Gearbox CSI Philadelphia, Pennsylvania

March 2 Gear Accuracy Committee WebEx

March 7 Loaded Tooth Contact Analysis Online Virtual Course

March 7-8 Enclosed Drives for Industrial Applications Committee Chicago, Illinois

March 9 Metallurgy and Materials Committee WebEx

March 16-18 2023 AGMA/ABMA Annual Meeting Lake Buena Vista, Florida

March 28 Helical Enclosed Drives High Speed Units Committee WebEx

March 28-30 Epicyclic Gear Systems St. Petersburg, Florida

April 12 Aerospace Gearing Committee WebEx