Co.s spinoff of its steel business has buyers of special
bar quality products wondering what might develop, but
none is concerned about service or quality disruption.
"We dont foresee
an immediate impact for Timken or for us," a forging company
executive told AMM Sept. 9. "Longer term, will the
loss of the bearings business hurt the steel company, and is
this getting the steel business ready for a sale?"
Timken would be attractive to a buyer, the forging executive
said. "They are the sole-approved source for many automotive
applications and should be able to command a premium for
An original equipment
manufacturing customer said the spinoff, announced last week
amm.com, Sept. 6), was expected. "Its
probably the best thing to do. It will still keep Timkens
status high in the market," he said. "It would not affect any
contracts we have with Timken."
The bearings operation
relies on the steel business for its melted steel, one
Mid-Atlantic cold drawer said. "Im sure that will
continue, but will the bearings company have the same kind of
control over the source material? Will the bearings company
source from other steel producers?" he asked.
In that supply chain,
with bearings going into critical moving parts, "its all
about control through a fully integrated system, start to
finish," he said, agreeing that steel supply contracts
wont be affected.
Most steel bar
consumers dont foresee much of a ripple. "I dont
think thats a big concern to us. Business will be the
same," a major Midwest bar processor and distributor said.
"I cannot imagine this
would impact us negatively on the steel side. They were pushing
for it (the split), and we never heard (from within the
company) that it would be a problem," a Southeast bar
A few members of
United Steelworkers union Local 1123 in Canton have asked
leadership about the security of their Timken pension and
retiree benefits, president Joe Hoagland told AMM.
USW Local 1123 has
about 2,200 members working at Timken, with 180 employed by the
"Its in the back
of your mind that the steel business could be sold. This is a
concern for some of our people. Some members have asked,
Should I get out now? I dont have an answer
for them," Hoagland said.
The unions labor
contract expires in September 2017.
business has been profitable and is running one to three shifts
from the melt shop to casting to rolling bar and tube, Hoagland