When considering total cost of ownership, manufacturers review and assess the direct and indirect costs and benefits of the materials they purchase. This includes the initial outlay of purchasing e.g. the unit price of products and the volume purchased (direct costs) and any indirect costs affected by product usage e.g. equipment wear rate, safety risks, maintenance costs.
The price of a lubrication programme is often a small portion of the total cost of ownership. Maintenance lubricants generally account for about 3% of the total maintenance costs but can have a much greater impact on the overall maintenance and production budget due to the value they create upstream and downstream. The costs are calculated by understanding both the purchase cost and the costs associated with further use, maintenance and disposal of the products, as well as any savings that are generated in production activities.
It’s a complex activity to do a detailed study of the total cost of ownership on every lubricant used within a manufacturing plant, particularly when there are hundreds if not thousands of line items. Castrol focuses on key operations and application hot spots where they have experience and knowledge of improving TCO. Castrol’s offers respond to manufacturers’ TCO challenges.
Clearly the success of Castrol’s offers relies on them being able to validate and prove the benefit they deliver. This requires a detailed study of the application, an understanding of the total costs involved and the value that Castrol can create… but this is a challenge that they step up to, because it’s what their business is built on. Castrol have the application experts who understand the complexities of manufacturing processes and a range of products that are hard to beat.
Here are some examples of where the TCO approach has benefited a number of Castrol’s customers across Europe:
In steel production, the hot rolling process operates under heavy loads and extreme temperatures. Due to this demanding environment and the need to avoid equipment failures, one manufacturer was experiencing excessive levels of grease consumption on the work rolls and vertical sliding surfaces, which meant the frequency of re-lubrication was high. All lubrication was done manually and the maintenance costs were significant. Production also had to be stopped frequently for maintenance to take place. Castrol worked with the customer using the Total Cost of Ownership (TCO) principle. Detailed analysis of the work rolls and related areas identified that the grease being used didn’t give the necessary performance required for the work rolls application, causing problems of bearing corrosion due to water ingress. Castrol selected Castrol Molub-Alloy 860 ES has high performance additives, is resistant to water washout and can withstand the high pressures and loads experienced in a hot mill. The lubrication interval increased by more than 100% and grease consumption reduced by over 70%. This gave an overall TCO saving in maintenance and grease costs of 24%. Other benefits such as lower waste disposal costs and increased uptime have not been quantified but have been realised by this manufacturer.
Leaking gearboxes are something that everyone wants to eliminate, both from a cost and safety perspective. Oil spills or leaks can also stain the manufactured product, creating quality issues and additional re-working costs. One European steel maker benefited from the TCO approach with the use of Castrol’s unique leak resistant oil, Castrol Molub-Alloy 969, in overhead crane gearboxes. Steel coils which were stored were prone to oil staining as gear oil leaked from the overhead cranes passing by. The leaks often happen from the oil seals and casing flange joints which flex due to cranes operating under extreme loads. This customer benefited significantly from eliminating the leaks entirely, extending the life of the equipment and mitigating staining of the steel strip which reduced quality issues.
Equipment downtime reduction is a key performance indicator in any manufacturing business. One manufacturer within the automotive industry was experiencing spindle failures on a manufacturing line, a key bottleneck process, which resulted in costly downtime and replacements. This operation employs hydrostatic bearings and was experiencing frequent bearing failure. In one year, there were five failures which resulted in production downtime and expensive repair work, costing over £50,000. Castrol conducted a detailed survey of the lubrication application and identified that the oil condition and lubrication regime was one of the key factors leading to failure. A replacement product was selected supported by the Castrol Predict service which provides analytical trends and highlights abnormalities in the oil for the Maintenance Team. This supports a predictive maintenance strategy to ensure equipment wear is reduced and uptime is maximised. A spokesmen from this site commented “The Castrol programme has been very effective and we recognise that value can be derived from the new lubrication programme and the Castrol Predict service. Since its introduction five years ago, there has been a 96% reduction in bearing failures and we are now planning to extend the Castrol service to other key manufacturing process equipment on site to help us reduce our total costs and reduce failure rates”.
Another manufacturer was experiencing frequent breakdowns of a gearbox which was operating in a harsh and demanding environment. Significant maintenance costs were associated with the frequent breakdowns. Castrol conducted a detailed analysis of the application and equipment and introduced Castrol Optigear BM, a highly refined mineral gear oil based on advanced plastic deformation additive technology. The maintenance team also used vibration analysis techniques to monitor wear and, since the introduction of Castrol Optigear BM, they have seen great improvements in equipment life. Before the changeover, gearbox failures were experienced every two months; no failures have been seen in over 12 months, and the vibration levels are improving due to the Castrol gear oil additive technology.
In the sinter plant at one steel making location, the manufacturer was experiencing heavy gearbox pitting which was reducing the life of the equipment. The application was heavily loaded operating with 400 tonnes of raw materials per hour and in a very dusty environment. The cost of gearbox replacement, in this case, included rental of a crane to access the overhead gearbox as well as maintenance hours. A suitable oil would have to lubricate all components of the gearbox – input shaft bearings which require a lower viscosity oil right through to the final wheel which requires a higher viscosity oil. Not an easy task and often a compromise is required. Castrol selected Castrol Molub-Alloy 690 for the conveyor gearbox. Castrol Molub-Alloy 690 is based on solid film additive technology that improves the plastic deformation process, eliminating future micro pitting. The life of the gearbox has now been in full service for well over 18 months without failure or wear, further micro pitting eliminated and without the need for an oil change.
In summary, there are a number of advantages to the Castrol TCO approach:
- Increase component life and helping to reduce stock levels and therefore improving working capital which is a big advantage in the current climate
- Reduce maintenance labour, giving manufacturers the opportunity to reduce labour costs or focus time on other value adding activities
- Energy costs, some of Castrol’s high performance gear oils such as the Castrol Tribol 1100 range reduce friction and wear which can result in a lower energy usage
- It’s easy to see the benefits on the waste bill when longer life lubricants are used which extends relubrication cycles and leads to a further reduction of manpower