Technology advances outpace price increases
This micro-PLC from Rockwell Automation provides communication capabilities of a larger PLC and the means to fully decentralize control.
By Elena E Murphy -- Purchasing, 5/21/1998 2:00:00 AM
Technological advances continue to outpace modest increases in price for programmable controllers. Demand is for low-end products that feature more powerful, but less costly, microprocessors and operate on compatible platforms. In addition, highly sophisticated programmable controllers are now available in ever-smaller packaging.
Prices will rise only slightly due to decreasing technology prices and mixed demand. Competition is one factor: Technology for low-end products costs less and is featured in more programmable controllers. The Asian economic downturn, too, has checked prices that otherwise might escalate.
Overall, tags will grow 3%-5% this year. Those increases are sustained by a number of factors including a fairly active economy since programmable controllers are used across manufacturing industries. Technological improvements continue to leap forward and tug prices slightly upward.
Programmable controller suppliers identify with the personal computer (PC) industry since tags are relatively stable but product value is growing. Microprocessors are more powerful so customers can achieve a higher level of functionality. Programmable controller producers credit competition among semiconductor and other electronic component producers with lowering the cost of new technologies.
The downturn in orders from Asia will keep a lid on tags through year-end even if there is a recovery in 1998. Exports to Asia have slipped and excess product is growing in Europe, the U.S., and South America. However, suppliers report that the slowdown is affecting only part of their business since other regions are economically active.
Low-end demand jumps
Demand for programmable controllers will grow 5%-7% this year due to varied performance among end-use industries. Most of the expansion will occur in low-end technologies since these products feature more power than in the past, yet are perceived as cost-effective based on stable prices. Steady tags will accelerate interest in the existing customer base to upgrade its programmable controllers, such as moving from multiple controllers to a single, multifunctional unit.
Due to the influx of affordable, low-end technologies, there are new customers that in the past avoided complex, rigid programmable controllers or couldn't afford turnkey systems. The appeal of these more sophisticated low-end programmable controllers is that the products "speed up processing and bring down memory costs," says Dennis Shreve, PLC product manager, Cutler-Hammer, Milwaukee, Wis.
Buyers are focused on system capability to achieve more complex functions. Not only are programmable controllers more advanced, but peripherals such as sensors feature more sophistication and steady prices. Those product trends dovetail with corporate goals among end users for faster, more accurate operations without increasing costs.
Active industries also are driving orders. Bill Black, Series 90 marketing manager, GE Fanuc, Charlottesville, Va., credits semiconductor, metals, and wastewater industries with boosting demand for programmable controllers. Automotive is strong in the long term but will exhibit stable performance this year, several sources forecast.
Within a number of active industries, customers require more flexibility from programmable controllers for increasingly efficient production processes. Mike Backman, strategic product group manager for motion control at Thomson Industries, Port Washington, N.Y., notes industries such as automotive now employ flexible transfer lines that include more convertible machines. That trend shifts more importance to the programmable controller to determine the host machines' functions.
The key to future programmable controller growth is compatibility. Until recently, a number of potential customers were concerned about investing in technology that often was proprietary, locking the customer in with a single supplier. One supplier says now that though it prefers selling turnkey solutions, the company promotes "mix and match" in order to encourage flexibility in the industry-wide customer base. Thomson's Backman concurs, pointing out that platforms such as Windows NT are more common since end users are comfortable with the familiar interface.
The ethernet is another tool to achieve compatibility between programmable controls and other machines or components. GE Fanuc's Black notes that programmable controllers can send data to a mainframe, which makes them particularly useful to companies that use system-wide data-collection programs.
Demand for smaller products continues to rise this year. Shreve points out that miniaturized programmable controllers are important since customers increasingly move product among machines. Miniaturization is feasible since electronics technology itself is shrinking.
Supply swells
The mixed demand picture will ensure stable supply of programmable controllers. Fewer orders from Asia will boost supply levels worldwide and various demand levels across industries will preclude spot shortages.
In addition, suppliers are investing in new capacity to generate more product. For instance, Thomson's Backman notes that suppliers use agile manufacturing practices or "contingency plans," such as outsourcing in order to meet changes in demand.
Production capacity is adequate even after a decade of consolidation. For instance, Siemens acquired Texas Instruments and Groupe Schneider acquired Modicon and Square D. However, consolidation peaked in the the mid-1990s and no mergers are expected this year.
Though consolidation hasn't depleted production capacity, Backman says that development capacity for custom product currently is strained. OEMs seeking a system that fits their unique requirements or customer base are partnering with programmable-controller producers for design expertise. However, depending on OEMs' forecasts and development pace, programmable-controller producers may encounter tighter engineering capacity.
Leadtimes are off-the-shelf for most products, especially those sourced from distributors. The wait for custom products varies. However, producers are angling to implement practices that speed up deliveries to distributors. One supplier aims to shorten its leadtimes to distributors to two weeks this year.
On the MRO side, programmable-controller producers are managing the trend toward integrated supply, says Dave Johnson, vice president and general manager of the controller business at Rockwell Automation, Mayfield Heights, Ohio. Suppliers provide product to customers through any distribution channel though often services are still issued by the OEM or an authorized distributor.
Seek service, quality
Suppliers recognize that service is critical to customer satisfaction and are implementing approaches to assist end users. After all, notes Johnson, "What good is a quickly delivered PLC (programmable logic controller) if the customer can't use it?" He compares strategic suppliers in terms of service to personal computers since the suppliers provide technical service for customers that need information on maximizing capability.
Another increasingly popular service is upgrading customers' programmable-controller technology based on the customers' previous investment. Black says that suppliers can change their customers' CPUs to more up-to-date versions. The customer is credited in some form for its financial commitment to the supplier's earlier technology.
Suppliers also monitor the number of spare programmable controllers at a customer location. Since technology is advancing faster than product cost, suppliers report that customers choose to source more spares in order to quickly replace a broken programmable controller rather than try to fix it and incur the higher costs of downtime.
In terms of legislation, suppliers say that Europe's CE mark has a favorable effect on all programmable controllers since it is associated with quality. Also, Black points out that European requirements for 100% recyclability improve programmable controllers. For instance, programmable controllers for the European market are laser-etched and no longer painted or feature attached labels. Those changes have driven down production costs, Black notes.
Industry initiatives include improving the ruggedness of programmable controllers. Cutler-Hammer's Shreve cites tests that programmable controllers can operate under conditions of high vibration and extreme temperatures. For a better look at what features characterize programmable controllers on the market for 1998, a few examples follow:
* GE Fanuc introduces new features to the CPX Series of CPUs for Series 90-70 PLCs. These PLCs have solved the ongoing problem that certain high-speed applications such as advanced batch processing and triple modular redundancy have been considered too large and complex for programmable controllers.
The CPX series consists of four models ranging from 512 Kbytes to 6 Mbytes of memory. They are single-slot CPUs with three built-in serial ports: RS-232, RS485, and isolated RS-485. In addition, the CPX series can be programmed in relay ladder logic, C language, and SFC (sequential function chart). The CPUs are based on the Intel 486DX4 processor running at 96MHz and solve Boolean logic execution speed is 0.4ms/K. CPX series is fully compatible with existing Series 90-70 CPUs and can be upgraded.
The Series 90-70 CPXs also are compatible with the new Ethernet TCP/IP Type 2 module that supports Ethernet Global Data (EGD). Ethernet Global data is up to ten times more efficient on bandwith utilization than the normal polling system. Ethernet Global Data (EGD) is similar to Genius Global Data Ethernet. EGD enables one device (the producer) to transfer data to other devices (e.g. a PLC or a host machine running the GE Fanuc Communications Toolkit) that supports the EGD concept. Tel: (800) 648-2001.
* Rockwell Automation now provides open DeviceNet networking capabilities with a micro-PLC. As the first mircro-PLC on DeviceNet, the MicroLogix 1000 controller enables any manufacturing facility or OEM with the communication capabilities typical of a larger PLC, with the means to decentralize control.
The MicroLogix 1000 family's compact size, low cost, and higher performance make it useful for controller applications under-32 I/O per node. The smallest model in the family measures 120 x80 x 40 mm. Manufacturing solutions previously used one large centralized PLC. Many current solutions distribute lots of smaller, networked PLCs over the plant floor, which decreases the likelihood of a full plant failure.
A MicroLogix, using the DeviceNet Network Interface (DNI), allows end users to take advantage of peer-to-peer messaging between controllers, program upload/download over the network, and the ability to mix high-speed local control with distributed I/O. Tel: (800) 223-5354, ext. 0575.
* Cutler-Hammer has developed a flexible, intelligent control for machine-process applications: the D50 Programmable Logic Controller. To handle the control requirements of today's networks, the D5 PLC offers several functions that have only been available to users in larger PLCs.
The D50 PLC includes fourteen I/O points, and up to five units can be added to give users with larger applications 56 discrete I/O points and an additional six analog I/O points to use on the network. For applications that need additional points, as many as 32 D50 PLCs can be connected through a single CPU port.
The D50 PLC features application-specific instructions for two high-speed counters, pulse catch inputs, and pulse-width with modulation output. It also can run an independent system, mini-network, or serve as a cell controller for a larger factory-wide open automation system in a large network.
Other features are a 2000 plus programmable step capacity for complex or simple control for applications that require 700 ma. of power for supplying external I/O devices and expander modules. The PLC offers Windows-based ladder programming of clear graphical representation and online editing. Finally, useful circuit and device commentary and logic power flow monitoring to make programming and controlling easier. Tel: (614) 899-4113.
* Thomson Industries offers a new stand-alone 4-axis servo controller, which provides automation OEMs a strong plug-and-play solution. The new TMC-2000 controller is capable of controlling up to 4 axes of servo and/or stepper motors and running four programs simultaneously. Available with prefabricated cables that interface with Thomson brushless motors and digital amplifiers, the TMC-2000 offers a solution for motion control problems including: point-to-point, linear and circular interpolation, electronic gearing, and user defined path.
The controller features eight programmable inputs and outputs (expandable to 72) and dedicated home and limit inputs. It also includes optoisolated I/Os; two RS-232 ports; Windows software for programming and tuning; easy, powerful programming language; rugged industrial enclosure; and multi-tasking capabilities. Tel: (800) 554-8466.
Market at a glance
Demand is growing 5%-7% in 1998. Low-end products account for the bulk of expansion. Demand will slow slightly as the millennium approaches.
Supply is plentiful due to downturn in orders from Asia and ample capacity. Consolidation has slowed.
Prices will rise 3%-5% this year and those increases will emerge in the second half of the year. Advancements in technology and moderate demand expansion will sustain prices.
Leadtimes are off-the-shelf for MRO buyers sourcing from distributors. OEMs are waiting 2-4 weeks depending on how close their forecasts match order levels.
Advanced industrial controls market
(million dollars)
1995 2000
Producers durable eqmt. invest. (bil$) 575 767
$ controls/000$ PDE 6.1 6.5
Advanced industrial controls sales 3,520 5,000
Programmable logic controllers 985 1,350
Adjustable speed drive controllers 895 1,275
Proximity & positioning sensors 295 495
Computer numerical controls 260 350
Other advanced controls 360 500
Parts & accessories 80 100
% advanced 45.7 49.5
Total industrial controls market 7,695 10,100
SOURCE: FREEDONIA GROUP
How supply managers add value
02/09/2010Suppliers add capability
12/21/2000Soft demand leads to flat prices
08/09/2000Feel safe to use p-cards online
09/06/2000
Now Playing: 
