Introduction/ Background

Although nuts and bolts industry falls in smes but it has great importance for
manufacturing..Nuts and bolts manufacturers have played a big part in making nuts and
bolts affordable by increasing their efficiency and improving components and
technology. The competitiveness of the industry has increased with demand, and there are
many companies providing nuts, bolts washels e.t.c

The nuts and bolts are used by all mechanical industries and it is the necessity of these all
industries. These are the major components of assembling the mechanical parts of
machines from small to giant sizes.

Production Capacity

The production capacity of air conditioner is…

In 2003 In 2004 In 2005 In 2006

29020 143795 231914 427350

Major Players

 The major players in commercial chillers are

 ABDUL SATTAR DATA NAGAR BADAMIBAGH

 A.M.K.ENGG.WORKS 27-KM MULTAN ROAD

 ABID WASHER MAKER SHALIMAR TOWN

 A AMJAD JAVED & BROS SULTAN MAHMOOD ROAD

 ALPINE INDUSTIAL COMPANY G.T. ROAD DAROGHAWALA

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 AMJAD JAVED & BROS SULTAN MAHMOOD ROAD

 BUTT FASTENER INDUSTRIES DEFENCE ROAD

 EASY FASTENEST (PVT) LTD. DEFENCE ROAD

 HAFEEZ ULLAH SCREW AND ALLIED INDUSTRIES MULTAN ROAD

 IRFAN INDUSTRIES MOMINPURA ROAD DAROGHAWALA

 KALANI BOLT AND HAND TOOLS INDUSTRIES, IQBAL PARK BUND ROAD, NEW
FIRDOUS COLD STORAGE

 KHALID NUT AND BOLTS G.T.ROAD BAGHBANPURA

 LAHORE IRON WORKS BUND ROAD

Location

(Plot No.24, MUHAMMAD YOUNIS KOT SHAHBUDDIN SHAHDRA TOWN, LAHORE)

(ALPINE INDUSTIAL COMPANY G.T. ROAD DAROGHAWALA)

( IRFAN INDUSTRIES MOMINPURA ROAD DAROGHAWALA)

(ABID WASHER MAKER SHALIMAR TOWN)

Production and Capacity Utilization

The Production of commercial chillers is…

In 2003 In 2004 In 2005 In 2006

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12043 64420 181820 363247

The Utilization capacity of Chillers is…

In 2003 In 2004 In 2005 In 2006

41.5% 44.8% 78.4% 85%

Imports/ Exports

Imports

Imported
Imported Imported
growth
growth growth
Imported Share in in
Imported in value in value
value 2008, Pakistan's Quantity Unit value, quantity
quantity between between
USD imports, unit (USD/unit) between
2008 2004- 2007-
thousand % 2004-
2008, %, 2008, %,
2008, %,
p.a. p.a.
p.a.
World 25,441 100 7,662 Tons 3,320 34 3 12
China 6,235 24.5 2,359 Tons 2,643 81 63 74
Japan 2,009 7.9 569 Tons 3,531 7 7 3
Germany 1,998 7.9 473 Tons 4,224 40 -7 -21
Hong
Kong 1,947 7.7 490 Tons 3,973 74 9 -3
(SARC)
United
States of 1,804 7.1 495 Tons 3,644 23 7 -55
America

Export

Exported
Exported Exported
growth
growth growth
Exported Share in in
Exported in value in value
value 2008, Pakistan's Quantity Unit value, quantity
quantity between between
USD exports, unit (USD/unit) between
2008 2004- 2007-
thousand % 2004-
2008, %, 2008, %,
2008, %,
p.a. p.a.
p.a.
World 630 100 173 Tons 3,642 -18 -25 -23
Kuwait 181 28.7 55 Tons 3,291 4 -13 99

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Germany 130 20.6 32 Tons 4,063 218 110

United
Arab 105 16.7 28 Tons 3,750 5 -19 200
Emirates
Saudi
52 8.3 15 Tons 3,467 -37 -41 -42
Arabia
Singapore 50 7.9 14 Tons 3,571 13 0 456
United
39 6.2 12 Tons 3,250 29 13 -25
Kingdom

Raw Materials

Raw material is basically made of iron and solid metal. Raw material which is used by
these industries are sheets of iron, metal rods.

Source of raw material

The industry use raw material locally. They purchase raw material mostly from scrap
yards as per order.

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The Manufacturing Process

Creating encasement parts from galvanized sheet metal and structural

steel

• 1 Most air conditioners start out as raw material, in the form of structural steel
shapes and sheet steel. As the sheet metal is processed into fabrication cells or
work cells, it is cut, formed, punched, drilled, sheared, and/or bent into a useful
shape or form. The encasements or wrappers, the metal that envelopes most
outdoor residential units, is made of galvanized sheet metal that uses a zinc
coating to provide protection against corrosion. Galvanized sheet metal is also
used to form the bottom pan, face plates, and various support brackets throughout
an air conditioner. This sheet metal is sheared on a shear press in a fabrication cell
soon after arriving from storage or inventory. Structural steel shapes are cut and
mitered on a band saw to form useful brackets and supports.

Punch pressing the sheet metal forms

• 2 From the shear press, the sheet metal is loaded on a CNC (Computer Numerical
Control) punch press. The punch press has the option of receiving its computer
program from a drafting CAD/CAM (Computer Aided Drafting/Computer Aided
Manufacturing) program or from an independently written CNC program. The
CAD/CAM program will transform a drafted or modeled part on the computer
into a file that can be read by the punch press, telling it where to punch holes in
the sheet metal. Dies and other punching instruments are stored in the machine
and mechanically brought to the punching arm, where it can be used to drive
through the sheet. The NC (Numerically Controlled) press brakes bend the sheet
into its final form, using a computer file to program itself. Different bending dies
are used for different shapes and configurations and may be changed for each
component.

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• 3 Some brackets, fins, and sheet components are outsourced to other facilities or
companies to produce large quantities. They are brought to the assembly plant
only when needed for assembly. Many of the brackets are produced on a
hydraulic or mechanical press, where brackets of different shapes and
configurations can be produced from a coiled sheet and unrolled continuously into
the machine. High volumes of parts can be produced because the press can often
produce a complex shape with one hit.

Cleaning the parts

• 4 All parts must be completely clean and free of dirt, oil, grease, and lubricants
before they are powder coated. Various cleaning methods are used to accomplish
this necessary task. Large solution tanks filled with a cleaning solvent agitate and
knock off the oil when parts are submersed. Spray wash systems use pressurized
cleaning solutions to knock off dirt and grease. Vapor degreasing, suspending the
parts above a harsh cleansing vapor, uses an acid solution and will leave the parts
free of petroleum products. Most outsourced parts that arrive from a vendor have
already been degreased and cleaned. For additional corrosion protection, many
parts will be primed in a phosphate primer bath before entering a drying oven to
prepare them for the application of the powder coating.

Powder coating

• 5 Before brackets, pans, and wrappers are assembled together, they are fed
through a powder coating operation. The powder coating system sprays a paint-
like dry powder onto the parts as they are fed through a booth on an overhead
conveyor. This can be done by robotic sprayers that are programmed where to
spray as each part feeds through the booth on the conveyor. The parts are
statically charged to attract the powder to adhere to deep crevices and bends
within each part. The powder-coated parts are then fed through an oven, usually
with the same conveyor system, where the powder is permanently baked onto the
metal. The process takes less than 10 minutes.

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Bending the tubing for the condenser and evaporator

• 6 The condenser and evaporator both act as a heat exchanger in air conditioning
systems and are made of copper or aluminum tubing bent around in coil form to
maximize the distance through which the working fluid travels. The opposing
fluid, or cooling fluid, passes around the tubes as the working fluid draws away its
heat in the evaporator. This is accomplished by taking many small diameter
copper tubes bent in the same shape and anchoring them with guide rods and
aluminum plates. The working fluid or refrigerant flows through the copper tubes
and the opposing fluid flows around them in between the aluminum plates. The
tubes will often end up with hairpin bends performed by NC benders, using the
same principle as the NC press brake. Each bend is identical to the next. The
benders use previously straightened tubing to bend around a fixed die with a
mandrel fed through the inner diameter to keep it from collapsing during the bend.
The mandrel is raked back through the inside of the tube when the bend has been
accomplished.
• 7 Tubing supplied to the manufacturer in a coil form goes through an uncoiled
and straightened before being fed through the bender. Some tubing will be cut
into desired lengths on an abrasive saw that will cut several small tubes in one
stroke. The aluminum plates are punched out on a punch press and formed on a
mechanical press to place divots or waves in the plate. These waves maximize the
thermodynamic heat transfer between the working fluid and the opposing
medium. When the copper tubes are finished in the bending cell, they are
transported by automatic guided vehicle (AGV) to the assembly cell, where they
are stacked on the guide rods and fed through the plates or fins.

Joining the copper tubing with the aluminum plates

• 8 A major part of the assembly is the joining of the copper tubing with the
aluminum plates. This assembly becomes the evaporator and is accomplished by
taking the stacked copper tubing in their hairpin configuration and mechanically
fusing them to the aluminum plates. The fusing occurs by taking a bullet, or

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mandrel, and feeding it through the copper tubing to expand it and push it against
the inner part of the hole of the plate. This provides a thrifty, yet useful bond
between the tubing and plate, allowing for heat transfer.
• 9 The condenser is manufactured in a similar manner, except that the opposing
medium is usually air, which cools off the copper or aluminum condenser coils
without the plates. They are held by brackets which support the coiled tubing, and
are connected to the evaporator with fittings or couplings. The condenser is
usually just one tube that may be bent around in a number of hairpin bends. The
expansion valve, a complete component, is purchased from a vendor and installed
in the piping after the condenser. It allows the pressure of the working fluid to
decrease and re-enter the pump.

Installing the pump

• 10 The pump is also purchased complete I h from an outside supplier. Designed to

increase system pressure and circulate the working fluid, the pump is connected
with fittings to the system and anchored in place by support brackets and a base. It
is bolted together with the other structural members of the air conditioner and
covered by the wrapper or sheet metal encasement. The encasement is either
riveted or bolted together to provide adequate protection for the inner.

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Problem faced by Industry

Nuts and bolts manufacturers face the challenge of improving efficiency and lowering
costs. The competitiveness of the industry should remain strong, driving more
innovations in manufacturing and design.

1. Pakistan is a country where policies are rapidly changed even in days and
weeks. In the past, aim of the monetary was credit expansion. Deteriorating
political, law and order situation in the Country is one of the major reasons of
Industrial down turn. Industrial activity cannot flourish in an atmosphere of
disturbances and fear.
2. Increasing trend in the cost of inputs has become common practice in our
Country due to which small Industries cannot compete in the markets. Due to
increase in prices of inputs used in manufacturing process like Electricity, Sui
Gas etc, our small sector is not able to compete / sell their products at higher
prices due to multiplied cost of production.

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3. Severe electricity load shedding and disconnection of Sui Gas supply for
industries in winter season is the biggest problem faced by this industry in the
country. Small and medium size manufacturing units are badly affected to the
power crises as they do not have alternative resources as corporate sector
have, like their own power generation houses. Due to power crises prevailing
for last many years, unemployment in the country has also increased to
considerable extent. In majority of sectors work force/labor works on daily
wages basis and in constant power break downs they are deprived of even
basic necessities of life which is least desirable in any civilized society. Today
Load Shedding has become major problem of Pakistan and small and medium
sized industries/traders are suffering to worst extent.
4. Lack of up-to-date Information about target markets, inputs, policies,
regulations, etc.
5. There is no proper association among these manufacturers. Hence these small
manufacturers are not able to effectively promote their interests.
6. A frequent cause of bankruptcy is undercapitalization. This is often a result of
poor planning rather than economic conditions.
7. On the other hand imported/smuggled goods are commonly available in the
markets at much cheaper prices. Chinese Goods are one of the best examples,
which are available throughout the country at much lower prices.
8. Unaffordable cost of new machinery.

Pricing

The prices of commercial chillers are normally from Rs. 156,000 to Rs. 270,000. But the
prices are not constant. They changes time to time and also according to the specification
of product. Pricing also set by competitive market. Some time whole seller also play a
role to set the prices

Govt Policies

The government policy exists, but there is lack of implementation, the only incentive
local manufacture gets is high import duty on imported brand as result local
manufacturer. The Govt is not giving any kind of subsidy to the local manufacturers of
nuts and bolts. There is no relaxation on electricity bills and taxes. The Govt only support
the corporate sectors not the small manufacturers.

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Due to huge amount of financing involved,Bank in Pakistan are very much

accomodating towards corporate customers.Likewise Government is also giving
more importance to Corporate entities. On the other hand small and medium size
businesses and industries are dependent on corporate sector to a great extent and
does not possess enough shock absorbers against higher cost of production and like
factors.

Chinese Goods are one of the best example, which are available throughout the
country at much lower prices. Today Chinese goods have become major threat to
Pakistani economy especially to industries operating on small or medium scale. In
Pakistan costs of production are much higher. Although it is in the knowledge of the
Policy makers, but they are paying deaf ear to such problems which is very much
unfortunate. SBP should take up these issues with GoP/Policy Makers and prevail
upon them to chalk out course of action & strategy to coup with this situation.

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Prospects (After WTO)

The implementation of world trade organization regime has open new window
opportunities as well as number of threats and challenges to various sectors of economy
including engineering sectors.
The government policy in previous years was to protect engineering industry by using
various measure including tariffs ,but this policy has been discontinued now with out
taking into consideration the competence of local engineering industry and with out any
future planning to counter the impact of WTO.
With the implementation of WTO tariff protection to local industries against imported
goods has to be eliminated, leaving no opportunity for local industry to compete with
cheap imported goods.
The major problem faced by local engineering industries is lack of economy of scale as a
result it is expected that growth rate of local engineering industries will decline in future
And technological development and product up gradation is likely to be effected.
Consequently, the economy has to face severe impact, resulting in unemployment in the
country, the current situation demand that government should take immediate and
appropriate steps to ensure that local engineering industry remain competitive.

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References

http://www.fbr.gov.pk/newcu/TARIFF/2008/ch1-97.pdf
http://www.orient-power.com/contact/index.aspx?PriID=22
http://www.epb.gov.pk/v1/index.php
http://www.iarreport.com(iar 83)

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