North America

Segment NAM 2017
Combined sales: € 552 million
Capital expenditures (PP&E): € 13 million
Total assets: € 299 million
Employees: 1 410

Economic environment in 2017

After slow economic growth in 2016 and a weak start to 2017, US GDP growth picked up and reached an estimated 2.3% for the full year. High consumer spending and increased defense funding boosted the growth. Industrial production figures were good thanks to a steadily improving global economy, a weaker US dollar - making exports more competitive - and a modest revival in oil drilling. Changes in US fiscal and trade policy have created an increasingly uncertain operating environment.

Our activity performance

Bekaert’s activities in North America achieved almost 8% sales growth and a significant improvement in profitability. Passed-on higher wire rod prices and price-mix effects combined with more than 3% volume increase boosted an organic growth of almost 10%. 

Automotive, industrial and specialty steel wire markets performed well in 2017. As anticipated, sales volumes were lower in the last quarter of the year due to the normal seasonality impacts. The adverse effects of a weaker USD in the second half of the year had a significant impact on both sales and profitability, year-on-year.

The transformation programs put in place in the region have had a material impact on the 2017 performance. The combined approach in implementing manufacturing, supply chain and commercial excellence have led to a stronger organization, better segmentation, and increased cost competitiveness. The underlying EBIT increased by 28% to € 33 million at a margin of 6%. The segment also reported a significant increase in EBITDA and ROCE margins compared with the previous reporting periods.

Capital expenditure (PP&E) was € 13 million in North America. The major expansion plan for the Rogers (Arkansas) plant was put on hold due to the uncertainty about changes in US trade policy, which might significantly increase the cost of imported wire rod in the future. Bekaert has to import raw material or finished goods into the US because the local steel mills cannot supply the specific wire rod grades needed to produce tire cord. 

Building the future for Bekaert in North America

Over the past decade, the market, customers, legislation and competitors have changed significantly in the North American region. These changes made our business model less competitive than it had been in the past. Profitability declined to unacceptable levels and the Bekaert North American team started a program in 2016 to reverse this situation. Their goal is to build the future for Bekaert in North America. Their approach is a synopsis of all other global Must Win Battles implemented at Bekaert. The team has a focused and ambitious growth agenda and is building a best-in-class organization underpinned by manufacturing excellence, customer excellence, partnering excellence, and a strong passion to win.
  • Bekaert’s global manufacturing excellence program was implemented in Rogers (Arkansas) and Shelbyville (Kentucky) in 2017. All plants in the US have now gone through the program and are implementing the actions defined. 
  • In 2017, the North American management team initiated a second wave of commercial excellence projects, taking on business platforms and cells that were not included in the first wave. Using this approach enabled the team to further refine their tools and way of working and increase the impact in a sustainable way. 
  • All but two production locations in the US have kicked off Bekaert’s global safety program BeCare. A plan for the offices is under development, but all staff who regularly appear on the shop floor have received safety training and have an implementation role to fulfill. 
  • In addition to the global transformation programs, North America has a dedicated project called ‘Passion to Win’. It concentrates on five people-related areas: talent; communication; recognition; empowerment; and alignment – and is closely tied to our long-term core strategy to engage and empower people.
Bekaert plant in Orrville adds operations site
Bekaert’s Orrville plant opened an additional operations site next to their existing premises. At this separate site Bekaert adds value beyond transforming wire by cutting precise lengths, and stamping and chamfering wire for their customers. The new building includes sustainable infrastructure elements such as high efficiency heating units, LED lighting and a Dramix®-reinforced floor. The building design is one open space without blind spots, offering full visibility from all sides for enhanced safety.


Bekaert's Van Buren facility achieves TL9000 quality certification
As only one of five companies in North America, Bekaert in Van Buren has achieved TL9000 certification. The surveillance audit thoroughly examined the facility’s quality management system, reviewing every aspect of the process from sales to planning to manufacturing and management. The certification is necessary for suppliers to the telecommunications industry.