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issue: December 2005 APPLIANCE Magazine

Arçelik - International
Creating Value in Cayirova

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by Paul Roggema, European Correspondent

Near the Bosporus Bridge that links Europe and Asia, Turkish appliance maker Arçelik centralized its laundry appliance production.

At Arçelik’s washing machine facility, robots insert drums into washer tubs.

Manufacturing Today

Arçelik’s entire washer and dryer production is located in Çayırova, near the historic Bosporus Bridge connecting the European and Asian parts of Turkey. The factory covers 37,500 square m and employs 1,477 workers, of which 133 are white-collar. This is a large facility by some European standards and results from Arçelik’s one-product/one-factory manufacturing structure.

The plant at Çayırova includes manufacturing of three washer platforms and one dryer platform. Dryers, owing to the warm Turkish climate, account for production of just 165,000 units per year.

When Arçelik acquired premium appliance maker Blomberg in 2002, the company found that production volumes were too low to support continued manufacturing in Germany and moved the washer line to Çayırova. Austrian appliance maker Elektra Bregenz was also added to the line-up and the two brands gave Arçelik a better product mix in the German and Austrian markets, where they are used along with the international Beko brand.

The platform for the lower-end market segment washers is produced in three depths: 35 cm, with a capacity of 3.5 kg; 45 cm, with a capacity of 4.5 kg; and 54 cm, with a capacity of 5 kg. The units are engineered with mechanical or hybrid controls, some with LED control displays. The line accounts for 60 percent of the company’s total washing machine production.

Arçelik says affordable, reduced-depth front loaders are primarily sold in Middle and Eastern Europe, where users often require appliances with a minimal footprint to fit small apartments.

Top-loading drums are also produced by Arçelik for Western European users. It was designed for French consumers, especially those in the Paris region, who prefer top-loading models.

Arçelik’s mid-grade washer platform has a 54-cm depth for 6 kg capacity and 60 cm for 7 kg capacity. This platform is engineered with hybrid or electronic controls, some with LED displays, and it accounts for about 30 percent of the company’s production.

The high-end washer line is 60 cm deep to offer 7 kg capacity, and is designed with electronic controls. This is the former Blomberg production line, moved from Germany to Çayırova in 2004. The SKU count for this line is approximately 1,400 units per year.

The company says 45 percent of the dryer models produced at the plant are condenser models, 30 percent are vented models and 25 percent are premium, energy-saving heat pump dryers.

The Blomberg product differs from the other products in several aspects. First, the exterior design is unique and has garnered several design awards. The interior construction is welded differently from other Arçelik products. The product also features overflow protection and a water cleanliness sensor to control rinsing performance.

Today, Arçelik says its 7 kg washers are gaining market share in Europe, where 4.5 kg and 5 kg machines were once the largest-capacity units available. A new feature gaining wider acceptance on high-end washer models is a direct-drive motor, and Korean manufacturers are especially aggressive in pushing the technology. Arçelik says it is the only European manufacturer to produce this technology in its own motor plant, located in Çerkezköy.

Washer Production

Arçelik’s washer factory consists of a mechanical production area, a paint shop, three plastic production areas, three assembly lines, a shrink packaging area, and two warehouses.

Production starts with sheet metal coils being cut after arriving from suppliers. All sheet metal parts for washers and the dryers are formed in-house. The plant stamps front and side panels on a 5-station, 1,250-ton transfer press and a 4-station, 800-ton press. Both presses have an automatic die exchange system with moving bolster plates.

Smaller parts, such as brackets, are stamped on one of nine different presses, ranging from 100 tons to 400 tons. Drums in various depths and diameters are produced on three Italian-made automated drum lines.

Cabinet forming, from flat metal sheet to welded cabinets, takes place on four completely automated lines and cabinets emerge ready to be painted. One of the lines forms the Blomberg-type cabinet, with the others forming “U”-shaped cabinets of different depths for the other assorted models.

Plastic parts are produced on 13 injection molding machines ranging in size from 1,300 tons to 2,000 tons, and three, 650-ton plastic presses for tubs and tub covers. Formed tubs are placed on pallets and stacker cranes deliver the pallets to storage shelves. As needed, the tubs are moved to the assembly lines via overhead transporters.

Six injection molding stations produce decorative, exterior parts. After molding, the front panels are printed and sent to the assembly lines. The flexibility of this operation allows the plant to provide parts for all the models, and approximately 40 percent of front panels are produced in-house.

Assembly takes place on three washer lines and a dryer line, with about 70 workers on each line. Normally, the plant operates on three shifts, 6 days a week, but in high-season the lines operate even on Sundays. Workers are assisted by 11 robots, supplied by ABB of Sweden and KUKA Roboter of Augsburg, Germany. This automation is used for counterweight assembly, drum assembly and transfer and cabinet assembly and transfer.

Each assembly pallet has an ID tag with all the needed assembly information. At critical stations, where appearance groups or control system components are added, monitors display the part data and even part photos to the station operators.

At the end of the assembly lines, the handling of packaged appliances is controlled by an automatic storage and retrieval system.

All washing machines made in Arçelik’s plant in Çayırova undergo full functional testing.

Tools of Flexibility

Çayırova is also home to a tool shop, staffed with 17 CAD/CAM design specialist and 33 operators, serving all Arçelik plants. The lab, with more than 20 years experience in CAD/CAM and CNC machining, manufactures sheet metal forming tools, plastic injection molds and unique machines, such as roller bearing insertion equipment. The shop has even been responsible for designing and manufacturing several special refrigeration models. Most recently, the lab produced designs and tooling for washer front panels, refrigerator door shelves, outer oven doors, and burning plates, and even developed equipment for inner-liner thermoforming. Arçelik’s in-house tool shop gives it a high degree of flexibility for its designers and purchasing departments.

Arçelik tends to manufacture more of its components in-house than might be typical in the appliance industry. The company sees many competitors doing away with in-plant finishing operations and plastic molding capabilities.

“Manufacturing in Turkey does not have the long tradition of Germany and Italy, and…the Turkish economy has been opened up to imports relatively late. With this in mind, vertical depth of integration is relatively deep,” Hakan Turan, production manager, tells APPLIANCE. “Many potential suppliers were too small and limited in innovation and investments. Still, the Arçelik strategy is to focus on its main processes and we always wanted to create technologically developed suppliers; so we actively support our suppliers. Happily, our key component suppliers are located within 20 km of the factory, which, of course, gives us a flexibility for product variety and quick model changes.”

The plant supplies its own power, with a multiple fuel unit that primarily uses natural gas. Electric output is 6.5 MW, and heat recovered from the engine is used for paint shop process and building heating, as well as for cooling purposes, making the unit a tri-generation energy plant. The energy plant was awarded the first prize in the Most Efficient Co-Generation Plant competition in 2002 and continues to run with high efficiency.

The Çayırova plant also has two waste water treatment facilities, one a biological waste water treatment unit and one an industrial unit to process water from the paint shop. For this task, there are primary, secondary and advanced refining units. Primary refining consists of physical treatment, where floating and sedimentary particles are filtered out. Secondary refining has physical and chemical treatment. Third-stage advanced refining is used as-needed. Rinsing water is recycled by ion exchangers with
69-percent efficiency. The methods are in line with IFC waste water limits and the factory also has a ISO 14001 (1996) Environmental Management Certificate.

European front-load washers come in different depths. Shown are Arçelik’s 54-cm and 35-cm depth cabinets.

Product Development

Arçelik’s product development department employs 70 engineers and technicians, some of whom came to the company from Blomberg when it was acquired. Arçelik also cooperates with design firm Arcelitalia, an Italian research company that is also part of Koç Holding. Arcelitalia is experienced in mechanical and plastic tub design and has much experience working with Italian suppliers.

The Çayırova laboratories are equipped with 400 test stations, including a washing performance lab, climatized test rooms, a component verification lab, reliability test stations, electrical security test rigs, data acquisition test stations of an in-house design, mechanical endurance test rigs, and a semi-anechoic (silent) test room. To construct testable prototypes there is a prototype lab. Design software I-DEAS, Adams and StarCD are used throughout design and analysis.

A Proven Formula

Several variables have helped to create Arçelik’s success. One of the variables that the company feels has served it especially well is its commitment to product quality. It has been offering an unusually long 3-year warranty on its products since 1998 to heighten awareness of its product quality. Quality was achieved through a series of quality improvement programs, using strategies such as Six Sigma, Total Product Management (TPM), Total Quality Management (TQM, from the European Federation of Quality Management), and the ISO 14001 and 9001 standards. TQM was introduced as early as 1993 and Arçelik believes it has long been a benchmarked TQM company. Its products achieve good ratings from independent test institutes, like LGA, Wfk (Germany) and French CTTN. The company prides itself on having a service call rate as good as German premium brands and Korean brands, while outperforming competitors in value-for-money.

Many other aspects have contributed to Arçelik’s success. Being a part of Koç Holding means it can share in the expertise gained from other group business units. Arçelik uses this synergy to improve its processes. It has also knowledge-sharing and license agreements with Bosch, Sanyo, GE, LG, and compressor supplier Tecumseh. Because staff costs in Turkey are lower, Arçelik is able to work with larger engineering teams compared to European competitors. Finally, since it is one of the most admired companies in Turkey, the best university graduates are eager to join the company.

The company took care to engage in rapid expansion of its manufacturing while maintaining product quality levels. “We were quite experienced in quality management, as we started to implement the TPM techniques about 8 years ago under the supervision of the Japanese Institute of Plant Maintenance,” Turan says. “This totally changed our production culture. After this culture change we were able to triple our production with relatively low investments, and all in the same floor area. We made a lot of smaller improvements, many of them regarding cycle time, to increase production step-by-step. TPM provided new problem-solving techniques, new production technologies and improved the skills of our engineers. Our blue collar employees are trained to solve their own problems by building small improvement Kaizen-style groups. To symbolize this, we call the blue collar employees operators, not workers.”

While the in-house paint shop continues to be a competitive cost advantage, it did turn out to be a production bottleneck as manufacturing expanded. Persistent TPM efforts resulted a capacity increase of 50 percent, Turan explains.

“The automation level is somewhat higher than other leading companies in the sector,” Turan points out. “However, the main methods to reach higher production were TPM activities, together with line balancing, material flow optimization, electronic Kanban systems (integrated with ERP), and computer-aided method studies.

“But we should not forget the human factor,” he adds. “Without the loyalty and the commitment of our operators on the shop floor, Arçelik could never have reached the productivity targets and the production increase as we did.”

Suppliers mentioned in this article:
Arcelik AS

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