CITY MACHINE TECHNOLOGIES Fixing to thrive in tough times

A bad economy means good times for a Youngstown company that repairs industrial equipment.
THE VINDICATOR, YOUNGSTOWN
By DON SHILLING
VINDICATOR BUSINESS EDITOR
YOUNGSTOWN -- Sugar mills in South America, Amish food processors and nuclear power plants all rely on a Youngstown repair shop to keep their equipment going.
City Machine Technologies is using a broad customer base to shrug off a recession that has hit the manufacturing industry hard and crippled the steel industry in particular.
"We've weathered the storm quite well," said Michael Kovach, president of the company, which has two plants on Rayen Avenue and one on Andrews Avenue.
He wouldn't disclose sales but said they are 10 percent behind last year, which was the company's best year despite a drop off in orders after the Sept. 11 attacks.
Kovach stopped short of calling the business recession-proof but said bad times can be good for City Machine Technologies. Companies that don't have the cash to replace equipment are rebuilding or repairing.
Kovach added, however, that his company has been set up to succeed in down times. In his 18 years of operating the company, he has diversified the customer base and the services it offers.
Electrical Apparatus, a trade magazine, recently featured the company as an example of how to reinvent a business to survive in tough times.
When Kovach bought the business in 1985, it was a small machine shop with two employees.
Divisions
Now it has three divisions and 65 employees.
The industrial machine division makes and repairs equipment for steel mills and other industries. One day recently it was working on a generator for a train engine.
The electric machinery division can rebuild a variety of equipment, such as motors in nuclear power plants. Some of these are 5,000 horsepower and as large as an office room. It also has worked on food processing equipment for Amish cheese factories and a machine that makes bacon bits for Wendy's.
A lifting magnet division, created in 1999, builds and repairs large magnets that are used in steel mills and scrap yards.
Kovach has added a couple employees recently to the 65-person company and figures he will be hiring more once the company achieves ISO 9000 quality certification next year. That designation will help it become approved to begin working on parts in nuclear power plants that are critical to the operation of the reactor.
Being able to work on such a variety of equipment usually comes down to having engineering knowledge and common sense, said Kovach, who is an electrical engineer.
Unfamiliar equipment
The company often takes on jobs that involve repairing equipment that it isn't familiar with, and sometimes there are no blueprints. These jobs require getting inside the machine and understanding how it works mechanically, he said.
He said the company began repairing gear boxes from sugar mills in Guatemala after a referral from a Cleveland company, which was having trouble with the work. Kovach and his crew examined the machines and came up with a method for keeping them running, which involves installing new bearings that are made at its shop.
"We didn't even know what this equipment was, but now we're the experts," Kovach said.
Repair jobs can take anywhere from two days to six months. Sometimes companies have spares for machinery that's being repaired, but sometimes they don't.
If a power plant has to take down one of its motors, it will be operating at 70 percent to 80 percent of capacity.
"A lot of times things are panicked," he said.
The electric machinery division runs three shifts so it can work 24 hours a day on a repair, he said.
Field services
Kovach also has expanded the field services operation, which sends workers out to plants to repair equipment. Often, equipment is so large that transporting it to a repair shop is impractical, he said. City Machine Technologies sends its crews out with portable lathes and other equipment.
This business now makes up nearly 20 percent of company sales.
"If the phone rings, you have to be ready to jump, and our customers know we are ready," he said.
Field service also is valuable because it creates more business for the repair shop, Kovach said. If a company that's in a bind uses City Machine Technologies' field crews, they are more likely to send other equipment to the repair shop, he said.
The company also has gained customers by developing methods to test equipment before it is sent back to a plant. Each piece of equipment requires a custom-made setup to test such things as voltage, vibration, electrical current and engine revolutions.
"We liken it to a science fair experiment," Kovach said.
It costs money to devise a test for a particular job the first time, but the investment pays off in persuading the customer to send other equipment in for repairs, he said.
As he looks toward the future, Kovach expects to continue diversifying the company's services and investing in computer-controlled equipment to improve the quality of repair work.
"It's expensive, but you'll die on the vine without it," he said.
shilling@vindy.com