SIC 3492

This classification covers establishments primarily engaged in manufacturing hydraulic and pneumatic valves, hose and tube fittings, and hose assemblies for fluid power systems. Establishments primarily engaged in manufacturing fluid power cylinders are classified in SIC 3593: Fluid Power Cylinders and Actuators; those manufacturing fluid power pumps are classified in SIC 3594: Fluid Power Pumps and Motors; and those manufacturing hydraulic intake and exhaust motor vehicle valves are classified in SIC 3592: Carburetors, Pistons, Piston Rings, and Valves.

NAICS Code(s)

332912 (Fluid Power Valve and Hose Fitting Manufacturing)

Industry Snapshot

The National Fluid Power Association (NFPA) calculated the total U.S. fluid power market at $13.5 billion in the late 1990s. The U.S. government's estimate for the value of shipments for fluid power valves and hose fittings was nearly $5.3 billion. The value of direct exports of U.S.-manufactured fluid power products, according to the NFPA, was just shy of $1.3 billion, excluding compressors. The estimate for indirect trade fluid power products (fluid power products exported as parts of end user machinery) in the late 1990s was $2.6 billion.

In 2000, the value of shipments within the fluid power industry totaled $6.7 billion. The industry employed 37,300 people with nearly 26,000 being production workers, in 2000. Average hourly wages that year were $14.97. The leading states for the production of fluid power valves and hose fittings are all east of the Mississippi and include Connecticut, Minnesota, Texas, New Jersey, Michigan, and Ohio.

Organization and Structure

According to the NFPA, fluid power is energy that is transmitted and controlled through a pressurized fluid—liquid or gas. Fluid power valves regulate the liquid or gas as it moves through valves, hoses, and fittings. The term fluid power thus applies to both hydraulics and pneumatics. Hydraulics utilizes liquid, oil, or water under pressure, while pneumatics refers to the use of compressed air. Fluid power is often used in conjunction with other technologies such as sensors, transducers, and microprocessors. Included in the total fluid power market are fluid power valves and fittings as well as hydraulic and pneumatic pumps, cylinders, rotary actuators, motors, filters, hose accumulators, air preparation accessories, stationary compressors, and other products.

The fluid power industry is generally divided into three large segments: mobile hydraulic, industrial hydraulic, and pneumatic. Historically, mobile hydraulic applications have accounted for about 50 percent of fluid power sales while the other two segments each share about 25 percent of the market. The mobile hydraulic segment (heavy truck, construction equipment, and agricultural machinery), although the largest, is also the most volatile.

The aerospace industry, construction equipment, heavy truck, agricultural equipment, and the machine tool and materials handling industries account for about 75 percent of the total fluid power consumption in the United States. The other 25 percent is divided amongst more than 500 other industries. In 1992, the last year for which figures have been published, the top five product share by type in order of dollar value were: nonaerospace-type hydraulic and pneumatic fittings and couplings for hose; aerospace-type hydraulic and pneumatic fluid power hose or tube end fittings and assemblies; aerospace-type hydraulic fluid power valves; nonaerospace-type flareless fittings and couplings (including nonmetal fittings) used in fluid power transfer systems; and nonaerospace-type pneumatic directional control valves. The rest of the market was divided by eight other categories by type.

Most of the establishments engaged in this industry employ more than 20 people. Therefore, this industry is characterized by larger businesses and labor-intensive processes. Throughout the 1990s the amount of employees per establishment was higher than the average of all manufacturing—as were payroll, hours worked, and wage statistics and shipments per establishment. Shifting from earlier trends, shipments per establishment also were higher than average, but investment per establishment was average.

Fluid power valves rely heavily on a number of economic sectors and industries for business inputs. The highest percentage of input is provided by blast furnaces and steel mills at 12.9 percent, followed by wholesale trade materials at 12.7 percent. Manufactured pipe, valves, and pipefittings represent 8.8 percent; manufactured goods from iron and steel foundries, 7.4 percent; and screw machine products, 4.8 percent. The remaining input categories are all less then 4.0 percent.

Current Conditions

According to the NFPA, the fluid power industry underwent two periods of sustained growth in the 1980s and 1990s. The average annual growth rate of the industry between 1987 and 1990 was 9.5 percent, and this figure climbed to 11.7 percent for the years 1993 through 1995. This remarkable growth was due to the expansion of existing markets and new markets, especially robotics and active suspension systems on automobiles—due to the introduction of electrohydraulic and electropneumatic technologies. Growth began to wane in the late 1990s, however, as shipments fell from $6.83 billion in 1998 to $6.49 billion in 1999. In 2000, the value of shipments recovered to $6.69 billion. The cost of materials grew to $2.78 billion that year.

The NFPA remains optimistic about future industry growth despite the slowdown in fluid power consumption growth in the late 1990s. Reasons for optimism include a strong and continued global demand for consumer goods and growth in demand for capital equipment in Eastern Europe and South America. Exports have played an increasingly important role in the U.S. fluid power industry. In 1989 U.S. fluid power exports were valued at $500 million, but by the late 1990s this figure had more than doubled to $1.3 billion. This represented an average annual export growth rate of nearly 20 percent.

Fluid power imports, however, are also rising. In 1989, U.S. imports of fluid power products stood at $350 million, but by the late 1990s this figure had increased to $1.2 billion. The five top importing countries of U.S. fluid power goods were Canada with $370 million, Mexico with $115 million, the United Kingdom with $125 million, Germany with $96 million, and Japan with $88 million. These countries purchased 61 percent of all U.S. fluid power exports in the late 1990s. Surprisingly four of these countries were also the largest exporters of fluid power products to the United States—Germany with $324 million, Japan with $233 million, Canada with $142 million, the United Kingdom with $141 million, and Italy with $66 million. In the late 1990s, 74 percent of U.S. fluid power imports came from these five countries.

The total number of industry employees fell from 38,757 in 1998 to 37,298 in 2000. Production workers in 2000 totaled 26,023, and they earned an average hourly wage of $14.97.

Industry Leaders

The top companies engaged in the fluid power industry include: ITT Industries; Vickers, Inc.; SPX Corporation; and the Cooper Cameron Corporation.

ITT Industries of White Plains, New York, makes a wide variety of products and services in many fields through its ITT Fluid Technology division including pumps, valves, mixers, and other fluid technology products including Koni shock absorbers and struts for the automotive market. ITT Aerospace Controls manufactures fuel, hydraulic, pneumatic, and solenoid valves. ITT generated $2.1 billion in sales in the fluid power market in 1998 and has 13,000 employees.

Vickers, Inc. has been part of the Eaton Corp. since 1999 and is headquartered in Maumee, Ohio. Vickers was once part of Aeroquip-Vickers, which had sales of $2.1 billion in 1998. Vickers was founded in 1921 in Los Angeles to design and build hydraulic machinery. Aeroquip-Vickers produces a wide range of products for the fluid power industry, including all pressure ranges of hoses, fittings, adapters, couplings, and other fluid connectors along with motor pumps, valves, and electrohydraulic, hydraulic, and pneumatic cylinders. Its Fluid Power Division produces and services 400 products and 34,000 components, including hydraulic and electrohydraulic equipment for global aerospace, marine, and defense markets. Vickers, Inc. employs nearly 4,900 people. In 1999 Aeroquip-Vickers opened an $11-million automotive hose and fittings factory in Queretaro, Mexico, for automotive air conditioning and power steering systems.

The SPX Corporation of Muskegon, Michigan, nearly doubled its size with the acquisition of General Signal Corporation in 1998. SPX's Hytec division produces high-pressure hydraulic pumps, rams, valves, pullers, and other equipment. Its Power Team produces hydraulic equipment for automotive and industrial markets as well as high-pressure hydraulic pumps, cylinders, and valves. In 1997, prior to its acquisition of General Signal, SPX had sales of $922 million and employed nearly 4,600 people.

Cooper Cameron Corporation of Houston, Texas, produces land and offshore hydraulic control and drilling systems for the oil industry as well as hydraulic industrial equipment including compressor systems. Products include oil and gas pressure control equipment including valves, wellheads, chokes, and blowout preventors. It also produces assembled systems for oil and gas drilling, production, and transmission. In 1997 Cooper Cameron had sales of $1.81 million and employed 9,600 people.

Research and Technology

Research in the fluid power industry is aimed at three key issues, according to the NFPA: higher operating pressures, lower noise levels, and less environmental contamination due to leakage. The industry has always been driven towards higher operating pressures, and this demand is not expected to subside. The noise issue is relatively new and has come because of more stringent government noise regulations. The leakage issue applies more to hydraulics than it does to pneumatics, especially hydraulic oil leakage; this is being addressed with increased use of straight thread connectors, a renewed interest in water in hydraulic systems, and more environmentally friendly fluids.

Under continuing pressure from the Environmental Protection Agency (EPA), the fluid power industry is turning towards more environmentally friendly fluids for use in hydraulic systems and products. To be considered environmentally safe, fluids must be readily biodegradable and virtually non-toxic; however, many such products, especially vegetable oils, have a deteriorating effect on commonly used urethane seals through hydrolysis. Parker Seals Packing has, however, developed a high grade urethane (known as P4301A90) that resists hydrolysis. Thus, environmentally friendly oils such as rapeseed oil can be used in some hydraulic applications. Another problem with the use of vegetable oils in these applications was the propensity for rapid oxidation at high temperatures—oils are not fire resistant. To deal with this problem, Houghton International of Valley Forge, Pennsylvania, has begun marketing a Canola Oil based hydraulic fluid called Cosmolubric B-230 that is described as a "… vegetable oil derived fire-resistant hydraulic fluid with additives to enhance corrosion protection, metal passivation, and oxidative inhibition."

Other trends include the use of exotic materials, miniaturized pneumatic valves, and solid-state pressure switches. In 1999 Parker Hannifin, for instance, introduced corrosion free compression tube fittings made from a titanium alloy. The company also produces compression tube fittings made of Hastelloy, a nickel-molybdenum alloy as well as Alloy 400, a nickel-copper alloy.

Kenneth Korane, managing editor of Machine Design , sees a growing demand for miniaturized pneumatic valves. "The world of pneumatics is getting smaller. A growing need for economical systems that are durable, flexible, and fast is feeding demand for downsized components," writes Korane. Smaller valves are easier to install, take up less space, and answer the growing need for valves that can be mounted on moving actuators and end effectors according to Frank Latino, senior product engineer for the Festo Company. Weight is also a growing issue. "More and more, pneumatic valves are used in portable equipment where weight and size become critical," according to Jim Crain, vice president of the Cincinnati based Clippard Instrument Laboratory. "Small valves are put into everything from clinical chemistry instruments to medical equipment itself," concurs Les Greenberg, business unit manager for Vector Engineering.

Solid state pressure switches used in fluid power circuits provide fast and precise operations and a longer cycle life than conventional electromechanical switches, according to Richard Schneider, an editor at Hydraulics & Pneumatics. "In addition, microprocessor circuitry makes possible performance features which extend the basic capabilities of pressure switches and allow solid state models to handle difficult applications." Schneider feels that the integration of solid-state technology into these applications represents significant technological advance for the industry.

Further Reading

Adams, R., J.P. Kromdyk, and T. Noblit. "Canola Oil-Based Fluid is Gentle on Environment." Hydraulics & Pneumatics , April 1999.

Cooper Cameron Corp. Connected @ Cooper Cameron. Houston, TX: Cooper Cameron Corp., 1999. Available from .

D & B Million Dollar Directory: America's Leading Public and Private Companies. Bethlehem, PA: Dun & Bradstreet, 1999.

Hitchcox, A.L. "Fluid Formulations Continue Evolutionary Improvements." Hydraulics & Pneumatics , September 1999.

Hoover's Masterlist of Major U.S. Companies 1998-1999. Austin, TX: Hoover's Business Press, 1998.

ITT Industries, Inc. ITT Industries: Engineered for Life. White Plains, NY: ITT Industries, Inc., 1999. Available from .

Korane, Kenneth J. "Mini Pneumatics Joins the Big Leagues." Machine Design , 9 October 1997.

National Fluid Power Association. NFPA: Solutions Through Motion Technology. Milwaukee, WI: National Fluid Power Association, 1998. Available from .

"Parker Hannifin has Exotic Alloy Fittings." Manufacturing Chemist , April 1999.

Pentair, Inc. Pentair. St. Paul, MN: Pentair, Inc., 1999. Available from .

SPX Corp. SPX Corporation. Owatonna, MN: SPX Corp., 1999. Available from .

Schneider, Richard T. "Solid-State Pressure Switches are Coming On Strong." Hydraulics & Pneumatics , May 1999.

United States Census Bureau. "Statistics for Industries and Industry Groups: 2000." Annual Survey of Manufacturers. February 2002. Available from .

Vickers Inc. Vickers. Maumee, OH: Aeroquip-Vickers, 1999. Available from .

Wangsaard, M.F. "Keeping Environmentally Safe Hydraulic Fluids in Their Place." Hydraulics & Pneumatics , February 1999.

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