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METAL STAMPING INSIGHTS

Latest tips, trends and best practices in the metal stamping industry

Designing the Metal Stamping Strip to Minimize the Use of Precious Metals

Posted by Tim Lynch | 6/15/15 10:00 AM

 

Manufacturers in the automotive, electronics, telecommunications and medical device industries are among the leading users of precious metals such as gold and palladium in critical parts. Gold is both an excellent conductor of electricity and a stable material that does not tarnish. As such, gold is often specified for parts formed on a metal stamping strip, which are intended for use in electrical connections. Precious metals such as platinum and less expensive metals such as copper may be used in metal stampings in two ways: for the stamped part itself or plated to a specific area of the stamped part.

But with the price for troy ounce of gold hovering around $1,200, minimizing the use of gold can make a big impact on the piece part price. Metal stamping engineers can help OEM engineers develop new parts that conserve on precious metals while preserving the functionality of the component.

 

3-D CAD files inform metal stamping strip design.

As a first step in quoting new part production, metal stamping engineers will review the manufacturer’s CAD files to determine how best to produce the part. CAD files are essential to developing the most efficient metal stamping strip layout. If CAD files are not available, the metal stamper may convert the OEM’s prints to CAD. Because metal stamping involves folding and forming, the engineers use the CAD file to “unfold” the finished part and arrange it on a virtual metal stamping strip to determine the most efficient layout to use.

When precious metals are involved, determining how to minimize their use is a valuable exercise. Among the factors that the metal stamping firm will evaluate in designing the metal stamping strip are:

  • The production process at the manufacturer and how the metal stamping will be handled in final assembly
  • Whether the part can be redesigned so that the metal stamping will eliminate steps in the overall assembly
  • Orientation of the part on the metal stamping carrier strip
  • Direction of the grain of the metal part
  • Any under-plating of a less expensive metal and how the precious metal will bond to it
  • The exact surface area that must be plated and whether spot plating can be used
  • The need for secondary operations after plating

Whether using precious metals or less expensive metals, the metal stamping engineers strive to eliminate waste of materials. For example, according to PMA Design Guidelines, “Nesting parts in sheet or strip stock can significantly reduce the amount of scrap generated in blanking operations, and is particularly successful with large L- and C-shaped parts. The amount of material that can be saved by slightly changing the design without changing its function is often worthwhile.”

However, when plating with precious metals such as gold, other design options should be considered. In this case, engineers are more concerned with designing the strip layout to reduce the use of gold, since its cost far outweighs that of the base material.

 

Precious metal prices are down but volatile.

Gold and other precious metal prices have fallen significantly in the years since the recession in the U.S., as have other commodity prices. According to the World Bank in a news release on its Commodity Markets Outlook, “The World Bank’s three industrial commodity price indices – energy, metals and minerals, and agricultural raw materials – experienced near identical declines between early 2011 and the end of 2014, of more than 35 percent each, and will continue to contract this year. Prices of precious metals are also expected to decline by 3 percent in 2015, on top of the 12 percent decline seen in 2014. Again, ample supplies, weak demand, and a strengthening U.S. dollar have weighed on prices of these commodities as well.”

Despite the decline in the price of gold in recent years, the price spiked in May following the release of minutes from the Federal Reserve’s April meeting, which indicated that interest rates would not be rising soon. An article published on May 21, 2015, in The Week stated, “The knock-on effect on gold prices brings to an end a tricky period for the commodity. Since mid-March, gold prices have struggled to break out of a $1,170-$1,230 an ounce range, due to uncertainty over the timing of the expected rise in US interest rates. Higher interest rates tend to hit gold because they increase the opportunity cost of holding non-yielding bullion while boosting the dollar, in which it the commodity is priced. Other metals were boosted yesterday. Silver gained 0.7% to $17.16 an ounce, while platinum was up 0.5% at $1,158.70 an ounce.”

The precious metals most frequently used in metal stamping are noble metals, which resist oxidation and corrosion, including:

  • Gold
  • Palladium
  • Platinum
  • Silver

 

Precious metal estimates reflect accurate weights while prices are updated daily.

Although the commodity price may move up or down over time, the metal stamping firm should be able to provide an accurate estimate of exactly how much precious metal will be required to produce the part, based on their upfront research and development of the optimal metal stamping strip design to reduce waste.

Due to the volatility in precious metal prices, metal stamping firms will provide an initial quote based on current prices, while the actual price will be determined on the day that the metal is used in production. For gold, the price index used is Engelhard Fabricated Gold, as published in The Wall Street Journal.

Of course, any metal stamping design involves trade-offs. In the case of spot plating, the tool design is more complex and therefore more costly, but the ability to reduce gold costs in a range of 30 to 50 percent allows for a quick cost recovery. In other cases, spot plating may not be viable.

Manufacturers who use precious metals in a metal stamped part can benefit by being open to recommendations for changes in the metal stamping strip layout, which may or may not require any changes to the part design itself.

 

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Topics: Pricing, Design for Manufacturability