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© State Corporation “Russian Corporation of Nanotechnologies”, 2010

Executive Summary

of the Technology Roadmap to Nanotechnology Applications

in Development of Highly Efficient Machining Tools

The Roadmap to Nanotechnology Applications in Development of Highly Efficient Machining

Tools (the "Roadmap") is a summary document describing the multi-layer system of

strategic development of the subject matter within a common timescale and showing

parameters that reflect economic efficiency of leading-edge technologies and products

characterized by a high demand potential and attractive consumer properties. The

Roadmap is prepared on the basis of expert opinions as well as reviews of Russian and

foreign statistical and analytic materials.

In the last thirty years, requirements to machining operations have undergone noticeable

changes. The share of hard-to-machine materials in the engineering industry, which is the

major consumer of machining tools, has grown up from 10% to 80%. Machining quality

and performance standards have also toughened. These factors generate the raising need

for advanced machining tools with improved performance properties. In this respect, it is

the nanotechnology-based tools that would help solving most of the technical problems

faced by the industry.

The Roadmap referred to in this Summary describes the structure of demand for machining

tools and identifies the most promising markets where such tools could be applied. The

Roadmap gives an assessment of nanotechnology capabilities required to provide

machining tools with the most wanted consumer properties which would allow such tools to

achieve the leading market position. The Roadmap forecast horizon is up to 2020.

Subject Overview

The Roadmap subject is limited to machining tools designed to machine various metallic and

nonmetallic materials in the manufacturing industry.

Machining tool (MT) is a tool used to change shape, size and surface quality of a

machined part by way of selective removal of material in the process of cutting, grinding,

polishing or finishing as well as deforming in order to manufacture a finished article or

semi-finished workpiece.

Other types of tools used in various industries should be considered within separate

industrial roadmaps since such tools, to the great extent, have limited applications related

to industry-specific technologies, in particular: 1) medical tools (surgery, dentoprosthetic,

etc.); 2) mining and road construction tools (drilling bits, slotting heads, etc.); 3)

agricultural tools (cutting blades, working elements of processing equipment, etc.); 4) food

industry tools (cutting blades, crushers, working elements of mixing and blending

equipment, etc.).

Nanotechnology Applications in Development of Highly Efficient Machining Tools Roadmap


2

Machining tools are usually made of the following four main groups of tool materials: tool

steels, hard alloys, superhard materials, cutting ceramics; each of these groups is

subdivided into several subgroups (see Figure 1). None of these tool materials is the

perfect one, each of them occupies its own niche in accordance with hardness, toughness,

breaking strength, wear resistance, etc.

MACHINING MATERIALS

Tool Steels Hard Alloys

Wolfra

m-C

obalt

Titan

-Wolfra

m

Titan-T

anta

lum

-Wolfra

m

Cerm

ets

(W

olfra

m-F

ree)

Ultra

Sm

all

Gra

in

Hig

h S

peed S

teels

Alloy S

teels

Super Hard

Materials

Dia

mond B

ased

Cubic

Boro

n N

itrite

(C

NB

)

Based

Cutting Ceramics

Oxid

e W

hite

Nitri

de

Nitri

de w

ith C

oating

Sia

lon

Whis

keri

zed

Oxid

e w

ith C

oating

Mix

ed O

xid

e-C

arb

ide

MACHINING MATERIALS

Tool Steels Hard Alloys

Wolfra

m-C

obalt

Titan

-Wolfra

m

Titan-T

anta

lum

-Wolfra

m

Cerm

ets

(W

olfra

m-F

ree)

Ultra

Sm

all

Gra

in

Hig

h S

peed S

teels

Alloy S

teels

Super Hard

Materials

Dia

mond B

ased

Cubic

Boro

n N

itrite

(C

NB

)

Based

Cutting Ceramics

Oxid

e W

hite

Nitri

de

Nitri

de w

ith C

oating

Sia

lon

Whis

keri

zed

Oxid

e w

ith C

oating

Mix

ed O

xid

e-C

arb

ide

High-speedsteels

CoatedHigh-speed steels

Hardalloys

Diamond coatedHard alloys

Ultra fine grainedHard alloys

Ultra fine grainedCoated hard alloys

Cermet

CoatedCermet

CoatedHard alloys

Oxideceramics

Nitrideceramics

Mixedceramics

PCD

CBNPer

fect

Cuttin

g m

ater

ial

Toughness, Bending Strength

Hard

ness, W

ear R

esis

tan

ce

Source: Expert data

Figure1: Tool Materials Groups and Properties

In view of the technologies and products analyzed, the Roadmap specifies eight types of

materials used to fabricate machining tools and designates to what extent they are

currently applied and prospectively applicable in Russia and the world (arrows show the

trends to growth or shrinkage of respective market shares):

Descriptions and competition advantages of the main material types are shown in Table 1

below.

1. High-speed steels

2. Die steels

3. Hard alloys

4. Cutting ceramic materials

5. Polycrystalline diamonds (PCD)

6. Cubic boron nitride (CBN)

7. Abrasive materials

8. Electrode materials

Russia: 18% ↓

Russia: 2%

Russia: 50% ↑

Russia: 1%↑

Russia: 6%

Russia: 6%↑

Russia: 17% ↓

-

World: 11% ↓

World: 2%

World: 56% ↑

World: 9%

World: 6%

World: 6%↑

World: 10%↓

-



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Table 1: Tool Materials Description and Properties

Material Description

1. High-Speed Steels

High-alloy hard carbidic steels with carbon content over 0.6%.

Quality of high-speed steels can be improved through the use of powder metal technologies. Characteristic properties of high-speed steels produced with application of powder metal technologies is high bending strength and 1.5-2.5 times higher firmness compared to regular grades.

2. Die Steels

Die steels are subdivided into two groups: 1) cold-working die steels; 2) hot-working die

steels. Steels of group 1 should have high hardness and wear resistance, high strength properties and adequate impact elasticity. Steels of group 2 should be capable to resist high temperatures. To increase steels' hardness at high temperatures, surface impregnation techniques are applied: nitriding, chromizing, boronizing, impregnation with titanium carbide which is characterized by very high hardness properties.

3. Hard Alloys

Hard allows are the most commonly used type of tool materials ensuring high-performance

machining. Market share of hard alloy tools is over 50%, and up to 85% of all cutting operations are performed with hard alloy tools since their cutting speed is 2-5 times higher than that of high-speed steels.

Hard alloy tools are manufactured by powder metallurgy techniques in the form of plates and rods made of carbides of wolfram (WC), titanium (TiC), tantalum (TaC) and Niobium (NbC) whose micro particles are bound together with cobalt or nickel mixed with molybdenum. There is also a special group of hard alloys prepared without the use of wolfram carbide (metal ceramics, or cermets). Hard alloy tools with hardsurfacing, wear resistant, friction reducing and other types of coatings, including nanostructured, are widely applied as well.

4. Cutting Ceramic Materials

Cutting ceramic materials can be divided into four groups:

1) Al2O3-based oxide (white) ceramics, 2) Al2O3-TiC-based oxycarbide (black) ceramics, 3) Al2O3-TiN-based oxynitride (cortinite) ceramics, and 4) Si3N4-based nitride ceramics.

Cutting ceramic tools are characterized by high plastic strength and cutting speed much (up to 2 times) higher than that of hard alloy tools. Due to reduced grain size and porosity, cutting ceramic tools have very high wear resistance, breaking strength and hardness.

5. Polycrystalline Diamonds (PCD)

PCD is a modification of crystalline carbon. Synthetic diamonds are produced from graphite

under high pressures and temperatures. The use of PCD cutting plates allows increasing tool durability by 15-20 times compared to hard alloy tools. The downside of PCD tools is that they can not be used to cut carbon-containing materials.

To make diamond-based abrasive tools more productive, manufacturers coat diamond grains with a thin layer of metals with good adhesion and capillary properties with respect to diamond: copper, nickel, silver, titanium, and their alloys.

6. Cubic Boron Nitride (CBN)

CBN plates are fabricated by compaction of CBN nanopowder. CBN is a little bit softer than

diamond but has high heat resistance (up to 1570°K), resistance to recurrent exposure to high temperatures, and weak chemical interaction with iron. CBN's cutting speed may exceed that of hard alloy tools by more than five times.

The use of CBN tools allows increasing machining performance by 1.5-3 times compared to hard alloy tools reaching higher machined surface quality which makes unnecessary further finish grinding. The downside of CBN tools is their high cost.

7. Abrasive Materials

Abrasive material grains with sharp edges serve as cutting elements of grinding tools. Abrasive materials are divided into natural and artificial. Natural abrasive materials include such minerals as quartz, emery, corundum, etc. In industrial applications, the most widespread types of such material are artificial abrasives: electrocorundum, silicone and boron carbides. Another type of artificial abrasives is polishing and finishing powders (chromium and iron oxides).

A special group of artificial abrasive materials is formed by synthetic diamonds and cubic boron nitride which are referred to as the most promising ones as having the highest hardness (diamond) and thermal resistance (CBN).



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Material Description

8. Advanced Machining Tools

Electrodes for electric erosion and electrochemical machining should be hard enough and

capable to sustain various mechanical impacts and thermal effects. To machine carbon and heat resistant alloys graphite and copper electrodes are used. Rough machining is performed with the use of aluminum alloy and cast iron electrodes, holes are machined with brass electrodes. In machining of hard alloys and refractory materials composite electrodes are widely applied.

Nozzles and injectors for abrasive water jet cutting are made of sapphire, ruby or diamond (service life of sapphire and ruby nozzles is up to 100-200 hours, diamond nozzles serve for 1000-2000 hours). Mixing tubes are fabricated of superalloys (service life up to 150-200 hours). For plasma cutting, copper nozzles (sometimes with wolfram liners) are used. Electrodes for plasma cutting are made of copper, hafnium, wolfram (activated with yttrium, lanthanum or thorium) and other materials.

In laser cutting, solid and gas lasers are normally applied but they are gradually giving way to more advanced diode and fiber lasers. Cutting of regular metals generally requires laser capacity of 450-500 W and above while to cut alloys laser capacity needs to be 1 kW and above.

Source: Analytical and expert data

Machining tool products can be conventionally divided into four global product groups

(cutting tools, grinding tool, deforming tool, advanced machining tools) incorporated by the

principle of similarity of operational, designing and process properties and approaches.

Basing on expert predictions, shares of such groups on the Russian market and their

potential in terms of nanotechnology applications in the future (up to 2020) were defined.

In addition, virtually in every group respective subgroups were delineated in accordance

with types of materials and tools used in machining processes (see Table 2 below).

Table 2: Machining Tools Market Segments

1. Cutting tools

(turning chisels, screw drills, milling cutters, reamer bits, broaching bits,

multiflute drills, etc.)

- Solid high-speed cutting tools

- Solid hard alloy tools

- Compound hard alloy tools

- Assembled hard alloy tools

- Assembled superhard material (SHM) and ceramic tools

- Compound SHM tools

Segment's share on Russian

market: 2010 2020

63% → 66% Share of nano

in the segment: 2010 2020

6% → 46%

2. Grinding tools

(grinding wheels, belts, pastes, suspensions, cutting wire)

- Abrasive materials grinding tools

- Superhard materials (SHM) grinding tools

- SHM pastes, powders and suspensions


market: 2010 2020

30% → 27% Share of nano


3% → 20%

3. Deforming tools

(dies, mandrel bars, draw rings, rollers, draw plates)

- Tool steel dies, press molds, rollers and draw plates

- Hard alloy dies, press molds, rollers and draw plates

- SHM rollers and draw plates


market: 2010 2020

7% Share of nano


3% → 12%



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4. Advanced machining tools

- Electrodes and wire

for electric erosion and electrochemical machining

- Nozzles and injectors

for abrasive water jet cutting and gas flame treatment

- High capacity lasers


market: 2010 2020

<1%

To achieve high performance characteristics of machining tools, certain nanotechnologies

can be applied in the tool fabrication process. The main directions of nanotechnology

applications in each of the above described product groups and the forecast of their

respective market shares by 2020 are shown in Table 3 below.

Table 3: The Most Promising Nanotechnologies Applied in Fabrication of

Machining Tools

Tool Type Nanotechnology Applications

(Predicted Shares of Nanotechnology-Based Tools by 2020, %)

Solid high-speed cutting tools

– Nanostructured coatings (50%)

– Nanomodification of surface layer (25%)

– Compaction of nanodispersed powders and fabrication of tools from 3D nanostructured materials (25%)

Solid hard alloy tools



– Detonation, plasmochemical and other SHM synthesis technologies with nanobinders (15%)


Compound and

assembled hard alloy tools


– Compaction of nanodispersed powders and fabrication of tools from 3D

nanostructured materials (35%)



Tool steel dies, press

molds, rollers and draw plates



Hard alloy dies, press

molds, rollers and draw plates




Abrasive materials grinding tools

– Fabrication of abrasive tools from diamond and SHM nanopowders with synthetic binders (70%)

– Electrochemical technologies for production of special abrasive nanopowders (30%)

Grinding and cutoff SHM tools


– Fabrication of abrasive tools from diamond and SHM nano powders with synthetic binders (70%)

SHM pastes, powders and suspensions

– Abrasive nanopowders production technologies (plasmochemical synthesis, detonation spraying, etc.)

Source: Expert data



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Machining tools' target characteristics (see Figure 2 below) were defined basing on

specifications of the most widespread tool fabrication technologies, namely compaction of

nano-dispersed powders (mainly, hard alloys) and application of nanostructured coatings

(mainly, multilayer). According to expert findings, Russia is currently following the

mainstream world technology trends, however lagging behind in terms of achieving specific

performance characteristics. The world technology level in both hard alloy and coating

applications is expected to be reached by Russia by not earlier than 2020-2025.

Hardness of Wolfram Containing Hard Alloys, GPa

World Russia

Hardness of Wolfram Containing Hard Alloys, GPa

World Russia

Microhardness of Multilayer Nano Coatings, GPa

World Russia

Microhardness of Multilayer Nano Coatings, GPa

World Russia

Source: Expert data

Figure 2: Machining Tools Target Characteristics

The products from the "Advanced Machining Methods" section have several important

distinctions from traditional tools. First, such advanced tools are non-contact, i.e., there is

no mechanical contact between the tool and the machined part. Second, such advanced

tools allow, in certain cases, reaching nano accuracy of machining operations even if no

nanotechnology was used to fabricate such tools. For instance, modern electrochemical

machining centers are able to apply coatings with thicknesses in the nanometer measuring

range and electrochemical copying resolution up to 100 nanometers. Table 4 below shows

the main advantages and disadvantages which the new machining methods' areas of

application depend on.

Table 4: New Machining Methods and Their Properties

New Machining Methods

1. Laser machining

+ No mechanical contact with machined parts

+ High accuracy of laser cutting

- Thermal impact on material in the cutting zone

- Impossible to cut light reflecting and transmitting materials and materials thicker than 20 mm

2. Abrasive water jet cutting

+ No thermal impact on machined materials

+ Wide range of cuttable materials and thicknesses (up to 150-200 mm)

+ High cutting accuracy with tolerances up to 0.1 mm

- Limited service life of cutting head parts

3. Plasma machining

+ Cuttable thickness up to 100 mm at a high cutting speed

+ Low thermal impact on the cutting zone preventing heat-induced distortion

- Only electrically conductive materials can be cut

- Low cutting accuracy requiring further machining



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New Machining Methods

4. Electric erosion machining

+ Very narrow cut with high surface quality

+ Can be used virtually for all metals and alloys

- Very low performance (cutting speed does not exceed 1 mm/min)

- High power consumption

5. Electrochemical machining

+ Can be used regardless of hardness and strength of machined materials

+ No mechanical or thermal impact on machined pats

+ Higher cut surface quality at higher performance compared to that of electric erosion machining

- High power consumption

- Very complicated procedures to arrange machining process Source: Analytical and expert data

In addition to machining tools fabricated by nanotechnology methods, the Roadmap considers

some alternative technologies capable to substantially reduce the need for machining tools in

certain industries and areas of application. In particular, resource saving technologies allow

abandoning machining (cutting, milling, etc.) operations altogether as in this case items are

fabricated to be of right shape and size from the very beginning. Global trends indicate that

such methods, in particular precision casting, directional crystallization, etc., have great

potential in the future. However, they are not expected to replace conventional machining

technologies in wider range of applications within the Roadmap forecast horizon. Table 5 below

specifies the main types and groups of alternative methods giving description of their pros and

cons.

Table 5: Alternative Technologies Reducing the Need for Machining, Their Pros

and Cons

Alternative Technologies Pros and Cons

1. Resource Saving Technologies

1.1 Precision casting and die forming

of metallic and nonmetallic materials

+Used to fabricated workpieces of needed shape which cuts

down materials consumption and machining costs

- Technology not mature enough to fabricate ready items

1.2 New methods of permanent

jointing (welding, brazing, gluing)

+Used to joint workpieces' parts after they are machined

separately which cuts down materials consumption and machining costs

- Currently existing types of joints are not strong enough

1.3 Additive methods (layer-by-layer synthesis)

1.3.1 Stereolithography

1.3.2 Selective Laser Sintering

1.3.3 Multi Jet Modeling

1.3.4 Plastic Sheet Lamination

1.3.5 Fused Deposition Modeling, etc.

+Fast synthesis of models during fabrication process (foundry

molds, patterns, etc.)

+Low-cost small-series production (medical materials,

engineering analysis, etc.)

- Relatively low accuracy (0.025-0.3 mm)

1.4. Extrusion

+Used to fabricated items by forcing melted materials through

the extrusion hole which results in lower material consumption

- Can be applied not to all types of materials (only polymer and

ferritic)



8

Alternative Technologies Pros and Cons

2. New Structural Materials and Technologies

2.1 Fabrication of items from composite materials

2.1.1 Coiling

2.1.2 Autoclave molding

2.1.3 Pultrusion

2.1.4 Injection

2.1.5 Infusion, etc.

+Improvement of items' performance characteristics due to

directional laying of filling compound and its high content in the material

+Control of materials' structure and properties by adding various

modifiers

- Can be applied not to all types of items

- Often require complicated extra machining

2.2 Directional crystallization

+One of the most advanced casting technologies ensuring high

performance characteristics of cast items

- Requires pilot castings to select right process parameters


Engineering Problems and Solutions

To radically increase performance and improve quality of machining tools a set of measures

aimed at solving the key engineering problems needs to be implemented. The major efforts

should be focused on the following groups of problems: 1) fabrication of new

nanostructured tool materials; 2) application of nanocoatings on tools' surface and surface

modification; 3) nanometric machining and new tool design options. The key engineering

problems and their respective solutions are grouped in Table 6 below. The right column

describes anticipated benefits of such solutions.

Table 6: Machining Tools Engineering Problems and Solutions

Engineering Problems and Solutions Benefits

Fabrication of nanomaterials

1. Development of powdered high-speed steels with nanosized grains • Higher strength, hardness, heat and

wear resistance of nanostructured tool materials

• Higher machining speed and performance

• Higher machining quality, lower consumption of machined material

2. Development of hard alloys with nanosized grains

3. Sintering of nanostructured hard alloys

4. Development of diamond-based nanostructured materials

5. Development of CBN-based nanostructured materials

6. Development of nanosized abrasive powders

7. Production of nanodispersed binders for grinding tools

Application of nanocoatings

8. Application of nanostructured wear-resistant coatings on machining tools

• Higher durability of machining tools and lower cost of machining operations

• Higher machining accuracy and surface quality of machined items

• Minimal use of toxic cutting fluids

9. Application of special coatings on diamond powder

10. Application of decorative-protective coatings on tools' bodies

11. Production of cathodes and target electrodes for



9

Engineering Problems and Solutions Benefits

application of nanostructured coatings

12. Nanomodification of the surface layer

Nanometric machining and fabrication of respective tools

13. Nanometric adjustment of high precision tools' cutting edges • Higher accuracy of cutting and

shaping tools with high quality of cutting edge and joint surfaces

• Higher accuracy of size and shape of

machined items, higher quality of machined surfaces in supercomplex parts for high precise instruments

14. Nanometric machining of cutting edges and jointing elements of machining tools

15. Permanent jointing of nanostructured surfaces of tools' bodies and cutting parts

16. Production of multirod electrodes of nanometric diameter

17. Improvement of laser machining performance and accuracy


World Market of Machining Tools

According to the market research findings, the world market of machining tools is expected

to develop in one of the following three scenarios (see Figure 3 below):

US

D b

illio

n

As usual scenario Positive scenario Active scenario

US

D b

illio

n

As usual scenario Positive scenario Active scenario

Source: Analytic studies, business plans of RUSNANO projects, expert data

Figure 3: World Market of Machining Tools, USD billion

Active scenario assumes that:

The market growth rate will accelerate from the pre-crisis 6-8% p.a. to 12-14% in

2011-2015 taking into account the post-crisis revival period;

By 2015, the market will grow by 80-90% compared to 2010;

After 2015, the market growth rate will stabilize at 8-10% p.a.

Drivers: 1) fast growth in demand for machining tools (due to proportional growth in

demand for machining industry products); 2) advancement and improvement of



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machining technologies; 3) reduction of prices for and wider applications of tools

fabricated with the use of nanotechnologies.

Positive scenario assumes that:

The market growth rate will remain at the pre-crisis 6-8% p.a.;

The market will revive by 2013 (regain the 2008 level), and by 2015 will grow by

45% relative to 2010 or by 15% relative to 2008;

After 2015, the market growth rate will stabilize at 8-10% p.a.

Drivers: gradual growth in demand for machining tools (due to revival of demand for

machining industry products).

Business as usual scenario assumes that:

The market growth rate will slow down from the pre-crisis 6-8% p.a. to 4-6% p.a.;

The pre-crisis (2008) market level will be regained by 2015 corresponding to 30%

growth relative to the 2010 market level;

After 2015, the market growth rate will stabilize at less than 6% p.a.

Drivers: 1) slow growth in demand for machining tools (because of slow revival of

demand for machining industry products); 2) lack of R&D investments; slow

advancement and improvement of machining tool production technologies.

Russian Market of Machining Tools

The research of the Russian machining tools market revealed the following three possible

development scenarios (see Figure 4 below):

Source: Analytic studies, business plans of RUSNANO projects, expert data

Figure 4: Russian Market of Machining Tools, USD million



11

Active scenario assumes that:

Russia will develop domestic fabrication of modern machining tools, including those

produced with the use of nanotechnologies, to reduce the share of imported tools;

The tool consuming industries will thrive;

New large-scale infrastructural projects will be implemented with the government's

support;

The industrial production pattern will follow the world trends;

Export of domestic tools will gain momentum replacing imports;

By 2015, the tool market will grow by 30-50% relative to the current level and will

keep its growth rate at 3-7% p.a. thereafter.

Positive scenario assumes that:

The machining industries will gradually overcome the crisis;

Industries that have accumulated the highest production expertise will replace

imports with own products;

The market growth rate will not exceed 5% p.a.

Business as usual scenario assumes that:

There is virtually no own production capacity, dependence on imports is close to

100%;

The market will be stagnating at zero or close to zero growth rates;

The country will not implement any large-scale projects that could stimulate demand

for high-technology tools.

Machining Tools Market Segments

The research has identified the following ten major areas where high-performance

machining tools can be applied:

1. Defense industry

2. Automobile industry

3. Aerospace industry

4. Heavy and power engineering industries

5. Railway engineering and shipbuilding

industries

6. Tractor and agricultural engineering

industry

7. Petroleum industry

8. Electrical engineering and electronic

industry

9. Wood processing industry

10. Other industries (repair shops, car

service centers, households, etc.)



12

The table below shows color indication of the market segments' perspectives in terms of the

current level and potential of growth in demand for high-performance machining tools

fabricated with the use of nanotechnologies: - high, - medium, - low.

Table 7: Machining Tools Consumption Segments

1. Defense Industry

Drivers Bottlenecks

Balanced portfolio of production orders from abroad

Growing share of public contracts

Extra financing on the industry (~ RUB 10 trillion) by 2020

Lagging behind in some areas and research trends

Lack of openness in the industry, poor

cooperation with foreign developers

High degree of the industry's dependence on the government

Trends The Russian Military is in urgent need for new types of weapons and military equipment which calls

for a new industrialization of the defense complex resulting in the introduction of new machining centers, application of new machining technologies and radically new tools including those fabricated with the use of nanotechnologies.

2. Automobile Industry

Drivers Bottlenecks Conditions urging foreign manufacturers to

deploy their production facilities in Russia which contributes to growing mandatory localization

Demand stimulation through preferential loans, vehicle recycling and other promotional

governmental programs

Implementation of the industry development strategy up to 2020

High share of imported finished parts in locally manufactured vehicles

Low quality of Russian (domestically designed and manufactured) vehicles and parts

Lack of modern machining centers using high performance machining tools

Trends Application of new approaches to arrangement and deployment of modern production facilities

(including satellite plants) and mandatory localization of foreign manufacturers can boost the demand for high-tech machining systems.

3. Aerospace Industry

Drivers Bottlenecks Governmental support of the industry in

accordance with the national strategy and the Federal Target-Oriented Program up to 2015

Industry modernization and establishment of world-class production facilities

Fabrication of new advanced aircraft models (SSJ, MC-21, etc.)

Relatively low demand for currently produced

domestic civil aircraft models

Opportunities to apply resource saving technologies (including those based on composite materials) which do not require any

machining operations

Trends Widening range of hard-to-machine materials used in the industry drives up the demand for

radically new tools including those fabricated by nanotechnology methods.

4. Heavy and Power Engineering Industries



13

Drivers Bottlenecks Long-term procurement programs to be

implemented by the largest heavy and power engineering companies

Construction of new power generating units by

Rosatom in accordance with the Federal Target Oriented Program up to 2015

Risk that consumers may revise their

investment programs

Significant dependence of the industry on governmental support

Trends The main requirement of the industry to procured machining tools is their high strength and

durability. Therefore, despite the fact this market segment follows the "as usual" scenario and applies technologies which remain unchanged for long times experts foresee gradual introduction of both new machining technologies and tools in this industry.

5. Railway Engineering and Shipbuilding Industries

Drivers Bottlenecks Expansion and renovation of the rolling

equipment and railroad network in accordance with the development strategy up to 2030

Modernization of shipbuilding plants in accordance with the development strategy up

to 2020 and award of the governmental contract to the Unified Shipbuilding Company (OSK)

Risk of smaller number of contracts essential for the plants' operations

Increase in share of imported products and parts

Trends Companies involved in maintenance of the rolling equipment are the primary consumers of

machining tools for hard-to-machine parts (wheel sets). To increase machining operations performance, they need to procure new tools including those manufactured by nanotechnology methods. As the Russian economy grows, the volume of cargo traffic by railroads and by water (river and sea) will be increasing. Construction of new modern ships and submarines for the Russian Navy may also drive up demand for high quality machining tools.

6. Tractor and Agricultural Engineering Industry

Drivers Bottlenecks

Traditional competitive advantages (low prices,

ease of maintenance) of domestically manufactured agricultural equipment

Governmental program for development of the

agricultural sector for 2008-2012

Lagging behind in many areas and research

trends

Unstable market environment due to financial difficulties of agricultural companies

High share of imported products on the agricultural equipment market, intense competition from manufacturers in the CIS

countries

Weaker governmental support of the industry starting from 2014 because of the need to comply with the WTO requirements

Trends The industry's production pattern is characterized by traditionally slow-changing technologies and

low prices for manufactured equipment. In such circumstances the application of modern machining tools and systems is only possible if the industry is radically renewed and new production of new types of equipment is launched.

7. Petroleum Industry

Drivers Bottlenecks



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Highly lucrative industry where large investments can be allocated by the top market players

Slow-going modernization of process equipment

Strong dependence on the petroleum market behavior

High share of imports in some segments (e.g., pipe making industry)

Trends Large-scale renovation of plants manufacturing petroleum industry process equipment can drive up

demand for knowledge intensive machining tools.

8. Electrical Engineering and Electronic Industry

Drivers Bottlenecks

Fast growing demand for the industry's products

Development of production facilities in Russia

including with the participation of the leading world manufacturers

Wide technology gap between domestic and foreign companies

Low level of domestic R&D activities in the area

of special purpose tools for electronic industry

Lack of domestic production of many electronic articles and parts

Trends The electrical engineering and electronic industry is characterized by the use of small-size tools

(e.g., microchip fabrication tools) whose main property is the sharpness of cutting edges. Besides, the share of machining operations in the industry is small and demand for machining tools may grow only if the Russia electronic industry becomes able to meet competition from foreign and gradually drive them out of the domestic market.

9. Wood Processing Industry

Drivers Bottlenecks

Development of wooden house construction under various target-oriented programs

High potential of the industry in Russia due to the country's environmental conditions

Poor state of those segments in the Russian wood processing industry which are responsible

for finished products

Low degree of wood processing in Russian plants

Trends The industry suffers from the low degree of wood processing. For this reason, consumption of high-

tech machining tools by the industry can be radically increased only through introduction on new full-cycle wood processing facilities.

10. Others

This segment includes construction industry, small-scale maintenance and engineering companies (car service centers, repair shops, etc.) and private households.

Drivers Bottlenecks

Flexibility of small companies, their fast

adaptation to the market requirements

Small consumers can not afford buying high-

tech machining tools because of their high

prices Only a small portion of construction materials

require application of high-tech machining tools

Trends The turnover of high quality machining tools in this industry is quite small and can increase only

after costs for such tools are radically reduced. Source: Analytical and expert data

According to experts, Russia is in urgent need for a deep industrial modernization which

implies not just a simple replacement of old equipment with new one but the transition to

radically new technologies allowing the industries to improve both quality and performance



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of machining operations. In this context, it should be kept in mind that all new high quality

tools (including those fabricated by nanotechnology methods) will be, without exceptions,

noticeably more expensive than the old ones and, accordingly, will be helpful and

economically efficient only if used in respective machining equipment.

Governmental Support to the Tool Consuming Industries

Changes in consumption of machining equipment and tools in Russia are driven by

developments in such sectors as defense industry, automobile industry, aerospace industry

and other industries relying to a great extent on the Government's support. For this reason,

we should briefly describe some of the most important support programs intended by the

Government for such industries:

- Higher demand for machining tools in the defense industry is expected in connection with

the ten-year program "Fundamentals of the Russian National Policy in Development of the

Defense Industry up to 2020 and for Later Years" which provides for allocation of about

10 trillion rubles of investments.

- Demand for machining tools in the aircraft industry is driven by the growth in production

of rolled titan and aluminum which are hard to machine. In addition, the industry has

adopted two comprehensive program documents: "Russian Aircraft Industry Development

Strategy up to 2015" and "Development of Civil Aviation in Russia for the Period of 2002-

2010 and up to 2015". These two programs anticipate that Russia will return to the global

aircraft market and by 2015 take up not less than 5% of the world civil aircraft market.

- Government financing is the key development factor for the rocket and space industry. As

of now, modernization of this industry is among the top national priorities; the new

Vostochny spaceport construction project (2010-2015) is launched in Amur Region which

will become a major consumer of modern equipment and machinery in the future.

- Development of the power engineering industry in Russia is taking place within the

framework of the large scale reformation of Russia's power generation and supply system

entailing the growth in demand for high quality machining equipment and tools. Most of the

industry's large players have prepared and are implementing long-term investment

programs supported, among others, by the Government. Besides, Russia has adopted the

"Development of National Power Generating Industry for 2007-2010 and up to 2015" federal

target-oriented program.

- The Automobile industry today is the largest consumer of machining tools in Russia. Its

development is effected under the "National Automobile Industry Development Strategy for

up to 2020". Demand for cars in Russia grows steadily being driven by government-

supported preferential loans and car recycling programs. Deployment of new car assembly

lines in Russia and expansion of their production output will require proportional increase in

supplies of advanced machining tools.

- The shipbuilding industry is one of the main consumers of high quality alloys whose

machining requires application of modern tools and equipment. The industry has adopted

the "National Shipbuilding Industry Development Strategy up to 2020 and for Later Years".

Besides, the Government plans to boost procurement of ships and submarines for the

Russian Navy. The Russian shipbuilding industry development program provides for

modernization of obsolete equipment of shipbuilding plants which will entail proportional

growth in demand for high quality machining tools.



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- The railway engineering industry is also among the key consumers of machining tools. The

"National Railway Transport Development Strategy up to 2030" has placed on the agenda

the issue of renovation and expansion of the railway equipment park and construction of

new railroads. All these efforts are planned to be taken mostly with the use of domestic

products.

Roadmap Visualization Description

The Roadmap visualization includes seven major layers (see Figure 5):

Main types of materials used to fabricate machining tools

Main engineering problems related to production of high performance machining

tools

The most promising types of machining tools fabricated by nanotechnology methods

Areas of application and market perspectives of machining tools innovations.

Forecast of volume and growth rates of the key market segments

Alternative technologies reducing the need for machining operations, their pros and

cons

Forecast of the most wanted consumer properties of machining tools fabricated by

nanotechnology methods

Main risks and limitations for the machining tools fabrication industry

The Roadmap visualization illustrates the correlations between the tool materials, the major

fabrication trends which the machining tools development depends on, and the most

promising products and their respective market shares. The Roadmap also shows the

forecast of machining tools consumption by the largest industries.

Figure 5: Roadmap Structure

Documents

of the Technology Roadmap to Nanotechnology Applications ...en.rusnano.com/upload/OldNews/Files/33824/current.pdf · of the Technology Roadmap to Nanotechnology Applications in Development