Heidelberg’s Path Forward
IPG visited Heidelberg's facilities in Germany last month.
After almost 13 years at the helm, outgoing CEO Bernhard Schreier expressed confidence in new CEO Dr. Gerold Linzbach, whose leadership experience comes from outside the graphic arts industry.
North American journalists in the Wiesloch-Walldorf manufacturing facility.
At Heidelberg’s press manufacturing facility, rows of press units sit in various stages of assembly.
Journalists were treated to a number of demonstrations at Heidelberg’s PMC at its plant in Wiesloch-Walldorf.
In December 2012, In-plant Graphics had an opportunity to visit Heidelberger Druckmaschinen AG’s headquarters in Heidelberg, Germany, to talk with executives and tour the company’s massive press manufacturing facility in Wiesloch-Walldorf. (Watch video below.)
Overall, the press manufacturing giant seemed optimistic about its future, despite the rise of digital printing and competition to print from e-readers and mobile devices. Executives pointed to strong press sales in emerging markets, like Asia and Africa, where Heidelberg has invested heavily in the past decade. They also noted growth trends in packaging printing, as well as the expansion of the company’s services and consumables areas—which now make up 60 percent of Heidelberg’s business in the U.S., vs. just 40 percent from equipment sales.
For the U.S. market, which saw a plunge in press sales starting in 2008, Heidelberg’s message was essentially this: “Modernize or get left behind.” Press technology has advanced so much in the past five years, noted Heidelberg board member Stephan Plenz, that only printers with the latest technology can hope to compete in the global market. This message seemed to address the fact that U.S. printers maintain some of the oldest offset presses in the world, according to Plenz.
“When I walk through shops in the U.S., the age of equipment is incredible,” he said. “The competitiveness to other countries is suffering. You’re not able to compete with a modernized print shop—not with old equipment.”
These older presses, well built though they are, are not as efficient as newer Heidelberg presses that employ Anicolor and Prinect technologies, Plenz maintained, resulting in less productive, more costly printing. He showed figures indicating a 20 percent drop in print production volume in the U.S. since 2006.
On the other hand, emerging countries, like China and Brazil, are showing substantial growth in print production volume—6 percent per year, noted board member Marcel Kiessling, head of global sales. Heidelberg expects this segment to account for 40 percent of global sheetfed volume by 2015, with a corresponding growth in press sales. The company is expanding its market coverage and service force in these countries.
The Advantages of Anicolor Inking
During the three days that IPG and other North American trade magazines spent with Heidelberg, Plenz and other executives repeatedly pointed out the productivity and cost advantages of using Anicolor inking technology for producing shorter runs. These benefits include 90 percent fewer waste sheets, 50 percent less makeready time and consistent, even ink application, without ghosting. Users of Anicolor presses are selling the 10th sheet, Plenz contended.
Still, in the U.S., particularly in the in-plant market, digital presses have been supplanting offset presses for some time now. Even Heidelberg now offers digital presses in the form of its Linoprint C and Linoprint L printers (Ricoh and CSAT products). Plenz, however, seemed surprisingly dismissive of the gains made by digital printing.
“The U.S. is definitely the market with the biggest portion of digital presses, but there are so many printers out there losing money with digital devices,” he contended, adding that many printers acquired digital devices because they thought they had to, but have not been making money with them. He said there has been much less personalized printing than expected and that transpromotional printing is not growing, despite the early hype. Plenz felt that personalized printing will not grow in the future, but rather personalization will happen via the messages delivered to our mobile devices instead.
In discussing Heidelberg’s partnership with Landa Corp. to develop and manufacture digital printing presses based on Landa Nanographic Printing technology, announced during Drupa, Heidelberg’s Andreas Forer seemed cautiously optimistic.
“If everything works as he [founder Benny Landa] has promised, then definitely we have a bright future,” he said, alluding to some roadblocks that have already been encountered.
Heidelberg’s marketing plans for its Linoprint C751 and C901 digital color printers seem predominantly focused on its base of existing offset customers, rather than on printers that are exclusively digital. Linoprint models are being offered as a way for an offset printer to handle very small run lengths, while enjoying Prinect integration and Heidelberg color management. So far the company has sold 170 Linoprint products, with the C751 comprising 70 percent of that business. Forer noted that customers are replacing their Kodak NexPress and HP Indigo digital presses—which they thought they would need for their production capabilities—with Linoprints, which he said are more appropriate for the type of digital work they are actually getting.
Using Prinect software to integrate Linoprint digital printers with prepress, offset and postpress equipment and manage the entire workflow was a recurring theme in our meetings with executives. Demonstrations in Heidelberg’s Print Media Center (PMC) showed how Heidelberg’s Web-to-Print Manager integrates with the Prinect Business Manager MIS to enable a seamless hybrid workflow for digital and offset printing.
During our visit, we toured both of Heidelberg’s PMC locations, which function primarily as demo centers for potential customers, and house almost every piece of equipment sold by the company. Just opened in October, the PMC in Heidelberg (54,900 square feet) highlights Heidelberg’s commercial print offerings, as well as CTP and postpress equipment. The PMC in Wiesloch-Walldorf (58,100 square feet) focuses more on Heidelberg’s packaging and very large-format presses. In the future, Kiessling noted, Heidelberg will use these PMC locations, as well as the ones in Atlanta, Sao Paolo and Shenzhen, as its primary customer contact platforms, rather than focusing on trade shows for this purpose (though it will still attend shows in emerging markets).
While in Germany, we were also given a tour of Heidelberg’s press manufacturing facilities. Rows of press units in various stages of assembly stretched across the vast building, with workers speeding past on bicycles or hauling press units on yellow lift trucks. Automated transport vehicles moved units to different assembly lines where new parts were added. Elsewhere, cast iron wheels of various sizes from Heidelberg’s foundry in Amstetten, Germany, were being cut and ground into gears for presses. Since the factory opened in 1957, it has produced 400,000 presses. All of the many presses we saw being assembled during our visit have already been ordered. Officials explained the rigorous testing each press goes through to ensure zero defects.
Our visit was capped off with tours of two German commercial printers: Drucken 123, in Aschaffenburg, and h.reuffurth, in Mühlheim am Main. Markus Muller, who runs family-owned Drucken 123 told an interesting story of how he expanded his shop from Rotaprint duplicating machines, to a two-color Heidelberg Speedmaster 52, and eventually to a five-color Speedmaster with Anicolor inking. He has had great success printing short runs of high-quality color work, and recently added a Linoprint 751 for very short runs.
During dinner one night, we met briefly with new CEO Dr. Gerold Linzbach. As he was relatively new and still learning the company, he did not offer details on any of the changes he is expected to make, other than to stress that returning Heidelberg to profitability and restoring the company’s momentum are clear priorities.
His predecessor, outgoing CEO Bernhard Schreier paid us a surprise visit during lunch one day at the Wiesloch-Walldorf facility. Relaxed and in good spirits after running Heidelberg for almost 13 years, Schreier said he wanted to meet one last time with industry journalists to thank them for their years of coverage of Heidelberg. Schreier expressed positive feelings about Linzbach, saying he had wanted the new CEO to come from outside the industry to bring some new perspective.
“It was an ideal choice,” he said.
Schreier said his visit with us was his last official action with Heidelberg. To emphasize this, when he had finished speaking, he removed his red Heidelberg tie for the last time and presented it to one of the journalists in the room.
“Thank you very much,” he concluded. “And good-bye.”