Chris CoughlinEVP and Group President,

The Timken Company &

ABMA Chairman

BSA 2017 Convention

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ABMA’s primary mission is to provide

leadership in the United States to address

issues impacting the bearing industry.

ABMA Mission

• Abbott Ball Company

• Accurate Bushing

Company, INC

• American Roller

Bearing

• Atlantic Bearing

Services

• Baldor Dodge

• Bearings

Manufacturing

Company

• Coorstek Inc

• Hoover Precision

Products

• Koyo Corporation

• Nachi Technology

• Nakanishi

Manufacturing

• New England

Miniature Ball

• New Hampshire Ball

Bearings

• NN, Inc.

• NSK Corporation

• NTN Bearing

Corporation of

America

• Precision Enterprises

• Regal Beloit

• Rexnord

• Schaeffler Group USA

• SKF USA, Inc.

• Standard Locknut LLC

• The Timken Company

• Universal Bearings

LLC

Primary Members

• Ajax Rolled Ring &

Machine

• Aubert & Duval

• Charter Steel

• Gravotech

• Greer Steel

• Latrobe Specialty

Metals, A Carpenter

Company

• Leech Carbide

• Ovako North America,

Inc

• PARTsolutions

• REM Surface

Engineering

• Rotor Clip Company

• Sentient Science

• Specialty Ring

Products, Inc.

• Specialty Steel

Treating

• Sullivan Steel Service

• TATA STEEL

• Universal Stainless

and Alloy Products,

Inc.

• Worthington Industries

Associate Members

• North America Industry Statistics

• 1Q Business Environment

• Long-term Trends Affecting the Bearing

Industry.

Today’s Topics

• 2016 Was a Very Difficult Year for the Bearing Industry

within the United States.

• Quarter to Quarter comparisons for 2016 vs. 2015 Show

Production Was Down in the 7-10% Range.

• It Was a Broad Based Reduction Across Most Product

Ranges With Only the Automotive Industry Holding its

Ground.

• Imports Significantly Outpaced Exports. 4Q Imports

Were 80% Higher than Domestic Production.

Executive Summary for 2016 Statistics

US Bearing Production

-35%

-30%

-25%

-20%

-15%

-10%

-5%

0%

5%

10%

15%

20%

25%

30%

35%

Q1 1

994

Q1 1

995

Q1 1

996

Q1 1

997

Q1 1

998

Q1 1

999

Q1 2

000

Q1 2

001

Q1 2

002

Q1 2

003

Q1 2

004

Q1 2

005

Q1 2

006

Q1 2

007

Q1 2

008

Q1 2

009

Q1 2

010

Q1 2

011

Q1 2

012

Q1 2

013

Q1 2

014

Q1 2

015

Q1 2

016

Pe

rce

nt

Ch

an

ge

Quarter v. Quarter Year AgoTotal Bearings Market - ABMA Estimates

US Bearing Production

900

1,000

1,100

1,200

1,300

1,400

1,500

1,600

1,700

1,800

1,900

Q1

19

94

Q1

19

95

Q1

19

96

Q1

19

97

Q1

19

98

Q1

19

99

Q1

20

00

Q1

20

01

Q1 2

002

Q1

20

03

Q1

20

04

Q1

20

05

Q1

20

06

Q1

20

07

Q1

20

08

Q1

20

09

Q1

20

10

Q1

20

11

Q1

20

12

Q1

20

13

Q1

20

14

Q1

20

15

Q1

20

16

US

D in

Millio

ns

Total Domestic Production - ValueTotal Bearings Market - ABMA Estimates

Total Shipments

3 Months Moving Avg (3mma)

US Production by Bearing Type

0

100

200

300

400

500

600

700

800

900

Q1

199

4

Q1

199

5

Q1

199

6

Q1

199

7

Q1

199

8

Q1

199

9

Q1

200

0

Q1

200

1

Q1

200

2

Q1

200

3

Q1

200

4

Q1

200

5

Q1

200

6

Q1

200

7

Q1

200

8

Q1

200

9

Q1

201

0

Q1

201

1

Q1

201

2

Q1

201

3

Q1

201

4

Q1

201

5

Q1

201

6

US

D i

n M

illio

ns

Domestic Production by Product Lines - ValueABMA Estimates

Ball Bearings Tapered Roller Bearings Other Roller Bearings Mounted

• North America Industry Statistics

• 1Q Business Environment

• Long-term Trends Affecting the Bearing Industry

Today’s Topics

• Off-Highway Markets Have Clearly Turned

• OE service leading the way.

• Original equipment builds improving, but still low.

• Industrial Distribution Demand is Improving

• Metals, mining, and general industrial improving.

• Energy Improving as Well

• Oil & Gas has turned off very low levels

• Coal has stabilized, but long-term future uncertain

• Bearing Companies are Cautiously Optimistic in

Public Comments.

Q1 2017 Environment

• North America Industry Statistics

• 1Q Business Environment

• Long-term Trends Affecting the

Bearing Industry

Today’s Topics

• Mega-Trends

• Electrification of the Powertrain

Trends Affecting Bearing Industry

Mega Trends - Urbanization

Driving Long-term Growth inMany Industries

• Rail

• Construction

• Mining

• Metals

• Energy

Mega Trends – Energy Efficiency

A Dynamic “Bearing” Environment

• Emission reduction affecting equipmentdesigns in terms of weight / efficiency

• Renewables continue to gain traction andare on long-term growth trend.

• Areas such as coal appear to be under long-term pressure.

• Government policy a major variable

Mega Trends – Globalization

Increasing Operational Complexity

• Increased channel complexity

• High variability with regards to equipment designs

• Globalization of manufacturing creates various challenges

Mega Trends – Digitalization

A Major Long-term Impact

• Affects product design in terms of sensing capability and integration into systems

• High impact on manufacturing process in terms of connectivity and automation

• Integration bearing manufacturers into supply chains, customers, and channels will continue to increase.

Electrification of the Powertrain

• Wide ranging consensus that this trend is real and will have a large long-term impact.

• Automotive industry is leading the way.

• Large impact on equipment design and associated components.

• Long-term, not confined to automotive. Many principles are equally applicable to industrial equipment

• A long-term issue for all bearing producers

Bearings and Their Lubrication• May 21, 2017 – STLE Annual Meeting

• Atlanta, GA

Advance Concepts of Beating Technology• June 19-22, 2017

• Oakbrook, IL

Essential Concepts of Bearing Technology• August 22-24, 2017

• Oakbrook, IL

Advance Concepts: Lubrication and Wear • Fall 2017

• Location TBD

Continuing Education

On Behalf of All ABMA Members, I Would Like to

Thank the BSA Organization for the Opportunity to

Present Our Industry This Morning.

And We Greatly Appreciate the Support of Our

Distribution Partners Who Help Us Bring Our

Products and Services to Market.

Closing Comments