When Douglas Grimm took the reins early last year of what he now describes as North America’s most diversified foundry, some 50 percent of Citation Corp.’s sales were generated by the auto sector. Today, the figure is closer to 30 percent and the outlook is a whole lot brighter.

Not too long ago, it was perfectly acceptable for a manufacturer of metals components to make copious amounts of only a couple of different widgets intended for one or two customers. During boom periods, these highly specialized downstream companies thrived. But the near-collapse of the domestic automotive industry has shown pigeonholed producers just how devastating a single downcycle can be.

"That may have been a paradigm that worked in the past, but now our customers really believe in the importance of diversification," said Douglas Grimm, chief executive offer of Citation Corp., the Novi, Mich.-based foundry business that operates 11 facilities in six states with approximately 2,300 employees.

The links in the supply chain have become increasingly fragile due to tight credit and liquidity concerns, he said. It's now exceedingly important for companies to not be overly reliant on a single customer or just one sector, and that's why Citation embarked on an aggressive...