Europe’s only spring manufacturer who also develops and manufactures its own range of air suspension systems, VDL Weweler, has cautiously resurrected its expansion plans to capitalise on some initial positive signs emerging of a gearing up of worldwide trailer production.
The key to gearing up to capitalise on positive signs in the trailer building market, according to VDL Weweler Managing Director, Dick Aalderink, lies in the timing and exploration of linking with the right affiliate companies.
Aalderink is in a position of strength. In 2008, VDL Weweler devised a plan to expand its production capacity, but put the idea on hold due to the looming GFC and the holding pattern required before global markets began the slow climb to recovery from late 2009. It was not until 2011 that the privately owned company overcame that post-GFC uncertainty and looked again to the original strategy. “We sensed a positive atmosphere in Europe,” says Aalderink. “So we decided to dust off our plans and prepare for the global recuperation, which is bound to happen at some point.“
During the pre-GFC good old days, VDL Weweler almost solely depended on the European market. “Europe is a very competitive environment and we have claimed our stake here,” says Aalderink. “But, we need a second, big volume mainstay overseas. That’s why we see a need to boost our capacity; and we can do so quickly because we had already put the mechanisms in place before the GFC.”
After 80 years in the business, VDL Weweler has gained vast knowledge in axle clamping, which is the critical part of the Bolt-on® concept. Now, the key to expansion is not a technical one. Rather, being able to gear up for new markets lies in the timing and exploration of linking with the right affiliate companies, he explains. “The question is when to invest into additional production capacity and how to utilise local expertise.”
For Aalderink, a young man at the head of an aspiring business, the answer is simple. “You have to observe the market and believe in your gut instincts,” he says. Granted, but Dick Aalderink is not all about instincts. An engineer by trade, he knows his numbers. When the US market showed signs of recovery in early 2011, with commercial trailer backlogs surpassing the 100,000-level in April, he knew that it was time act. Today, step one of his resurrected strategy is underway – the new production facility is already under construction.
Now Aalderink is working on step two; and if he is right, it will lead VDL Weweler into a prosperous future. “You need to find a strong, local affiliate to overcome the straining introduction phase and speed up the market launch,” he explains.
The calculation is simple. “Once you’ve reached a market share of 15 to 20 per cent, growth will increase automatically as the product will prove itself in the field. In Europe our market share already is around 30 per cent, but worldwide it is just under 10 per cent.” To obtain the missing 10 per cent and kick-start VDL Weweler’s expansion, Aalderink is approaching key players in the axle manufacturing industry – preferably those who cannot draw back on an in-house suspension system.
“It is a logical procedure,” says Aalderink, who has understood that the difference between market lows and the height of a new bull run can be very short. “We have a versatile system, but no own axle. Our advantage is that we can easily re-design the axle clamping to suit any axle type, so now we need to convince possible affiliates to choose VDL Weweler.”
Usually, Weweler’s natural competitors are axle builders who offer an integrated all-in-one solution. But, “most of them do the engineering in-house and simply buy in the suspension system, so why don’t they buy from us?” Aalderink says. “We’re only competitors if we sell directly to the trailer manufacturer, but when we supply the axle builder in the first place, we become partners.”
VDL Weweler’s suspension system is characterised by a spring steel parabolic trailing arm, which acts as an integrated roll stabiliser and as a guiding arm for the axle. The spring steel parabolic trailing arms are manufactured in-house and the suspension system is supplied in a modular, do-it-yourself kit.
“By using modular construction methods, Weweler can achieve efficient volume production while also maintaining the flexibility to meet the demands for small and medium volume specialised solutions and applications,” says Aalderink, who is focusing on capturing markets that need a non-European, custom-tailored solution.
The much-talked about Middle East, for instance, is no such area. “The Middle East is no blank spot on the map and we supply quite a bit over there. Therefore it is not an area where we can achieve the growth we are aiming at. The real blank spots are Brazil and South America in general. It’s almost like North America – a unique market that will need a unique, non-European solution in the not-so-far future.”
With that said, the current state of the world economy is the ideal business environment for a flexible company like VDL Weweler. Cooperating with the OEM market, it will benefit from a pent-up need to replace out-dated stock in Europe and North America and improved financial performance in the fleet sector. Supplying the aftermarket, it is able to serve those who keep using second-hand stock. “I think it is the right time to invest,” Aalderink explains. “The trailer production will eventually ramp up and by then, we will be able to offer a tailor-made product for both North and South America, as well as China and India.
On 1 January 2013, the new production facility will start rolling. In the meantime, it is an almost philosophical question Aalderink and his global affiliates will have to face. The most challenging design area of an air suspension system is the connection between the trailing arm and an axle beam. While the competition banks on a welded solution, VDL Weweler’s approach is different. It is based on a bolted joint. “The bolt technology has developed rapidly in the past,” says Aalderink. “Today, we use stress-resistant material that was not available a few years ago. A welded joint, on the other hand, is the weak point of every construction.”
While convincing the axle manufacturing industry to trial the Bolt-on® system – hoping to win over a strong partner to promote the Bolt-on® solution – the Aalderink management is facing a balancing act. “We have to remember where we come from,” says Aalderink. “A global expansion is a full-time job, but also have to stay in touch with the trailer manufacturing industry and the truck drivers to make sure our product can succeed in the field.”
Hence the last, and maybe biggest issue the aspiring Dutch company has to overcome is transferring the local service philosophy to the global market. “We are training a lot of people in Holland to understand our philosophy,” says Aalderink. “Ideally, we manufacture the spring steel parabolic trailing arm in Holland and then fit and service the product locally. And, who else but a local affiliate could help us achieve that goal?”