In 2002, the fusion of SA Truck Bodies and Henred Fruehauf caused a stir in the South African marketplace. Overnight, the duo formed the country’s most comprehensive one-stop-shop and Africa’s most influential authority in trailer building.
As a result of growing global competition and increasing regulation in the global manufacturing sector, business conditions around the world are changing rapidly. The consequent need to adapt the trailing equipment industry’s overall structure has generated a wave of mergers in the past decade, not only in Europe, but also in Africa.
It is no surprise that the newly-founded corporation, led by Henred Fruehauf, spent the best part of 2002 restructuring, rationalizing and consolidating, the main emphasis being to achieve the best management, manufacturing and service structure available.
The end product was one giant one-stop-shop uniting a myriad of renowned brands under one roof to form the continent’s most influential authority in trailer manufacturing – just in time for a phase of intrepid investment between 2001 and 2008 that saw South Africa grow at an average growth of 5.6 per cent.
Today, the conglomerate is a prime example of structural diversification and well set up to benefit from South Africa’s on-going development. Four main manufacturing plants have been retained after the historical amalgamation – three of them build new trailers in Bloemfontein, Gauteng and Cape Town; the fourth is an Axle and Suspension manufacturing plant in Gauteng. This factory is an ISO 9002 establishment boasting to be the best of its kind on the continent, as it does not only produce trailer parts for Africa, but also for the European market.
The company’s sales department is bolstered by 30 parts outlets around the country, seven service and repair centres, a countrywide 24-hour mobile service as well as two second-hand trailer outlets – a vast network that can make a real competitive advantage in a place like Africa as product availability around the continent can be a real challenge. In that sense – only one decade after the company’s inception – the “new” Henred Fruehauf has become the spearhead of South Africa’s commercial road transport industry.
And, although some clichés about the African marketplace have remained – local hawkers still sell engine oil on the side of the road – CEO Dirk Botha is convinced that the business is only scratching the surface of what could be the most bustling transport market in the world. “Africa’s transport industry has already become an important contributor to the continent’s GDP and will become even more important in the future,” he says. “At Henred Fruehauf, we want to be part of that exciting development.
“We don’t have the luxury of specialising in one type of trailer as the local market demands the whole spectrum ranging from rugged logging trailers to high-tech aluminium tankers, waste handling equipment and walking floor trailers. But, our engineering is of the highest standard and up to every job, and we have a lot of licensing agreements with renowned European companies like Spitzer and STAS & Donbur to cater to every market,” he adds. “We try to tap the full potential available throughout the group to achieve a high payload and a low tare weight, especially in the bulk transport sector.”
For most of the past decade, the country’s trailer manufacturing industry simply accepted the fact that transport companies would overload a vehicle and thus build in some extra strength, according to Botha. However, modern load weight regulations now force the industry to design trailers that can boast the same stability, but have less tare weight to max out the legal weight limit. “Lightweight equipment definitely is a new trend,” he says. “The good news is that it can be done, but operators will have to accept that there may be a price premium. The advent of high tensile steels, for instance, has opened up new opportunities to achieve significant mass savings. We usually use a combination of Domex steel, plastic tailboards and bolt-on aluminium components – such as spare wheel carriers – to lower tare weight.”
But, like every high tech material, there is a price to it – and this can be a real problem in a cost-conscious market like South Africa, says Botha. “We need to produce as cost-effectively as possible.” In addition, using high quality equipment can be a major challenge in a developing market and the supplier base that manufacturers need to sustain healthy growth has not always been there in years past to provide adequate components. As a result, the manufacturer that is able to meet its own needs will have an inside track on meeting its customer requirements, says Botha. “By uniting different industry-related services under one roof, we’ve been able to capitalise on the ability to produce all equipment needed to build a trailer in-house.”
In fact, Henred Fruehauf now is a conglomerate containing 14 companies, including industry powerhouse Henred Fruehauf itself, as well as SA Truck Bodies, Road Tankers, Busaf Bauer; Trailstar and Palfinger South Africa. The components division comprises of three independent companies, including axle and suspension specialist Fruehauf Components, Henred Fruehauf Parts, and engineering expert TPE.
In co-operation with subsidiary Fruehauf Components, every trailer brand can draw back a whole range of suspension types to cater for all axle type requirements and riding heights. Spring suspensions are available with a choice of imported VDL Weweler 1, 2 and 3 blade parabolic spring packs, and the locally manufactured 7, 8, 9 and 10 blade multi-spring packs with ratings up to 15 tonnes.
“A variety of VDL Weweler and Hendrickson air suspensions are available to suit a wide range of applications,” says Botha, who is a firm advocate of VDL Weweler’s unique parabolic spring arm design. “It’s a great addition to our tried and true axle design that we introduced into South Africa in 1976. This axle became the industry standard and, with a few minor improvements, still is the market leader today.”
The component manufacturing division is subdivided into two units. Fruehauf Components itself focuses on all running gear, and is an OEM supplier to the industry producing axles, mechanical and air suspensions, walking beams, bogies, hanger brackets, rockers, axle seats, clamp plates, rollers, and anchor pins. Pre-assembled products include brake-systems, fifth wheels and landing legs. Route Components, meanwhile, produces all steel components used by the group’s trailer manufacturing companies.
Ever since the expansion in 2002, the company also ventured into the finance market. According to Botha, Henred Fruehauf’s in-house finance division offers a range of financial packages such as rentals, residual value leases, buy-back agreements, and full maintenance leases. “We structure packages to suit the client and our experience in the industry gives us the leading edge in this regard. The new Henred Fruehauf promises to be to the industry what everyone expects of it – market leadership. Even as a “big company” we promise to maintain the “small company” values that have led us to where we are today.”
Despite that “think small” attitude, doing business still holds huge opportunities, according to Botha. “Africa continues to offer numerous opportunities to investors in the post-crisis world, with the options as varied as the countries.”