Manufacturing Titans in the Heavy-Duty Aftermarket Come Together at HDAW

Episode 308: At HDAW’24, we had the privilege of sitting down with some of the heavy-duty industry’s biggest names. Kent Jones, President of SAF-Holland, shared exclusive insights into their merger with Haldex. Additionally, Tim Bauer, VP of Aftermarket for North America at Eaton, and Cengiz Shevket, President of Aftermarket Sales for North America at SKF, discussed their cutting-edge software and top-of-the-line products designed to enhance efficiency for end-users.

Join the discussion for an exclusive look at the strategies driving industry titans and discover the latest product and technologies that can streamline operations, reduce downtime, and improve overall fleet efficiency.

Show Notes: Visit HeavyDutyPartsReport.com for complete show notes of this episode and to subscribe to all our content.

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Transcript

Jamie Irvine: 0:39

You're listening to the Heavy Duty Parts Report. I'm your host, jamie Irvin, and this is the place where we have conversations that empower heavy duty people. There are some manufacturing titans in heavy duty parts that serve the trucking industry. In this episode, we are going to speak to three of those manufacturing titans who were all exhibiting at HDAW Heavy Duty Aftermarket Week in Grapevine, texas, back in January.

Jamie Irvine: 1:10

First, we're going to get a post merger report from SAF, holland and Halldex. It's been a year since these two companies came together and we're going to find out how things are going. Second, we're going to get a mini masterclass from Eaton, which is going to help us prepare for providing parts and service to those that are repairing automated transmissions. And finally, we discuss with SKF the move in the world from globalization to something they call regionalization, also known as near and on shoring. All three of these conversations really point to how these big titans of manufacturing are making moves and taking steps to try to support the trucking industry to a greater degree. So let's get to our conversation with SAF, holland, halldex, where we're going to learn about how things have gone since they merged just a year ago. We are at HDAW 24 in Grapevine, texas, and I am very happy to have my guest, kent Jones, who's president of the Americas of SAF. Holland Kent, welcome to the Heavy Duty Parts.

Kent Jones: 2:15

Report Thanks, Jamie. Thanks for having me. Glad to be here.

Jamie Irvine: 2:19

Yeah, so you're a commercial vehicle expert. You've previously worked for Remy, a ZF group, but I think your specialty really falls on business growth and you've had a chance to work on the OEM and aftermarket sectors, correct?

Kent Jones: 2:31

Yeah, I've been in the industry my entire career. So I worked as an engineering student working for a commercial vehicle division of General Motors and then went right into Del Carimi was a spin out of that. Then I worked there for about 20 years, worked about five years for ZF Right. I left just before the Big Web acquisition that they had and then I've been with SAF Holland now for four years.

Jamie Irvine: 2:53

You had some big news a year ago. It's already been a year. It's hard to believe, but at early 23, we saw the merger between SAF Holland and Haldex. When you brought these two companies together, why did that merger create something better for your customers?

Kent Jones: 3:11

There's a couple layers to that. The merger of the acquisition of SAF Holland and Haldex was two great names in the marketplace, both companies over 100 years old and both with strong US American heritage, and also in North America, but also in Europe as well. The benefits that we see we thought we got to put these two companies together because we will be stronger together that's just not a marketing slogan. We really truly believe that's the case Exists both for our aftermarket customers and our OEM customers. Both organizations had really fantastic distribution at Haldex and the SAF Holland side. We were able to put those together and really have the best of both for independent aftermarket OES, us, canada, mexico. We've got five distribution centers all over North America now. So, moving parts and forward deploying, we combined sales forces, commercial representation for OE customers OE truck, oe trailer, aftermarket fleet Canada and we really were able to get synergies and co-mingle those together.

Kent Jones: 4:23

Probably the biggest benefit in the long term is the way we're going to be able to deliver system solutions. On the OEM side, we're an excellent suspension manufacturer. On the trailer side, we got a great position, great share position, but we're always buying someone else break and wheeling components. Well, now we have our own and we're integrated within the team. We think we can supply those combination systems. Really focusing into the future to air disc break, that's at. Haldex got a fantastic air disc break product line. We think we can deploy that and really increase air disc break content both on truck and trailer side of it. Then, of course, they've got a fantastic drum break portfolio market leader in brake adjusters or slack adjusters, spring brakes, friction material and remanufacturing. We can just deploy those fantastic Haldex assets across an even larger customer base to pick up those synergies.

Jamie Irvine: 5:16

Tell me something since the merger. You always hope for the best. No doubt mergers come with their challenges, but tell me about, maybe, something that was unexpected, something positive that came from this that was a little unexpected.

Kent Jones: 5:30

Yeah, that's a good question. We we worked really hard on this merger, paid real close attention. We even had a third-party consultancy group trying to help us, because these are two big companies coming together Infecting a lot of people out of moving pieces. There's always a lot of uncertainty when that, when that, takes place, and we really wanted to make sure that we were, you know, doing this thing in the right way. So we kind of broke the, the, the merger, up in like three categories.

Kent Jones: 5:55

How do we buy products better together? You got, you know, increased purchasing power, two and a half billion Euro dollar company now that really can buy products better in the marketplace. Try to find those kinds of synergies. How do we sell products better and I kind of mentioned that earlier in the in the previous question how we do system level selling and move that together. But the part that's probably was maybe I expected more synergies but it's not really there and it's okay is just in the operation side of business, the way we manufacture products. There's there's just very limited synergy. We we build big heavy Axial suspension, we bang a lot of steel together and weld and Haldex is more detailed manufacturing assembly, clean room and.

Kent Jones: 6:39

Just bringing those together really didn't make a lot of sense. So we're keeping manufacturing separate. They're different, completely different product lines, I mean, and I've been very impressed this is probably another surprise for me very impressed with the level of Quality and safety minded of the Haldex team. Not surprising, since they're out, you know, a hundred year break manufacturer right. But their attention to detail in the manufacturing operations side of it was was very impressive.

Jamie Irvine: 7:04

Yeah, so when, when you bring these two companies together, like you acknowledge there are, there are some challenges, for for someone who's listening right now, who's familiar with the two brands, what, what challenges did you have to overcome early on when the merger first started, and and how is that now kind of played out a year out?

Kent Jones: 7:22

Yeah, so two two answers that question. One was for our people. You know, we wanted to make sure we were treating people very fairly. We knew that there would be. You know, there were many jobs. There was only one job. There weren't two jobs and we wanted to try to find you know what's who's the best person for that job, and then try to treat that other person in the most fair way. We did. I think we did a pretty good job at that. There were some people that left the company during that process, and that's fine. People always need to do what's best for For them and their families. Very impressed on that side, from the customer side, this is the fun, exciting thing, in fact. What? That's what's taking place Every day right now, happening right now where I'm talking in our booth, of people coming to us saying, hey, I'm a hauling distributor, I'd love to take a look at this haldex, or vice versa.

Kent Jones: 8:03

Right and because while we both had a lot of overlapping customers, nearly every one of them we had different strengths as they have, home was much larger with the OES aftermarket and the large what we would call national accounts, and Haldex was much stronger in the independent aftermarket and the buying groups and a lot of the smaller Distributors and now we can bring, you know, fantastic product lines up and down the channel and we think that's great for the fleet customer.

Jamie Irvine: 8:27

So that's yeah, that's great for for you and for for selling more product, but I love what you just said the end. That's great for the fleet customer, the end user. So talk to me a little bit more about how that fleet is then able to kind of Take advantage of what this is now enabling those distributors, right?

Kent Jones: 8:43

So one of the things we did fairly early on, in as early as we could when capacities would come up, is to try to bring a Full system sale. And I'll just pick the trailer because it's probably the most the largest example right. So an axle and trailer suspension system that's fully decked out in wheel ends and and now a Beautiful complement of haldex braking products. We can sell that as one complete assembly to an OEM trailer manufacturer. Now this last couple years have been really going gangbusters on trailer manufacturing. People couldn't find enough labor, they couldn't hire enough people. They wanted to try to eke out whatever they could do.

Kent Jones: 9:17

Well, if we can deliver a full system to an OEM trailer manufacturer, they can take those people and redeploy them somewhere else and maybe get it up. You know, some of our studies have done up to 10% additional output on the trip. That helps the fleet customer get their deliveries better. And then once the fleet Receives that product that has, then if there's ever any problems or if they need some help, there's one throat to choke. They don't have to go to five, six different manufacturers for a different drum, a different Hub. They go to a different axle. That's all in one particular system. And you know we we can help manage and they like that also for replacement components. They get consistency in what they're trying to be able to offer so they don't have to triplicate Inventory on their shelves right.

Jamie Irvine: 9:57

And then an additional advantage I think that I'm seeing is that when you do have a technical issue so let's say you spec a trailer and then the fleet is now working that and they expected certain performance and they're not getting it it's not that because there was a manufacturing problem, but maybe there's a technical issue there's. There's a, there's another variable that wasn't taken in. Now they have one person to talk to and you guys can walk them through the whole process and get them to a place where they're speccing equipment correctly and getting the most out of it.

Kent Jones: 10:23

Yeah, you can have incompatibility between components when people would select all a cart. We can try to give an optimized performance. That exists and if there is, you know, a discussion or performance related, then you know it doesn't have this going.

Kent Jones: 10:34

Yeah it's like okay, but what can I do to help you? You know, to provide solutions. Yeah, we would send in our service teams or, you know, engineers to try to be able to help them. They like that. They're like, oh, okay, this is really great. This is. I want to do this more on my, you know next order so it's, it's unlikely.

Jamie Irvine: 10:48

You've got an announcement as as Large as last year's that these two companies are being purged. But but what does the future look like for the company? How now, now that this merger is done, you've got it optimized, you've got things going in the right direction, right, it's working well. Where are you going to take it from here?

Kent Jones: 11:06

Well, I've been with the company now for about four years and we've gone through pretty good transformation. What I found when I came to the company sometime ago is right just before a COVID hit, we need to work on some things to improve performance in the company. Things were a little shaky there for a while. We're getting back on our feet in a really, really strong way. We were running our manufacturing plants, you know, basically full-on capacity for the last Couple years. Now, with the Haldex acquisition over the last year, we're integrating system level components and now what we're really going to be working on, you know, in the next three or four years is Increasing manufacturing capacity, tremendous demand for our products in these system solutions that we're looking for.

Kent Jones: 11:45

We need to be able to supply to customers. So we've got great people, we've got great products, we got wonderful aftermarket position and distribution, great forward deployed inventory. But we have, like many people, that we've struggled at times for the level of supply that we need and I'm trying to fix that. We're bringing in additional supply situation so that we don't have to make compromises To our you know best aftermarket customers when the markets hit 330,000 trucks and traders, 350,000, 360,000, and that a lot of suppliers are still really struggling with that. But I think we got the you know good support of our that the Americas is a great place to invest and we're gonna, you know, put those funds to good use.

Jamie Irvine: 12:25

Well, thank you so much for coming. It's a busy time at the show. I really appreciate you coming on. If people want to learn more about the company, go to SAF, holland comm, and this will be able to get a full access to everything that's available. The product line, of course. Talk to your distributors about buying the product and, again, just thank you so much for coming on the show.

Jamie Irvine: 12:45

Thank you, glad to be here. Mergers are always challenging and it's good to hear that SAF Holland and Halldex have really been able to find their stride and this merger is really working for the company but, more importantly, it's working for those that they serve. We're going to take a quick break to hear from our sponsors. We'll be right back. Are you deferring maintenance because of filter cost or availability? Or, worse yet, are you trading down to no-name filters to try to save a few bucks? Either way, you're rolling the dice. The good news there's a new premium filter option for fleets Hanks filtration. If you're responsible for a fleet, you won't believe how much using Hanks filters will save you. You've got to go to heavydutypartsreportcom slash Hanks to find out more. That's heavydutypartsreportcom slash H-E-N-G-S-T Head there. Now.

Jamie Irvine: 13:40

This episode of the Heavyduty Parts Report is brought to you by Find it Parts, your ultimate destination for heavyduty truck and trailer parts. Discover a vast range of parts at finditpartscom. Don't spend hours a day looking for parts. Instead, visit finditpartscom and get them right away. Next we're going to talk to Eaton Now. Automated transmissions are truly a game changer for the trucking industry, but there's some specific things you need to know if you're selling parts or if you're repairing automated transmissions, and in this conversation I feel like we get this mini masterclass on what we need to know. Listen into my conversation with Eaton. My guest today is Tim Bauer, vp of Aftermarket of North America at Eaton. Tim is someone who has many, many years of experience in the commercial vehicle parts business, and so it's really great to have you on the show for the first time, tim. Welcome to the Heavyduty Parts Report.

Tim Bauer: 14:36

Jamie, thanks for having me Pleasure.

Jamie Irvine: 14:37

So we're here at HDAW. This is really a representative of the aftermarket and that side of the business. Let's talk a little bit about the kinds of conversations you're having right now on the show floor with people here at HDAW.

Tim Bauer: 14:51

For sure. So, look, we're spending a lot of time really talking about the transition. So we've talked for 10 or 15 years about manual transmissions going away, automated transmissions coming in. That technology is a game changer and it's different for the independent aftermarket, and so we're spending time trying to educate the market. Here's what's coming. We've got a promotion called Prepare to Repair. So what do they need? What do they need to know? Clutches are different, transmissions are different, and how can we help the industry move it forward? So if you think back a few years on Eaton, our whole portfolio was around how do we service Eaton install base, and we've pivoted in the last five years too. We want to serve all the vehicles that are in the marketplace and help trucks keep running and help fleets make money, and if we can educate the market by doing it, that's really what we're all about. So we've got service tools, we've got clutches, we've got clutch actuators, we've got transmission components for rebuilders and all those makes and models, and that's what we're spending all of our time educating the market on.

Jamie Irvine: 15:48

So what do your distributors run into as they start to try to provide these products to their end user customers? It might be a fleet, it could be a local repair shop, like from the parts side. Is it parts identification? That's the issue. Is it helping them diagnose problems Like where do you see the need come up when people make this transition?

Tim Bauer: 16:08

Sure, Look, it's both for sure Parts identification. I mean it's not as easy as it used to be.

Jamie Irvine: 16:13

You used to be pretty easy. You used to be pretty easy.

Tim Bauer: 16:15

You had a lot of the business on clutch and transmission. Now Daimur has their own transmission with somebody else that makes their clutch. Volvo has their own, mac has their own, navistar's getting in that business. Now Eaton's got our product plus the Endurant, which is our joint venture with Cummins. So if you look at the market, the portfolio of what people have to carry has gotten far more complex, and so how do they identify, first of all, what they need and then, secondly, we've got this good, better, best offering.

Tim Bauer: 16:41

If you think of the legacy clutch. For the manuals, where is the truck in the life cycle and why is one of them better than another? Because people try and have a one size fits all mentality and what you end up doing, honestly, is you're paying a higher price for features that you don't use, and then, when you don't use that and you have to sell it, the customer's got getting value out of it, so you're cutting your margin, and so we're spending a lot of time educating on how do you identify the right part for the right application and then how can we help? We want to be that one stop shop for our distributors so that they can keep the fleet operators in North America running and keep goods moving and trust us with all of our quality and our product and our sales team out there.

Jamie Irvine: 17:18

So when I was selling parts for a distributor, I was always trying to focus on areas that I could talk to my customers and say look, if you change to this product line, you're going to reduce your total cost of operation. For sure You're going to get better cost per mile. What's the version of that that equates to this product?

Tim Bauer: 17:37

Yeah. So look, we do talk cost per mile, but if I think, let's go back to our manual clutch portfolio. So we have the Advantage series, and the Advantage series is a strap drive. That's changed from, maybe, what you sold, but frankly, it's got features for downspit engines and all the aerodynamics on trucks. Well, when a truck is seven, eight years old, they don't need those features, right?

Tim Bauer: 17:58

So at the end of the day we've got a middle grade product, which is our ever tough product. Good enough product, one generation old on technology, still eaten back, still similar to the QTS. You buy the clutch install kit. You get the extended warranty with it when you do the install. So we're educating. What are the differences? There's a price difference to it. They can make more margin. And then here at the show we've now launched a reman advantage line, so we're updating our reman portfolio. So if you think about the lifecycle of a truck, zero to five years is advantage. That's really the sweet spot. Six to 10 should be the ever tough, and now we've got a line for the 10 plus in our reman product. And so that's really been our focus and that's what we're trying to educate the market on what's the right product for the right application. Too often the customer wants to buy one part number for everybody, and it just doesn't work that way. Yeah.

Jamie Irvine: 18:47

Yeah. So when the automated transmissions came out, I remember hearing a lot about drivers we're kind of struggling to transition to trust the technology right and once they learned to do that, there was these obvious improvements on like things like fuel consumption and things of that nature. When it comes to the repair technicians that are now having to fix this equipment, is there kind of an equivalent where they had to make an adjustment in mindset to approach this equipment in a different way?

Tim Bauer: 19:14

For sure. So every automated or electronic type of product there is a failure code or a code that goes across that helps them diagnose. And one of the things we recognized is is we launch the clutch. For the automated transmissions you actually need software to instead of the old clutch you put it in, adjust the linkage and away you go On the new product.

Tim Bauer: 19:34

It's actually a software that engages the transmission, the clutch and the engine, so the shift happens, and so we had to get that software tool out there to augment what we're selling on hard parts. And so we've added that, and now this year we've actually added a full suite of software that allows them to diagnose any failure that's running across the J1939 bus on the truck. So if they have service, we've got a product called Select Diagnostics that we're selling. Okay, that allows them not only to identify what the fault code is, but then we've got our users that are doing it putting in what's solving it that has an AI driven element to it that says 80 percent of the time this solves that to help them triage faster and get trucks out, so make them more efficient. That's part of the value we're trying to bring to the marketplace as the vehicles become more complex.

Jamie Irvine: 20:23

That's incredible. So tell me something. Eaton is a legacy manufacturer in my mind. They've been around for a long time and they're well known for the products that they're well known for, but is there something that Eaton manufacturers that maybe a lot of people don't immediately think of you guys, for?

Tim Bauer: 20:38

Yeah, so look, our company is. I mean, we make a lot of products in the light vehicle space, yeah, right, and a lot of people don't know that we're one of the largest manufacturers of valves and lifters for engines in the world. And nobody knows us because we sell it to the light vehicle OEMs or even some of the commercial vehicle OEMs, and so a lot of people don't know that my team does a little bit there, but we haven't spent a lot of time talking to the market about what that portfolio looks like. And then I would tell you our business today what they knew Eaton five or 10 or 15 years ago.

Tim Bauer: 21:10

Our business today has evolved Right, we want to be a vehicle on operation all makes supplier, that's, a partner to the industry, helping guide them through this transition. And that means, whether it's existing technology that stays with internal combustion, or, as the market moves to EV, how can we play in that space and help get them ready? And so we're trying to stay a step ahead of where the market's going and bring those products to the independent aftermarket so that they're prepared and ready to serve the customers. At the end of the day, we all win when the vehicle or operator, their wheels are turning and they're making money. That's where we win and that's got to be our sole focus, and that's what my team's been doing over the last five to seven years.

Jamie Irvine: 21:49

Well being. At HDAW we are focused on the independent service channel the aftermarket that supports that independent service channel. So what steps does Eaton take to provide the aftermarket side with the education and training and the knowledge that they need so that they can go out into the field and successfully deploy your products in a way that really keeps the trucks and trailers rolling Sure?

Tim Bauer: 22:09

So we've got some training that we do in field. We've got some tools that are online. We've tried to create a lot of tools at our website and then we've got a sales team that are knowledgeable and can sit down in front of the customer and help them understand and answer their question more deeply. Everybody's in a little bit different space so we're trying to do it not as a cookie cutter, one-size-fits-all, but more of a customized approach. And so we're back to simple blocking and tackling. How do we do fleet nights? What do they need to know? What are simple failure modes? And we're trying to create all those tools with competitive cross-references. How do we bundle from a ship direct perspective or a portfolio perspective to allow customers to maximize what they buy from us? So we're trying to do it in a little bit different space.

Tim Bauer: 22:53

But then think about the services side. Everybody knows us for parts, but we've added to the service ranger software. We did ProPlus last year for the clutch calibration and now this year with select diagnostics. How do we help those service outlets have one tool Right, if you think about their serve and all makes. So they might have a Cummins tool, they might have a Dymor tool, they might have a Vol. They got five or six tools. We're trying to simplify that. There's one tool, every system, every truck, all makes all models from somebody that they trust in the market.

Jamie Irvine: 23:23

So when you sell certain product categories, like, for example, with after treatment, a lot of times like the DPF gets blamed, but it's just the symptom. There's a problem elsewhere in the system. I think a fuel injection right. There might be a contaminates in the system, but they blame the injector. Now that the setup on the drive line is the way that it is and all of these pieces are so interconnected, is there kind of like an equivalent situation where there's a symptom, where the people start throwing parts at the problem? You know, tell me a little bit about that.

Tim Bauer: 23:50

Yeah, look, the most common thing that I'm seeing is when customers are replacing an automated clutch. They got to drop the transmission. It's a major job, but sometimes they won't replace, like, the clutch actuator. Ok, right, and so they put it back up and the clutch actuator is good at that moment, but then it fails three, six months down the road. So we're trying to educate on when you do it, do a full job, right, it's a little more expensive up front, but your peace of mind and your longevity of the repair is far more reliable. And so that's really what we're trying to spend our time educating, and that's why we've added not only the clutch but the clutch actuator, the clutch install kits. We're trying to do that education on what's the right way to do the service event so that the customer ultimately comes back, because it's the service providers, frankly, relationship with the customer, and we just want to help that.

Jamie Irvine: 24:38

Yeah Well, parts people. I'll tell you what my mentor told me Sell them what they need, not what they ask for. Absolutely Right, Fantastic. So if people want to learn more, they should go over to Eatoncom. Thank you very much for taking this time. I know it's very busy at the show, so it's really great to have you come to our booth and talk about this. I think this is great and I think this information is going to really help the aftermarket.

Tim Bauer: 24:59

My pleasure. Thanks for having me, Jamie.

Jamie Irvine: 25:01

Well, I was really appreciative of Tim and Eaton for taking some time to provide us with that masterclass on everything we need to know about automated transmissions, and also the additional information they shared about driveline in general was very, very useful. So, finally, in today's episode, we're going to speak to SKF. Now they're going through a new phase of manufacturing. They're moving away from globalization towards what they call regionalization, which is also known as near and on shoring, and they really highlight why they're doing this, and there's three or four really important reasons and I think it's good for us to consider those. Especially if we're buying parts, we need to think about which suppliers we partner with and make sure that they can take care of our needs, regardless of what goes on on the world scene. Listen into my conversation with SKF.

Cengiz Shevket: 25:54

My name is Jengis Shevket. I am the president of the Vehicle Aftermarket Sales in North America for SKF.

Jamie Irvine: 26:01

Jengis got his bachelor's degree in mechanical and production engineering. He joined SKF in 1990 as automotive applications engineer and has been with SKF ever since. Jengis, welcome to the Heavy Duty Parts Report. Thank you for having me so glad to be here. We're at HDAW right now, and this is such a great opportunity for us to come together. The whole industry is here and it's an exciting time of the year. I actually love this show. It's my favorite of the year. When we are here, though, one of the things that it gives us an opportunity to do as an industry is to talk about the trends, and certainly after COVID, we have seen this strong trend towards on-shoring. Could you explain to our audience, for those who might not be familiar, what is that and why do you think that's so important to bring manufacturing to North America? Yeah, sure.

Cengiz Shevket: 26:51

We went through a phase of globalization maybe two decades ago, and that was really cost-driven chasing lower cost products, access to global supply chains. And what has happened over the last few years First, I would say, with the tariff wars and then the pandemic, of course has shown weaknesses and vulnerability of our global supply chains. And to improve availability and have the product readily in the hands of the people that want to use it, we've moved from globalization back to what we call regionalization. Okay, From an SKF perspective, there is one more element. Our company is very focused on sustainability and our carbon footprint. That's one more element that us as a company is looking at regionalization. Regionalization, producing where we use the product.

Jamie Irvine: 27:48

Well, and it makes sense. We saw how vulnerable really the supply chain was during COVID. I think it was more vulnerable than any of us would have ever imagined. And then that also makes a lot of sense to me. If you don't have to sail it halfway around the world and you can produce it more locally, not only is there security there, but, to your point, there's less of an emissions contribution and getting the product physically to the North American shores.

Cengiz Shevket: 28:11

Absolutely Right, absolutely.

Jamie Irvine: 28:13

So let's talk about products. We're here at HDAW Heavy Duty Aftermarket Week. This is a big focus on that side of the business. So what product categories are you really focusing on that? You're going to be talking to people out on the show floor.

Cengiz Shevket: 28:26

Yeah, skf has been supporting the North American Heavy Duty market for, I would say, about 100 years. So new kids on the block, new kids on the block, but we are really known as the wheel and guys. Yeah, yeah, our first product that was probably used extensively and became a household name was the Scotseal. It was under the CR original Chicago Rohite brand. That was the Scotseal and every oil axle had it. But we are a bearing company and we also have an extensive range of wheel and bearings. And we talked about regionalization. One of the things that we've done very recently is added a very sizable factory in Mexico to make those bearings here in North America for the North American consumption. That's exciting.

Jamie Irvine: 29:25

That's exciting. Yeah, when I was selling parts, I always remember the seals and the bearings. There was always some other guy that was the go-to brand name, and we see that changing in the market. So explain to us how SKF's solution for wheel and components is really different from the other options available in the market.

Cengiz Shevket: 29:46

Yeah, One thing I'll say is that we are actually the OE. Today, if you take apart a tractor wheel and the bearings in there and the seals in there, I would say more than 50% of the market is SKF. So we are the OE guy. Skf is known for highest quality, precision machining, high quality steels and reliability. So our differentiation is dependability out there and these trucks on the road really uptime. Reliability and scheduled maintenance as opposed to unscheduled maintenance are the key things. So that's how we differentiate, being that guy.

Jamie Irvine: 30:28

And so what you're saying is that this aftermarket option for the replacement of the OE product that they can install. Okay, everybody talks about quality, so let's go a little deeper into that. How does using those products translate into not just downtime, but like, how does it impact the cost of the total cost per mile or the overall total cost of operation?

Cengiz Shevket: 30:54

Predictability is a very important thing. If you can schedule in your maintenance intervals without having the unscheduled events, then you can budget for your yearly outgoing and if your product is reliable, you can actually extend that service interval. So instead of having to repair every year, maybe you can schedule a repair every three years. So quality and dependability and reliability of the products really works out as both in budgetary reasons but also the bottom line cost. Yeah, yeah.

Jamie Irvine: 31:31

And when you talk about that regionalization, one of the things I know about selling in North America is you've got a lot of different geography. There's a lot of different conditions. So we had unfortunately us Canadians we had minus 37 in Northern Alberta last week. It was brutal. You have other parts of the country that in the summertime, for example, the heat, you have people running in the mountains, you have people running where there's a lot of humidity. So how does the quality that you engineer into the product enable a company to be able to operate in all of these different vocations and these different geographies?

Cengiz Shevket: 32:06

One of the benefits of being in the OE side of the community is that we are part of the design process when the trucks and trailers and other vehicles are being built. They are built for let's call it 10 years and so many thousand miles on the road and we design our products for the full range of environment, minus 40 to plus 40, if you want, and different road surfaces or off-road that they're using. So we know it, we extensively test it, we have our own testing facilities and we go on fleets and these are absolutely tested in every environment that they can be in.

Jamie Irvine: 32:44

Yeah, that makes a lot of sense. You've recently developed a product called Tracks. Tell me more about that. How does it help the end user reduce their downtime?

Cengiz Shevket: 32:53

Yeah, tracks is a unique product. It is an early warning system, if you like. It is a sensor, and it is a retrofitable sensor, which is you don't have to change any of your architecture in your vehicle. All you have to do is remove a couple of lug nuts and the Tracks sensor will just bolt on, tighten them back to spec and you're ready to go. We have two of these things. One of them is Bluetooth-connectable to telematics on board, so it will relay the vibration and temperature signals from the wheel end all the way to the telematics and to the user interface or a service manager's desk. So with that, thousands of miles before a real failure happens, the sensor will tell you the bearing is in a distress condition or that there is an abnormal temperature at one wheel, which is an indication of a failure somewhere in the system, correct and if left unattended they can lead to catastrophic failures.

Cengiz Shevket: 34:01

Right, a bearing failure is a bearing failure, but if a bearing failure is not taken care of could be a wheel off, or it temperatures the temperature, but if it's not taken care of well, it could be a thermal event. So we are part of the ecosystem to give that early warning to the service manager and ultimately to the driver that there's something going on. You cannot just schedule your maintenance or, if it's serious and acute, pull over. Wow, and we're not new to condition monitoring. Skf has been in there for decades in mostly the industrial market for mostly fixed assets.

Jamie Irvine: 34:40

Like wind turbines, much easier. Fixed assets a little bit of an easier thing to monitor than a moving vehicle, correct.

Cengiz Shevket: 34:46

But we're also on railroad right Railways. So we've taken all that knowledge and put it into a bolt-on plug and play system for commercial vehicles. So it gives the ability to act before something serious happens and schedule that maintenance in.

Jamie Irvine: 35:06

Tell me a story of one of your customers, or your end user customers, who put this into place and it had a real world impact on their business.

Cengiz Shevket: 35:14

Yeah, we've had a couple of public testimonials, so I have no problem in mentioning at least one name Pilot Flying J. They're a tanker fleet and they were on pilot phase with us as we were developing program and then they took it onto their production phase and so we are with them in their vehicles and they have responded to an alert from the track sensor and when they pulled apart they noticed that the surface of the bearing had started flaking and again, it was a good indicator for them to repair something that was truly going to fail, and if they hadn't done it it could have led to more serious consequences, especially on a tanker fleet.

Jamie Irvine: 36:03

I was just thinking of, say, a catastrophic failure on a tanker fleet is kind of a worst case scenario on the road, absolutely, absolutely so. That's one example. That's one example, right. And then I can imagine as well, just from the preventative maintenance side, and that ability to have someone who's monitoring in real time and to set up that scheduling. That is so important because the utilization is a real issue with fleets, and especially private fleets. They have to be utilizing their equipment at maximum to be profitable and so to be able to plan that service event in a way that doesn't affect utilization, I think that's a really important component. So I can see fleets really enjoying the access to this new data.

Cengiz Shevket: 36:43

Yeah, fleets absolutely, and they see the value, sometimes more than the OE that's making the vehicle, because for the OE is just a bolt on another part that doesn't affect the basic function of the vehicle, but the fleet. He's worried about his bottom line cost of operation and keeping that vehicle on the road. And that's where we're coming.

Jamie Irvine: 37:05

Well, this has been so fantastic. Thank you so much for coming and taking some time to talk to us about this. I really appreciate it and happy selling out there on the show floor. Thank you very much. Thank you for having me on Wonderful. It was great. Speaking to SKF, if you wanna learn more about them, go over to their website, skfcom today. This brings our series of interviews from HDAW24 to a close this week. I'm actually in New Orleans right now and I am recording interviews at TMC's Technology and Maintenance Council's annual meeting. We're gonna be sharing with you what we learned at TMC and those interviews in the next few weeks.

Jamie Irvine: 37:49

Next week I want you to tune back in because it's an important episode. We're gonna give you an update on what's going on with the transition in refrigeration in the trucking industry, and there's been a big change since the last time we talked about it. If you haven't already, head over to heavy-dutypartsreportcom, hit that follow button, sign up to our once a week, our weekly email where you will get all of the updated content so you never miss out. If you're listening on your podcast player of choice, make sure you hit the follow button and if you can give us a five-star review and a rating on Apple Podcast. If that's the podcast player you listen to, that would be great. And also, of course, if you're watching on the YouTube version, make sure you subscribe to our channel and hit the bell notification so you see when we post new videos.

Jamie Irvine: 38:35

Thank you so much for listening to today's episode. Hdaw was another record-breaking year. It was so awesome to be there and I can't wait to share with you what we learn at TMC and, as always, I wanna encourage you to be heavy-duty. Thanks for listening. Talk to you next week, okay, okay, okay, okay, okay, okay Okay, and enjoy the workout of many students.