VMI Group to benefit from trends driving the tire industry – RubberNews.com

AKRON—The major trends driving business in the wheel industry are all things that benefit car tire machinery maker VMI Group, according in order to the firm’s CEO.

Those factors include reshoring to bring tire production closer to the customer, the need in order to update technology at older tire factories and a push to use new materials that have a lesser impact on the environment .

“These three factors together are driving investment in brand new equipment, ” Harm Voortman, CEO of the Epe, Netherlands-based VMI Group, told Rubber News. “This is good for companies like VMI. Over the last decade we have been focusing on automation and creating higher levels of automation. That fits very well with what the market now demands. ”

The reshoring trend is one that goes against past practices, where companies would produce everything as far away as possible to keep costs low.

“Now you want to be close to your markets because associated with the transportation issues and the disturbances within the supply chain, ” he said in the interview at the recent International Tire Exhibition & Conference in Akron. “That means in the Western World you see the lot regarding investment going on. But in order to do that in a new cost-efficient way, you have to go with a high level involving automation. inch

Secondly, much of the particular installed tire manufacturing base in typically the Western region is behind in technologies, meaning companies need a lot of personnel to run the production lines. That makes it tough to be cost-competitive along with newer operations, Voortman said.

“The problem with personnel is that this is a real driver now for companies to invest, because it’s very difficult to get motivated people. If you have people, after awhile they move on. Turnover will be high, plus (replacements) hard to get. That means this drive for automation is enormous at this moment. ”

In addition, with the wheel manufacturing technological innovation in place at some of the older facilities, it may be tough to catch up even with updates at brownfield locations. “If you need to compete as a company with an existing factory in North America, and you have to compete with newcomers that have a greenfield plant with the latest and most modern equipment, it will be extremely difficult to upgrade what you have and compete on a cost level, ” he said.

Much of what can be done to upgrade a tire plant depends on what generation of technology currently is in place. If it’s not too ancient, it’s possible to make some updates, but the older the machinery, the less cost-effective it is to upgrade it.

“I’ve seen factories where VMI machines from the 1980s are still building tires, ” Voortman said. “That’s great and we’re very proud of that. But it is clear that you can not upgrade that to the level we have nowadays. ”

The VMI CEO, who also is a board member of parent company TKH Group, is encouraged that companies are investing in new materials and tire designs to either make a tire lighter, improve rolling resistance or increase the lifetime of the tire.

“All this together creates an industry where, in your existing factories, you need to process new materials, ” he said. “That sometimes is not possible, so you need the functionality of new, modern equipment to produce these tires with these new materials. ”

VMI is working closely with its tire manufacturing customers to develop new technology that will be able to process these next-generation materials and tires. Voortman said that means not just talking to those on the purchasing side, but also those on the engineering and tire technology side. And when the topic is sustainability, that means collaboration at the board level.

“Not all companies are already focusing on this, but in my opinion, this will become the main topic within the coming years, ” he said. “So that is something we have to discuss with the top level of management from the companies.

“What are their goals and visions? Where do they want to focus on, and then see where we can fit in and support them on this path. inch

Developing and implementing the technology, however , is only the first part of the equation. Once a solution is engineered, when it’s time to install and use it, staff training is critical as the new processes are very different than building a tire in the past.

“This is operating a high tech, highly advanced machine, with robots, with cameras. That means you really need to train the people, and not just the operators, ” Voortman said, “but also the maintenance staff. And you have to refresh that every now and then. inches

To that end, VMI has training centers set up globally for its customers, including one in the U. S. at its Stow, Ohio, location. Tire makers can send their operators and maintenance staff to be trained at various levels, with courses ranging from basic to standard and advanced. He said some training also can be performed on-site at customer factories.

“Training individuals, and helping them absorb this new technology, that is key in the success of the customers, ” he said.

The ongoing disruptions in the supply chain are very awkward for VMI, its CEO said, because the firm is proud of its reputation for on-time delivery.

“Now you see it becomes more and more difficult to have your delivery times in place, ” he said. “We’re constantly in discussion with our customers, who really have a need to get their equipment. We fully understand and would like to cooperate with them. But it’s very difficult now to get the production done. ”

On a base lapisan, it’s that suppliers are late on delivery. But Voortman said the real issue is in production, and if you don’t have a reliable stream of materials come in, then your production will be disturbed. “Before you know it, you will end up with chaos, ” he said.

VMI has put much effort into keeping its parts coming in so it can alleviate the impact on its customers, but that can be a difficult proposition.

“There are improvements for sure, but some components will still take time, ” Voortman said. “In my opinion, the disturbance on the supply chain will also have an impact in 2023. Somewhere down the line this has to be resolved, but I don’t see it happening in short notice. ”

VMI’s main production facility is at its headquarters site within the Netherlands. It also keeps its research and development, and engineering close to this facility to make all prototypes there first.

But to lower costs for customers, it setup a plant in China more than 20 years ago, where standard modules are produced and then integrated with parts of the machine that come from Holland.

When tighter delivery times, political unrest and trading barriers became an ongoing factor in recent years, it also opened a facility in Poland in 2017. Expansion is ongoing at that facility to double its current capacity, according to the VMI executive.

Almost every machine from VMI is made partly at two of three facilities. And after prototypes become production-ready, they also are integrated into production in Poland and China to keep costs lower can be.

Voortman said the rebound in the market was much faster in 2021 than the firm had foreseen. Sales last year totaled $473. 2 million, 56. 4 percent higher than 2020, according to data from European Rubber Journal . That ranked the firm as the world’s largest producer of rubber-related machinery.

“We thought, in discussion with our customers, that the recovery would take a little bit longer. But in 2021 we already saw a fast rebound, and that continues at a very high level in 2022, ” he said.

“And I think that also in 2023 it will be at a high level. We don’t see a lower level of investments coming in the foreseeable future. very well