Investing in Australia

Nelson Global Products

Nelson Global Products (NGP) is the largest independent manufacturer of mufflers and tube assemblies worldwide. Privately owned by Wind Point Partners (WPP), the company employs over 3,000 people and boasts 17 locations across four continents.

NGP has enjoyed rapid growth, exploding onto the international scene with recent acquisitions in China, India, Brazil, and Australia. The company is gaining traction around the globe and is “the number one supplier in our particular market sector in the U.S,” NGP Australia General Manager, Malcolm Neylon, reports. NGP’s head office has been located in Stoughton, Wisconsin since 1939, and the company’s manufacturing operations are currently located in Clinton, Tennessee; Fort Wayne, Indiana; Arcadia, Black River Falls and Viroqua, Wisconsin; Morton, Illinois; Cambridge and Chaska, Minnesota; Scoresby, Australia; Daman, India; Rio Grande do Sul and Araucaria, Brazil; Changzhou, China and Monterrey, Mexico. Even more NGP manufacturing facilities are slated to open in the near future.

NGP designs, manufactures, and markets under its flagship Nelson brand a wide range of fabricated high performance OEM and aftermarket products for the commercial vehicle on-highway and off-highway markets, as well as the outdoor recreational vehicle and power markets. These products include mufflers and silencers, exhaust tube assemblies, Exhaust Gas Recirculation (EGR) and Thermal Management Tubing (TMT) for emissions systems, pressurised air and fluid carrier tube assemblies and structural assemblies.

NGP’s product engineering capability and advance metal forming expertise bring a distinct edge, enabling the team to provide complete design and manufacturing solutions for the toughest challenges across multiple markets.

NGP Australia was formed when NGP acquired Cummins’ exhaust operations in Scoresby, Victoria. In the three years since, the company has made a capital investment of over 900,000 AUD and has set its sights on becoming a market leader in Australia, Mr Neylon shares.

A complete re-layout of the facility to optimise flow is already bringing positive results. “Our lean journey in Australia has been a strong focus,” Mr Neylon explains. “We have been doing waste reduction in our business which makes us market competitive. Part of that has come about by establishing a very clear process flow within our facility; our material flow is very clean, there is no wasted motion or transport within the process.” The team has also introduced the use of highly efficient CNC bending machines.

NGP Australia has also been investing in its employees. Each employee has undergone a 12 month lean training program, three key employees have received supervisor training, and a manufacturer engineer has had Greenbelt Six Sigma training.

The facility has ISO 9001: 2008 quality certification and is targeting ISO14000 certification. The team is not finished yet; to achieve consistent delivery and quality performance this year’s budget includes additional investment to replace the wash facility, forklifts, material handling equipment, hydraulic presses, and endforming machines.

Manufacturing processes at NGP Australia’s 7,000 square metre facility include tube cutting, tube bending, end finishing and fabrication, weld assembly, wash and paint, high pressure testing and cleanliness test lab, and muffler fabrication. Currently, NGP Australia employs 65 people and focuses on a target customer base that includes all major OEM truck manufacturers, agricultural, mining, and train manufacturers.

A key strategy for NGP Australia has been diversification. “The business was primarily focused on providing exhaust tubing to OEM truck manufacturers in Australia,” Mr Neylon says of Cummins’ operations before NGP came on board. “Since we took it over we have diversified into a broader range of tube work.” He estimates that about 65 per cent of NGP Australia’s business currently involves exhaust tubing and similar OEM equipment for Australian truck manufacturers.

The remainder of the business has been refocused, primarily into the structural tube sector. “We are looking at handrails and structural components in vehicles as well as other applications,” Mr Neylon reports. “We have just been awarded the handrail business for the new Volvo truck model that is being released in Australia and we are in negotiations with other truck manufacturers.” The company is able to supply a full range of handrails, “from powder coated finished rails through to polished stainless steel.”

NGP Australia’s business also includes supplying Pooldeck products, which consist primarily of stainless steel handrails, starting platforms and ladders commonly used in residential and commercial swimming pools throughout Australia.

NGP Australia’s tight radius bending sets the company apart. The team specialises in 1D bend radius, “which means that if we are taking a five inch tube, and we are bending it through a 90 degree angle, we will bend it to a radius of five inch. That is very tight bending [with] a lot of elongation in the base material. The majority of companies are still only bending to 1.5 D – a much larger bend radius.” NGP Australia works with thin walled tubing as well as thick walled tubing and with a wide variety of grades and materials, from mild steel to stainless steel.

Mr Neylon believes that NGP Australia’s sales will continue to increase due to a growing market demand. “It is my personal view that the trucking industry in Australia is going to be very strong in the future,” he says. As local manufacturing decreases, demand for imported goods will increase accordingly. “So we have got a lot of freight movement in the country due to the rising demand for imported goods. And of course, with such a large continent we need to have a strong road freight network.”

The only question is whether or not these much needed trucks will be produced domestically or overseas. NGP Australia is helping to give the domestic manufacturers a fighting chance. “We are supporting the local truck manufacturers in becoming more cost competitive,” Mr Neylon explains. “A lot of the imported trucks are being brought in because of the favourable exchange rate. If we can reduce the cost of the local truck manufacturing they become much more competitive regardless of the Aussie dollar.”

Supporting domestic truck manufacturing provides Australians with a superior product in addition to helping to boost the nation’s economy, Mr Neylon says. “The local trucks are built for Australian conditions,” he explains. “The imported trucks are built [to have] a shorter truck life, typically five or six years.” Australian built trucks are designed to last more than 10 years, Mr Neylon adds, and are able to withstand much harsher environments than what American or European made trucks are designed to endure.

With such a strong demand for its products Down Under, NGP Australia is well positioned to continue its growth and success. “We have identified our niche market to be the tube business, so we want to be the leader in that business not only globally but in each of our locations,” Mr Neylon remarks. To reach this goal, the team is working closely with leading engineers to develop new products that will meet Australian demands and continue to evolve along with the industry’s needs. Flexibility will also be key. “The truck industry here is built around low volume production, so you need to have a flexible work environment [so] that you can change part numbers quite easily and frequently.” The success that will come from implementing these strategies will benefit everybody involved. “We want to grow the local industry,” Mr Neylon insists. “[We want to] support the local manufacturers.”

For more information about Nelson Global Products, please visit http://www.nelsonglobalproducts.com.

Making Sense of Management

Management is the art, or science, of getting things done through people. Sounds fairly straightforward – except for the fact that people are not robots waiting to do our bidding. People have their own minds, motivations, and goals. So how do managers keep operations – and the people behind them – running as planned?

June 19, 2018, 8:05 PM AEST