The mobile machinery sector is on the upswing. Large orders from two major customers, John Deere and Caterpillar, are evidence of this. During the spring, Sales General Industry (GI) handed out awards to employees and departments that played a role in the successes.
Whether you look at the world of politics or business, change and upheaval are making headlines. At Freudenberg Sealing Technologies (FST), conversations are turning to the phase-out of the internal combustion engine, new electric-mobility solutions, batteries, fuel cells and electrolyzers, not to mention hydrogen and renewable energy. After all, companies have to set their course for the future at an early stage. But it is just as striking that FST is still growing nicely in the classic business sectors – with good future prospects.
One excellent example is the industrial business’s mobile machinery sector, which includes the agriculture and construction segments. In 2019, the sector chalked up record sales in the three-figure million euro range. Today, just four years later, the sales volume is 50 percent higher – despite rising raw material and energy prices, the COVID crisis that had crippled the global economy, and the material and delivery bottlenecks that many industries are experiencing even today.
“We are naturally talking about biofuels and alternative hydrogen drives as well. But the classic technologies – hydraulic and powertrain applications – will remain our bread-and-butter for the foreseeable future. This reliable, ongoing business will be with us for many years. There are many reasons for this: the all-day operation of heavy equipment, the power density that the work requires, and the lack of a charging infrastructure” said Angelika Mulac, Vice President Mobile Machinery.
The booming business is the result of global trends,, especially population growth. The situation calls for increasingly efficient food production. Natural and geopolitical catastrophes are also fostering global demand for infrastructure and construction projects. But this is also a “homemade” success, as shown by the two awards honoring the sector’s employees at the Sales GI meetings during the spring.
John Deere / Caterpillar
FST was able to greatly increase sales over the latest strategy period with a major order from agricultural machinery manufacturer John Deere, GI’s largest customer ever. The accomplishment is especially impressive because the team had to work hard on logistical challenges due to raw material shortages as it developed the business. Price increases also had to be agreed upon with the customer due to rising costs. The most important aspect: “Our business relationships were not damaged during the negotiations. On the contrary, we even expanded our pipeline of potential projects and products,” Mulac said. “In general, we can see that our customers appreciate us as strong, reliable partner at their side.”
Award-winning cooperation between Sales GI and several FST divisions on the Caterpillar order highlighted how important working “together” is for good customer relations. Caterpillar is the company’s largest customer in the construction segment. “We have already been earning relatively high revenue with Caterpillar, but we still see enormous potential. If we are going to exploit it, we have to put our business with Caterpillar on an even larger platform and expand our network to the business units that we are not yet serving,” Mulac said. Caterpillar is making this easier: Its representatives are already expressing the desire to take the business relationship to the next level.
Signed in 2022, a framework contract governing future cooperation is the foundation for new sales initiatives. The Lead Center Fluid Power Industry, which provides a large portion of the products for Caterpillar, played a major role in drafting it. “There was great cooperation. Sales GI could not have done it on its own,” Mulac said.
New business can also be traced to effective cooperation between Sales and the divisions. For example, the collaborative approach has led to orders for Oil Seals Industry and the O-rings Division, whose Kuressaare site was audited and certified for a new major order. The Competence Center in Santa Ana arranged for the desired logistical service package: The parts are being coated, printed and packaged individually according to customer requirements.
Electric mobility is also making inroads at Caterpillar, and FST is actively supporting its developments there. Plug & Seal connectors from Morristown serve as cooling elements for batteries and make it possible for Caterpillar mining vehicles to operate underground.
