January 26, 2009 Driving Difficult Directions

Volume 12 | Issue 1

Marmon-Herrington manufactures OEM solutions designed to provide all-wheel drive axles and transfer cases for class 6, 7 and 8 trucks and sp

Marmon-Herrington is a small, build-to-order manufacturer with only 50 employees based in Louisville, Ken. In these days of economic turbulence, being small has its advantages, especially when you serve a specialized niche market that larger companies consider only as an afterthought.

The company’s reputation, however, extends well beyond the specialized niche it serves. Marmon-Herrington traces its lineage back to the mid-19th century, and has produced a number of noted hallmarks in the automotive and trucking industries. Unlike some other nameplate companies that played important roles in the development of these industries, though, Marmon-Herrington is not only still around, but thriving.

Marmon-Herrington manufactures all-wheel drive axels and transfer cases for Class 6, 7 and 8 trucks and specialized vehicles. And nothing else. This provides the undercarriage for stable success even while problematic potholes in a slowing economy widen for the overall industry.

“We’re a small company, and that means we have considerably less overhead, so we’re in a much better financial position than a bigger company without a lot of bills to pay when the economy gets tight,” points out Robin Stow, vice president of sales and marketing. It also helps when that small company exclusively supplies to a small niche that doesn’t feel the repercussions of a troubled economy in quite the same way as the broader marketplace.

The markets that require all-wheel drive equipped trucks include the military, oil and gas, agricultural and forestry. According to Stow, “While we currently are seeing a slowdown in military contracts, demand for all-wheel drive trucks in the commercial oil and gas markets remains strong. Even while the economy may be declining, the need to continue exploration for new energy reserves, not to mention maintain current production, isn’t going away. This is exactly the kind of operational environment where if you need trucks, you need them to operate offroad. One good example is wind farms, which is starting to get the attention here that it has in Europe. Well, wind farm sites are typically in isolated areas, so any vehicles working out there require off-road capabilities.”

Most truck OEMs manufacture hundreds of thousands of vehicles a year that require conventional axles and transfer cases. In contrast, the market for all-wheel drive versions runs to about hundreds of vehicles.

“We’re the only company that provides all-wheel drive solutions for this market, and that’s all we do,” explains Stow. “While it’s true that the bigger axle manufacturers offer all-wheel models and try to compete with us, it’s not their focus, it’s not a major revenue source for them. Put yourself in the position of our customers. Who would you rather do business with? A company that looks at you as a side project, or a company that is entirely concentrated on designing solutions tailored to your engineering needs?”

He adds, “The value-add of Marmon-Herrington to truck OEMs is our sole business is providing all-wheel drive truck axles and associated products as part of a flexible and innovative mobility solution tailored to chassis weight classes, power train options and fleet specifications; our customers get our entire, undiluted attention to meet their needs. Maybe the bigger guys can offer something that seems less expensive, but it doesn’t turn out to be so because whether some relatively small part of their business is delivering on-time or maintains certain quality standards just isn’t a big blip on their radar.”

LOOKING BACK ON INNOVATION
The original company bearing the Marmon name dates back to 1851 as the Nordyke and Marmon Machine Company, specializing in the manufacture of flour mill machinery. Around the turn of the century, the company shifted gears to the emerging automobile industry, and for the next three decades, The Marmon Car Company produced some of the world’s finest cars.

“Marmon built the car that won the first Indianapolis 500 race in 1911,” Stow points out.

The six-cylinder Marmon Wasp, so called because of its yellow with black accents paint job, took first place honors with a six-hour, 42-minute and eight-second finishing time. Unlike other racecars of the period, the Wasp was built with a smoothly cowled cockpit and a long pointed tail to reduce air drag. But the innovation that perhaps has the most relevance to contemporary driving was the invention of the rear view mirror. The Wasp enabled a single driver to operate a race car without need of a riding mechanic to watch for cars from behind!

The company also made a touring car called the Marmon Sixteen that was one of the first luxury sedans and is cited by industry historians as exemplifying the golden age of American passenger vehicles. However, the luxury car market became considerably less lucrative once the Great Depression arrived.

This resulted in the second half of the company’s business, as well as the second half of its name. Colonel Arthur Herrington, an ex-military engineer involved in some of the first designs for all-wheel drive vehicles, joined forces with Marmon to fulfill contracts for military aircraft refueling trucks, 4×4 chassis for towing light weaponry, and commercial aircraft refueling trucks. It also supplied an order from the Iraqi Pipeline Company for the largest trucks ever built at the time. In addition to large commercial and military vehicles, the company tapped into a growing demand for moderately priced all-wheel drive vehicles under the nameplate of Marmon-Herrington Ford.

While it eventually evolved away from making the entire vehicle, the installation of commercial all-wheel drive truck chassis became the company’s core competency. In the early 1960s, Marmon- Herrington was purchased by the Pritzker family and became a member of an association of companies that eventually adopted the name The Marmon Group. Today, the Marmon Group is owned by Berkshire Hathaway, and comprises more than 125 business units that operate independently within diverse business sectors around the world.

DRIVING FORWARD
Today, Marmon-Herrington designs and manufactures installation kits for most Class 7, 7 and 8 truck makes and models, as well as custom-engineered prototype axle systems for specialty applications, in modular product offerings with interchangeable key components. It does not install the axles and transport cases, rather it provides the product kits for OEMs and installers to do so.

“We supply mobility solutions,” Stow explains. “The typical truck manufacturer doesn’t have that much of a demand for all-wheel drive, so it doesn’t pay to have a dedicated production line. But, there is still demand, and we partner with the OEM, or a fleet owner, to engineer and provide product that meets their power train needs for a given weight class. The fact that in most cases we have modular components that we can easily configure into an application for a specific use means we can meet individual use requirements without the need for extra lead time.”

Stow says that the company primarily assembles components manufactured elsewhere into a solution for a particular chassis. “Historically, we outsource these products to Europe, simply for cost reasons. However, these days the American dollar is much more favorable in terms of the exchange rate, so we’re hoping to move more of these resources back to the United States.”

He emphasizes the importance of a solution designed specifically to a particular vehicle. “In the old days, if the exhaust system was in the way of what you were doing in putting in the drive train, well, you’d just re-route it any way you’d want it. These days, EPA (Environmental Protection Agency) regulations won’t let you do that. So we’ve got to come up with something that works without disturbing or affecting the truck’s existing structure.”

Indeed, environmental concerns coupled with improved fuel efficiency standards are driving new innovations in all-wheel drive power train designs. “We’re working closely with our customers to change specifications and stay ahead of diverse industry trends. From power train emission standards to changing driver skills and expectations, we lead the way in bringing information and design solutions to the OEM. We’ve cultivated a partnership relationship that no one but us is capable of delivering.”

Marmon-Herrington may be small, supplying a small market, but it is exactly the right size to continue to provide value-add service to move its customers comfortably under challenging conditions, both terrestrial and business.

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