January 26, 2010 Getting Vertical

Volume 13 | Issue 1

Master Power Turbo only makes one product, turbochargers, but it's tightly focused on making them better and better. Now the company is read

Some companies choose to excel by making only one product, but making sure it’s the best there is and then winning customers who seek out quality. Master Power Turbo is such a company, concentrating all its efforts on making the best turbochargers possible and working constantly to improve their product and stay ahead of the competition.

“We only make turbochargers,” said Master Power’s Commercial Manager Ricardo Letti Borghetti. “The company is characterized by its verticalization; all the industrial processes are internal, from the designs, the projects, the molds, the foundry of aluminum and iron, machinery, final assembly and testing.”

As part of that verticalization, the company is in the process of installing its own precision foundry which will allow Master Power to cast super alloys (Nickel base) for turbine wheels. This alloy withstands temperatures of up to 900 degrees centigrade. In addition, another plant is being installed to produce compressor wheels in aluminum through the plaster molding process. The company began planning the investment at the end of 2007, when it started purchasing and installing the new equipment. In November last year the company started testing of the machinery. Production is scheduled to start in March, said Borghetti.

Once these two new units are finished and production commences, the company will be even more vertical, with the ability to make more of its own parts to ensure their quality, and to be more flexible with introducing new technologies.

“This is to give us greater control over the processes and to have more control over the quality of the product. It’s verticalizing our production even more. We’ll be less dependent on components from other companies,” Borghetti said.

The $6 million investment will also help Master Power become more competitive, improve technology and quality, while offering the best turbocharger to answer modern demands.

The company invests constantly to improve its processes and to increase production capacity. In 2009 Master Power produced about 100,000 turbochargers, and has the capacity to manufacture 180,000 in 2010. The factory, in the town of Sao Marcos in Rio Grande do Sul state, has two production units, including the foundry and assembly areas, as well as testing and quality control labs.

800 APPLICATIONS
A turbocharger is used to boost the density of the air entering an engine, providing more power. Inside a turbocharger, a turbine and a compressor share a shaft, with the exhaust gases of the engine turning the turbine. The turbine powers the compressor, which pushes a higher volume of air into the intake manifold, where it is then distributed to the engine’s cylinders. The extra volume of air permits higher pressure in the cylinder, even at high engine revolution speeds, giving the engine added power.

Master Power makes more than 500 different kinds of turbochargers for more than 800 different applications. The turbos are used on cars, trucks, buses, farm equipment, maritime vehicles and, of course, on high performance race cars. Most, if not all diesel engineers are produced with turbochargers already installed, and Master Power’s biggest market is the so-called after market, which means replacements for damaged or burnout parts, or people installing turbos to improve the performance of their vehicle.

In Brazil the parts maker sells most of its turbochargers through a network of 35 big distributors, who then sell the turbos to stores around the country. A network of 217 service centers in Brazil provide after-sales service. Master Power also has direct distributors in more than 50 countries, on all continents. The biggest foreign markets are in the Middle East, Argentina, South Africa, Colombia and Mexico. Exports represent about 40 percent of the company’s total sales.” The clients now value post-sales service and technical assistance very highly, and we make sure we provide those as well.”

Up until just last year, 100 percent of the company’s sales came from the aftermarket. A few years ago Master Power decided to move into the original parts market, selling turbochargers to the engine makers that supply Brazil’s many auto and vehicle manufacturers. This year the turbo maker expects to get 3 percent of sales from the original parts market, and the goal is for sales from that source to reach 30 percent two years from now.

“Moving into that market is a slower kind of work; it takes longer based on the tests that have to be done by potential customers,” said Borghetti. “Now we supply original parts to MTU in Brazil, a maker of maritime engines and generators, which also uses turbochargers. Generators are essentially industrial engines.”

The original parts market offers much bigger potential for sales growth because the quantities required by engine manufacturers are much greater than the numbers sold into the aftermarket. Winning one client this year among the big engine manufacturers in Brazil could mean meeting the 30 percent goal in one shot. Companies in other countries represent another big potential market.

The original parts market is also growing quickly because of growing pressure on engine makers to cut polluting emissions while also increasing power. Turbochargers are the best way to accomplish both these tasks, but they also need to improve to keep up with the new demands, and Master Power is in a good position to stay on top of the newest technology and incorporate it into its products.

“We need parts that are more durable, which can handle these new requirements,” said Borghetti. “We work constantly on research on new alloys and new production processes to meet this demand.

That is why the company does all this work in-house, getting help from from research institutions and universities. Master Power, which acquired ISO 9001-2008 in 2004 and is in the final stages of acquiring TS-16949 certification, works with these institutes to research new materials and alloys, and also works with government research facilities.

“The company does its own research as well, constantly testing potential new materials and designs to evaluate powertrain performance, and then applying this knowledge to improve our turbochargers,” Borghetti notes. “They’re all factors that make us more agile and quick.”

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