MTU South Africa is a subsidiary of MTU Friedrichshafen, a leading German manufacturer of large diesel engines and complete propulsion systems, which has won several international awards and accolades over the years for its innovation and superior product portfolio.
MTU South Africa employs a team of 180 people and is responsible for supplying two core products – diesel engines and complete propulsion systems – to customers in various applications across the Sub-Saharan, including mining, power generation, rail, construction and industrial. The company also targets customers in marine and naval defense, a sector that Procura Diesel Services (the company MTU took over in 2001) focused around.
MTU’s brand has a rich history spanning back 102 years, where it has seen several forefathers of the modern day diesel engine associated with the company, including Graf Ferdinand von Zeppelin, Karl Maybach, Gottlieb Daimler and even Rudolf Diesel himself.
“It’s actually an engineering institution if you think about it,” says Hilton Foster, senior manager of sales at MTU South Africa, explaining the company’s remarkable background. He adds that, as of 2011, the brand has been owned by Rolls-Royce and Daimler. “That’s a very powerful message to the industry in terms of where we come from and where we’re going into the future.”
With this kind of pioneering pedigree in the company’s DNA, it’s clear to see how MTU has been able to establish itself as a competitive player in South Africa.
However, Foster says it’s not just the products that have helped the company succeed on the continent.
“We also supply a very comprehensive after-service market, such as spare parts, maintenance contracts, service level agreements, anything having to do with after sales,” he says.
On top of workshops in Johannesburg and Cape Town where technicians can perform full engine repairs and rebuilds, the company has a specialised team of 12 ‘flying doctors’ – product, support and service specialists – who fly to where the customers are located and perform maintenance on MTU’s engines.
MTU also has ‘men on site’ offering dedicated technical support in five open-pit mining locations across South Africa to clients utilising trucks with MTU engines.
These technicians use the mine facility as a workshop with their own special tools and parts on site. They work closely with the mining operations people and proactively advise when a truck’s engine needs its next service, oil change, filter change or technical downloads.
“[The MTU team members] are so specialised in their field, they can go into any market sector and find a solution for the customer. That’s the foundation we work from that gives us a competitive edge in the market,” says Foster.
MTU Friedrichshafen is a brand that has been in existence for more than a century. By comparison, MTU South Africa’s 12 years of operations seems small, but the successes the company has been able to achieve in little more than a decade are noteworthy.
In the mining sector, MTU South Africa just finished a re-power project for a client’s dump truck. MTU ended up replacing a competitor’s engine with one of its own – all the fittings and testing executed on site – and the results have been favourable, says Foster.
“Now the exciting part is to manage the engine, including all the downloads and the proper comparisons; that’s what we pride ourselves in,” says Foster. “We can take this to the customer and show them what we can potentially save them over the next five to 10 years. How their efficiencies and production will be better. We’re very proud of it and we know there’s more in the pipeline.”
In power generation, MTU SA’s Series 4,000 engine has become the benchmark engine of choice for the telecommunications industry in South Africa, says Foster. MTU partnered with a local OEM that builds the highly regarded engine into a complete genset, which is then used by telecom companies such as Vodacom, as back-up power generators for their data centres.
MTU’s South African business has also worked with rail operators in Africa. In 2007 the company provided the diesel engines for five locomotives made by a Chinese OEM to Madagascar’s main rail operator, Madarail. Since then, MTU has been providing full maintenance and support. The company has also embarked on other projects with the operator to upgrade the engine for one of its older models. “That was a success for a re-power project in our market,” says Foster.
“A good business model, for other African countries and emerging markets to consider, is to take some of the older equipment and instead of scrapping it, to just refurbish it. Those types of projects are possible as an alternative.”
The company is also currently working closely with two Chinese OEMs bidding on Transnet’s tender for 465 diesel-powered freight locomotives. “We’ll be supporting the Chinese with our engines as the preferred propulsion systems for the locomotives…that’s quite a hot topic in South Africa at the moment.”
The increased investment and rising global interest in Africa’s rail industry is why MTU SA decided to exhibit at this year’s Africa Transport and Infrastructure Show in Johannesburg this month.
“Rail has always been an important application for MTU globally. As Africa develops, one of the main focus areas is going to be infrastructure and rail is a very prominent area of opportunity,” explains Foster. “We’re confident we can create a product that can serve Africa very well. As long as we get the maintenance contracts in place with the operators, there’s no reason the engines can’t be going for 20 to 30 years. There’s no reason why a locomotive has to stand and not perform, as we see in Nigeria and Namibia. We pride ourselves in selling and maintaining a product, which is more critical. We feel like we can really bring value to the customer. We can’t stress that enough.”
Looking to the future, Foster says the plans for MTU are ambitious yet focused.
One area the company is looking to invest more in is building its technical skills and capabilities within South Africa. The company has been operating a training school and apprenticeship programme to educate people not only for MTU’s business, but also for the benefit of the industry overall. The programme has been extended to the local government and to some of MTU’s biggest customers including the South African Navy, which currently has two candidates in the apprenticeship programme.
“The whole vision is to one day have a complete training school that’s registered with the education board with a proper curriculum. We are marching down this road, but it’s a long one to go down,” says Foster.
Not unlike much of the world these days, MTU South Africa also has a vision to grow into the rest of the Sub-Saharan continent. The company is aiming to extend its dealer network and set up hubs within the region, with the most recent expansion taking place in Zambia. “We have a man on site there with a warehouse to provide support for the underground mining industry in Zambia,” Foster adds.
Other countries Foster’s looking at include Nigeria, Rwanda and Mozambique, due to its oil and mining discoveries. He believes that partnering with some of the big mining, power generation and construction multinationals coming into the continent will help set the brand up to eventually become the preferred partner to such ventures.
“We’re a very lean company. But we have big vision and big growth potential. It’s an exciting time for people in the African continent, especially in the Sub-Saharan,” says Foster.
“Africa was always considered the continent you didn’t want to do business with, lots of political strife and civil war. But it’s a continent with huge, huge potential, with an abundance of resources and infrastructure development going on. It’s the place to do business and we’re really excited about the future.”