Meritor: Soldering On
For the last five decades Meritor has been a consistent presence in the local market, adding much to the legacy of Australian manufacturing. This year it celebrates its 50th anniversary as a driveline components specialist.
In many ways the modern history of Australian trucking runs parallel with the presence of Rockwell and Meritor, as it later became known, in the local market. It first opened its doors as a producer of driveline parts in 1970.
The axle assemblies produced by Rockwell for its first customer locally, International Trucks based out of the Dandenong site now occupied by IVECO, were completely built at its Sunshine plant. It’s here crown wheels and pinions were cut on specialised machinery and later treated. It’s also here where axle housing assemblies were also moulded into shape and welded.
Over the years the customers grew even if the volumes were, by today’s standards, relatively small. Under the Rockwell aegis, axle assemblies were supplied to Ford for the Louisville truck built in Melbourne.
It also delivered to Mercedes-Benz and Freightliner, who were assembling trucks under the same roof in Mulgrave, Western Star in Brisbane and the original equipment manufacturers, who continue to build trucks in the country today, such as Kenworth in Bayswater, Mack in Wacol and stable mate Volvo, before it began importing its own drivetrain assemblies.
As it celebrates 50 years in Australia, Meritor, whose parent company is based in Michigan, has built a reputation for Australianising the imported product it sources from around the globe and enhances, through a dedicated in-house engineering department, to better adapt to the rugged Australian conditions.
Its most popular drive-axle model series, the RT46160, a tandem drive-axle, is sold all over the world and is specified for Mack, IVECO, Kenworth, Freightliner, Western Star and DAF trucks.
Built at Meritor’s plant in Sunshine, an enclave of Melbourne’s western suburbs, the RT46160 is a robust upgrade on the same tandem drive-axle that arrives here on imported vehicles. According to Renzo Barone, Meritor Territory Manager – Truck, the company invests in a localised approach to provide products tested and validated to meet the Australian customer and unique environment.
“Our welding procedures are more robust,” he says. “We’re flexible enough to be able to offer solutions like these enhancements as opposed to a huge manufacturing plant that doesn’t have our flexibility.”
The road transport environment has undergone many changes in the time Renzo has been at Meritor. Remnants of the company’s manufacturing glory days were still present at the facility and in use when Renzo started out.
First imported into Australia in 1922, the Gleason, a gear cutting machine, was used to cut crown wheels and pinions from blanks without gear teeth into correct ratios and lap them to be assembled to a differential carrier.
Another major process undertaken in the facility was friction welding in which the wheel ends, often referred to as a spindle, were friction welded into the housing. That would entail the spindle ends of the housing, spun at rapid speeds, being forced into an opening. The friction from a stationary object forced into a spinning object created the weld.
“That process is still performed today by Meritor’s other production houses around the world but that was done in-house here back in the day,” Renzo says.
“I was right on the cusp of that. When I started out we really didn’t have a computerised system for anything really and it was only very basic email that we used as far as computers were concerned. It was a lot more hands on with far more paperwork back then. The majority of what we do now of course is now via electronics and computers.”
A cornerstone of the manufacturing facility was the popular heavy duty suspension known as the Rockwell 6 Rod. It was common across most of the local commercial vehicle manufacturing and popular notably in roadtrain and logging applications.
Kenworth, Western Star and Mack all specified it.
When Western Star discontinued manufacturing trucks in Australia, the vehicles it built in Canada and later Portland, Oregon, for the Australian market, where the Rockwell 6 Rod was very much in demand, necessitated its export to North America.
The suspension was then fitted onto the Western Star trucks before the vehicles were shipped back to Australia. That ceased around 2011 according to Renzo.
“That was an interesting time building the assemblies out of here shipping them to the US and then having them come back again,” he says. “It was a niche market but it was indicative of our adaptability and service capabilities for the needs of the market.”
In the mid ‘90s Isuzu were looking for a vehicle that would meet the light tare requirements of the Australian industry without relinquishing any of its durability. Long renowned to have good quality heavy duty components, Isuzu, however struggled to reduce these in weight says Renzo.
As a result, Meritor was appointed as its supplier of axles for export to Japan. Product initially came out of the Melbourne facility but as an involvement in supplying some Mack components continued to grow a facility in Wacol, Brisbane was established to service both brands. It lasted up until 2014.
Meritor has also previously supplied a hub reduction axle to Mitsubishi in Japan.
“It’s encouraging today to see we still supply Meritor components within the Mack vehicles even though they continue to have their own drivetrain components,” Renzo says. “Meritor has been synonymous with Mack for many years.”
In November, Renzo will have been with Meritor 28 years. He arrived at the company on 4 November 1992, recruited by Mal Grumont from the Australian Capital Territory where he was working as a service manager at a Ford Truck dealership in Belconnen.
Grumont, who at the time was the Meritor Sales Manager, soon became a mentor and influential figure in Renzo’s career.
“He took me under his wing, took me all over the place and introduced me to customers at the coal face,” he says.
On these rounds Renzo met with fleet owners, end-users and dealers. Mal, according to Renzo, taught him nearly everything he knows about the business.
“Mal was a font of knowledge. He had such a positive impact on operations and me along with Graham Hall.”
Hall had himself started out on the shop floor and worked his way up, no less, to Managing Director. He literally grew up within the business.
“Graham knew many of the larger fleet owners and operators personally. We still have very good relationships today between our vehicle manufacturers, dealer network and end users,” says Renzo. “He was instrumental in creating that.”
A majority of the equipment used during that golden era of manufacturing was shipped to India, where it is still in operation making the same axles today that were made in Melbourne up until the late 1980s.
Behind the facility is another building almost identical in size, that was sold off when Meritor scaled down from a fully operational manufacturing plant to an assembly facility in 1988.
At one stage both buildings employed nearly 400 workers across day and night shifts with a café run by dedicated full time staff. A worker could get a sit down meal at any time of the day.
Now the remaining site is largely automated and augmented by overhead cranes which keep manual handling, which was widespread during the factory heyday, to a minimum.
“Those manual handling processes you don’t see today especially with the rise of health and safety parameters. It would have been hard yakka with the air conditioning facilities next to none,” Renzo says. “The welders suffered most during summer. There was a lot more welding going on back then.”
In December 2018 the entire roof was replaced for a cost over $1 million, adding insulation and new lighting.
These days the Sunshine site serves as a semi-assembly plant where it will dispatch steer axles, differentials, axle assemblies, drive axles and brake components. It is complemented by an aftermarket distribution warehouse nearby in Derrimut where a brake riveting process also takes place.
In addition to investment in the Sunshine facility, Meritor recently added balancing capability to the product line, which was a process that up until recently was outsourced. For David Cole, Meritor Managing Director, the company continues to build on its core capabilities.
“We saw an opportunity to gain better control of product quality, with an advanced balancing process” he says. “We are excited to be doing further manufacturing in Australia, alongside our existing axle capability”.
Multiple changes to the business and the building itself reflect how Meritor has adapted to changing economic conditions in Australia and the imperative to increase volumes across its broadening product portfolio.
David, who returned to the company just over a year ago after being with Meritor in Asia Pacific between 2008-2011, says a shift to the cabover European designed commercial vehicles in the industry has necessitated a shift in the product development of the business while also ensuring the flexibility of manufacturing processes.
“We’ve taken a more global perspective on products for the market here,” he says.
“With access to these global product capabilities, we can offer a more comprehensive portfolio of products and solutions to our customers with emphasis on service and support, which ultimately makes it easier for customers to focus on their businesses. Our product focus remains on reliability, efficiency, and niche application solutions for Australian conditions”.
As a publicly listed company, Meritor must deliver on shareholder expectations. Some of its strategic acquisitions in the past year include Transpower and Axletech among others.
The purchase of California-based Transpower represents investment in having a battery and electronic systems with fully integrated capability.
“This acquisition complements the work that Meritor has been leading on axle electrification” David says.
“You see significant advancement of electrification across all of the OEMs especially in the last 18 months, and the pace of project development and investment only continues to accelerate. At Meritor, this advancement is about evolution and revolution, and we are excited with the acquisition of Transpower as it enables us to provide a complete electric drivetrain system capability for our customers under the Meritor Blue Horizon brand.”
Brought back into the Meritor fold, Axletech, a specialist in off highway, defence, mining, material handling and agricultural sectors, satisfies the need for greater diversification in the industrial area as truck volumes come down globally.
“Diversification into these industrial segments is complementary to the cyclic nature of the heavy duty truck markets, and it’s certainly an area that Meritor has a proven capability already” David says. “We only see positive opportunities to expand this product portfolio and capability in Australia”.
Under Meritor’s current M2022 global strategic plan, the company is taking a longer term view for Australia according to David.
“Having seen the challenges faced by the local automotive industry of recent years, we need to remain agile to these changes in the market and our customers, and continue to improve productivity, innovation and make the right strategic investments,” David explains.
“As the market in Australia here comes off the high of 2018, it’s important that we adapt and make these changes in our business and continue to bring our customers new and innovative products and solutions”.
Meritor has been quick to embrace electrification, announcing recently it will partner with Kenworth on electric powertrain development for its T680E model Class 8 battery-electric vehicles in North America on a short-hood day cab.
One of the big transitions in full effect at Meritor is the emphasis placed on health and safety in recent years. When put against its global operations, the Australian organisation ranks, says Renzo, near the top of all of its international facilities for its safety record.
“We pride ourselves on being one of the safest Meritor facilities in the world. That’s always paramount. The facility itself has been streamlined a lot since I’ve been here,” he says. “It’s a great place to work. The long tenured staff are testament to that.”
Stability at the organisation has always been reflected in the impressive service time of the staff.
As that old guard has been gradually replaced by a new generation of employees Renzo is now considered one of the veterans.
Welder, Nick Saflekas, has been at the Sunshine plant even longer. He commenced working at Meritor in 1972 in the furnace tasked with heat treating raw materials.
All of it, in stifling hot conditions, lowered by hand. It was hard work but not without exhilaration.
“Back then there was over 400 staff,” he recalls. “We were running at full capacity. There was a lot going on. For a young guy it was exciting.”
A few years later he applied for a position as a second class welder. At the time he was working 12 hour shifts during the day and attending night school where he was learning his new trade. Nick got the job over two other applicants. He was eventually promoted to team leader.
It remains one of his fondest memories.
“I never expected it. It was a great honour. There were never any problems with the boys. They were good to me,” he recalls.
When Meritor stopped making tri-axles he eventually changed sections moving to the housing lane. This year marks his 48th at the company.
“When you stay in the one place you get to learn more,” he says. “That’s what happened with me.”
The rich albeit capricious history of manufacturing in Australia has seen some iconic brands, long considered formidable players in the market, fall by the wayside.
As once powerful industries like the automotive sector in the country previously insulated by tariffs and subsidies, have slowly succumbed to rising costs, unflattering exchange rates and outsourcing offered by better economies of scale under free trade agreements, commercial vehicle componentry and trailer manufacturing companies, forge ahead enduringly. And in doing so they keep alive the memory of the incalculable and meaningful hours of sweat that helped go into building the country. Meritor is one of them.
On the carrier line for differentials at the Sunshine facility there’s a hydraulic press with a small plaque on the assembly.
It honours Ivan Gangur, another long term employee who retired in 2018 after 45 years of service.
The plaque commemorates his time at the company and the section he staffed. It includes the date of his retirement – 22 December 2018 – and notes the ratio changes he performed.
The number is well over 10,000.