Issue: May 2006


Global leadership in the specialty transmissions and gears market



Automotive Industries spoke to Gary Lehman and asked how Fairfields operations and outlook have changed after it was bought out by Saurer

by Rob White

Earlier this year, the Lafayette, Indiana-based Fairfield Manufacturing company, which manufactures gear and drive products for off - highway mobile machinery, was bought by the Swiss company, Saurer AG. The US$1.8bn Saurer, which is a global leader in textile machinery and transmission systems, felt its company, Graziano Trasmissioni, which is part of Saurer's transmission systems and Fairfield, would be able to merge its strengths to compete globally.

The US$230m Fairfield, is a leading manufacturer of planetary gear drives, which it makes under the Torque-Hub trade name. Plus the company manufactures custom gears and custom gear assemblies for a broad range of applications. Its customer base includes companies such as Allison Transmission, Case New Holland, Caterpillar, Electro Motive Diesel, General Electric, John Deere, JLG, Joy Global, SPX, Terex and AGCO.

Fairfield has an employee base of 1600 workers around the world. Its facilities include a 600,000 square foot factory in Lafayette, Indiana and a subsidiary, Fairfield Atlas, which has approximately 200,000 square feet in Belgaum, in the south-west of India. Fairfield Atlas manufactures gear and drive products.

Graziano Trasmissioni, which started operations in 1951 in Italy, was bought by the Saurer Group in 1992. It is a global leader in the manufacture of gears with a client roster that includes all the major manufacturers of cars, agricultural tractors, construction machines, industrial vehicles and vehicles for special applications. The company has 10 manufacturing bases around the world, which employ 3000 people. Graziano manufacture a full range of original equipment manufacturer product solutions including gear-boxes, transmissions, axles , transfer cases and related gearing components for both on-highway and on-road vehicles. Customers include automobile manufacturers such as Lamborgini, Maserati, Ferrari, and Volkswagen. as well as Off High Way OEMs such as AGCO, CAT, , Claas, Club Car, CNH , JCB Industries, John Deere and others.

The purchase of Fairfield Manufacturing, and its integration into the Transmissions Systems group with Graziano, Saurer is expected to become a global leader in the specialty transmissions and gears market. Fairfield will bring new products and access to new applications to Saurer as well as a better access to the North American Customers and Market. Graziano will have also with Fairfield a strong support and a high competence base to develop the US automotive transmission market.

Graziano, will provide Fairfield better access to the European market. Graziano and Fairfield's combined strengths are expected to help Saurer further increase its presence in booming Asian markets like India and China.

Commenting on the recent acquisition, Gary Lehman, president and CEO of Fairfield said: "This opportunity brings an exciting new perspective to our company and will help expand our services and offerings to our customers and markets around the world. We look forward to becoming part of a world - class organization such as Saurer."

Automotive Industries spoke to Gary Lehman and asked how Fairfield's operations and outlook have changed after it was bought out by Saurer.

AI: How have daily operations at Fairfield Manufacturing changed after Saurer bought it out?

Really nothing has changed in our daily operations. We are beginning to share best practices between Fairfield and Graziano to take advantage of the technical expertise each company has developed in over 140 years of combined gear manufacturing. Manufacturing, Engineering and Supply Chain personnel from each company are meeting and working with their counterparts so we can truly begin to operate as a global organization.

AI: How have Fairfield's prospects changed after the buy-out? do you see the company growing globally and at home? If so, could you please give us your predictions on how your company will grow over the next few years?

Access to Granziano's knowledge of the European market as well as their broad manufacturing footprint has immediately allowed us to pursue additional opportunities that would have been much more challenging for Fairfield before the acquisition. Our businesses have very little overlap and fit together almost perfectly. We both expect significant growth over the next few years with prospects to increase revenues by over $100 million.

AI: How do you view India and China emerging as potential markets and as manufacturing bases?

China and India are well beyond emerging markets as they are both significant markets for us today. Fairfield and Graziano have both had factories in India for several years and are increasing our capacity as we speak. Graziano has just established manufacturing capacity in China and we are jointly forming the supporting business unit to actively pursue opportunities in Asia.

AI: How do you think Graziano has benefited by Fairfield's incorporation? And how big will the European market be for Fairfield?

Fairfield will give Graziano a NAFTA manufacturing presence to better serve their significant present business as well as pursue additional opportunities. We also offer our Torque-Hub planetary gear drive system as potential drive solutions to their already broad customer base. The European market for this product is very large, probably 20% larger than the US market, so there is ample room for growth


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