A.A. Trailers banks on value engineering for growth

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A.A. Trailers is banking on value engineering to achieve strong growth.

Story by: Ashish Bhatia

A shift to higher tonnage trucks is influencing the sale of tractor-trailers for some time. Offering the lowest cost of transportation per tonne per km, tractor-trailers are rising in volumes. The truck-trailer market in India is estimated to grow at a compound annual growth rate (CAGR) of 9.5 per cent over the period from 2016 to 2020. Production is anticipated to rise to 71,249 units in 2020 from 52,468 in 2016. To grab a large share of the burgeoning truck-trailer market, Navi Mumbai-based A.A. Trailers is banking on value engineering. It wants to grow faster than the industry average. As an organised player the company is competing with a large contingent of unorganised players found in various regions of the country. As part of its value engineering strategy, A.A Trailers is sourcing not just the best grade of raw materials from established vendors, it is also investing in green manufacturing technologies and materials. Using polyurethane paint, which is free from lead and chrome for example, A.A. Trailers has to its credits many industry firsts according to Ranjan Pahadsingh, the chief executive officer. Manufacturing truck-trailers since 1997, the company has a capacity to build 160 trailers per month. Offering 82 trailer varieties including flat bed trailers, skeletal trailers, semi low bed trailers, low bed trailers, tanker trailers, hydraulic modular front axle trailers, side wall trailers, multi-axle trailers and bomb cart trailers to name a few, the company is confident of leading the truck-trailer market in India.

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Catering to Original Equipment Manufacturers (OEMs) since inception, and to aftermarket customers, A.A. Trailers, in a bid to attain rapid growth, is investing in capacity expansion. It is building two plants at Faridabad and Mumbai each. Expected to go on stream soon, the two new plants will hike the manufacturing capacity of the company to 500 trailers per month. Catering to customers all over India, the company is also planning to build a large scale manufacturing base in Orissa. Contemplating whether to build a facility at Pune or Orissa, the company, plans to begin with the manufacture of tip trailers, running gears and side wall trailers because of their demand at Orissa. Aiming at a turnover of Rs.500 crore, A.A. Trailers will float an IPO once it reaches that mark. “We will become a listed company once we reach the Rs.500 crore level,” revealed Pahadsingh. With the Faridabad facility expected to cater to clients in the North West region, and especially Rajasthan, which is India’s biggest tractor-trailer market, the company is keen to leverage the large manufacturing base at Orissa, once operational, for exports. Without losing sight of quality, A.A. Trailers with its order books full, is operating at all shifts to address demand. Mentioned Pahadsingh that the quality is getting them good orders. The polyurethane paint the company uses, costs three times more than the enamel paint used by other trailer manufacturers at Rs.350 per litre according to Pahadsingh. “It is this quality that gets us repeat orders,” he quipped.

Fabricating the beams for the main structure of the trailer in-house initially, A.A. Trailers used to also produce its own kingpins unlike the industry practice of importing them. To ensure quality, the company is sourcing the beams from companies like Jindal Steel. “We have defined a universal beam and uniform thickness for the flanges. In the last one and a half year, we have not compromised in any area of our technical process, and the technical ability. To move to the next level, what we have done is to introduce analysis methodology,” said Pahadsingh. What makes it interesting to use technology wisely is the demand. It varies wildy across regions. Averred Pahadsingh, “The demand for side wall trailers is high in Rajasthan compared to other regions.” The need to cater to demands that differ from region to region, A.A. Trailers has engineered an ability to be flexible in its manufacturing. Attributing this as one of the key qualities to achieve rapid growth, Pahadsingh opined, “In-line with the market requirements, we have to cater to a whole lot of trailer applications. It is simply not the standard trailer most of the times.” Flexible manufacturing ability is also helping the company to address the needs of customers. An interesting case, mentioned Pahadsingh, is the preference for flat bed trailers by customers who are looking to transport steel coils. “After observing the tendency of such trailers to crack under the load of steel coils, we started adding extra coil reinforcements. This is one of the reasons why we get the customer to disclose the exact application before we take an order. We also make them disclose the maximum load the trailer could be subjected to. It helps us to engineer a trailer that works under extreme conditions,” he explained.

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Introducing cold coil carrying trailers (canopy device), which were earlier imported from Italy, A.A. Trailers, with up to 38 different lengths of prime movers available, offers side wall trailers range from 23 ft to 50 ft. The heavy side wall trailers that the company makes are used to transport granite and marble. Supplying trailers where glass is stored in a wooden pallet and held against the side wall, the company sources key components like axles from well established manufacturers like York and Jost. The same is the case with the hydraulic tipping systems that finds use in a tip-trailer. Depending on the requirement of the customer, the company offers axles that are hydraulically steerable. Trailers with such axles are used to transport heavy and long structural machinery. The bomb-cart trailers that the company makes, find use in ports. Planning to manufacture axles, A.A. Trailers builds different types of air-suspension trailers. Keen to launch new variants with a minimal cost difference when compared to trailers with mechanical suspensions, the company is also gearing up to make slideable trailer platforms. Scaling up operations from 120 to 160 trailers in the last eight months, A.A. Trailers, according to Pahadsingh, should reach a turnover of Rs.500 crore by 2021 given Pahadsingh’s experience in hydraulics, the company is also looking at diversifying in other areas without losing focus on manufacturing trailers. Expected to exceed a turnover of Rs.100 crore this year, the company is busy going pan-India. Attracting clients from Jammu and Kashmir, Assam, Haryana, Uttar Pradesh, Delhi, Punjab, Kolkata, Tamil Nadu and many other regions, A.A. Trailers is also looking at rising opportunities in the LPG segment for growth. Signed off Pahadsingh, “The challenge is to not lose site of quality even if the volumes grow manifold. Our endeavour is to be regarded as a quality manufacturer of truck-trailers as it will help us to scale greater heights.”

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