ARMOR CHASSIS' march through the South is changing the landscape of transportation corridors with the same boldness that Sherman exhibited in his march from Atlanta to Savannah in 1864. Fortunately for the residents of Georgia and South Carolina, Armor's invasion is changing things for the better.
"Since August 1998, we have manufactured and delivered 6,500 container chassis to buyers that we never heard of or didn't know a year ago," says Patrick Gilbert, director of marketing and administration at Armor Chassis. "We have changed the landscape between Savannah and Charleston. You literally can't go down I-95 without seeing an Armor chassis under a container."
Armor Chassis is a new manufacturer of container chassis and platform trailers in Ridgeland, South Carolina, strategically located between the Ports of Savannah and Charleston. During the first full year of production in 1999, Armor built in excess of 3,200 container chassis and 300 platform trailers.
Container chassis are used to feed the enormous hunger for imported goods that are shipped into US ports via containerized ships every day. But the fleets only bring the containers into port - from there a container chassis has to be supplied along with a power unit that pulls the chassis and container to its final destination.
Armor managers saw a business opportunity, and they acted upon it. One of the greatest risks in business is the startup of a new company to meet an emerging or forecasted demand. Millions of dollars in capital could be obliterated in the blink of an eye, simply because the perceived demand didn't materialize. For many entrepreneurs, a far greater risk is not taking advantage of an opportunity when it's available.
By understanding the risk involved and acting quickly and decisively, Armor Chassis has built a momentum that will be hard to stop. Momentum has been built by making business decisions that have paid dividends to the company, even at an early stage in the company's development.
That's the business philosophy of William Gilbert, president and owner of Armor Chassis. "Armor Chassis was organized and started because a need in the marketplace wasn't being met, and provisions weren't being made to meet forecasted needs," says Gilbert. "We saw an opportunity and acted upon it.
"We started our business plan by identifying needs," Gilbert says. "We first looked at the market's needs, and then we focused on what our needs would be if we were going to provide a product for the market."
According to Gilbert, Armor is able to manufacture the impressive number of chassis because of the modern plant that the company built.
Custom Design After Armor decided to locate in Ridgeland, the company built the manufacturing facility. Since the Gilbert family's primary business is the design and construction of industrial manufacturing space, the opportunity to construct their own manufacturing facility was a welcome bonus. The facility that Gilbert designed is a state-of-the-art plant that fully encompasses the chassis manufacturing operation.
The main building encompasses 120,000 square feet and is designed to handle the fabrication of several different size chassis and trailers on four assembly lines. Two of the lines are dedicated to Armor's main product, the 40-ft and 45-ft gooseneck container chassis. The third line is highly versatile and can manufacture the 23-ft chassis or the larger platform trailer. A fourth offset manufacturing line is devoted to specialty items such as the chassis frames for hot-dip galvanizing.
"Metal preparation is a key component in producing high quality painted product, and we have the adequate equipment to do that," says Jimmy Phillips, general manager of Armor's manufacturing operation. "The heart of our cleaning system is an in-line shot blast cabinet through which all component parts pass through prior to welding."
The blast booths were built by BCP. Armor's two main manufacturing lines have in-line preweld blast cabinets that achieve a near-white blasted surface for assembly and welding. The two 60'x12' blast booths use a one-inch line conveyor style blast system. From there, the products or trailers are moved directly onto a fixture jig, and welding begins as the manufacturing process moves forward.
"Once we put the main beams in the welding jigs, it turns into a fast operation to assemble the componentry and produce a 40-ft container chassis," says Phillips. "All of the welding jigs are under the supervision of Clark Daring, the plant superintendent, and Bobby Malphrus, the welding supervisor. That really was the first job that Armor did.
"We operate the two main lines for mostly 40-ft chassis. We also run a mirror image, third sister line right beside the two 40-ft chassis lines."
The manufacturing line design allows Armor to manufacture a combination of 40-ft and 23-ft chassis. The company also can swing into production on a batch of specialty trailers that are fabricated in an area directly adjoining the main chassis lines.
All of the chassis, including those from the specialty line, are equipped with landing gears and axles prior to movement by overhead conveyers into the paint both.
The paint booths were built by JBI and include the latest environmental technologies. "They are very environmentally friendly, using a low VOC paint. All the paints are stored in a fire-safe container outside the facility," says Patrick Gilbert.
After painting, the tires, lighting, decals, and mud flap holders and flaps are installed. Axle alignment and one of the inspections occur at that point.
A third line adjoins the two main manufacturing lines. "This third line is not only efficient but it brings a great degree of versatility to the operation," says Phillips, a veteran of the trailer manufacturing industry. "That helps Armor manufacture to the needs of the market and not rely on building a single product."
Armor manufactures several different trailer chassis. "The standard 40-ft chassis is a strong product for us," says Phillips. "Additionally, we can manufacture several other models using the main assembly lines or by swinging smaller assembly lines into use."
Phillips describes a fourth shorter line-styled area outside the manufacturing lines where technicians are disassembling a chassis. "We are studying the feasibility of producing knock-down kits that will be reassembled in a possible West Coast facility," says Phillips. "This is really a question of how efficiently we can produce the trailers using this technique. We want to capture some of the Midwest and West Coast business."
Newer and Different Models Part of the attractiveness of Armor as a manufacturing company is the diverse product range that it can manufacture, says Phillips. "We have already built and delivered several types of trailer chassis that you might not regularly see in a container chassis manufacturing plant.
"The line is currently turning out some 40- to 45-ft extendible container chassis," says Phillips. "But just several weeks ago, we were manufacturing 27-ft chassis models that were going to be used for our galvanized trailer chassis."
One of the biggest successes for Armor has been its galvanized chassis, he says. "We have some cost advantages in the manufacturing process that we can pass along to the end user."
Armor manufactures the galvanized chassis at a cost advantage because of the strategic location of the galvanizing company. "There isn't a substantial add-on cost to our galvanized chassis because of transporting the chassis to the galvanizing facility," Phillips says. "And we are strategically located to serve most of the companies that have a heavy volume of Caribbean business. That's a great advantage of being between the Savannah and Charleston ports."
Hot-dip Galvanizing Galvanizing the chassis produces a very weather-resistant product that has the strength of steel without its inherent rusting problems. "Hot-dip galvanizing can provide a usable lifespan of about 25 years," says Phillips. "This product is very popular in the Caribbean and some of our other markets." Armor uses the hot-dip galvanizing technique with approximately 15% of its chassis in various sizes.
Parked in a holding area are several large platform trailers that are made of a very heavy-duty construction. "These platform trailers are designed for roll-on/roll-off operations," Phillips says. RO-RO trailers are driven into a ship's hull. At the final destination, they are picked up by a power unit and driven out of the ship's hull.
"We are expanding our product line to include RO-RO trailer production, as well as other types of chassis, including slider units, tank chassis, and a specialized container hoist styled dump-unit," Phillips says. "An example of this would be the development of our 27-ft rear dump container chassis.
"The 27-ft hoist units are able to dump with both sets of wheels firmly planted on the ground and still reach a 45ø angle," says Phillips. "That's a great advantage to our customers."
The dump chassis uses a standalone 19-hp Perkins diesel engine attached to the chassis. This eliminates the need for a tractor equipped with a power take-off and hydraulic unit.
Researching the Market "Once we started looking at the idea of manufacturing chassis for container operations, it looked interesting," says William Gilbert. "When we really got interested in it, we formed a team to put together a feasibility study to uncover any real opportunities."
"We didn't have any previous experience in chassis building. We got some names from Trailer/Body Builders. Those sources confirmed that there was a need for several thousand units in just the Charleston/Savannah area," says Patrick Gilbert. "We talked with the heads of the major leasing firms to understand their historical and forecasted purchasing habits for chassis in general. Then we researched information concerning different chassis configurations."
Gilbert says that the due-diligence team put in hundreds of hours researching the data for chassis fleet demands, absorption of new equipment, utilization factors, and the average fleet-age statistics.
"We saw a real need in terms of manufacturing intermodal chassis," says Gilbert. "Major leasing companies identified a need for several thousand intermodal chassis in the Southeast port corridor. We also realized that a long-term business opportunity existed if we could meet this need."
Moving ahead with the plan to manufacture chassis was a good business decision based upon the information that was reviewed, according to the Gilberts. They cite fleet survey data from the Institute of International Container Lessors that indicates approximately 32,000 additional chassis were added to the existing domestic container chassis fleet of 670,000 chassis in 2000.
Few new businesses have been organized with the goal of entering the world of heavy-trailer manufacturing, but Armor believes it can profitably meet customer demand. And they started from scratch to prove it.
A Clean Sheet of Paper "We started with a clean sheet of paper," says Patrick Gilbert. "There weren't any preconceived ideas about the location of the plant or how to manufacture the product. That afforded us a lot of flexibility in how we started the actual business."
Armor wanted a facility that was well within the reach of the users of its product in addition to one that fostered the easy access of vital raw materials.
"When we looked at where the buyers were using the equipment and the places that they actually needed the chassis shipped to, we found that a location on the southeastern seaboard was preferable," Gilbert says. "But that's a large area. We started looking for a state that would help us to make this work, and would remain in the magic 400-mile range from most of our major raw material suppliers."
Armor found that South Carolina fit their needs very well. "Ridgeland provided all of the things that we needed to make the project a success," says Gilbert. "This area can meet our labor needs, plus there has been a major effort by the state and local officials to help us in the training of our skilled labor pool."
The state and Jasper County put together a training program that has benefited Armor employees. "Many of the employees attended a job training school that taught them how to weld and perform many of the manufacturing tasks that we needed," Gilbert says. "That's pretty impressive when you understand that many of these people attended classes on their own time just for the opportunity to work at Armor."
When asked about the future, Phillips, who came out of semi-retirement to join Armor, says, "It is interesting to see all these units going to different ports all over the world. I think when things slow down, I might have to visit our Caribbean buyers and see how things are working out. But I don't believe business is going to slow down any time soon."