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Sunday, 21 January 2018 12:31

Fire truck maker HME ramps up ahead of growing demand

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Wyoming-based HME Inc. manufactures the HME Ahrens-Fox line of fire apparatuses. The company sells all over the globe, but it has found particular success in California and in growing areas along the West Coast and south and central U.S. Wyoming-based HME Inc. manufactures the HME Ahrens-Fox line of fire apparatuses. The company sells all over the globe, but it has found particular success in California and in growing areas along the West Coast and south and central U.S. Photo by Katy Batdorff

WYOMING — As more municipal fire truck fleets exceed their life expectancies, that’s good news for one West Michigan-based manufacturer of heavy duty truck chassis and fire apparatuses.

Roughly three out of five fire trucks have been in service for more than a decade, which has HME Inc. projecting a 20-percent bump in fire truck production this year as more communities replace their aging vehicles, according to President Jim Monterusso.

With the age of the fleet and the lack of municipal investment during and after the recession, Monterusso sees plenty of pent-up demand to carry the Wyoming, Mich.-based manufacturer for the next several years. 

“There is a tremendous need for new fire trucks throughout the country,” he said.

HME, one of the world’s largest full-line fire truck manufacturers, produces hundreds of fire trucks a year — everything from mini pumpers to more expensive ladder trucks costing more than $1 million. 

At HME, the increase in production means more hires — 12 to 20 people over the next year and a half — and the announcement of a new facility in the next month, said Monterusso, who started working at the company eight months ago. These plans come as the 170-employee company hired roughly a dozen people over the last eight months.

The success at HME is part of a recent industry trend. According to a forecast from Research and Markets, the fire truck industry should achieve compound annual growth of 7.1 percent over the next decade, reaching $8.5 billion by 2025. 

Unlike other large fire truck manufacturers, HME designs and builds chassis for its vehicles in-house, rather than contracts it out, Monterusso said. The company also owns all of its intellectual property and focuses its portfolio of fire trucks to provide affordable solutions for rural or “small-town America,” he said. 

“We have all of the capabilities of the bigger companies; we’re just smaller and more nimble,” Monterusso said.

Despite HME’s success nationally in the fire truck and chassis markets — the manufacturer generates annual revenues in excess of $50 million — the company remains a relative unknown in its home market in West Michigan, a fact Monterusso wants to change.

“We’ve just been more interested in our product than talking about it,” he said. “We’re now at a size and scale where we are going to have to moderate that a bit. People need to know we are here. … We’re really good at designing and building trucks. We’re not very good at talking about designing and building trucks. Historically, it has not been part of our DNA. That needs to change a little bit.” 

Under its current ownership, HME moved to West Michigan in 1988, relocating its cab and chassis manufacturing operations from Chicago. More than a decade later, the company built its first fire truck in 2002.

West Michigan now is “home and likely to be home for a long, long time,” Monterusso said. 

After licensing the Ahrens-Fox name for more than a decade, the company in 2016 acquired the brand, which dates back to its founding in 1910 in Cincinnati, Ohio and has a history of industry innovations. 

The company now sells its trucks under the HME Ahrens-Fox name. 

THRIVING MARKET 

One market where HME sees the most demand is along the West Coast of the United States,  particularly in California. The company has been selling fire trucks to California’s CAL Fire, the state’s wildfire agency, for 10 years, Monterusso said. 

Some of those vehicles, including HME’s Wildland fire trucks, garnered attention recently as agencies battled a string of massive wildfires. Seeing the trucks on the news was a “personal” moment for the company, Monterusso said.

While the company currently has no direct contracts with CAL Fire, “we continue to produce that product and ship it to California every month,” he added.

“We literally have hundreds of trucks that are on the front lines fighting these wildfires that we see on the news, the majority of which were made right here,” he said. “We, of course, recognize them, but nobody else does. We continue to make those (trucks) for municipalities throughout California.”

California has long been HME’s largest market in terms of unit sales. However, the company sells into other growing U.S. markets that have to appropriately size their emergency fleets to their expanding populations. 

“We’ve got several parts of the country that are growing rapidly, mostly in the West,” he added. “There are incremental demands for infrastructure (needs) and fire trucks. One of fastest growing markets is central and southwest (U.S.).”

‘GOLD STANDARD’

Today, HME Inc. is split into two divisions: HME Ahrens-Fox, which makes the fire apparatuses, and HME Heavy Duty Truck Parts, a supplier of heavy-duty truck parts and assemblies for OEM customers. 

HME Ahrens-Fox offers more than 20 fire engine platforms, ranging from pumpers and aerials to wildlands and tankers, but typically works with customers to develop custom trucks to fit their needs. For example, this month, HME was working to finish an order of six custom fire trucks for the city of Detroit.

Custom cab/chassis designs make up the bulk of sales for HME Ahrens-Fox, according to Monterusso. Currently, the company has about a nine-month lead time for a custom fire truck.

Beyond the domestic market, HME ships fire trucks all over the world, exporting to South America and Saudi Arabia, among others. As the company pursues growth at home, it also expects to expand its global market presence, Monterusso said.

“Worldwide, in terms of fire apparatus, the U.S. is kind of viewed as the gold standard,” he said. “A U.S.-made fire truck is highly coveted in most parts of the world.”

While HME expects to grow, its plans are contingent in part on municipalities making new purchases, a process that has been complicated by discussions of tax reform and public infrastructure spending in recent months, Monterusso said. 

“Rescue equipment is not like hamburgers or handbags that people can just choose to go without,” Monterusso told MiBiz in December. “These products are essential for the safety of our firefighters and fellow citizens. The question is not ‘if’ these needs are manifested in the market, but ‘when’ and ‘how.’ …

“The need for our products is undeniable. Figuring out when and how those demands will appear in the market is still very difficult.” 

 

Made in Michigan: HME Inc. is one of the largest full-line producers of fire trucks for the global market. The company builds its HME Ahrens-Fox products mostly in-house and is looking to hire 12 to 20 people in the next year and a half as it ramps up production to meet an expected spike in demand. HME Inc. generates annual revenues in excess of $50 million and employs 170 people. It operates a manufacturing facility along Chicago Drive at Byron Center Avenue in Wyoming, a suburb of Grand Rapids. 

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