During the recent economic downturn, there have been pages of negative headlines. One industry that has undoubtedly bucked the trend has been South Africa’s automotive sector, which continues to enjoy sales growth. At Artav Stainless Steel, business continues to thrive, thanks to some unique innovations.
The family run business first came to prominence in 1997, with the launch of Maxe, a company that introduced the first stainless steel bull bars to South Africa. Today the business manufactures a range of accessories for the 4×4 and SUV market, working hand in hand with all the major OEMs.
Whilst Artav manufactures over 200 different products from its 7,000 square metre facility, it has significantly developed a strong reputation for innovation through its investment in research and development, something that Aaron Engelbrecht, Sales and Marketing Manager, describes as “the lifeblood of the business.”
Today the company manufactures bull bars, nudge bars, bumper protectors, roll bars, side steps, rear steps, tow bars, winch plates and other accessories and is successfully establishing the name Artav to an industry that had grown accustomed to the quality and service of Maxe, as Engelbrecht explains:
“Maxe came to fruition around 1997, when my father Anton, walked out of a shopping mall in Johannesburg (where we lived) and saw a Toyota vehicle with an aluminium nudge bar. The market back then was essentially using mild steel which was typically powder coated – nobody manufactured stainless steel in South Africa.
“Anton phoned my uncle Karl Engelbrecht, who was working with stainless steel accessories for the boating industry in Durban and they decided to start a business dedicated to automotive. They started out by purchasing a tube bending machine and with four people operated from a 1,000 square metre site in Westmead.
“The business grew rapidly and within eight years we were exporting to businesses around the world, had won Toyota and Nissan supplier of the year awards and employed 350 people. At that point, Maxe was sold to a private equity company.”
“Four years later there was a huge demand from the aftermarket to buy stainless steel accessories, we therefore opened a 1,000 square metre facility in Westmead and four years down the line, we have over 250 after-market customers on our books, covering the whole of Southern Africa from Cape Town up to Zambia.
“Artav is a lot more structured and we operate in an environment with competition now, so we have to source the best raw materials and watch our prices. It is imperative that our service levels are high as the average fitter cannot invest in large amounts of stock. Undoubtedly it has been tougher with Artav than Maxe but our growth has been controlled and is still excellent.”
Controlled growth maybe, but demand still saw the business relocate to a bigger premise a couple of years ago and Engelbrecht can see a time in the imminent future when another move might be needed:
“I don’t believe that this place will be big enough in the next year or two and we may have to move again. Our total market share is currently around 30 per cent but we are growing quite quickly; for South Africa’s aftermarket we are the dominant supplier and probably account for 70 per cent of business.
“For the OEMs our share is much smaller but moving into 2013 we have some great new innovations which we believe will get a lot of attention.
The reason for Engelbrecht’s bullish enthusiasm is Artav’s latest unique invention, a range of four inch oval products. The idea of using oval came from one of our suppliers overseas.
“We made a note of the product and looked at bringing the tube into South Africa and then played around with methods to bend the tube and create a complete range. We proceeded with development on the Roll Bar, Nudge Bar and Side Steps. The Roll Bar and Nudge Bar were the most testing to develop.”
The technology involved in creating the oval products is advanced and unique to Artav. There are limitations to bending stainless steel but the company was able to provide a prototype of the first oval nudge and roll bars for Ford and eventually hopes to provide products for all of the major manufacturers.
The product range greatly excites Engelbrecht and is the culmination of heavy investment and months of testing, as he explains:
“R&D is very important to us and we have to constantly design new parts as the industry is always evolving. Once a new vehicle comes in we can develop a new kit in full in three or four days, but the oval technology needed to bend a four inch oval tube is far more complex and we believe will be well-received.
“To develop this product and bend the oval tube we have had to purchase customised tube bending machines from Taiwan and use new polishing machines. Plastic moulding costs are also high and it will take us six months to a year to see a full return on our investment.
“The market seems to thrive on new accessories and designs and this range of products is a first in this country. We believe that oval accessories are going to be popular over the next four to five years.
Whilst Artav came up with the concept and developed a product, Engelbrecht says that the company will then work with the OEMs to adapt each accessory, which partly explains the series of meetings currently taking place. He is confident that the nudge bar should be ready for production early next year and suggests that production capacity may be the biggest challenge at that time: “We have to constantly monitor our stock levels – and in the current commercial climate, with imports coming from the East, it is becoming harder to compete on price. We have to produce the required stocks at affordable prices and also educate the market on what constitutes a quality part.”
One thing that will greatly aid the upscale and remains a constant at Artav is the experience of its staff. There are currently 100 employees and Engelbrecht says that many of these have been in the stainless steel accessory industry for over 15 years.
“They are the reason we are where we are today,” he acknowledges.
“We are always acutely aware of our stock holdings and the OEMs will usually give us monthly updates on their requirements, so we are able to forecast their needs and typically will hold one month’s stock for them. The day to day jobbing is more bespoke but the factory is set up as a jobbing centre, so we can make parts quickly and generally despatch the same day,” he continues.
Of the longer term future, Engelbrecht has clear ambition: “We would like to see ourselves as the market leader in terms of innovation, design, quality and service. With this in mind we will continue to expand and grow with demand. The trick will be to manage that growth sensibly,” he predicts.