Firestone Industrial eyes increased air springs share with new center

CHOBIENICE, Poland—The European market is projected to lead the charge in the air springs industry through at least 2025, maintaining the largest global share and highest adoption rate for air springs for all types of vehicles, according to Orion Market Research.

And Firestone Industrial Products Co. L.L.C. hopes its new distribution center in Chobienice, Poland, which opened in December 2019, can improve supply chain efficiency for FSIP customers—whether OEMs or aftermarket consumers.

"We have a very strong base in Eastern Europe and this gives us a logistical advantage into the market there," said FSIP President Emily Poladian, a long-time executive with FSIP parent company Bridgestone Corp. who has been leading FSIP for about a year. "The distribution center will offer shorter shipping times and lower costs for us and our customers."

Key to this change in supply chain strategy for FSIP is the nearby location of an FSIP manufacturing plant in Wolsztyn, Poland, only about 10 miles from the new distribution center in Chobienice. As air spring products are made in Wolsztyn, they don't have to travel far to the warehouse.

"The (distribution center) location gives us the capability to handle inventory for our OE customers, with additional space for safety stocks, and we can offer service out of there as well," Poladian said.

The Wolsztyn manufacturing plant, which itself recently underwent a 20,000-sq.-ft. expansion to allow for production of a component for automotive suspensions, produces air springs and air spring components for commercial vehicles, including trucks and trailers.

FSIP's previous distribution center was in Rotterdam, Netherlands.

"Poland is a great central location to access a good part of Europe," Poladian said. "There is port access from there. And although we don't send a lot of product from Poland to China, we have easy access to rail capabilities when we do. A good amount of our customer base is within 1,000 miles of this location."

The Chobienice distribution center is 100,000 square feet and employs 16 people, according to FSIP.

The warehouse, built from the ground up by a third party then taken over by FSIP last year, has four loading docks and warehouses products mainly from Wolsztyn. However, Poladian said it also could house air spring and vibration-dampening products for niche markets (such as industrial applications) that come from the U.S.

"I would say about 90 percent of the product to be housed there will be from Wolsztyn," she said.

The warehouse is integrated with FSIP's inventory tracking and shipping software, making for "an exceptional setup for the flow of materials," according to Poladian.

"People don't think of warehouses as being 'modern,' " she said. "But we were able to design the layout, and the facility is fully integrated with a nice level of technology. There are no gaps in understanding our inventory levels.

"I won't say there is anything revolutionary about the warehouse, but it's an exceptional setup for the flow of materials, whether high volume or high velocity products. A logical layout makes for more seamless operations."

Industry not without challenges

With a growth rate of between 6.7 and 8 percent predicted by 2025 (depending on the market researcher) and global sales of $5.3 billion in 2018 and $8.1 billion projected by 2025, the air springs industry is poised for consistent growth, according to Orion Market Research.

Air suspension usage on cabs for commercial trucks has been predominantly high for decades, with a very high penetration rate—nearly 100 percent—for use on heavy trucks, Poladian said.

Trailers show a blend of air and mechanical spring usage, but still are strong in air spring adoption with about a 70 percent penetration rate, Poladian said.

"The downside is that commercial vehicle production is very cyclical, and globally there is a downturn in the demand for new trucks and trailers," she said. "So our customer base is producing fewer units.

"We predict that we will be back on growth in this sector by late 2021 or early 2022. Firestone is in a good position as we continue to grow our market share in Europe."

In addition, Poladian said FSIP is looking to increase its market share on the passenger car side, expected to be a burgeoning sector for air springs moving forward, especially in the electric passenger car realm. Currently only luxury, gas-powered passenger vehicles tend to use air springs in their development.

"As we change to the electrification of vehicles, there is an increasing demand for air suspension on passenger cars," Poladian said. "This is a good opportunity to offer an adapted suspension. The electric market is good for business and we have the capabilities to be a competitor in that market."

But sales still can be difficult to predict, Poladian said, and FSIP's diverse portfolio in the air springs industry only helps the Nashville, Tenn.-based company.

"It's a hard question to answer," she said. "From a commercial vehicle space, globally, build rates are down by about 15 percent. This is in all markets, not just in Europe.

"There are growth projections in the passenger space, so it all could be a bit offsetting. It just gets a little noisy to be able to say for sure."

An important tenet for any air spring supplier, however, is to solidify its relationships with OEMs, according to Orion.

And FSIP maintains an advantage in this respect, Poladian said.

"Firestone has a slightly different approach since we have a significantly higher market in the OE space than our competitors," she said. "We are not at the market share percentage where we want, but we've made inroads in trailer and truck OE's in Europe. We have good relationships, and we are a proven supplier in the U.S. We will look to leverage these things globally."

Earlier in 2019, Bridgestone unveiled new investments in eight tire plants across Europe, including two plants in Poland.

"A lot of what we are trying to do, obviously with Bridgestone as the largest tire maker in world, is leverage that technology and the rubber that we make," Poladian said. "We have a dedicated team of engineers focusing only on air springs, so they are unencumbered by other categories. We are very proud to service our customers' needs from a design standpoint, as every suspension is unique. We try to meet their needs rather than forcing them into a catalog for an item."

She added that Firestone Industrial Products will keep making strategic investments in Europe "to better serve our customers, and we will continue to be innovative and dynamic as we respond to market growth."