Industrial Utility Efficiency    

ELGi Goes Global

Compressed Air Best Practices® Magazine interviewed Dr. Jay Varadaraj, (Managing Director) of ELGi Equipments Ltd.

 

We all like entrepreneurial stories, how did ELGi get started?

ELGi today is one of the world’s leading manufacturers of air compressors. Like most companies, however, it started with one ambitious person. My grandfather, Lakshminaickenpalayam Govindaswamy (this where the “L” and “G” in ELGi come from) was a bus driver for the British in 1918. He purchased one bus and proceeded to build a fleet peaking at 300 buses. He believed he was in the transportation business so he entered the airline business ultimately withdrawing however when this industry was nationalized.

 
Elgi Compressor   ELGi's current lubricated compressor product offering consists of belt drive 3-40 hp, and direct drive from 15-200 hp.

A family-run business, his brothers and sons were also involved. Since they were repairing their own fleet of buses in their own shops, they got into the automotive repair and parts manufacturing business. This business was founded in 1960 and was named ELGi. The company manufactured small reciprocating compressors for tire inflation, lifts, and greasing and washing equipment needed in the automotive repair market in India.

ELGi is the #1 supplier in the automotive supply industry in India holding a 45 percent market share. We offer a large range of products ranging from lifts to paint booths and painting solutions and any type of equipment for automotive service. We are the leaders in India for that, Mercedes, BMW. Nevertheless, ELGi today is predominantly an air compressor manufacturer where we continue to accelerate our growth.

 

How has ELGi evolved from a domestic to an international company?

In the 1990’s, as the Indian market was opened up, we knew international air compressor competitors would enter the market. When we honestly looked at our organization, quality, technology – we saw we had some gaps compared to the international competition. We were used to being in a protected market.

We decided to invest in modernize our manufacturing processes and product technologies. We also realized we needed to invest in gaining market share internationally. We were a big fish in a small pond and we had to look at opportunities worldwide.

So we set about building a new company. What should we not do? We set a global aspiration and said we wouldn’t license our technology to others. We had grown both our piston and rotary screw air compressor businesses, using licenses from German and U.S. companies, from the 60’s to the 80’s. We were licensing technology that was becoming old-fashioned. We also realized that a company builds know-how but not “know-why” when licensing.

 

Is this why ELGi has become so strong in compressor airend manufacturing?

Yes, this fundamental desire for “know-why” has driven our strategy and investments over the past 25 years. Today, we build ten different airend sizes for lubricated rotary screw air compressors. The range is from a 35 mm to a 310 mm rotor. Next year we will produce a larger size. We also manufacture our own oil-free airends.

It’s been a wonderful journey technically. We assembled a group of engineers with strong scientific backgrounds and not just engineering capabilities. We went and partnered with universities and organizations all over the world, to develop our knowledge. Today, we possess the capabilities to design and build airends for any specific flow and pressure.

If a customer comes to us wanting a specific pressure, flow, power, we can design an air-end in less than an hour, Not that we would do it, but we have the capability to do airend profiles. We can simulate thermodynamics of compressors, we know potential failure modes, the engineering we have built is at a very high level.

 

 

Elgi Airend

ELGi has largest range of lubricated airends in the industry, from 35 mm to 310 mm male rotor sizes.
   

Please describe your airend manufacturing process and facilities.

Today we build close to 14,000 airends per year. Our quality allows us to offer a market-leading airend warranty (more on that later). It’s been quite a journey! Getting to this level, however, hasn’t been easy.

Airend manufacturing is about machining housings and rotors. We are probably the only company with it’s own foundry where we make our own special castings. We believe our custom-designed castings set the new international benchmark for quality in terms of thermal distortion and deflection. We do all machining of housings in-house using some of the best machining center technology in the world from Makino and Mazak.

On rotors, you have to mill and grind the rotors. We have built and designed our own milling machines specifically for rotors. You can’t take a milling machine, designed for something else, and achieve the same quality. We know because we tried. We decided to create a 7-man team of engineers dedicated to building machining centers and tools just for rotors. We now have our own design machining center and we know there is a quality difference.

We have the technology to produce high performance air compressors that don’t have to be high priced. We are not hiding behind low labor costs in India. We use our technology to bring costs down. All products brought to America are high performance and comply with all U.S. standards. They are also very competitive.

Another example is the motor. We have a team of electrical and design engineers focusing on motors. The motors almost all other air compressor manufacturers use are not designed for air compressors. They are standard industrial motors simply used by air compressors and they carry unnecessary costs because they’re designed for general use. Customers want a reliable motor that can be fixed locally if it fails. We have significant plans to design and build our own motors to reduce manufacturing costs.

 

So would you consider yourself to be a global company?

   
  Elgi 13
  Elgi 14
  

Elgi 5

As part of their “UPTiME Design” philosophy, Elgi uses the highest quality, name brand components in their packages.

Absolutely. We operate in a true global market place. While our international business has expanded steadily for many years, it’s grown rapidly this decade. Our international growth has exceeded our expectations. Over the past twenty years, our global footprint has expanded to 63 countries, 20 regional offices and more than 280 distributors. Currently, more than 2 million ELGi air compressors are installed all over the world including at world-class companies such as Coca-Cola, Cummins, GM and Halliburton. We have worldwide close to 1500 employees, our total manufacturing campus covers 140 acres of land, with over 1 million square feet of manufacturing buildings. We have made the transition.

Now, fifty percent of our business is coming from outside of India, and that trend will continue to grow. There are multiple reasons for this.

We have acquired two European compressor companies: Belair in France and Rotair in Italy. This has provided us with greater access to these and other markets. But acquisition is only part of the story.

We’ve been the market leader in India for many years. Since the millennium, many global manufacturing and tech companies are building plants and facilities in India. This not only helps grow our domestic market, but has given us exposure to these customers. That’s motivated us to invest heavily in our company resources, such as R&D, manufacturing, and product support.

We’re implementing aggressive expansion plans in China, southeast Asia, Brazil, Europe, and of course, the United States.

We now have centrifugal machines and are are a full product range company. One of very few who can design and manufacturing a full range of air compressors.

 

Why is ELGi entering the U.S. market?

We see a great opportunity, and quite frankly, a need for what we offer. U.S. companies see the value of emerging market content, yet they also demand a high level of product quality and local support. At ELGi, we are poised to provide all of these elements while removing any risk our customers may have with their compressed air systems. And with the launch of our new electric Global Series rotary screw compressors, the timing is ideal.

 

What type of presence does ELGi have in the USA?

We understand that first and foremost, customers want dependable support for their compressors. They hate to wait on parts. And they only want to deal with experienced and knowledgeable technicians. That’s why we’ve worked so diligently to build a solid infrastructure prior to selling our products.

We currently have nearly 30 distributors established across the U.S., with the highest concentration in heavy manufacturing areas. We ensure that all our distributors stock a full inventory of parts and supplies and are fully trained on our products.

We have established a dedicated support and distribution center in Charlotte, North Carolina, where we ship products and parts. This location also includes experienced service technicians dedicated to handling any service issues.

Of course, we know it’s all about the people you have working for you. We’ve assembled a “who’s who” of the compressor industry to join our team, one of the most experienced and well-respected teams in the industry. They include: Hannu Heinonen, Vice President, Americas; Gary Valvo, President; Keith Sportsman, Director of Sales; Bob Phillips, National Service Manager; our Regional Sales Managers are Frank Brookshire, Dean Chew, Curt Greifer, and Grayson Biggins, Product Manager.

 

What market segments does ELGi serve?

Whether you’re running an assembly line, welding shop, food processing plant or even a railroad, ELGi has the right product for your business.

We offer one of the widest product lines in the industry: portable, rotary screw, oil-free, diesel, reciprocating, centrifugal, marine, defense industry and railroad compressors. Plus, we make the widest range of oil-lubricated air ends-worldwide.

We cover your compressed air needs from a small to a very high air flow and from low to high pressure. We have products from 10 to 14,000cfm (0.25 - 400m3/min) at pressures from 30 to 450psig (2 to 30 bar).

At this time, for our U.S. customers, we offer rotary screw, diesel and reciprocating models. However, we will be bringing our full product line to the U.S. in the future.

You mentioned the importance of support, how else do you convey it?

We’re all about removing our customer’s risk. That’s really the major pain point any customer has. They want assurances that their air compressor will stay up, so their business can stay up and running to fulfill their customer’s needs.

 

That’s why we have created our UPTiME Assurance program, which features a 48-hour Air Up promise.

It’s simple, really. If a customer’s machine ever experiences any unwanted downtime, we’ll have them running in 48 hours. And we’ll stop at nothing to do this. We accomplish this in many ways: with excellent parts availability, local support and we even provide loaner machines if needed.

 

How else does ELGi live up to this UPTiME commitment?

Our entire business model is based on UPTiME. Starting with our R&D, to manufacturing, distribution, support and even marketing. We’ve built this pledge on what we call our three pillars of UPTiME. These are the UPTiME Assurance Plan, which we just discussed, UPTiME Design and UPTiME Components.

UPTiME Design is how our products are engineered. We want them to run cooler and cleaner, so they run longer. For example, we have developed a Thermo-Zone layout for our rotary screw compressors, so that hot areas are separated from cool areas. This way, the more sensitive components are always protected.

And since no detail is too small, we’ve even placed service interval stickers on our machines to assist technicians. We know that there will always be planned downtime. But we want to ensure this is minimized. We’ve received lots of praise from customers about this. It seems small, but it’s just another example of our approach to ensuring UPTiME.

The second pillar is UPTiME Components. On an ELGi compressor, every part is a premium part. That starts with our exclusive Axis air ends. They’re the largest and most robust in the industry.

And, as said, the UPTiME Assurance Plan completes the pillars and backs up the product.

 

Speaking of air ends, don’t you offer a unique warranty?

We guarantee our air ends for life. It’s the industry’s first ever, to our knowledge. And it shows how much confidence we have in our products. Once again, it’s all about removing risk for our customers.

 

What’s the first thing people tell you about your products?

We’ve recently introduced a new Global Series, and during this launch phase, we’ve unveiled the product to customers in the U.S. and all over the world. The one thing we keep hearing is how impressed people are with the look and quality of our machines.

On the outside, we they say we have the feel of a high-end European design. But it’s on the inside where it really counts. This includes our air ends and major component details such as rigid, stainless steel piping and leak-free hoses.

 

What surprises people about ELGi?

Without a doubt, it’s our vast array of proprietary technologies. Unlike other Asian-based companies, we are not assemblers. We are developers of exclusive embedded technologies, and utilize our own manufacturing plants and processes to build the entire compressor.

Our product exclusives compare favorably to any compressor manufacturer in the world. ELGi is one of only three companies in the world to develop our own oil-free, dry, 2-stage rotary screws and centrifugal compressors.

We make our own air ends, branded Axis™. We also offer the widest range of oil lubricated oil air ends in the world. Our UPTiME Assurance plans feature a first-ever lifetime warranty on air ends and a 48-hour UPTiME promise.

 

Thank you for your time.

 

For more information please contact Grayson Biggins, Product Manager, ELGi USA, tel:704-943-7966 ext. 275, www.ELGi.com

 

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