Industry Q&A: COR Cooling Finalist at the Queensland Mining Contractor Awards
In June 2016, COR Cooling was announced as a finalist in the Peabody Energy Cost Saving Initiative Award at the Queensland Mining Contractor Awards. Always excited to hear about recognition of our members for their fantastic achievements, Austmine caught up with Scott Sach, Queensland State Manager for COR Cooling on what they’ve been shortlisted for and what else has been happening in their world the last few months.
Can you tell us more about the project, or innovation/process that you have been shortlisted as a finalist for?
COR Cooling has a service offering of repairing heavy industrial, earthmoving and drilling systems, within which we hold a unique position in the market. We are able to see what’s occurring locally, but our national spread of clients allows us to compare the Hunter Valley with the iron ore mines in Western Australia. In particular, this gives us good feedback on commonality of failures on equipment, as we work closely with clients to understand what’s giving them grief on site that COR can assist with. As a company, we have a unique marriage between our fully functioning manufacturing and design part of the business and our first hand reports coming in from service and operations branches on the failures they see out on site.
In relation to our award application and finalist listing, we looked at CAT793D truck fleets and saw a commonality of failures specific to coal mines. The corrosive nature of coal meant it was attacking the copper fins of the original core units in that design, leaving the radiator exposed to needing cores replaced more often than not with each engine life. With these radiators, only genuine parts can be purchased for replacements (as opposed to cheaper replicas), making this an incredibly expensive exercise for coal miners! Our vision was to create an alternative product, that demonstrated resistance to the corrosion caused by coal, allowing the radiator to get multiple engine lives from the core units. Naturally this would tick the box of cost reduction for both mine owners and contractors.
Our first step towards this vision was to create a bullet list of points we wanted to focus on, ensuring we would not duplicate the design, but improve upon it. This list identified any area we noticed where a core could fail, or where we could make an improvement to extend the service life of the core. This list included items such as replaceable stainless steel seal rings, expansion joints and, critically, the changing of our products to an aluminium base, so they wouldn’t be corroded by the coal as the copper had been.
The result was that after 12 months, we came up with product that was new and fresh to the market. It took a lot of engineering, as well as partnering with another company that was able to produce wind tunnel testing and design testing around the real world performance of the core design. The outcome is a product we can release to the market, with a very good belief that it will provide the required service without failure.
Why is it so important in the current market climate for service and technology companies to be focused on saving cost for clients?
This cost saving focus has of course come to the fore in recent times, but COR Cooling has always been heavily involved in this process. I think what has shifted is the mining industry’s receptiveness to this concept as being critical. During the boom times where commodity prices were high enough, miners supported total reliance upon OEM vendors and a single approach to maintenance. This didn’t provide as many opportunities for companies like us to develop products off our own bat and take them to an end user who would willingly implement them as a cost saving initiative. Many of the radiator models were under MARC agreements with miners, meaning there wasn’t enough sales opportunity to justify the cost of significant R&D and product development. This has now changed.
Certainly, across the sector, the focus by all participants is now squarely on cost. There’s two options for evaluating the cost of a product: either you look at the invoice price you pay, or you calculate the total cost of ownership. Lots of companies have now realised that you can pay a lower invoice price, but not get an increased value from a product or piece of equipment. Our focus has been not just supplying an alternate part to our clients; any product or part we supply has to have a reason why we would choose to supply it, and to fit naturally into our suite of components for rebuilding to extend service life, reduce cost and increase value in unison.
The market is now aligned with our thinking. The reduction of invoice costs from all vendors has realistically gone as far as it can, so now we must all concentrate on creating better value, reducing maintenance and fuel usage, whilst ensuring when we fix a piece of equipment, that it will cost less to repair next time around. All of this has to tied in simultaneously to the critical safety element of mining operations.
It’s been an exciting few months overall for COR Cooling; can you tell us more about what’s been happening?
COR Cooling was formerly a subsidiary of Austin Engineering and was sold as a complete entity to H-E Parts International on 20th May 2016. H-E Parts is much more closely aligned with the business model of COR Cooling and we’re finding great synergies and opportunities to work with our new parent company. The international reach of H-E parts is great for us and we were in fact strategically acquired as part of their strategy to offer total front to back service offerings for heavy machinery earthmoving trucks. H-E Parts has also recently acquired Dyno Power in the Bowen Basin and between both company acquisitions, the greater group now covers all major under carriage components of popular HME truck fleets.