Ariel corporation, mount Vernon, ohio, UsA

www.arielcorp.com

Just in Time

Top Logistics for the Golden Age of Gas

Ariel Corporation, Mount Vernon, Ohio, USA, is one of the leading manufacturers
of high-speed reciprocating compressors in the world. To this day, Ariel produces
exclusively in Ohio. It was at this location that Jim Buchwald, one of the most successful
compressor designers in history, founded the company in 1966. While this small city
in the heart of the state of Ohio may not be located in the current centers of the oil
and gas industry, Ariel stands by the traditional Mount Vernon site. Thanks to a highly
modern distribution center, almost all replacement parts for Ariel compressors
routinely ship at any destination worldwide within 24 hours.
TEXT: Ludwig Schnefeld PHOTOS: Ralf Baumgarten

early a basic valve had a lead time of

13 weekstoday just three. replacement
parts routinely ship within 24 hours.
Steve Thompson
vice President Supply Chain
Ariel Corporation

e are the prime choice

worldwide for high-speed
reciprocating compressors, explained Steve
Thompson, Vice President Supply Chain at Ariel Corporation. We worked
hard over many years to achieve this position in
the market. We are very proud that we recently
shipped our 40,000th compressor.
Global market leadership goes hand in hand
with a significant logistical challenge. We have
a very respectable market share that we plan to

With the recently shipped 40,000th

compressor, Ariel underscores its
leading position in the world market.

increase, Steve Thompson added. The value

proposition that Ariel provides to the customers
covers everything from shipping the compressor
to service in everyday operation. Developing the
best systems, including for the aftermarket, has
therefore been one of Ariels strategic objectives
for many years. In the early years of Ariel, it
could take several months to complete an order.
For example, the basic lead time for valves was
13 weeks, Steve Thompson recalls. Today, the
majority of HOERBIGER parts can be received in
three weeks with specially engineered product in

nine to twelve weeks. The new distribution center

opened in 2012 has considerably expedited
Ariels replacement part shipments as compared
to most of its competitors. Most parts routinely
ship within 24 hours. In a few isolated cases, it
may take up to 48 hours. HOERBIGER Corporation of America, which supplies the lions share
of all valves used in Ariel compressors, is making
a significant contribution to this achievement.
HOERBIGER is an extremely important supplier
for us, Steve Thompson said. After all, we have
a long common history.

iTS ALmoST imPoSSibLe

To KeeP ALL vAriATionS
in invenTory. hoerbiGer
reALLy doeS A very
Good Job And ASSureS
ThAT We Are AbLe To
SuPPLy even rAre
rePLACemenT PArTS
WiThin An AdequATe
Time FrAme.
steve thompson

Logistics hand-in-hand: while Bryan Moore (left)

records a HOERBIGER shipment in inventory, his
colleague Hilary Matthews prepares a customer
order (center). Steve Sheets (right) removes
replacement parts from the spiral conveyor.

Partnership entails obligations

This shared history dates back to immediately
after the companys founding. At that time, Jim
Buchwald met Hubert Wagner, who was in
charge of developing the HOERBIGER commercial agency in the USA established in 1963.
Hubert Wagner was excited about Jim Buchwalds idea to build a reciprocating compressor
that had a speed of 1,800 revolutions per minute. He advocated the development of a matching valve at HOERBIGER in Vienna, Austria. The
basic design was the tried and tested RX valve.
It was fitted with a newly developed spring

plate, which ensured reliable functioning of the

valve even at 1,800 revolutions per minute. At
3,600 piston strokes per minute, this equated to
a capacity of more than 100 percent over the
customary performance.

steVe thOmPsOn
Vice presiDent sUpplY cHAin
Ariel corporAtion

Over the decades that followed, Ariel and

HOERBIGER repeatedly joined forces to work
on innovative solutions. Soon, the focus would
no longer be only technical aspects, but increasingly also the logistical requirements of the
supply chain.
One example is the IN-SYNC program from
2004. Back then, we replaced the existing
manual process for ordering valves with an electronic order system, Steve Thompson reported.
The system has been expanded since then:
The valves are now shipped configured for
the unit and already contain the Ariel serial
number.

Steve Thompson has been in the oil and

gas industry for 32 years, 27 of them with
Ariel. Since 2000 he has been responsible
for Ariels supply chain.

Alex Wright, the oldest son of Ariel CEO Karen

Buchwald Wright, is managing the new distribution center, which opened in January
2012. Here, 24 hours a day, 7 days a week,
120 employees assure that the network of
Ariels distributors can be supplied with all
components of an Ariel compressor within
the shortest timefrom standard replacement components to machined parts. We
process approximately 800 orders a week
here, Alex Wright explained. The 50,000square-foot (4,600 square meter) facility offers sufficient capacity to keep up with the
strong growth that is expected in the market
in the coming years. Previously, we barely
had 8,500 square feet (800 square meters)
available for the logistics operation, Alex
Wright reported. The added space now allows us to process the orders considerably
more efficiently, and more importantly we
can handle them faster. When it comes to
planning the processes, Ariel uses the
benchmarks from the automotive and commercial vehicle industry as a guide: the automotive retailer AutoZone, the industrial
equipment manufacturer Caterpillar, and the
motorcycle manufacturer Harley-Davidson
served as inspiration for the development of

100 Percent Performance

the new logistics center. We deliberately

For our collaboration on the supply chain, our

goal was 90 percent on-time performance.
HOERBIGER achieved nearly 100 percent during the first phase of the programIN-SYNC 1.
This was and still is an outstanding achievement. According to Steve Thompson, this high
performance is critical for the aftermarket: The
aftermarket business is a major logistical challenge for everyone involved, notably for the parts
that HOERBIGER produces. Especially when it
comes to valves, there are numerous variations
depending on the output and application of
the compressorsdespite a largely standardized portfolio. Its impossible to inventory every
configuration of HOERBIGER valves. HCA works
hard to help Ariel respond to customer needs in
a reasonable time frame. All this is done worldwide. Over the years, HOERBIGER has invested
in a global network of production plants and
service locations. These complement Ariel Corporations distributor network.

used companies for reference that have an

extensive global spare part business, Alex
Wright stated.

Alex Wright
Director Aftermarket Operations
Ariel Corporation

The Logistics center

is impressive. We have
achieved outstanding
logistics qualityand
thats the bottom
line.
Alex Wright

Always Close to the Customer

We must be prepared that our markets will become ever more global in the coming years,
Steve Thompson explained. The new logistics
center in Mount Vernon will support the increasing globalization of Ariels business, but constitutes only a part of the strategic preparation for
the challenges of the future. Steve Thompson
added: It is extremely important to us that we
are represented around the globe wherever our
compressors are being used. HOERBIGER is

part of this network and contributes to ensuring

that we can always procure the necessary components close to our customers. Like all players
in the market, Ariel is intensively engaged in analyzing the effects of the economical use of
shale gas. Steve Thompson anticipates significant momentum, especially in the North American market: We are a U.S. factory, and as a result our focus is, of course, on supporting the
development of the U.S. marketplace. While at
present there is uncertainty in the USA to what
extent the government will actively engage the
availability of shale gas, it is important to note
that the use of shale gas will be a significant
positive driving force for the national economy.
The domestic shale gas deposits provide the
USA with the opportunity to reduce its dependence on energy imports. Shale gas will additionally create options to lower the unemployment numbers.

Growth through Shale Gas

Steve Thompson is convinced: Shale gas will
drive the economy like nothing else in the past
decades. This will have considerable impact
not only on companies that are involved in gas
gathering, but also on gas-processing industries, such as the chemical industry: There are
many locations along the Gulf Coast in this sector that were shut down over the last few years.
These plants can now be put back into operation. He added that a lot of companies moved
abroad because natural gas prices were so high.
Now that the prices for natural gas are falling,

Part
The close collaboration between Ariel and HOERBIGER goes back
to the inception of Ariel Corporation in 1966. Virtually all of the
standard valves used in Ariel compressors are manufactured by
HOERBIGER Corporation of America in Pompano Beach, Florida,
USA. When it comes to developing new valves, Ariel works closely with HOERBIGERs research and development. This close cooperation is paramount for us, explained Karen Buchwald Wright,
CEO of Ariel Corporation. A common understanding of modern
product design, quality and service drove both companies to continually improve their products and business processes.
John Wise, Valve Cell Engineer, during a functional check of the valve (left)
before it is packaged and stored (right).

these companies are returning. And they will bring back other businesses,
Steve Thompson added. It is critical for Ariel to be prepared for rapid
growth. The company has undergone intensive preparations: We have
given very careful thought to how we must respond to the new development in the gas market and what strategies we must rely on to take advantage of the new opportunities that natural gas presents, Steve Thompson
stated. It is imperative that we have the right processes in production and
in logistics to be able to keep up even with strongly rising demand. Ariel
invested not only in the new distribution center, it also expanded the workforce.

Global, of Course
Ariel is also working on new developments for high-speed compressors,
which are specially tailored to the value-added chain as it relates to shale
gas, from gathering to the end user. To this end, Ariel continues to count
on the long-standing partnership with HOERBIGER: We recognize that
HOERBIGER is a very R&D driven company, Steve Thompson added.
HOERBIGER has managed to continually bring out new products with
better performance and higher reliability. With this, HOERBIGER clearly
demonstrates that it wants to remain a technological leader in the market.
Together, we are well-prepared for the future, Steve Thompson said.
Natural gas will be the driving force of this future. Will it also drive

globalization? Steve Thompson leaves no doubt: Ariel is a global company.

By default, we will expand our presence internationally. This has always
been a focus for Ariel.

Part OF
Ariel Corporation is considered a market leader around the world
for high-speed compressors. Initially, Jim Buchwalds idea of combining conventional gas engines with high-speed compressors to
form one powerful unit was met with skepticism by the industry.
Today, the portfolios of almost all renowned compressor manufacturers include high-speed reciprocating compressors that follow
this design principle. For a trendsetter, it is crucial to tirelessly
explore the requirements of the customers and respond with customized solutions, Steve Thompson explained, Vice President Supply
Chain at Ariel Corporation. Because we do this, we are optimistic
about the future of our industry.

Partnership
The partnership between Ariel and HOERBIGER goes back to very
close, friendly relations between Jim Buchwald, the founder of
A riel Corporation, and Hubert Wagner, who was searching for
new business partners in the New World for the HOERBIGER
commercial agency founded in 1963. Hubert Wagner valued the
personal traits of the visionary design engineer from Ohio. From
the history of HOERBIGER Ventilwerke in Vienna, he knew the difficulties that pioneers have to overcome to be successful. For this
reason, and arguably also because he shared the vision of Ariels
founder, he supported the undertaking to develop a compressor
that was to be faster and more powerful than any reciprocating
compressors available at the time. To this day, the cooperation
between Ariel and HOERBIGER is distinguished by the pioneering
spirit from those timesto include when it comes to developing
i nnovative logistics processes for the supply chain.

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