It was a momentous year for the country. The second Mabo decision was handed down, overturning the concept of terra nullius. Paul Keating earned the sobriquet “Lizard of Oz” by resting his hand on Queen Elizabeth’s back. And Billy Ray Cyrus’ “Achy Breaky Heart” set the nation afire, staying at no. 1 for seven weeks and in the process becoming Australia’s favourite song of 1992.
Heady times. For CJD Equipment in Perth, 1992 also marked the start of their involvement with AB Volvo; the Swedish manufacturer of industrial vehicles. In the quarter-century since then, AB Volvo spun off the passenger car arm of the company into its own entity, while taking full ownership of the construction equipment arm; CJD has grown to operate a national dealer network for them; and both companies have weathered enormous changes in the Australian economy.
As CJD and Volvo mark the 25th anniversary of their partnership this month, Inside Construction spoke with CJD’s managing director Alan Barnett. For Barnett, “relationships are the key to our business. Relationships with our employees, relationships with our customers, and relationships with our manufacturers.”
“A number of staff have been with us for over 40 years”, adds Barnett, who himself holds 16 years tenure at CJD, nine of them at the helm, (and is now part-owner). It’s a culture that made itself felt a few months after he took over, when the full impact of the GFC struck in Australia.
“A very fortunate thing for me as managing director when I started in 2008 was that our two founders Ron Rafferty and Rob Jowett were still involved,” Barnett relates, “and they were a wealth of knowledge for me to talk to about all the challenges that were going on [and] how we look after our people”.
Australia was relatively insulated from the GFC, but “being related and integrated with a global company like Volvo, you get to see what happens in other markets like Europe and North America”.
“Probably I’d say the downturn of the mining boom has had a much bigger impact on our business than the GFC did… when it hit, it hit very hard.”
An atmosphere of policy turmoil certainly didn’t help dealers and distributors.
“When you’re talking capital equipment for businesses and for investment, they want to see political stability,” he says.
Barnett believes it’s the continuity of knowledge at CJD, combined with the agility and values of being a smaller, family-oriented business, that helped the company push through those troubled times. That’s also how CJD earned trust and developed new markets in the early days of the Volvo partnership. He argues that a successful dealer must “always focus on customer service” and be “more nimble… with a sense of urgency”.
In 1998, when Volvo took over the Samsung Heavy Industries line of products, they also inherited their private dealer network in Australia. Although Volvo prevaricated for a while over the balance between manufacturing and retailing, by May 1999 they had offered the Tasmanian and Victorian territories to CJD.
They took the opportunity and ran with it. The Queensland contract followed a month later, and NSW in early 2000. By 2001 CJD was in negotiations with Volvo over an agreement to import and distribute their equipment exclusively across Australia and Papua New Guinea.
The construction equipment arm of Volvo, uncoupled from the passenger automobile side of the business in 1999, has since added some key equipment to its offerings. CJD now carries Ingersoll Rand rollers and pavers, Terex rigid and articulated trucks, and Shandong Lingong (SDLG) loaders on their behalf.
But there have been internal developments too, including the EC950E excavator and the A60H articulated hauler (a descendant of the world’s first ever articulated hauler, Volvo’s 1966 “Gravel Charlie”). Recently, buzz has also been growing about experiments in electric drive and hydraulic systems.
“[Construction equipment] follows on from the car industry, but probably ten years after,” says Barnett, “if you’d asked people five years ago they would have been talking about gas”.
It’s the peripheral services and customer support, according to Barnett, that will differentiate successful dealers in the future.
“People’s expectations of quality, reliability, safety are a given as technology advances,” he says.
“For us, it’s more about how we partner with companies – how we make it easier to use our stuff. That’s going to be a very dynamic change”.
With their current stable of vehicles, Barnett says CJD’s prepared for the future. He’s optimistic about the coming years on the eastern seaboard: “I would have said 12 months ago that NSW would have started to plateau a bit… but after the announcement of the Badgerys Creek airport and what’s going on there… it’s got two to three years to go of growth”.
NSW, Victoria and South East Queensland are the key growth areas in civil infrastructure, predicts Barnett, adding “we are starting to see coal in some of the central Queensland area pick up a little bit, but we’re not going to see a mining boom like we had in the past.”
“There’ll be growth in mining and more stability, but I think it’ll be a steadier process which is good for everybody.”
The partnership “has been very successful for both Volvo and CJD”, says Barnett, “there’s been some great relationships, not just business relationships but also friendships”.
“We’re very much looking forward to the next 25 years, and where Volvo takes us over that as well.”
