Air Products Operates Distinct Relationship with Its Carriers
Apr 1, 1999 12:00 PM
When a tractor breakdown recently threatened delivery service to an Air Products chemical customer, the contract carrier dispatcher understood the urgency of the situation. He called a wrecker and ordered the driver to tow the tractor and tank trailer - not to a repair facility, but first to the customer so the product could be successfully unloaded.
The unusual on-time delivery effort was dramatic evidence of the close professional relationship that Air Products of Allentown, Pennsylvania, develops with its tank truck carriers. Air Products selects carriers that have demonstrated the effectiveness of their employees, equipment, and operations. Then, as part of the ongoing process, the shipper shares its resources and knowledge to enhance the relationship.
"We put a lot of time into choosing our carriers and developing the relationship, and that produces dependability," says Richard Walters, manager of North American distribution for Air Products and Chemicals Inc. "We're very loyal to the carriers we've selected, and for good reason."
The relationship builds trust between the carriers and the shipper. It is one reason Air Products has continued the practice of using contract carriers to enhance its aggressive growth that grosses $1.5 billion in annual chemical sales. By not owning a chemical fleet, the company avoids capital investments and expenses that otherwise would go into fleet equipment, maintenance, and operations.
"It just makes no sense for us to have a fleet, since services are available from common or contract carriers," says Walters.
In an effort to succeed with closer relationships and to lower costs, Air Products has reduced the number of individual carriers in the last three years from 17 to the current nine. The nine strategic carriers include Quality Carriers Inc (formerly Chemical Leaman Tank Lines Inc), Trimac Transportation System, McKenzie Tank Lines Inc, Delaware Express Company, Jordan Transportation, Service Transport Company, Roy Brothers Inc, Frank J Sibr & Sons Inc, and Langer Transport Corp.
"The carriers are bulk transportation specialists and can develop their own efficiencies," says Walters. "We are in the chemical manufacturing business, not the trucking business."
Air Products views carriers as an integral part of operations, relying on them to deliver product safely and on time. "They are really an extension of us," Walters says. "We try to have an appropriate relationship with our carriers. We want to know who is transporting and handling our product. That means that even though rates are important, the carrier's safety record and performance are key factors."
Customers often require the driver to load or unload. "Drivers know the customer loading racks and are familiar with the employees there," he says. "Failures are minimized by this knowledge and interaction."
To achieve its distinct relationship with carriers, Air Products endorses the Chemical Manufacturers Association (CMA) carrier assessment. Using the assessment as a guide, Air Products managers conduct a review of the carriers' terminals every three years. Prospective carriers, like those who have already been chosen, must provide information about their driver hiring qualifications; office, terminal, and maintenance facilities; safety and emergency response programs; and tractor and trailer maintenance schedules.
Air Products requires the drivers to demonstrate knowledge of vehicles' unloading equipment and understand the importance of customer service and on-time delivery. Specialized handling of certain products, like amines carried at high pressure, calls for selected drivers.
Air Products utilizes a carrier performance measurement process called Vendor Challenge. This process, in place for 14 years, tracks performance from many sources, including customer-provided feedback. "We categorize nonconformances; ie, equipment issues, driver training, dispatch, etc, and work with carriers on prevention and continuous improvement," says Glenn Acker, supervisor, bulk truck transportation.
At the same time, the shipper lends support to the carrier and provides input for equipment purchase. "We ask what can we do to help their productivity," says Walters.
One example occurred with McKenzie Tank Lines Inc, which has 16 MC331 tank trailers dedicated to Air Products for high pressure amines, says Acker. The two companies collaborated to design new trailers to replace older vehicles in the McKenzie fleet. The rear-unload trailers manufactured by Mississippi Tank Co are used in amines transportation at a plant in Pace, Florida. Fourteen of the 9,500-gallon vessels are noninsulated and made of carbon steel, one insulated trailer is made of carbon steel, and one is made of stainless steel.
The amines tank trailers have certain improvements, including the elimination of threaded connectors and piping, and stainless steel emergency valve conversions. Extensive testing and research were applied in developing an elastomer for valve seats and seals. An aggressive hose testing program was developed, and a pre-trip inspection program that includes pressure testing of the vapor compressor was implemented. A sonic tester is available to check for leaks.
Air Products also consulted with Quality Carriers Inc and McKenzie to obtain filter units for dry bulk trailers. The units are used in polyvinyl alcohol deliveries where textile customer facilities were unable to capture the dust from the product.
Quality Carriers Inc also has provided lightweight tank trailers for the Calvert City, Kentucky, plant to transport polymer emulsions.
Trimac introduced five high-temperature DOT407 trailers to use in specialty amines transportation at a Wichita, Kansas, plant. The 6,800-gallon carbon steel vessels were assembled by Polar. They have Betts steam-jacketed three-inch hydraulic internal valves and Durco steam-jacketed three-inch external valves.
Delaware Express has a specific assignment that handles deliveries for a large customer in which several drivers are dedicated to the service. Air Products helped Delaware Express install a telemetry program that monitors the customer's storage tank levels and determines when deliveries are necessary. "This enabled the carrier to become an integral part of our supply to this important customer," says Walters.
Air Products provides continuous training and support to its carriers. This includes sending plant employees to carrier safety meetings to offer product training and discuss safe handling.
The company utilizes a "first time bulk delivery process" whereby customer delivery requirements are clearly defined prior to a first delivery with all new customers. "We have learned that a clear understanding of all requirements between the customers, the carriers, and Air Products will prevent delivery nonconformances," says Acker.
All of this emphasizes the priority Air Products places on the well-defined communication between carrier and shipper. "We feel very comfortable contacting a carrier's CEO (chief executive officer) or president," says Walters.
These well-thought-out interactions between shipper and carrier were begun when the chemical division was established in 1961 as the industrial gases company diversified into chemicals. At that time, Air Products began manufacturing chemicals via a joint venture with a petroleum refining company to convert refinery by-products into oxo-alcohols for use in producing plasticizers. Air Products had been founded 21 years earlier by the late Leonard P Pool in Detroit, Michigan, with the "on-site" concept of producing and selling industrial gases, primarily oxygen.
Perhaps it isn't amazing that the company eventually moved into the chemical industry. The first home for Pool's new company, almost 60 years ago, was a Detroit warehouse with an unusual "aura" about it. The company's founder rented part of the building to his brother, Dr Walter Pool, who used the space to start a college of mortuary science. The students used cadavers to learn their craft. Company pioneers remember the air was thick with chemicals.
Things are different today in the international chemical division that produces alkyl and specialty amines, epoxy curing agents and modifiers, industrial coating resins, polymer chemicals, polyurethane additives, polyurethane intermediates, polyurethane prepolymers and curatives, and surfactants.
Among the industries served are adhesives, agriculture chemicals, castable elastomers, ceramics, construction, graphic arts, nonwovens, paints and coatings, paper, pharmaceuticals, polyurethane foam, and textiles.
The gas division supplies a broad range of industrial gases - chiefly oxygen, nitrogen, argon, hydrogen, and helium - and related equipment, serving more than 100,000 customers throughout the world. It generates almost $3.5 billion in revenue and has historically maintained its own fleet for gas distribution.
The relationship that Air Products has developed over the years with its carriers has made a major contribution to the success and extensive growth of the chemical division, says Walters.
"From its roots as a small industrial gas company, Air Products has expanded to reach nearly every continent in the world," he says. "Its products and services have important applications in industrial, consumer, and agricultural markets as well as those emerging along the frontiers of science and technology. We think this ensures a future for the company as bright as its past."
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