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H&K Emerges From Economic Slump With Cat Lease

A big purchase adds up to a show of faith in the recovery.

Mon August 26, 2013 - Northeast Edition
CEG


H&K Group has leased three Cat 980K loaders from Giles & Ransome.
H&K Group has leased three Cat 980K loaders from Giles & Ransome.
H&K Group has leased three Cat 980K loaders from Giles & Ransome. (L-R): Jim Haines, Kristen Bromley, Scott Haines and John R. Kibblehouse Jr. mark a new era of business. (L-R) are Pep Hunsicker, John B. Haines IV, Wayne Bromley and Jack Tepper. H&K Materials Division’s Pep Hunsicker (L) and Jack Tepper pose at the business end of a new Cat 980K loader.

For the first time since the economy’s, and more specifically, the construction industry’s downward spiral in 2008, John B. Haines IV, co-chairman of the board of The H&K Group, signed leases for three, brand new, Caterpillar 980K loaders.

On June 28, corporate officials from The H&K Group, as well as from Giles & Ransome Inc., Cat equipment dealer based in Bensalem, Pa., gathered at The H&K Group’s corporate campus in Skippack, Pa., to take custody of the new equipment. Other than having some "shiny" new equipment in The H&K Group’s massive fleet of nearly 500 pieces of heavy equipment, the event marked what seemed to be the company’s emergence from the economic slump that many businesses and industries have found themselves mired in over the last few years.

"Five years ago we were purchasing 15, 20, 30 pieces [of equipment] a year and now we have just been using the life in the pieces we have," said Haines.

A major benefit that the new equipment will bring to H&K is efficiency, due to higher fuel economy and larger buckets, which will create a higher load out production in the quarries.

"We’re replacing some of our older equipment from the late 80s and early 90s, and the fuel efficiency is much better on these new models," said Pep Hunsicker, director of H&K’s Materials Division.

"I would say 60 percent of the fuel savings we are going to have is going right into the payment of the machine. These new 980’s will be loading both our trucks and railcars, and the differential in bucket size is noteworthy. What we previously loaded in three trips will now only take two."

The combination of fuel savings and increased load capacity will ultimately provide much relief to H&K’s bottom line, according to the company.

It didn’t take long for the loaders to see some action, as they were immediately dispatched to three of H&K’s larger quarries, Birdsboro Materials, Pottstown Trap Rock Douglassville Quarry, and Pyramid Materials, which is the company’s closest quarry to Philadelphia.

"They [the loaders] will go into the quarries that demand both higher load-out production and increased reliability. These pieces will be instrumental in supplying materials to our fleet of on-road haul trucks as well as our growing rail freight business," Haines said.

H&K’s Birdsboro Materials facility boasts the company’s largest and most active rail loadout facility complete with its own locomotives and more than 300 railcars. The stone is then railed to the Delmarva Peninsula to feed that region’s asphalt production needs.

The other beneficiary of the new equipment agreement, of course, was the supplier of the equipment themselves, Giles & Ransome (G&R). H&K and G&R have maintained a solid business relationship of more than 35 years.

"H&K has been one of our largest customers for many decades, said Kristen Bromley, president of Ransome Engine. "Of course it has been slower on the recent downturn, but it is nice to see the business is back up and running and they are able to buy the equipment from us."

This long-standing business relationship benefits both H&K and G&R. Wayne Bromley, president of G&R stated the importance of keeping a good business relationship going: "Always talking; always communicating. We hope to identify the needs they are going to have. We try to meet their equipment needs, but also their product support needs, as well. Looking at the needs H&K had, and looking at Cat’s introduction of the 980K, it’s a very popular machine. There was some interest from them to try it, and we feel very honored to have the opportunity to place three 980Ks with them. It’s been a very difficult period for the industry and it’s nice that things are starting to get better."

"Wayne Bromley and the whole G&R crew are honest. They are very fair and I like the relationship where I can pick up the phone and call the CEO on a Saturday afternoon. You are just not a number, even in that big of an organization. They have the same views as we do here at H&K, without the customers, you have nothing," Haines said.

Both parties look forward to maintaining this partnership for many years to come, as well as helping to grow and replenish H&K’s Cat fleet in the future as the economy and construction industry continue to recover and prosper.