Gränges is active in the global market for advanced aluminium materials, with a clear leading position in rolled products for brazed heat exchangers. The automotive industry accounts for about half of Gränges’ sales, the HVAC industry for around 24 per cent, and other end-customer markets (transformers and food packaging) accounts for the remaining 26 per cent. Gränges’ position is strong in all the regions in which the company operates.
High barriers to entry
The market for advanced aluminium materials is relatively difficult to enter. This is not primarily due to the capital-intensive nature of the industry, but rather because of the high level of competence and experience required to develop the new, advanced materials that customers demand. These skills are also critical to operating flexible production processes efficiently, and to be able to guarantee a high degree of delivery reliability in terms of volume, time and quality. All this requires well-tuned manufacturing capabilities and processes refined over long periods of time, as well as effective customer service and a global logistics capacity.
Manufacturers of heat exchangers are faced with constant demands for improvements from their customers in the automotive and the HVAC industries. Therefore, they need to continuously improve heat exchanger performance, reduce weight to meet demand for lower environmental impact, reduce total costs and increase the value of their cooling and climate control solutions. A core challenge is to meet the requirements of next-generation automotive platforms, new applications and demand of end-customer products. This means that as a supplier, Gränges needs to be at the forefront of developing adaptable and customized aluminium materials.
Long-term customer relationships
The long development cycles of new product platforms in end-customer industries such as automotive and HVAC require long-term cooperation between producers and their suppliers. Gränges has long-term relationships with its customers, a result of its strong focus on continually developing new products, materials, and processes in close cooperation with customers. These long-term customer relationships also reflect the strength of Gränges’ brand for heat exchanger materials, recognized for its capacity as a global supplier with excellent delivery performance. Of Gränges’ customers, 85 per cent have worked with the company for more than ten years.
Gränges’ competitors vary in size and strategic focus. Factors affecting the degree of competition differ between regions and end-user markets, but generally Gränges competes on quality and technical content of the products, the ability to meet customer requirements, product range, lead times, technical support, price, and customer service. Competitors are primarily major global aluminium companies such as Arconic, Novelis and UACJ. In Asia, there are several local players that are direct competitors to Gränges in the Asian market. In Europe, there are signs of growing competition from manufacturers in Eastern- and Southern Europe.