THE INTERVIEW NOVEMBER/DECEMBER 2019
GETTING SOME AIR
Atlas Copco celebrates a century of operations in the
UK this year. Ahead of the celebrations in November,
MM sat down with Alexander Pavlov, the company’s
managing director for the UK and Ireland
BY CHRIS BECK
Atlas Copco’s compressed air has been
part of the UK’s industrial fabric for
100 years. Indeed, if you look back
at some of the major events of the
20th century, chances are you’ll see
one of the company’s compressors
somewhere in the background. For example,
Atlas Copco compressors were used to pump up
the pontoons that helped raise the wreck of the
Mary Rose in 1982.
The UK was Atlas Copco’s fi rst successful
overseas expansion from its native Sweden.
Indeed, the Compressor division’s global HQ, in
Antwerp, was actually established in 1956 – almost
50 years after the UK branch. Originally based in
London, where the factory was lucky to escape
being hit by a bomb during the Second World
War, Atlas Copco has called Hemel Hempstead
home since the 1950s. Its current site in the town
has been its UK headquarters since 1972 (when it
was visited by the King of Sweden, who landed his
helicopter on the roundabout outside).
Today, the company is headed by Alexander
Pavlov, whose career at Atlas Copco has taken
him across the world, from Belgium to the
Balkans before settling in Hemel Hempstead.
originally spoke
Manufacturing Management to Pavlov way back in September 2017,
when he had been in the job for just six
how the company has developed.
MM: How
have you
seen the
company
change in the
past two years?
The company has
AP: been doing very well over the
last two years, without making
any radical changes. It’s been
organic, natural growth. The
main diff erence would be
probably the product range.
We’ve launched so many new
products over the last two years,
some of which are really gamechanging:
oil-free compressors,
for example. The previous
range had been around for two
decades with only some small
design improvements, but this
is a major leap forward. Now we
are ahead of the competition on
performance and serviceability.
Of course, this has happened
with a three-year backdrop
of Brexit uncertainty, always
preparing for the worst – and
so far, the worst hasn’t really
happened. Over the past
three years we haven’t seen
a slowdown apart from
in a couple of projects in
the automotive world and
British Steel. These are all big
customers, but even still, the
business is growing.
MM: When we spoke a
couple of years ago, a word
that kept coming up was
servitisation. Have you
seen that grow in the last
couple of years?
AP: Yes, it’s growing. The idea
behind servitisation is to off er
air instead of a specifi c product.
A customer can just have a
compressor and start paying
per running
hour – it’s
a kind of
rental service
model. Perhaps
because of all the
uncertainty, that business
model has really started growing
recently. It’s still a relatively
small part of our business, but
two years ago, it was nothing.
MM: Do you think the
market is getting more
used to the idea of
servitisation?
AP: Over time, yes. Some
markets are much more
interested in a servitisation
model compared to others. In
the UK, companies still like to
invest in machinery, whereas in
the US, for example, it’s very,
very common to sell so-called
‘air over the fence’ contracts,
where you basically charge per
cubic metre of air. Compressors
are installed at the customer
side, but some in the US even
put a fence around them, so
that the customer cannot even
get access. They are run via
automatic controls and remotely
monitored. The customer
doesn’t even have access to the
machine, because it’s not his
machine – he’s just paying for
the air. It provides fl exibility for
a company with several factories:
they can rearrange production
between factories and say ‘OK,
I need less air here, I can move
those units to another factory’.
In the end, they will still pay
per cubic metre and not for
the machines. In the current
uncertainty, there is often a
block on CapEx. Customers
can benefi t by just renting the
months. We paid him a visit again to see
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