To understand Electronics Remanufacturing Co. (ERC), you need to first understand President Russ Schinzing and his passion for electronics.
He began his career in the electronics division of Cardone Industries. He remained there for 16 years, until he met the president of Detroit Diesel, who was interested in remanufacturing electronic components on Detroit Diesel engines.
Schinzing went to work for Detroit Diesel, but realized that trying to grow the remanufacturing business was hampered by the OEM affiliation.
“It was difficult to get business from other people, and I thought there was an opportunity because there wasn’t an independent electronics remanufacturer in commercial vehicles. So I said ‘let’s try this. It will be fun.’ And it has been. I would not trade this for the world.”
Doing Things No One Else Is Doing
ERC is a relatively young business, launched in 2010, and Schinzing said it has taken some time to grow.
“Just because I had a good name and reputation did not mean all these companies wanted to start working with me," he says. "However, we got some good companies to sign on early, and I think it is being proven out that there definitely is a need for an independent electronics remanufacturer in the commercial vehicle market.”
Schinzing says ERC deals with “stuff that no one has ever touched before in the commercial vehicle market.” This includes things like turbocharger actuators, EGR values, instrumentation and ABS-related components. “Almost every OEM is doing its own engine control equipment, but no one is doing transmission control stuff.”
ERC’s business model is to be a third-party partner to either an OEM, Tier 1 supplier or to another remanufacturer.
“For example, we work with a lot of turbocharger remanufacturers who know how to remanufacture turbos, but do not know how to remanufacture electronics. Our competency is working with people who have cores to develop remanufacturing programs for their electronics,” Schinzing says.
Reverse Engineering Key
This process usually begins with reverse engineering the electronic component. “We have to figure out how it was put together and we have to understand the circuits,” he says.
“We have to reverse engineer all the communication protocol – how it talks to other modules and how it is communicated with – so we can actuate it. That usually is the largest part of the reverse engineering process – understanding how to communicate with the modules,” he explains.
Schinzing’s team, which consists of engineers, technicians, quality control people and parts changers, assumes that 100% of the circuit paths and 100% percent of the components on the units it receives are bad. “Our testing tells us whether that is true or not,” he says.
ERC staff has to make these assumptions because there is no way to tell by looking at an electronic component whether it is good or not.
“For the most part there is no physical identification of failure,” Schinzing says. “There is no gear to look at to see signs of wearing; no chipped teeth to see.”
As with other types of remanufacturing, the basic part has to be in good condition to be remanufactured.
“There are a few failure modes that would preclude you from being able to remanufacture a component,” he explains. If the failure occurred as a result of a fire that burned a hole through the component or if there is heavy corrosion, the component can’t be remanufactured.
In addition, there is some concern about software upgrades. “That is something you deal with a lot in electronics, but for us that is part of the reverse engineering process,” Schinzing says.[PAGEBREAK]
He believes the company’s ability to reverse engineer is one of the things that differentiates ERC from its competitors. “We actually reverse engineer for a lot of the other electronic remanufacturers out there.
Looking for Niches
“Another big differentiator for us it that we found niche products that no one else is doing. I think there are a ton of them out there. Every day we are looking for more of these niche products, because there is opportunity to get to the market early.”
Schinzing is not just bragging about ERC’s prowess. The Heavy Duty Remanufacturing Group of the Automotive Parts Rebuilders Association recently awarded ERC the prestigious Mike Hill Heavy Duty Remanufacturer of the Year Award. The award is given to a company or individual who has demonstrated innovative ways to create and grow a successful business model and in the process supported industry efforts to advance the science of remanufacturing.
Looking at the Market
He says the competitive landscape for electronics remanufacturing is small but growing, and at the same time it is a market that is large and growing.
He also is optimistic about the future. “In our market analysis, electronic content is only going to grow in commercial vehicles. As electronic content grows due to emissions regulations, weight reduction and increased fuel economy, that is going to drive our business.”
That prospect is exciting to Schinzing. “We love what we do. We are really good at this and we love doing it. We have a passion for electronics remanufacturing. I never see myself retiring,” he says. “When you find something you love to do, you don’t call it going to work anymore.”