Martin Nanninga on corporatization of barrier producer

Faster when things go wrong: that is the promise of VEVA® and CADO®. After privatizing these activities at SPIE, Martin Nanninga continued them under his own flag as VEVACADO International BV. With a light organization and production partners who are also shareholders, he gains agility and scale. The order flow is growing from CADO passages for tunnels and ring roads to VEVA® systems that safely direct traffic to the other lane in the event of an incident, and the focus is on international expansion (including Scandinavia, Germany/Denmark and the Middle East). Next step: smart control and strict certification, with cybersecurity as a prerequisite. 

Why this acquisition, and why just now?

Martin Nanninga: "SPIE is at its core a service provider. Product development and keeping its own products 'in the market' require a different type of organization and investment. Renewed focus was initiated last year. When it appeared that people wanted to say goodbye to these products, I said: then I will take over VEVA and CADO." According to Nanninga, the carve-out required about eight months of preparation and the contract was formally ratified on January 1: "Since then I have been the owner of VEVACADO International BV."

How is the new organization set up?

"Running immediate production with low fixed costs was crucial. I arranged production capacity with three partners who are also shareholders: a steel builder, a control cabinet builder and an assembly/installation partner. This allows me to breathe with the order flow and scale up quickly when needed." Shortly after starting, he also hired a technical manager to ensure production and quality.

What will change for you personally as an entrepreneur?

"Decision making is faster, I can serve the Middle East myself (Saudi Arabia, Qatar, Oman, the Emirates) and I obviously coordinate with my shareholders. But most of the decision-making power now lies with me. That's a world of difference from the bureaucracy of a multinational company."

And how is the relationship with SPIE after the deal?

"Excellent. We have agreed that we can fall back on their knowledge for technical questions. If necessary, when the first CADO is welded with us, we will have an SPIE inspector look over our shoulder. That cooperation remains constructive."

Where does the order book currently stand?

"We are now building 11 CADOs and one VEVA, with more on the horizon this year. These weeks I am negotiating VEVA deliveries in Norway and I expect a significant order for several CADOs on the Antwerp ring road." He also mentions opportunities in Sweden and Slovakia ("around 40 units there alone over the next few years") and a tender in Oman with "significant numbers."   

What exactly do VEVA and CADO do, and what problem do they solve?

"A VEVA moves traffic to the other lane in case of emergencies or work, so that the flow, at lower speed if necessary, is maintained. There are four VEVA installations on the Storebælt Bridge in Denmark; this allows you to close off a section and still pass through while emergency services work safely."
"CADO is a fast-opening passage for emergency services, for example to tunnels. In countries where emergency services have to squeeze through stopped traffic, it saves up to 21 minutes. That can literally save lives."

How important are certifications, and what does that mean for innovation?

"Crucial. We work under the European EN 1317 standard (performance of vehicle restraints, ed.). With such a certificate, you cannot simply change a product; otherwise you have to crash test again. Those are substantial investments with multiple crash tests, from passenger car to bus and truck." The core of the design therefore remains intact. "Innovation in the coming period is mainly in the intelligent control shell: decision support from the traffic center. Biggest challenge here is cybersecurity. Some countries, including Germany for example, are conservative in this regard. Elsewhere, such as in the Middle East, people are actively seeking secure solutions."

How do you scale up without getting bogged down in fixed costs?

"My partners have multiple production sites. If I hit capacity limits, I can bring in a second supplier of equivalent quality, with rock-solid quality assurance, of course. For installation, I am increasingly working with trained local partners in countries where systems are already in place. Thus, installation is becoming more and more 'plug-and-play'."

What about maintenance?

"For now, SPIE will continue to perform maintenance and annual inspections. Later I can take over or (partially) outsource that. Putting a fleet of 'ten vans' on the road myself is a strategic choice; first the basics have to run well."

Domestic versus foreign: where is the market?

"Roughly 90 percent are foreign countries. The Netherlands is now in the replacement market: systems from 2002 are approaching end-of-life and are being renewed during tunnel renovations. That will pick up over the next five years, but it will remain roughly 90/10 foreign/domestic." The main customer demand combines safety with reduced congestion. "The longer the traffic jam, the greater the pressure on emergency services, and that is counterproductive."

Intertraffic will take place again next year: what will you show there?

"In March, I have reserved a large booth. It will be the first time we present VEVACADO as an independent brand full. The whole market is there; we are really going to 'build a party'."

Finally, your milestones for this year?

"One: convert the pipeline into signed orders in Germany-Denmark, Antwerp, Norway/Sweden. Two: under own production have EN 1090 (production/construction) and EN 1317 fully in order. If that stands, no one can do anything to us."