National Vacuum Going Gangbusters
TRAVERSE CITY – A Traverse City company is working with one of the nation's largest producers of natural gas to produce a fleet of eco-friendly tanker trucks.
National Vacuum Equipment, founded in 1980 by owner Bruce Luoma, is partnering with Oklahoma-based Chesapeake Energy, the most active driller of new wells in the nation to outfit the hardworking big rigs with NVE's model 4310 vacuum blower.
The "green tanker" project has been underway for more than a year.
"Their goal is to have environmentally friendly vacuum tankers set up to work on natural gas," says Luoma, from NVE headquarters on Aero Park Drive. "Typically most pumps run on oil, and then the oil gets spit out and has to be collected. Ours is a dry-running vacuum motor. The equipment we make only pumps air."
Thirty-one years ago, with only $1,500 of startup money, Luoma launched his company, retailing rotary vane vacuum pumps for northern Michigan's burgeoning oil and gas industry. "I was basically a sales guy for a truck dealer," recalls the Marquette-area native who moved to Traverse City in 1974. "Then I got involved selling vacuum equipment."
In the mid-1980s, NVE began fabricating its own line of tank components. Then in 1990, the company developed a line of vacuum pumps and began selling a variety of valves and accessories. Since then, NVE has added its own line of valves and high vacuum blowers.
Today, it offers the largest selection of vacuum tank pumps and components in North America and features a full service fabrication shop and machine shop. That growth reflects one of Luoma's key business philosophies: "No question about it, we're big on innovation. If you're not moving forward, you're moving backward."
And yet the company doesn't rely on any single client to be successful. "We try not to depend on any one customer," says Luoma. "Nobody is responsible for more than 3 or 4 percent of our total sales."
To accommodate NVE's recent growth, the company turned to the Traverse City Area Chamber of Commerce about a year ago to discuss their proposed expansion plans, says Tino Breithaupt, the chamber's senior vice president of economic development.
"As we further identified the details of their plans, we brought in Ben Bifoss [city manager], Bryan Crough [community development director]aand Deb Chavez [city Assessor] from the city of Traverse City," says Breithaupt. "As a result of this team-oriented approach, we were able to successfully get their property tax exemption request approved by the city commission."
The four-year property tax abatement is worth about $79,000 over its life span and reduces new property taxes paid by approximately 45 percent, so NVE is paying new taxes, based on their new investment, but not at 100 percent, according to Breithaupt.
"If NVE was paying $100 a year in taxes before this expansion project, they still pay the full $100 a year," he explains. "Let's say the new investment without the abatement increased their tax bill to $150 per year. With the abatement, NVE will pay approximately $127.50 in taxes instead of the $150. So their tax bill still goes up, just not at the full tax rate."
One of the most complicated steps in NVE's expansion came because of growth within other TC companies, which forced some facility shuffling.
"[There was] a four-way domino affect, which started with Century, Inc., who purchased the National Vacuum facility located across the street from Century," says Breithaupt. "In turn, National Vacuum began discussions with the property owner where GT Stamping was located. NVE and the property owner came to an agreement on the purchase of the property. GT Stamping had announced that it was closing its operations in TC and moving everything to Mexico. However, GT Stamping decided to keep what they had remaining in TC and found a new home on Park Drive."
NVE now plans to build a new building for its fabricating operation. The company's investment in new machinery and equipment totals almost $1.4 million with the prospect of creating six new jobs over the next two years. That should be no problem for a company that has been steadily growing.
"We've added staff – 20 in the past 60 days," says Luoma. "We're looking for qualified machinists and qualified welders."
Typically, NVE has three or four students from the Traverse Bay Area Career Tech Center. "(Precision Machining Technology instructor) Matt Teeter is doing a really good job at TBA," says Luoma. BN