Indianapolis has become the operating headquarters of a Ukrainian-American venture producing what could be the next big thing in refrigeration units for semi trailers.
The move came with the naming this year of Thomas Roller as president and CEO of Ukram Industries. Roller is known locally as former CEO of Indianapolis-based Norwood Promotional Products and of Fruehauf Trailer, which was based here in the 1990s. Though Roller has led other U.S. companies through the years, he’s continued to reside here.
Roller was recruited to steer Ukram as the European company prepares to launch the first North American sales of its EcoFridge trailer refrigeration systems.
EcoFridge units cool with liquid nitrogen, long used in scientific and industrial applications. Emitting a wispy, white vapor, liquid nitrogen can chill objects to the point of shattering.
But unlike conventional diesel-powered cooling units, the cryogenic system doesn’t emit the greenhouse gas carbon dioxide or ozone-depleting fluorocarbons. Nitrogen is the must abundant component of air. Liquid nitrogen prices have remained stable over the years.
Neither do EcoFridge units make a clatter, which has been a selling point in parts of Europe with strict noise regulations.
In the past, it would have been easier to mass-market babushkas in the United States than exotic, liquid nitrogen chillers made in a place most couldn’t find on a map. Diesel-powered systems are proven and widely supported. Liquid nitrogen units, by contrast, require infrastructure at the truck terminal to store and dispense the super-cooled fluid. They also rely on a computerized sensor system to prevent cargo handlers from being asphyxiated when inside the trailer.
But Ukram is betting tougher climate regulations will make a compelling case for its cooling units. The California Air Resources Board has caused near pandemonium in the refrigerated industry by imposing tougher emissions standards for the chilling units. Trucking companies must retrofit or replace them or face tens of thousands of dollars in fines or even jail time.
Not surprisingly, Roller will focus initial sales on California. “Our business climate is focused on ‘green,’” he said. “I’m getting so many calls. I’ve had literally 10 mega-companies calling me in the last two or three months.”
Coming chill for fleets
Several other states are looking at California-like regulations for refrigerated trailers, said Jim Gray, marketing manager for Sioux Falls, S.D.-based K& J Trucking. His firm ships ice cream and other frozen goods to California and throughout the West. “The flood gates have been opened,” he warns.
Ukram was launched nearly a decade ago by former NASA scientist Howard Pedolsky and by Ukrainian engineers and physicists.
The chilling units are made in the Ukraine and likely will be for the foreseeable future because much of the company’s funding—more than $4.5 million—is from the European Bank for Reconstruction and Development.
So far, Ukram has sold about 50 units in France, Israel, the United Kingdom and South Africa. Sales are in the “single digit millions,” said Roller, though he expects “triple digit millions” in annual sales within five years.
A key European client is ASDA, a Wal-Mart-owned supermarket chain in the United Kingdom that’s fond of wearing its “green” credentials on its corporate sleeve.
It was ASDA’s embrace of the technology that helped seal the deal for Roller, who traveled to the Ukraine after a pitch from an executive recruiter in London. Roller had been commuting to Minnesota to an executive position at food company Quality Ingredients Corp.
“If you can satisfy these guys [Wal-Mart’s ASDA] you don’t have to talk to anyone else,” he said.
Roller has hired three people so far and said local Ukram employment could expand to a dozen people over the next year or so.
Founder Pedolsky, who ran the company out of Maryland, will work as a consultant. Ukram’s board wanted someone with sales experience as CEO, said Roller, whose resume also includes executive experience at Carrier Corp.
He moved his family here to work at Carrier’s west-side residential HVAC operation in 1989. It was Roller’s 10th corporate relocation and, as far as he was concerned, his last. His reluctance to pull up roots again may well prove fortuitous to the extent Ukram expands here.
Early versions of the EcoFridge were tested with the Cincinnati-based grocery giant Kroger. Roller considers that test “premature,” noting the further refinements to the technology and green mania that’s swept business since then.
Ukram said its system should sell at about $30,000 per unit, which is about the cost of a conventional refrigeration unit. The company claims lower maintenance costs because the liquid nitrogen system has few moving parts. As with conventional chillers, the refrigerant must be topped off periodically. Installing a nitrogen depot costs a good $100,000, though the expense is negligible for larger terminals.
Ukram said the units become more economical as diesel prices rise.
Future still foggy
The cryogenic trailer chilling market is still emerging, however.
Minneapolis-based Thermo King, which with Carrier dominates the truck trailer cooling market, has developed a cryogenic unit using carbon dioxide instead of liquid nitrogen.
Like users of EcoFridge units, trucking firms also need to have access to a cryogenic fuel depot—in this case CO2. Thermo King says the new units don’t create new CO2 but rather reclaim it from other industrial processes such as alcohol distillation.
This may be Roller’s toughest competition. Trucking executive Gray already has Thermo King cryogenic sales material on his desk. K&J always seems to be in the market for new trailers; his firm goes through them in three years rather than the usual five because ice cream must be chilled way down to minus 20 degrees.
Replacing units is more costly for many firms because the California rules “have destroyed the used trailer market,” Gray says.
With pollution regulations—and costs to comply—for traditional refrigerating growing ever more costly, “new technology needs to be embraced,” he added.
From what he’s seen of specifications so far, Gray said manufacturers of new chilling units need to be mindful of weight issues and of availability of supporting infrastructure.
“The one thing I see for sure is the technology is moving forward quickly,” he said.