Published in the May 2009 Coal USA Magazine

Ted Doheny, president of Joy Global division Joy Mining Machinery, has been responsible for the company’s entire underground mining machinery business since 2006. This alumnus of both Cornell and Purdue sees a strong future for the mining equipment sector and a quick recovery from the current downturn.

Q: What was your impetus for joining the coal mining community in May 2006?

TD: I was looking for a company with a strong brand, a solid market for future growth, and where I could leverage my experiences to take a good business to the next level of performance. Joy was a great match – a proud 90-year history of proven performance with a strong brand name and the clear leader in mining equipment.

Joy was in a technology-driven industry under great pressure to find new ways to control costs and create growth for the markets served. I also saw the coal industry as a solid market for the future as the largest source of safe and reliable energy to satisfy the long-term needs of the global energy challenges with no other clear solution for the short term.

After traveling extensively to visit our facilities around the world and meeting our major customers, I saw two key opportunities to create value for Joy; expand our product focus to supply full systems and services and drive operational excellence to the next level of performance throughout our global facilities.

We put together a vision of transforming Joy from being the “best mining equipment company in the world” to being “a world-class company serving the mining industry”. I am excited our results are showing we are making significant progress on our journey.

Q: What are your views for the short-term future of the industry, considering the current economy? Is Joy in a proactive or reactive mode?

TD: With the commodity prices dropping significantly in the last six months, capital expenditure for new mines and mine expansions will slow. We will be focusing on servicing our large global fleet of equipment and helping our customers find new ways to improve safety, productivity, and lower their costs so they can remain competitive on lower commodity prices.

Coal producers have shown a strong discipline not to over produce which will keep supply in check with demand.

It would appear that China may be the leader in the recovery due to their dependence on coal as a secure energy source and their ability to drive their stimulus packages quicker than other counties. Our significant investments in China over the last few years should allow us to capitalize on this.

We also believe China will invest in high productivity mining methods to improve their safety record while closing the smaller but numerous township mines that still produce the majority of coal.

We are definitely in the proactive mode. Not only are we taking appropriate cost actions in this current slowdown, we are expanding our Operational Excellence initiatives from manufacturing to our supply chain, engineering, as well as service and sales.

This will allow us to further improve our cycle times, productivity, quality, and performance to our customers.

We are also being proactive as we continue to invest in new products and key acquisitions for growth. For example, we recently announced our acquisition in China of a local shearer manufacturer for China Mining Machinery (a Joy subsidiary) that will enable growth into the rapidly growing local Chinese mining equipment market, which produced more than one billion tons from underground coal mines last year.

We have also introduced the latest shearer technology to go after the world’s largest coal seams. In our first year of operation our new high seam shearer is now the world’s most powerful and productive, capable of cutting 6.3 meters, and produced well over 10mm tons in just its first year of operation.

We are also being proactive by driving higher productivity and safety by providing advanced controls and automation that includes cameras on shearers at the cutting face getting us closer to our vision of creating a manless longwall operation.

So yes, we believe we can be proactive even in a slow market to use technology to create some new opportunities for both growth and to make us a stronger and more efficient company.

Q: Is Joy's aftermarket business stronger now than the past? Is this market-related or attributable to another factor?

TD: Yes, our service business is stronger today than in the past. Our service growth comes from three main areas: our fleet has grown significantly over the past five years, our customers are asking Joy to take on more underground, and we are developing new products and services that are creating growth.

Our passion for service is built on our Life Cycle Management Strategy which has been, and will continue to be, Joy’s core business strategy. Our customers are relying more and more on Joy as we are growing our presence underground with the acquisitions of Stamler, Continental and our development of new service products.

We are continually working to make our products more reliable and, with over 40 locations worldwide, and with new infrastructure in China, India and Russia, we continue to expand the industry’s largest service and engineering network for underground mining equipment.

Historically, over half of our revenue has come from services and we believe this will continue even as we aggressively grow our machinery businesses.

We are also expanding our service products with new control and automation solutions. We are opening our first Customer Care Center in South Africa this year that will provide Joy Smart Services to our customers in the region.

We now have the capability to monitor Joy machines remotely to provide precise information for pre-emptive maintenance, equipment performance and process control. It allows us to stay connected to our customers on a 24/7 basis over the life cycle of the equipment and to connect our global network of engineers right to the equipment at the face.

Q: What are Joy Mining's arterial challenges, trends and opportunities going forward?

TD: Many times in our 90-year history, the mining industry was challenged by various economic issues and we were able to respond with better equipment, better service and with the best people. We believe our relentless focus on serving our customers’ needs and delivering the best equipment and services will make our customers more successful, which will drive growth for Joy.

In the industry’s challenge to drive to zero harm, produce more tons, and continue to do this for a lower cost, Joy is bringing new innovations to the market to address these challenges. On safety, the trend is to move to a manless face for longwalls and with our continuous miners it is all about keeping the operator out of harm’s way.

We are also seeing the trends to go to higher seams and to lower seams with more power and more sophisticated control systems with the goal of driving to manless faces. We also know that our customers will continuously challenge us to drive to a lower cost per ton produced.