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Business Observer Friday, Jun. 3, 2016 4 years ago

Growth fuel

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American-made products have such a good reputation overseas that it compensates for higher costs.
by: Jean Gruss Contributing Writer

Wessel van Tonder has good news for American manufacturers.

“It still means something if it's made in the U.S.A.,” says van Tonder, a South African oil executive who led a buyout of Fort Myers-based AXI International in 2012.

That's one of the reasons the manufacturer of fuel-management systems has been growing rapidly in Fort Myers. Van Tonder says he could have cut costs and moved the company to a cheaper overseas location, but the value of the firm's “Made in America” reputation was more valuable. “Our company has an extremely good name,” he says.

AXI manufactures cleaning and polishing systems that keep fuel from degrading inside tanks. Hospitals, call centers, airports and other industries maintain back-up fuel systems to generate power in case their main source fails. But fuel that sits unused for long periods degrades and fouls up these backup systems. Much like a dialysis machine, AXI's systems run the fuel through filtering and conditioning machines that keep it usable in case of emergency.

As an oil executive with Oilcom in Tanzania, van Tonder knows all about challenges in fuel delivery and maintenance to remote places in Africa such as Uganda. Initially, van Tonder came to Fort Myers in 2012 to be a customer of Algae-X, but he and his partners acquired the company instead and renamed it AXI International.

Still, the transition was difficult because it was hard to find engineers in Fort Myers to create new products and grow the company, van Tonder says. “One of our big challenges was human resources,” he says. “This was a technology company without engineers.”

But van Tonder recruited engineers such as Blayne Sheldon, who relocated to Cape Coral after a round of layoffs at General Motors in the industrial Midwest in 2010. A headhunter connected Sheldon with AXI and he's now vice president of operations.

Today, AXI has 30 employees at its Fort Myers headquarters, including the manufacturing plant. “We're doing real R&D now,” says van Tonder. “Your greatest asset is your staff.”

For example, AXI has developed a new solar-powered fuel-polishing machine that can be used without outside power. This is critical for hard-to-reach places such as remote agriculture operations, cell-phone towers and areas of the world with regular power outages. Powered by solar panels, the machine extracts fuel from a tank, filters it, removes any water and returns the conditioned fuel back to the tank so it doesn't gum up the fuel injectors on a motor. “That opens up huge opportunities for us,” says van Tonder.

Renewable fuels are on the horizon for the company, too, though oil-based engines remain a staple of backup systems. “Diesel engines are still going to be around for many, many years,” van Tonder says.

What's more, companies that burn clean diesel fuel may one day get credit for that. “We'll play a bigger part in the environmental world,” van Tonder says.

Van Tonder declines to cite revenues, but he says the company has the potential to reach $1 billion in revenues. For now, exports are about 30% of sales but van Tonder says that could grow as business grows in places such as Asia and Europe. “I see that over the next year going up to 50%,” he says.

Follow Jean Gruss on Twitter @JeanGruss

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