HM GEM Engines founder, Bruce Parker, started his business in 1969, building engines in a shed in his mother’s backyard. Over the years, Bruce transformed the business into an automotive powerhouse, performing machining work for some of the biggest names in automotive manufacturing. Today, HM GEM Engines has a major network of branches in Sydney, Adelaide, Brisbane, and Cairns, and machine shops and engine warehouses in Tamworth, Wagga Wagga, Shepparton, and Bendigo. A firm believer in giving back to the community, Bruce joined with others to create the Commando Welfare Trust to look after the dependent children of fathers killed or seriously wounded in action or training.
The business has changed quite a lot since it began.
Our speciality was high-volume passenger car engine reconditioning, on a production line basis, and that market has dissipated over the last 20 years. These days, most people do not want to put a re-manufactured engine in a 15-year-old vehicle, but it was commonplace in the ’70s, ’80s and early ’90s. We manufactured just on 40,000 units per annum, and we now build less than 1000. Halfway through the ’90s, it also became obvious that engines were going to last a lot longer than they did in the ’70s and ’80s, because of improved engine design, and advances in engine oils and coolants. Also, the introduction of the GST in 2000 reduced the cost of vehicles, particularly used, late model cars, so the exchange engine equation went out the window. So, we scaled down our volume and set our sights on developing diesel engine work. We have supplied machining services to Cummins Diesel for 50 years, and Caterpillar for a similar period. Also, Mercedes-Benz, and MTU; they are all solid relationships. In addition to that, a lot of heavy diesel engine machine work is sent to us, where the customer has his own workshop to remove and refit engines and do their own overhauls. We also get a lot of work through OEM customer recommendation. Repco is also a major customer, so is the Burson Group. We still do a few exchange engines, and we manufacture cylinder heads as well. We are also a Capricorn supplier.
How should a business prepare for substantial change?
Talk to your customers. Businesses should treat their customers as their number one external priority. Keep very close to your customers and listen to them. Talk to them about the future, that’s what we did. The relationship we have with Cummins Diesel is a classic example. They have worked very closely with us, not only supplying us with specifications and technical information, but also telling us what the future holds. I class some of the senior people at Cummins as my very best personal friends and we have had a great working relationship over a very long period of time.
In the early days you had a racing involvement with Allan Moffat.
We built engines for Allan when we were in Doncaster, in the early ’70s, when he had the Coca-Cola Mustang. HM Engines also supplied the special exhaust systems to the Ford Motor Company for use on the Falcon GT-HO Phase III. Allan was very helpful in getting us into Ford’s competition department. I can’t speak highly enough of Allan. In those days, he raced against the likes of Norm Beechey, Bob Jane, Jim McKeown and in my opinion, no one was a better touring car driver than Allan. I had a tremendous amount of admiration for him. I recall being part of his pit crew at Mallala in South Australia, where he won a race in his GT-HO Phase III. He came into the pits after the race and said, “There’s a flat spot on one of the tyres.” We jacked the car up and there was a flat spot on the tyre he had nominated. How he felt which side it was on from the driver’s position just shows the feel he had for the vehicle. In my candid opinion, he was the best at the time.
What is HM GEM engine’s competitive advantage?
Our competitive advantage is our staff. Some have retired after being with us for 40-plus years. We don’t make people retire when they reach a certain age. I’m happy for them to work on past what used to be called a retirement age – 65. I’m 76 now and I’m still working in the business because I love it. My original sales manager, Charlie Nichol, retired at 85. He wasn’t working full time at that age, but he was coming in a couple of days a week. He knew a lot of our major customers, he knew their children, the football team they barracked for, and so on. Doug McKenzie, who was trained by Charlie, will have been with us for 50 years in 2022. Doug is 70-plus years of age. A number have been with me for 30 years and a substantial number for 20 years, 15 years, and so it goes. We try very hard to retain our apprentices and we pay them adult wages once they click over into their fourth year. That helps retention, but it’s not the only thing. The other competitive advantage we have is the machinery and equipment that we use from brands considered to be the world’s best. HM Gem Engines has always had a policy of updating at least one major piece of machinery every year. In recent times, we’ve taken advantage of the government’s full tax write-off, spending a lot of money in the financial year nearing completion and we will do the same next year. We also hold quality assurance 9001 Certification, which we’re very proud of, and we are audited on a regular basis. Quality is absolutely paramount to us and to our customers.
Why do you still love coming to work?
It’s a ‘family business’ – I’m not talking about my actual family, it’s a family business because of the people who work here. We treat the business as one big family and that works for us. People are our biggest asset, from the skilled tradesmen through to the admin people. Nothing gives me more pleasure than to see a young person coming up through the organisation to a supervisory role, then on to middle management and in some cases, senior management. For example, the General Manager of HM Gem Engines, Dean Taylor, started as an apprentice. He could have gone to university, but he wanted to build engines, and good on him. He has been with the organisation for 25 years and I’d like him to be here for another 25 years, long after I’m gone. My son, Daniel, has his own business doing small repetition engineering. Daniel is also a part-owner, and director of HM Gem Engines, as is Dean. As I step back from the business, I expect Daniel will keep this business going, not as a manager but as an owner, so that it remains in the family when I’m pushing-up daisies. That’s my wish for the business.
You’ve stepped back a little bit. Was that tough to do?
It wasn’t easy. I’m in a couple of days a week and looking at trimming that back a little further. The general management operates well, and I don’t interfere with the day-to-day running of the business. I’m in for the management meetings, board meetings that occur every month. We take a full day every month and examine every single aspect of the business.
Is there one big decision that has made the company what it is today?
There’s not one big decision. I’m very thankful that my marble came out of the national service draw years ago. I stayed on with the army for a period, then continued in the reserve. I was a non-commissioned officer (NCO). The army taught me leadership and management, and you’ll go a long way to find better training for that. I might be old fashioned, but a boy could do a lot worse than experience compulsory national service. It’s only for a relatively short period of time, but by crikey, it teaches you a lot about yourself, self-discipline, and leadership, and prepares you very well for the rest of your life. Not everyone would agree, I understand that, but for me, it was very appropriate.
What about other organisations?
We are in South Dandenong, and it is a unique area. It’s the industrial hub of Melbourne, it’s been designed properly, and I give a lot of credit to Dandenong’s previous and current CEOs, and councillors. The infrastructure within council and the support services they offer are second to none. The council CEO is John Bennie. He’s a hands-on operator and absolutely first class. Moving to Dandenong was the best thing we could have done to expand. That doesn’t mean there aren’t other parts of the country doing similar things, but I feel Dandenong is ideal as far as innovation and support for large manufacturing and service industries are concerned. We also have SEBN – South East Business Network, which Sandra George has run for many years. She’s been responsible for innovations within the eastern part of Melbourne, which includes Dandenong. And it would be wrong of me not to mention VACC, and MTAA. We have had difficulty in our industry, with a lack of tradespeople. We take on about a dozen apprentices nationally each year, but we have had difficulty filling those positions for the last 20 years. I am concerned that schools have convinced students to go to university and whilst that’s good for people who are suited to it, the last thing we need is more double-degree baristas. I am delighted with what the man who runs VACC – Geoff Gwilym – is doing in this respect. Geoff is a true general, he’s a strategist and a futurist. The government announced last year that it was creating 100,000 apprenticeships and it added 70,000 more to that this year, and I know that was due, in no small measure, to the lobbying of Geoff Gwilym. Together with his team, Geoff has been instrumental in lobbying the government for more apprentices. We are very, very fortunate to belong to industry associations that take its members seriously.
As far as I am concerned, VACC and MTAA are the gold standards.
As featured in the June 2021 issue of Australian Automotive.