We’ve been off to a busy start here at Capital Reman in 2018. Here are a few shop pictures of engines going out the door.
We’ve been off to a busy start here at Capital Reman in 2018. Here are a few shop pictures of engines going out the door.
Things are not starting the the new year off right for manufacturing giant Caterpillar, Inc. Last year the IRS came down on Caterpillar for attempting to use some creative accounting practices to avoid paying tax on earned income.
The investigation by the IRS started many years ago and was officially entered into legal precedent last March. Investigators have stated that Caterpillar has evaded paying their full share of taxes going back 18 years. If found to be true the company used illegal tax strategies to save over $2.4 billion.
A senate hearing in 2014 determined the company had been using one of its subsidiary companies in Switzerland to (Caterpillar SARL) to funnel profits, sales and international orders. The strategy works by bringing earnings back to the United States through Switzerland but avoiding US tax for sales made outside of the country. Switzerland has a long history of being a tax shelter for 3rd party individuals and businesses. The senate committee concluded that over $8 billion in profits had been funneled through Switzerland holdings.
Caterpillar has maintained that its tax strategy is legal albeit outside of the box of normal corporate tax accounting. The company effectively paid a 4% corporate tax rate for most years going back to 1999. Some employees at Caterpillar questioned the practice and brought the discovery to outside authorities which began an investigation.
The company is still under investigation as the federal government audits their books at Peoria, Illinois headquarters. The initial raid by the Internal Revenue Service and the Office of Export Enforcement at the Department of Commerce seized millions upon millions of documents at the Peoria and Morton corporate facilities. Caterpillar has blocked part of the investigation stating most records should be sealed under attorney-client confidentially.
Leaked copies of the search warrant indicated that Caterpillar violated export controls dealing with countries under U.S. sanctions such as Syria, Sudan and Iran.
PriceWaterhouseCoopers, which handles Caterpillar’s tax management strategy, has been found to also be liable in the investigation. PwC tax partner Thomas Quinn wrote in a 2008 memo that the company would “have to do some dancing” in terms of complying with IRS rules regarding Non-U.S tax exemptions. Managing Director Steven Williams was also quoted as saying “What the heck. We’ll all be retired when this comes up on audit.”
The news is another devastating blow to thousands of employees at the Peoria campus as company recorded four straight years of losses and amidst layoffs. Since 2015 the organization has closed more than 30 of its US and International plants. The company also recently released news they are cancelling plans for a brand new Headquarters in East Peoria and moving operations to a more cost effective location. Caterpillar has wavered in recent years exiting the over-road trucking business in 2010 amid class action law suits with their emissions ACERT technology and betting big on overseas expansion in China which has since cooled.
Caterpillar CEO Jim Umpleby said in an interview with the Wall Street Journal “We’re a values-based company. “We’re cooperating, and we’re hopeful that that issue will be resolved in an expeditious manner.” Only time will tell but hopefully Caterpillar recovers from this situation and puts this behind them.
We want to wish everyone a giant thank you for your support and business over the course of the year. It has been a blast growing bigger and bigger!
We also had a wonderful turnout for the 11th Year of the Harry Samora’s Foundation which donates Toys to sick patients at Children’s Hospital.
Happy Holidays from us a Capital Reman! We will be off Monday December 25th and Tuesday December 26th.
It is a surprise that Volkswagen hasn’t blamed Rudolf Christian Diesel for their recent woes as if he hadn’t invented the damned diesel engine they wouldn’t have had to cheat the emission figures. What is not in doubt is that the man was an engineering genius.
Diesel was born in Paris in 1858 to Bavarian immigrants but when he was 12 years old his parents were forced to flee France because of the Franco-Prussian war. They settled in London but soon after Diesel was dispatched to live with his uncle and aunt in Augsburg, a relatively small Bavarian city, best known for being the birthplace of Mozart’s parents.
The purpose of this was so that Diesel could become fluent in German whilst being educated at Königliche Kreis-Gewerbeschule (Royal Circle Vocational College), where his uncle taught math.
Excelling, he won a scholarship to study at the Royal Bavarian Polytechnic of Munich. His father insisted that he give up on his studies and get a job however, Diesel defied him, and despite getting and overcoming Typhoid, finished with top honors. After graduation, he returned to Paris to work with Professor Carl von Linde, who’d taught him in Munich.
Linde saw Diesel’s potential and soon promoted him to the manager of the research and development department which concentrated on refrigeration technology. But Diesel’s ambitions were beyond keeping things cold and he branched out and started to explore the building of an engine, using ammonia vapor, however, the engine he built exploded, nearly killing him and forcing him to spend months in hospital. For the rest of his life Diesel was nearly blind. Diesel recovered and continued, undeterred, to achieve his dream of creating a more efficient engine. Around this time Karl Benz had just been granted a patent for a new invention he had designed and named the ‘Motor Car’.
Meanwhile, Diesel, who had acquired an in-depth knowledge of thermodynamics, was looking at ways to maximize fuel efficiency, having realized that up to 90% of the energy that fuel produces is wasted. Diesel teamed up with Maschinenfabrik Augsburg (Now known as MAN Diesel) and Friedrich Krupp AG to fund his projects. After more than 7 years of tinkering with various engine designs the ground work was first achieved in 1892 with his first successful patent for an engine that ran on powdered coal. After much work, he patented what he had called the compression-ignition engine then returned to Augsburg where he spent 4 years developing a series of increasingly successful models, culminating in his demonstration in 1897 of a 25-horsepower, four-stroke, single vertical cylinder compression engine.
The engine design utilizes the basic principals of the Carnot Cycle of thermodynamics which is a principal theory explaining the upper limit of efficiency of heat converted into work, with the help of refrigeration. The design Diesel invented uses compression ignition rather using a spark plug like a gas engine and can be run on bio-diesel or petroleum based fuels. A compression design is roughly 30% more efficient than a traditional gas burning engine. It is the forced compressed air which is mixed in the combustion chamber which leads to higher internal temperatures. The gasses will expand at a higher rate applying more pressure on the pistons thus turning the crankshaft at a faster rate. The engine instantly became a huge hit with the general public when it was first introduced at the 1898 Munich Exhibition.
Throughout the process, Diesel believed that his invention would be a great help to small businesses. For craftsmen and artisans who, through using the diesel engine, could start to compete with larger, more powerful companies. In fact, the opposite occurred and it was the industrialists that embraced it – using his engine to power pipelines, water plants, trucks and boats, and later, which some believe led to his death, U-Boats.
Diesel’s engine and the patents that went with it made him very wealthy, very quickly, earning him millions. He had married, bore three children, was famous and respected. Diesel was ahead of his time warning the pubic of potential air pollution and believing businesses should be owned by their employees – some would say – he had it all.
On a September morning in 1913 Diesel climbed aboard the Post Office steamer bound for London. War was looming and the German Navy had already made an approach to have exclusive rights to the Diesel Engine to power its submarines. Diesel had refused and was traveling to London for a series of meetings. One of which was with the British Navy. On the evening of the 29th September, he dined on the ship and at around 10 pm retired to his cabin, requesting a wake-up call at 6:15 am. When that call came there was no reply so a member of the crew took the liberty of entering his cabin. Diesel’s nightshirt was laid out neatly on the bed, his watch had been removed from his wrist and carefully placed. His hat and coat hung neatly. Yet Diesel was nowhere to be seen.
Ten days later a Dutch ship came across a corpse floating in the ocean. It was in such a state of decomposition that the body, once retrieved, was returned to the sea. Though a crewman went through the pockets and found an ID card, along with a glasses case and a pocket knife. These items were later identified by Diesel’s son, Eugen, as his father’s.
Before he left on his journey Diesel had left his wife a bag, with instructions to not open it for one week. When she did she found the equivalent of what would be worth $1.2 million today, along with financial documentation that suggested that Diesel was close to bankruptcy – quite incredible considering the wealth that he had accumulated. Also, on the ship Diesel had left his diary. On the date of his disappearance was a page marked with an X, which some believe to be a sign for death.
To this day no one knows what truly happened. Was he murdered by the Germans, by a competitor, or did he, in the knowledge of his financial state, take his own life. We will never know. What we do know is that he was responsible for inventing an engine that will go down in history of one of the greatest engines ever made. One that he professed could run on vegetable oil – which was not taken seriously until over one hundred years later.
When researching an engine rebuild it can be confusing wading through industry lingo and technical jargon. This article should help clear up the differences between short blocks, long blocks, complete crate engines and what option is best for your situation.
Short Blocks are a non-running engine. They consist of an engine block, crankshaft and connecting rods. A short block however does not consist of a cylinder head, liners, gaskets, rings a timed gear-train or any kind of ancillary parts including the fuel system.
Advantages: Short blocks are great for customers who have a non-cracked cylinder head but an un-useable crankshaft. Usually when a crankshaft spins a bearing the entire engine seizes up also ruining the head. Customers with a workable head can save a great deal of time and money just opting for a new block/crankshaft combo.
Disadvantages: Usually short-blocks requests are rare because the customer’s cylinder head is also un-useable. When remanufacturing an engine it might be best just to have the cylinder head work done as well. A new ported head machined back to OEM spec can be a great way to add life to an existing engine. Another disadvantage of a short-block could also be the labor costs. A mechanic will ultimately have to reassemble the engine regardless if it is a short block or a long block which includes re-configuring the old cylinder head. The labor costs to reassemble the engine will be more than a long block or complete engine without the added advantage of a new cylinder head.
A long block is a more complete version of a short block. A long block is still a non-running engine but contains more parts than a short block. The biggest difference between a short block and a long block is the inclusion of the cylinder head. A long block will typically include:
• Cylinder Block
• Complete Loaded Cylinder Head
• Connecting Rods
• Intermediate Cover
• Timed Front Gear Group
Depending on the rebuilder, some long-block engines will include injectors often called a 7/8 engine. It is always advised to get a build sheet before purchasing just so you are completely aware of what you are getting.
Advantages: Long-block engines are perfect for customers looking save some money but wanting the most complete internal gear-train. A remanufactured long-block engine can be as much as 50%-70% cheaper than a complete drop in option from a dealer. Other advantages of a long-block engine include less complications during installation. A long block is built to the exact engine serial number of the engine being replaced. The existing flywheel and flywheel housing are already an exact match so bolting up the engine to transmission will work every time. Long blocks are also built to accommodate the exact fuel system. Some blocks are built for inline fuel systems while others are built for rotary style fuel pumps. With a long-block all someone would have to swap over from the old engine is the water pump, oil pump, turbo, fuel system and ancillary parts such as accessory mounts. It is cheaper on the parts and labor side than a complete engine.
• Upfront Pricing
• Save money re-using good working ancillary components
• Built exactly to engine serial number
• Swap over perfect fitting ancillary components
• Perfect fit every time
• Shorter Lead Time
• More simplistic warranty terms
Disadvantages: The disadvantages to long-blocks engines are few and far between. For those looking to get back to work or on the road as quickly as possible, a long-block will require more labor than a drop-in complete engine. Long-blocks engines warranties also only cover the hard-internal parts of the engine and do not include failures to the ancillary parts which means if your injectors fail they are not covered by the builder.
A complete engine is just like it sounds… “fan to flywheel” drop in ready to go. A complete engine includes all of your hard internal parts as well as the fuel system, turbo, pumps, housings and oil pan. A complete engine can be bolted up and attached to the transmission rather quickly and requires no additional labor to assemble the engine.
Advantages: A complete drop-in option built to the exact serial number and arrangement number will be the quickest way to get back on the road. Lead time can be a matter of days vs. 2 weeks or more with a remanufactured long block. Complete engines usually are dyno tested and come with a complete warranty on the entire unit.
Disadvantages: The price of a complete drop-in from the dealer will cost considerably more than a long block option; sometimes double the price. Complete engines (crate engines) not build to a specific serial number sometimes may not be a 100% exact fit. Some customers will look to swap in a different model or higher horsepower unit but not expect the intensive labor costs associated of not doing a like-for-like swap. Many times complete engine swaps will require different motor mounts, have different oil sump locations, incompatibility issues with the block in the application, issues with turbo and crossover tube clearance, upgrades to the suspension/axles as well as configuring the ECM of the truck to work with the ECM of the new engine. Compatibility is important but often times overlooked when doing crate engine swaps.
All three options will get you back to work again however it is wise to research the long-term pros and cons of doing each. Overall, the thing to keep in mind when researching replacement engine options is whether lead time or cost more important.
From all of here at Capital Reman we wish you a joyous Thanksgiving to you and your family! We will be closed Thursday and Friday returning to normal business hours Monday, November 27th
Capital Reman Exchange is proud to call Colorado our home. Based in the Mile High City, we call the Capitol City of Colorado our home, but ensure it is our client’s capital equipment and trust we strive to earn each and every day. We achieve trust through hands on ownership and an employee base that is second to none in skill and training.
Our modern facilities and equipment include our full machine shop and separate engine building departments. These facilities help keep Capital Reman Exchange a cut above the competition and allows us the flexibility to work with customers who are individual owners, fleet managers or anywhere on the spectrum.
We a certified AERA (Automotive Engine Rebuilders Association) machine shop. Our team of in-house diesel experts are qualified to assist you with:
- Remanufactured Diesel Engines
- Used Diesel Engines
- Camshafts and Followers
- Cylinder Heads
- Connecting Rods
- Rocker Assemblies
- Inframe and Overhaul Kits
We believe our consultative approach to solving diesel engine problems helps to craft the perfect solution to fit your specific application. Call us today, we would love to help you with all of your heavy duty engine needs!
All OEM manufacturer’s brand name, tradename, symbols or descriptions are for internal reference only. Any statement, website content, advertisement, literature or brochure should NOT be interpreted or implied as having any direct relationship with OEM manufacturers or their respective dealer network. Under no circumstance is any engine part or engine advertised by Capital Reman Exchange, LLC affiliated with any OEM manufacturers which includes but not limited to Caterpillar®, Cummins®, Detroit Diesel®, Mack®, John Deere®, Komatsu®, Waukesha®.