Indheater is a Swedish supplier of switch heaters for the railway industry. Their innovative solution is based on induction technology and within a few years they have shown significant growth on the Swedish market as well as other parts of Europe where snow and ice create problems for rail traffic. Business Sweden in Toronto worked together with Indheater to explore the potential in Canada with very successful result.
Canada is geographically large country in which a functioning railroad is extremely important for infrastructure and transportation. Combined with massive snowfalls and extreme cold during winters, technologies that can improve the logistics and infrastructure are met with a significant interest from key local market players. Indheater’s system is designed to address "the winter problem", i.e. train disruptions and delayed trains, loss of productivity and safety issues related to manual cleaning of the switches on the tracks.
Business Sweden inititated a project with Indheater’s CEO, Fredrik Grivans, to explore how their induction solution could replace existing products in Canada’s railroads. The focus of the project was to verify the market potential of Indheater’s solutions by mapping important stakeholders and arranging qualitative meetings with relevant decision makers.
The market in Canada is dominated by two large players, Canadian National CN and Canadian Pacific CP, who together own over 90% of Canada's railways and are essential partners for companies that are interested in entering the railway market in Canada. Business Sweden succeeded, through its established network, to verify interest and book meetings with these two players as well as arrange nine other meetings with the most important stakeholders over a four day period. The meetings were with customers, potential investors, partners and project manager for large projects in both provinces of Ontario and Quebec. In addition, Fredrik joined Anna Johansson, Swedish Minister of Infrastructure, at an event in Business Sweden's premises to promote and get more weight behind Indheater’s investment in Canada.
Business Opportunity Project opens doors for companies on our local markets
The meeting program was successful with immediate positive feedback from the Canadian players and plans for follow-up were scheduled at once. Since January 2017, Indheater has conducted two projects in Canada (only one month after the first meetings) and additional projects are in the pipeline. Business Sweden's quick access to the right network were a large contributor to the positive project result, but the key for Indheater’s quick and successful market introduction was their innovative technology and knowledge in the field.
- The purchase cost of Indheater’s system is 40% lower and the operational cost is 68% lower than existing systems
- The return of investment is expected to be less than 14 months
- Indheater’s capacity for ice/snow removal means a substantial improvement, where in addition, melted water evaporates
- There is also a strong sustainability aspect in Indheater’s system with a lower power consumption (40-60% compared to other electric heaters)
- Induction heating instead of gas (today’s standard in Canada) eliminates problems with pollution and fire hazards
Fredrik Grivans, CEO, Indheater (to the Minister of Infrastructure Anna Johansson)
“It means a lot to our company to have the support from you and your organizations.
The rest of the week was spent with Trafikverket’s equivalent organization in parallel with big-city companies in Toronto and Montreal (comparable to SL) and based on the response we got and the concrete business opportunities that have already appeared, you should be able to travel by railway secured by Indheater’s winter safe tracks in a few years.
Swedish industry has undoubtedly a good name in Canada and given our similar climate and population distribution, the challenges for the infrastructure are very similar and our solutions fit well in Canada.
I have also noted that your organization with Business Sweden works very well. The Toronto office was of great help with their strong commitment and motivation.
Indheater is a clear example of Swedish technology matched with a market demand and with the right stakeholders. Business Sweden's strength is to guide Swedish companies through internationalization and using our network and local knowledge match companies to help grow their international revenue.