The Cedar Valley is full of quiet powerhouses and Power Engineering & Manufacturing (PEM) is one of them. Based in Waterloo, PEM crafts custom heavy-duty gearboxes that power everything from U.S. Navy aircraft carriers to massive mining machines. But beyond engineering steel and precision parts, this is a story about people, craftsmanship and a workplace culture that welcomes everyone.

The Story Behind the Steel

Founded in 1975 by Saul Herscovici, a former John Deere gear specialist, PEM began by selling small, durable gears. He soon discovered the real power lay in custom solutions, designing gearboxes tailored to each customer’s exact specifications. Instead of picking from a catalog, clients get a team that builds precisely what is needed.

Today, PEM delivers custom gearboxes for industries ranging from defense to oil and gas. Its reputation rests on durability, reliability and long-term service. 

A Culture People Stay For

Dennis Schilling, President and CEO, started as a machinist in 2005 and rose through the ranks. He says,

“I love what we do at PEM and I love how we make it happen. More than anything else, I love being part of a culture focused on customer satisfaction and win-win business decisions.”

This customer-first, solution-oriented mindset echoes throughout the company. Todd, a 45-year PEM veteran, explains:

“It’s the family atmosphere… they treat you with respect. If you have a problem, they’ll help you out.”

Cory, a mechanical engineer, shares what drew him to PEM:

“You get to create something from scratch. You design a gearbox that conforms to high-level requirements. It’s fast paced and you have autonomy. That is what drew me to this job.”

Engineering Excellence in Action

Each gearbox project is unique, whether it involves reverse-engineering an older design or producing a 20-ton unit for a fracking rig. According to the team, they are committed to delivering solutions right the first time, often within just months.

PEM supports critical missions around the world. They supply gearboxes for aircraft carrier elevators, anchor systems and retrofits for natural gas systems on cargo ships entering U.S. ports. Every shipment is a reflection of the Cedar Valley’s ability to build world-class equipment.

Driving Growth Through Collaboration

Under Schilling’s leadership, PEM has grown approximately 15 percent each year for the past four years. The company is also an active member of the Cedar Valley Manufacturing Association(CVMA). Team members meet quarterly with peers to share challenges and trade practical solutions, helping to strengthen the local manufacturing economy.

Why Power Engineering Matters

• Custom gearboxes built to meet each customer’s unique needs
  
• Life-long product support
  
• A respectful, team-centered work culture
  
• Real opportunities for engineers to lead early in their careers
  
• Community partnerships and regional leadership through CVMA
  

By combining precision engineering with a culture of respect and reliability, PEM represents the best of the Cedar Valley. It’s a place where talent and purpose come together, and where hardworking people create something built to last.

For more stories about local companies building a better future in the Cedar Valley, visit growcedarvalley.com.