Metro deep, mountain high

It's a mistake to think of demand in Eastern Europe as uniform. "Each market is completely different and has progressed, or declined, at a different rate", says Klaus Kroeppel, vice president sales, Central and Eastern Europe, at Manitowoc. "

"As the largest country, with a population of more than 35 million, Poland has made the greatest progress. Even during the crisis years the market grew, albeit at a slower rate of 1%.

"But many countries experienced zero growth, or less. The market in Hungary, for example, is dead. There has been no demand for cranes, new or used, for a year or more.

"The market in the Czech Republic is basically in the middle -- both geographically and in terms of its economy. We're getting a few orders out of Slovakia."

Greger Jacobson, senior vice president, sales, EMEA at Cargotec agrees. "The differences are surprisingly wide. For us, the Czech Republic and Poland are showing a fairly strong rate of development, while others like Hungary are showing very poor development. There is also a fairly big difference among different product and customer segments."

"We are experiencing stable demand generally", says Tomas Kocak, director for the Bohemian region, for the Czech Republic and Slovakia's JVS Cranes, "But the pressure on prices is still significant. Government funding for infrastructure projects slowed down some time ago. Smaller infrastructure subcontractors in this field have suspended their operations or adapted to other fields of business and infrastructure projects are now delivered mainly by large national construction companies. Many companies are now focusing on the reconstruction of the major highway in Czech Republic, but we do not expect much for the tower crane industry sector there."

Liebherr marketing manager Hans-Martin Frech says, "The markets in the Czech Republic and Slovakia are running on a low, but stable, base. We have several jobsites in Prague and Bratislava with top slewing tower cranes 71-500tm."

Palfinger says it has been expanding it sales and marketing network in the region and has found that the market in Russia has remained on a good level, while the outlook in other countries is increasingly positive. Palfinger's knuckleboom cranes remain the company's strongest product in Eastern Europe.

Innovation is the key
JVS Cranes has been specializing in the rental and sale of cranes in the Czech Republic and Slovakia since 1992. With 60 machines, the company is one of the largest rental houses and operators in the region. Kovak says, "Demand is coming mainly from larger construction sites, thus stronger and taller cranes are needed, 55-100m tall.

"Last year we supplied three cranes for the reconstruction of the new shopping centre in Ostrava. We supplied one self-erecting tower crane, Liebherr35 K, and two tower cranes, Liebherr 110 EC-B6 and 75 EC-B5. It was a particularly challenging task, made even more so when a couple of cranes had to be placed into the inner passage. This called for experience, heavy equipment as well as specialist skills of our workers."

Building a more specialist and skilled workforce as well as investing in new technology is crucial to the development of a more entrepreneurial eastern Europe. Countries in the region are recognising the need to compete more through the use of innovation and excellence, and less on cost.

Avtokran, one of Russia's largest crane manufacturers is moving into a production area which has, up to now, been exclusive to Western and Japanese manufacturers. The company recently launched a telescopic truck crane with a ushaped boom, the first of its kind manufactured by an eastern European company. Sergey Eremin, first deputy general director of JSC Avtokran explains, "U-shaped booms are the most advanced today and most leading manufacturers will use them in crane design."

While the production process is expensive, time consuming and requires a high degree of skill, Avtokran made a strategic decision to invest resources into this development. "As we are a long-time leader of the truck mounted cranes industry in eastern Europe, we felt it necessary to develop this top-tier technology", continues Eremin. "All key manufacturing operations are continually monitored and can be controlled remotely. We have developed a well-organised technical process, by which it is possible to achieve high productivity and lower costs per unit of output. This has enabled us to offer the boom at very competitive price."

With this additional string to its bow, Avtokran is now better able to expand its range of customers. "We're attracting customers from the CIS, Middle East, Africa and Latin America with our u-shaped boom", says Eremin. "At Bauma in Munich this year there was a great deal of interest in our products from customers in developing countries as well as Europe."

Production began last year at Avtokran's Ivanovo plant where Avtokran manufactured 1,772 truck cranes, including 200 cranes with ushaped booms, for the global market.

And it's not just domestic partners who are taking advantage of the emergence of a more forward-thinking and pioneering eastern Europe. Hiab, part of the Cargotec corporation, sees the region as a hotbed of knowledge and innovation. In a drive to improve efficiency of load handling equipment and operational safety conditions, the organisation has teamed up with academic partners in Poland and Sweden for a three year research project. The project will also involve the creation of design strategies for advanced light materials applied to load handling structures, in order to reduce their weight and fuel consumption at the same time.

"The project will involve taking a multidisciplinary approach to crane construction and we will promote the mutual transfer of knowledge between academic and industrial partners, as well as between academic partners from different countries," explains Rafal Sornek, vice president, research and development, Hiab. "We chose our partners in Poland based on their substantial experience and knowledge in electrical and mechanical engineering and mechatronics, as well as their expertise in structural engineering." Hiab expects the project to boost research and development leading to more sustainable load handling equipment. The company has received €1.4m funding for the project.

Plus, the company recently invested approximately €20m for a new painting and assembly area in Hiab's multi-assembly unit in Poland. "This investment will improve our capabilities and efficiency in assembling load handling equipment", says Jacobsen. Knuckleboom cranes such as Cargotec's Hiab range were hit particularly hard by the fall of residential construction. The move to this multi assembly unit in 2011 was the company's response to the global situation of load handling equipment and an effort to improve the profitability of the Hiab business. At the time of the move, Cargotec said it was vital to develop a more competitive production and transport set-up closer to existing and future customers and partners which confirms the company's focus on the region.

Going underground
Crane use is extensive on underground transportation projects and application has evolved massively. Metrostav has been the main contractor on the Prague Metro for 40 years. "Five years ago we were using the RDK 200 crawler crane from Ukraine to transport material to construct a utility tunnel on Wenceslas square. We've moved on a lot since this old type of crane", says Petr Hybský, Site Manager for Metrostav. Metrostav currently owns 11 cranes and will rent specialist cranes when the project demands it. Their fleet includes eight Liebherr tower cranes.

The metro line A extension project made history when a tunnel boring machine (TBM) was used for the first time in the Czech Republic to excavate a tunnel. The project was a challenge for the team. Hybský says, "We used a Liebherr LR 1750 to assemble the TBM which was the first time we had used a crane of this type. Plus the team had to learn a whole new technology of tunnel boring machines. Perhaps the biggest challenge of all was the disassembly of the TBM at the end of the project. We had very limited space to disassemble 300t of heavy machinery. We used a GIGA double girder bridge crane with 60t capacity."

Moscow's ambitious metro construction programme has a budget exceeding USD3bn a year. Russian rental company LTECH recently added two new Mighty cranes -- the CR 285 DME and CR 335 DME to its fleet. Moscow metro has acquired the CR 335 DME to use in the ongoing programme of development of the metro.

Heavy investment
Manitowoc's launch of the Grove GBT35 in 2011 was the result of close collaboration with local customers in Russia in order to design a crane specifically for the Russian market. This was a strategic decision based on the high level of opportunity in the area. "Bringing the GBT35 to market was a learning process", says Kroeppel. "It took longer than anticipated because of the rigorous certification process we had to go though. We made many adjustments to comply with Russian regulations and it took two years to complete."

The superstructure of the GBT35 is built in the US and assembled on chassis locally. It has a 35 tonne capacity and a 39 metre five section full-power boom which is three metres longer than its nearest competitor and eight metres longer than most cranes in this class. The first unit will be delivered in June this year via Manitowoc's local dealer Global Cranes.

Despite the Latvian economy contracting nearly 20 per cent in 2008, this Baltic state is on the up. Recent construction projects such as wind farms in northern Latvia and power stations across the region have meant dealers, manufacturers and renters have had to review their product offering to ensure they are in the position to meet demand. Last year, rental company Arsava added the first Grove GMK 6300L to its fleet, making this the largest crane in the region. Arturs Maslovs, an Arsava co-director, said the company was pleased with the variety of tasks the crane has completed so far. "The crane has a great boom that is really useful for job sites like power stations, but it also showed excellent strength on wind power projects," he says. "One of the most interesting, and arduous, tasks was when it was used in Liepaja harbour to lift boats from the water to prevent them from becoming trapped in ice over winter."

Although dogged with objections and controversy since plans were announced as far back as the 1980s, the construction of the nuclear power plant in Belarus is a boost for lifting firms in the region. Baltkran, a crane manufacturer based in Russia, recently won a tender to supply three gantry cranes for the plant. The widespan dual console gantry cranes with a lifting capacity of 50 tonnes and more than 70 metres of bridge length will feature a differentiated lattice portal's structure in order to withstand wind gusts and storms. "The first two cranes have already been produced and supplied and are currently being installed", says Arthur Ermolaev, vice president of Marketing for Baltkran. "Since then we received an order to supply two more gantry cranes which will be delivered end of June." The cranes will be installed in the open storage area and are designed for handling of equipment and materials between the railroad tracks and a warehouse.

"In 2011 we supplied cranes for the largest intermodal terminal in Minsk and Brest and since then we've had another order from Belarus railway line to supply four container RMG cranes for the project", says Ermolaev. "We can see a positive growth of demand both in Belarus and in Russia. In particular over the past three years we have witnessed the increase of demand in Belarus."

An Olympic revival
For Liebherr, the most popular tower cranes in Russia are the 132 EC-H 8 Litronic and the 130 EC-B 8 Fr.tronic top slewing tower cranes. "The demand for tower cranes in Russia is high", says Frech. "There are a lot of projects and job sites."

Indeed the ongoing construction of Olympic sites in Sochi is keeping the industry busy, not only in the host country of Russia but also neighbouring countries to handle the huge tourist inflows expected. Global Rent supplies Liebherr tower cranes which are working on a range of projects across Olympic sites. Two Liebherr tower cranes from the EC-H series are working on the construction of the railway bridge which will carry road and rail traffic from Sochi over the River Mzimta to the Olympic skiing events. The top slewing units can achieve freestanding heights under hook of nearly 85 metres. The 550 EC-H 40 Litronic and the 200 EC-H 10 FR.tronic are mounted on reinforced 500 HC towers for extra stability in a region that is prone to earthquakes.

The largest single collection of Manitowoc models working on Olympic projects are the 16 cranes installed at the cross-country skiing and biathlon complex, Psekhako Ridge. There are two 1.8t Igo 18 cranes, a 4t Igo 50 and an 8t GTMR360B, from Potain's range of self-erecting cranes, on the project. From the top-slewing range, there are six 10t MC 235 cranes, a 5t MCT 88, an 8t MD 185 B, two 12t MC 310 cranes and two topless MDT 178 cranes, with a capacity of 8 t.

But while the 2014 Olympics, and other sporting events such as the 2018 World Cup and the 2014 Ice Hockey World Championships, are keeping the order books full, these are finite projects and the region must keep an eye out for the next growth market.

JVS is looking to the power sector for future opportunities. Vacek says, "The industrial sector is driven by demand from the largest electrical energy producer CEZ, which is planning the expansion of Czech nuclear power plant. Many contractors are gathering their experience in this field mainly by modernising other CEZ and nuclear research facilities. We have been involved in many discussions on expansion of the nuclear power plant in Temelin. I believe the current supply on the market will not be able to cover the demand once the project starts so companies will have to be proactive in their planning and work with renters to get their cranes on this site.

"After three years of research and market testing we decided to purchase eight tower cranes from Wolffkran on top of our Liebherr fleet. These are mainly self-erectors. They have been quickly placed on market and our experience is very positive now. We want to stay in this market area and invest more in quality tower cranes."

So what can we expect to see in eastern Europe, as the economy continues its unpredictable journey?

"More of the same", says Jacobsen. "It's recovering, but slowly. The future will depend very much on the development of EU bank crises and level of EU funds invested in European countries. The price pressure on our products is high and customers' requirements are still very much focused on simple products. We expect this development to continue in the short to mid future."

"As ever, our challenge continues to be reliability of markets and forecasting rates. We have no idea what's going to happen. We used to be able to forecast rates but now the forecast is nothing like the reality, says Kroeppel. "In Poland, we're expecting to see replacement for cranes that reach end of life, as the average age of many cranes is around 20 years. But it will all depend on the state of the economy and investment in construction."