Much of Scandinavia’s crane industry is focused on the North Sea oil business, although there is also a significant timber and pulp industry and, of course, construction. Major crane producers include loader crane manufacturers Hiab in Sweden and HMF in Denmark; KCI Konecranes in Finland, producing overhead travelling cranes and gantry cranes; and Munck in Norway, which also acquired 66% of Dreggen in 2001, producing between them overhead travelling cranes and ship cranes.
With conflict in the Middle East driving up the price of oil and with international containerised trade to and from China creating massive demand for container handling infrastructure, demand for offshore, marine, and dockside cranes is proving quite strong. With construction, however, the picture in Scandinavia is more mixed, but is also generally positive.
In the corporate world, the most significant recent development is the de-merger of Cargotec from Finland’s Kone Corporation, the lift (elevator) company. Kone took over Cargotec, parent company of Hiab and dockside equipment producer Kalmar, in 2002, beating its former subsidiary KCI Konecranes for the right to purchase the Finnish government’s golden share. Cargotec gained a separate listing on the Helsinki stock exchange on 1 June.
In March, Cargotec also completed the acquisition of MacGregor from venture capitalist investors. MacGregor is a Swedish producer of ship cranes and other marine handling equipment.
The Kalmar, MacGregor, and Hiab divisions of Cargotec all had a great start to 2005. Hiab’s sales were up 28% in the first three months, year on year, to 1197.8m; Kalmar’s were up 46% to 1264.5m; and MacGregor’s were up 21% to 181.7m. Collectively, operating profit was up 59% to 138m.
According to Kone, separating Cargotec – a company heading for 2005 sales of more than 12bn – and giving it its own stock market listing will put it in a better position for further mergers and acquisitions.
KCI Konecranes gets stronger
Although KCI Konecranes failed in its bid to take over Cargotec, it has continued to grow from strength to strength. It added reachstackers to its dockside product offering of container cranes and rubber tyred and rail mounted gantry cranes in September last year by acquiring SMV Lifttrucks. SMV Lifttrucks makes heavy duty reachstackers up to 60t capacity as well as forklift trucks. In January, KCI also took over Morris Material Handling Ltd, the UK overhead travelling crane builder.
Like Cargotec, KCI Konecranes is also having a great year, and expects sales for 2005 to be 20% up on last year’s 1728m. In the first quarter, its sales were up 27%, as was the value of orders received.
On 17 June the company reached a landmark with the retirement of founder president and CEO Stig Gustavson on his 60th birthday. Pekka Lundmark succeeds him, while Gustavson, who effectively created the company in its modern form by leading the management buyout from Kone Corporation in 1994, becomes non-executive chairman of the board.
In 2004, Dreggen reached the landmark of producing its 2,000th crane under its own name since starting in 1987. The offshore industry demands explosion proof hoists and last year Dreggen developed a hydraulic operated chain hoist with stepless control. It also struck a deal with R Stahl to include the German company’s explosion-proof hoists and crane components in its own product line.
Recent orders for parent company Munck this year include a $1m order for a pair of electric gantry deck cranes for two cutter suction dredgers that are being built in China for the Jan de Nul Group. The cranes will be used for repair and maintenance of the dredging installation, and for handling of weights up to 25t.
The offshore and marine sector is also the focus of GMC, a Norwegian lifting equipment and service company based in Stavanger. Recently, it built a 60t chain gypsy winch in just three weeks for a 137mm anchor chain. The winch is on hire to Stolt Offshore off the coast of Florida in the USA.
GMC also produces a wide range of pneumatic trailers with deck capacities up to 30t. The trailers are normally used offshore in hazardous areas where heavy valves, motors, and other equipment need to be moved to the crane area. The trailers have hydraulic motors for all operations to keep movements smooth. It has produced a special 26t capacity trailer for use on the Troll A platform. The operator Statoil will use this trailer to transport diesel engines and other heavy equipment from the production area to the crane area.
Like most other European countries, cranes for construction come primarily from Germany. There is barely any demand for crawler cranes, and not so much for tower cranes either, since there is not the need for masses of high rise blocks. Mostly, it is wheeled telescopic mobiles that do the work, supplied by rental companies.
In Denmark, says Lars Michael Jensen of Liebherr Denmark, all the cranes are at work. “Normally the market starts to move in March, but this year it has been all year.” He says that a lot of private developers had been delaying investments but with interest rates now low, they are pushing ahead. There are also government housing projects driving demand. Traditionally, the Danish mobile crane market is in the region of 10 to 20 units a year, he says, and this year he expects it to be at the top end of that.
Jensen estimates that the total number of mobile cranes for hire in Denmark is about 150, and about 70 of them are Liebherrs, he says.
Significant sales
Significant sales in the past year include a 550t lattice boom LG 1550 truck crane and a 500t telescopic all terrain LTM 1500, both to Kran Ringen Wind, which – as its name implies – specialises in installing wind turbines.
The dominant rental company in Denmark is BMS, which has become even more dominant since merging with Kran Ringen last November, taking its fleet up from 70 mobile cranes to 110 and annual turnover above c50m. It also has 400 aerial work platforms.
Perhaps even more significant is BMS’s acquisition of a small crane hire business in Sweden, TP Kranar AB, which is based in Helsingborg. This is the Danish company’s first foray into the neighbouring country.
Sweden is an altogether larger market for mobile cranes, with a population that includes 400 Liebherrs alone. Kenneth Nilsson, boss of the long-serving Grove distributor there, Kenson, says in the south and west of the country the market is good at the moment. Construction began in May on a new railway tunnel beneath Malmö to connect the city with the Oresund crossing to Denmark. Completion is scheduled for 2008. Two billion kronor (c220m) is being invested in a paper mill to the northeast of Gothenburg, a refinery on the west coast is investing heavily, and there are new road and rail links being built between Gothenburg and Trollhättan, where Saab cars are made. In the north of the country there is not so much activity (Nilsson points out that Malmö in the south is as near to the Mediterranean as it is to the north of Sweden) although there is the Bottnia railway construction project. The Grove distributor is upbeat about prosects. “Hopefully we will be busy in Sweden for three or four years,” he says. ”I am optimistic.”
Kenson’s deliveries this year include two GMK 3055s (55t) to Kranexpressen, based in Lund, and a GMK 5130-1, a GMK 4075 and a GMK 3055 to Edins Kranar. Kynningsrud has also just taken delivery of a Grove RT 760E. Scandinavia is not particularly a market for rough terrain cranes, but this unit will be based in a refinery.
Booming market in Norway
In Norway, according to Thomas Bolin of Liebherr Norway, the market is “booming”. He says the combination of low interest rates and high oil prices is encouraging a lot of investment in the oil business. A new offshore pipeline and a refinery are both planned. There is also a new opera house being built in Oslo.
Bolin says that the mobile crane market in Norway is usually in the region of 30 to 40 units. Last year there were 42 new mobiles sold in Norway, of which nine were Liebherrs, including an MK truck-mounted tower cranes. Bolin thinks the total market will about 60 units this year.
Like its neighbours, there is not much demand for crawlers in Norway, but Bolin thinks this may change. “I think in the future, as [oil rig] modules get bigger, people will look to crawlers,” he says. There are some crawler cranes in Aker’s yard in Verdal, including two LR 1550s, a 600t Demag, and an old Lampson.
Norway has also played host this year to the new Liebherr LR 1400W, a crane launched at Bauma 2004, and owned by Weldex of Scotland. Notable for having two slew rings, one above the other, it is designed specially for manoeuvring around wind farms, and has been used in Norway to install a new wind turbine park on the island of Smola.
