Surplus cranes from UK rental company Ainscough were the main attraction at a Ritchie Brothers auction in Moerdijk, the Netherlands, in March. Ainscough took over its rival, Initial GWS, in February and as part of a subsequent inventory reorganisation Ainscough cleared out 115 mobile cranes, mainly from the GWS fleet.
The UK rental industry breathed a collective sigh of relief as the exodus of cranes reduced the nation’s oversupply. The decline in the number of cranes in circulation might enable hire companies to put up their rates, they hoped. However, the auction meant that there was a chance that they could all return straight to the UK.
Another fear was the impact that the sale might have on the market for used cranes around the world if financiers were to use the prices at the auction as a guide for real values. Crane prices at auctions are always suppressed because bidders build in a risk factor into their bids as they are not entirely sure of the quality and value of the purchases.
A month after the ex-GWS cranes had left the UK, they were sitting in the Ritchie Brothers yard at the port in Moerdijk awaiting new owners. Ritchie Brothers is a well established auction house for construction equipment, but there were more cranes at this event – 147 in total – than any other auction it has held. Also on sale was a wide variety of other construction machinery.
As is the case with these auctions, bidders did not get a chance to try out the machines, but they did have the opportunity to view the cranes the day before the sale. “Everybody buys blind at these events,” said Liebherr-Great Britain director David Milne. “You buy them as you see them.” The process of buying a crane, whether it is new or used, is usually a long one. Potential buyers would normally test drive and load test a crane over a period of time, Milne said.
Crane dealers, users, manufacturers and anybody with a vested interest arrived in the pouring rain to see the proceedings. The general opinion of the auction varied but one thing was very clear – some of the cranes on show were sold very cheaply.
The cranes on show ranged in age from the late 1970s to 1990. They had been scrubbed up for the sale but that couldn’t hide the fact that they had had a hard working life at GWS. “They may look nice but we all know what’s underneath,” said Peter Burwell, managing director of UK-based TCS Crane & Access Hire. “Personally I wouldn’t touch them.” All the cranes, however, went within about three hours. The 115 cranes from the GWS fleet were sold for a total price of $4.83m. It is not known how much the other 32 cranes went for but it was certainly a blow to the used sector.
The biggest cranes on sale were two 300t-rated Demag HC 920 hydraulic truck cranes. These two, built in 1989 and 1990, were sold for $270,000 and $300,000 respectively to phone bidders from Portugal and South America.
The rest of the cranes on sale included models from Tadano, Grove, Liebherr, Kato, Krupp, PPM and a few very old Coles and Jones machines.
UK crane owners will be glad to hear that all but a dozen of the cranes will remain out of the country – the number returning is probably not enough to thwart Ainscough’s ambitions to clean out the UK market of older kit. However, as most of the buyers were dealers, one cannot determine where these cranes might end up.
The biggest crane to return immediately to the UK was a 200t-capacity all-terrain Demag AC 615, which was bought by rental company Emerson.
Another UK buyer was Roger Miles, owner of Roger Miles Plant Sales, who bought seven machines, the largest being a 25t capacity Grove TMS 50 truck crane. Despite his bargains, Miles was not completely pleased with the whole event: “I’m disappointed. It doesn’t do anyone any good with this many cranes coming into the market at once at these prices. It undercuts everybody.” So will the low prices seen at this auction pull down resale values? “Low prices like this do not realise the potential of the machine,” Peter Burwell said. “It can’t be used as a guideline for the price of other used cranes. The only effect will be if people read too much into it.” Paul Rosevere, sales director at Kato UK, agreed: “People will stop and look at the price of other cranes, but it was a typical auction and it’s finished now. It was a one-off event.” Prices at an auction, any sort of auction, depend on several things. The people that turn up, the manner of the auctioneer prompting bids, and in this case, the weather. The relentless rain may have discouraged some people from attending. Those not brave enough to face the downpour could follow proceedings on the internet. Perhaps had the sun shone, the prices might have been higher.
David Ritchie, one of the Ritchie brothers that founded the company, explained that the starting prices of the lots for sale at his auctions are carefully pre-determined and whatever happens on the day is down to the people bidding, underlining that every auction is unique. If ten scrap dealers desperately want a Jones Iron Fairy 10 for general yard duties, its price will rise as they try to outbid each other. On another day, interest may be minimal and an identical item may be picked up for just $3,000.
