South Korea’s container crane and port crane equipment manufacturing industry has become more focused on the domestic market in recent years as manufacturers have faced tough price competition from ZPMC of China in major foreign markets. The problem is the same as that faced by other port crane manufacturers around the world, none of which account for more than about an 8% share of the world container crane market.
As well as ZPMC, competition from European and Japanese equipment suppliers is also strong, both for quayside container crane and for rubber-tyred gantry crane contracts. While South Korean firms including Hyundai Heavy Industries, Samsung Heavy Industries, Doosan Heavy Industries, and Hanjin Heavy Industries continue to bid for international contracts, winning large orders has become increasingly rare.
Doosan Heavy Industries & Construction Co Ltd is believed to be the only South Korean port crane maker to have won a large container crane contract during the past few years, with most orders booked by Korean manufacturers being for less than 10 crane units.
Doosan recently completed delivery of a 42-unit rubber-tyred gantry crane (RTGC) order to the Port of Singapore Authority PSA that was awarded in 2004. Including a recent contract, Doosan has received orders to supply the Port of Singapore with a total of 120 RTGCs since 1997. The recent batch of RTG cranes is designed for increased safety. Each of the RTGCs is fitted with 16 wheels instead of the usual eight.
“We have supplied container cranes locally and overseas. Most projects are one or two units, but Singapore has been 120 units,” commented a source in Doosan Heavy Industries’ material handling equipment division. “Container cranes can lift one or two containers depending on the client, but the twin spreader design is normal now. Our biggest contract before was with Pusan Port for over 10 container cranes.”
Doosan Heavy Industries is a leading industrial plant contractor and supplier of heavy equipment. The company’s major activities include the design and construction of power plants. Apart from supplying power plant boilers and environmental protection equipment, Doosan also manufactures turbines and generator sets. Doosan has a large castings and forging division. Other major activities include the construction of desalination plants in the Middle East.
Container port handling equipment is produced by Doosan’s material handling equipment division, which supplies coal handling equipment and bulk cargo handling facilities for other industries.
Port of Singapore Authority is the largest customer for RTGCs. Other recent clients include Southern Gateway Terminals in Colombo, Sri Lanka, and Korea Express in the Port of Pusan.
Doosan also supplies ship to shore container cranes. Recent quayside gantry crane clients include Jakarta Container Terminal in Indonesia, Jawaharlal Nehru Port near Mumbai in India, and Frazer Terminal in Vancouver.
“Prospects for our port crane sales are not bright. ZPMC is dominating the world market due to price,” the source commented. “We are looking for projects not involving ZPMC as they are not concerned with all projects. We got contracts in Singapore in 2004 and 2005. We had no success anywhere else, but we are still bidding on various tenders.”
Doosan is expected to be one of the bidders for container cranes to be installed in South Korea’s planned Kwangyang Bay Port expansion. The company’s R&D division is involved developing new automated controls that will be required for quayside container cranes installed in the port expansion.
“Container cranes are well developed in technical terms. There is nothing else to develop except for automation,” the source said, “We are developing more automated controls, but the new features are not commercialised yet.
Our government has a plan for Kwangyang Bay 3-2 terminal project, which they announced will be developed as an automated terminal. We have to adapt to this. The tender has been postponed for about six years. We expect the project will be tendered again in 2007 or 2008.”
South Korea’s other container crane manufacturers also are expected to bid for the Kwangyang Bay project, which is likely to be awarded to a local supplier. Hyundai Samho Heavy Industries will be among the bidders having recently commissioned five automated rail mounted gantry (RMG) cranes also known as automated transfer cranes at Pusan East Container Terminal (PECT).
The terminal has become the first terminal in Korea to install automated cranes, which are in service at new berths four and five.
The cranes stack nine-wide between a 28.5m rail gauge, and have dual cantilevers covering two road lanes. Stack height is 1 over 6 by 9ft 6in high and operational speeds are 150m/min for the gantry, 120m/min for the trolley and 75-80m/min for the empty hoist.
Among other recent orders that Hyundai has won is a contract for four quayside container cranes from Hutchison Port Holdings and one for Uam Port.
Meanwhile, Hanjin Heavy Industries & Construction, one of South Korea’s leading heavy industrial groups with total annual sales of about US$1.5 billion, is looking to expand container and port crane sales overseas. Hanjin’s plant division produces cranes and dry bulk handling equipment at the company’s Pusan fabrication yard.
Since the late 1990s Hanjin has focused on domestic quayside container crane and RTG crane sales after earlier supplying port cranes to overseas clients including Kaohsiung Port in Taiwan and the Port of Oakland in the United States. Domestic clients include the Port of Pusan and Kwangyang Port.
During the past five Hanjin has installed seven 50t twin 40ft rail mounted quayside container cranes at the Port of Pusan and six 50t and nine 61t quayside cranes of Kwangyang Port, also designed to lift two 40ft containers.
The Port of Pusan also is a regular market for RTG cranes with some 44 Hanjin units operating there in total. Dongbu is the largest customer in Pusan Port buying 21 RTG cranes from Hanjin since 2002.
Competition from ZPMC remains the main challenge in winning overseas contracts according to Hanjin Heavy Industries sales manager Lee Yong Tae: “We are trying to get more projects, but ZPMC has a very low price. We will try to cut our price but we think it will lead to a bad situation in future.
If customers think that quality is important then we are OK, but if they just think about price we cannot win the project. We have experience of building cranes to lift one or two containers including two 40 container lifts. We buy the main crane controls system from ABB and then use a Korean fabricator.”
