Western Europe has long been regarded as one of the most important markets for the crane industry, providing the highest levels of demand for all terrain cranes anywhere in the world.

The majority of this demand comes from Germany, which accounts for almost half of the Western European market for all terrain cranes, and thanks to the country’s rapid emergence from recession it has provided some much needed respite in a troubled market.

Few expected Western Europe to recover rapidly throughout 2011, fewer still expected a second recession during 2012, so a cautious ‘wait-and-see’ approach has been evident throughout the industry for some time now.

Businesses have had to adapt to the uncertainty prevalent in the construction industry to avoid the fallout as projects are postponed or cancelled, potentially leaving them with excess equipment standing idle.

But on the other hand, not being able to react quickly enough to an opportunity when it arises can be just as damaging.

For US-owned manufacturer Manitowoc’s executive vice president for EMEA, Philippe Cohet, striking this balance is crucial but difficult.

"In Western Europe I personally navigate with relatively low visibility, which obviously is creating all kinds of challenges. One of the challenges we have in this climate is people wait until the last minute to make decisions, and very often availability makes the sale. So if you are able to make a crane available in two-to-three months you make the sale, and if you ask people to wait six-to-eight months you lose the sale.

"We have considerably reinforced our supply chain practice. This was the outcome of our lean manufacturing approach that we launched years ago to try and stabilise our lines and simplify parts management.

For Manitowoc’s Wilhelmshaven facility, this has meant switching from production based on orders already received to manufacturing cranes based on a sales forecast instead.

"When you get lucky the orders come in and you ship the crane. When you don’t get lucky you end up with a crane in stock for a few months until you finally find a customer for it. But as a result you have a relatively short delivery time because when we have a crane in stock we can ship it within a few weeks, and that really helps our business.

"It’s a big decision we have made and sometimes it can be challenging from a cash standpoint, because your working capital is going up, but it is working quite well at the moment."

This reorganisation to leaner operations reliant on ‘just in time’ production practices has helped Manitowoc cope with supply chain issues felt by many during 2011, and often commented on during the reporting of financial results.

As the German export economy started to recover so rapidly in comparison to others in Western Europe, construction machinery component suppliers found themselves quickly inundated with high numbers of orders for parts that they simply could not provide quickly enough.

Tadano general sales manager Thomas Schramm explains: "I would say the reasons for any supply chain issue for many was the economy in Germany. The German exporting economy did grow during the last year, and very quickly after much worse years in 2010 and 2009.

"Because other industries are much bigger than the mobile crane industry, they were sucking up lots of material. This was particularly the case for some hydraulic components, such as hydraulic pumps."

Indeed the rapid resurgence of the mining industry put a heavy strain on suppliers who needed time to readjust their output levels to catch up with demand for some hydraulic system components.

While these common supply chain issues were quickly resolved, the biggest strain for manufacturers operating in Europe is still the move from Euromot Tier IIIb to Tier 4 interim, which will continue to complicate things until 2014 when Tier 4 final regulations come into effect.

Along with a large research investment, managing a ‘just in time’ production process while accommodating customers operating globally is a difficult proposition.

Cohet says: "The Tier III/Tier 4i engine situation creates a lot of tension in our supply chain because depending on where the crane is going it’s not necessarily the same engine. This limits the flexibility, not only for us, but also in some cases for some of our customers who have large fleets operating in different countries. The big guys like Sarens, companies like that.

"Sometimes they buy cranes and they don’t initially know where the crane is going to go. Then, a few weeks before delivery they call you and say ‘oh by the way this crane is going to North Africa and it must be a tier III’.

"They give you this call as if engines are like plug and play, it’s a bit more complex than that! So it creates a significantly increased level of complexity in the supply chain, and in 2014 we will go to tier IV final. This will create another challenge in our supply chain. All of that needs to be managed extremely carefully, that’s one of our big concerns right now."

One of the keys to survival in tough economic times is being able to move to wherever the work may present itself, a feat surely easier for the bigger rental firms. Mammoet’s director of projects for Europe, Kees De Rijk, is adamant that however difficult it may seem in Europe right now, the means to surviving and thriving are there for those prepared to search.

"I’m pretty optimistic," says De Rijk. "Our cranes at the moment are spread all over Europe. The weakest market we have around is the Spanish market but that’s not a surprise. For all our markets we have projects going on in Norway, in France, in Italy, in Germany, in Holland and in the UK. They are in quite a normal spread of activities as well.

"The last couple of years we have had a lot of cranes in the big power plants in Germany, but now our cranes are spread more or less evenly among end-user sectors, with slightly higher levels in the offshore sector. Offshore is now the number one sector followed by the usual the civil projects, petrochemical plants, and other power projects.

"We have a couple of cranes working the throughout the year erecting wind turbines on wind farms, and also doing onshore handling of offshore components.

"We all live in a difficult time with difficult circumstances, and these circumstances are not the circumstances we like to work with but we have been working in three or four years now. But these are the facts of today it.

For German manufacturer Sennebogen, prospects throughout 2011 seemed to be fairly steady, with no great improvement or decline in sales, for its heavy-duty crawler and telescopic crawler product lines.

A stable German market was particularly good to the firm during 2011, leading marketing director Michael Ibarth to believe the firm could modestly improve its turnover and sales figures throughout 2012.

But as Ibarth points out, much of this may be due to overseas demand helping to sustain high production levels at it’s plant in Straubing.

"From what I have heard across the market, we have pretty much reached a bottom line in Western Europe and there’s probably not really going to be much more consolidation in the market. It seems to be that a lot of manufacturers can cope with the situation right now.

"Our performance in Western Europe for 2011 was okay, but more or less the better markets for us are located in South East Asia and South Korea, so those are more satisfying for us. We did do some projects in South Africa, we did do some projects in other European countries but in terms of being satisfied, I mean I don’t really consider Western Europe being a market that has completely recovered, but a lot of these markets are still struggling somehow."

Cohet has seen similar benefits from overseas demand increases, adding: "Our market share has been around 20% for 2011, this is where we stand in Western Europe today. But in Germany we are building cranes for export to Brazil, for America, for Asia, for Australia, so the factory in Wilhelmshaven is running right now at 450 cranes capacity but not all of that is going to Western Europe."

This is not to say the German market has not has not been fruitful throughout the year. According to manufacturers Manitowoc and Terex, the market for larger self-erecting tower cranes is gaining traction and providing an opportunity for those prepared to capitalise.

At this year’s Intermat exhibition Liebherr and Terex will both be exhibiting new self-erecting tower cranes, with Terex’s new high capacity self-erector signalling the start of a line of cranes aimed at dominating this growing market.

Terex’s Rudiger Zollonz explains: "There is some markets moving and we are preparing for it. This is reflected in one of the new products we will have at Intermat. For the self-erecting market, we are moving to bigger cranes. We will have a 45m self-erecting crane with climbing capability at Intermat.

"It’s a shift that’s been going on for several years already, and Terex is now entering the segment of the very large self-erecting cranes. That’s where the past other types of tower cranes have been used historically, and now self erecting cranes are getting more and more interesting for our customers.

"Previously that size of reach and radius was to a size of reach and radius and height that in the past was left, always was covered by other types of product like tower cranes or flat top tower cranes. And now the self-erecting are reaching that size. It will take some time before you see more of the family."

But apart from traditionally smaller markets within Europe such as that of self-erectors, over the next few years De Rijk thinks the largest volumes of demand will be generated by the growing wind energy industry. This is despite current concerns over China’s growing monopoly over wind turbine component production, which is often at cutthroat prices thanks to heavy subsidisation for Chinese turbine manufacturers from their government.

With the cost of turbines dropping, pricing pressure on contractors to bring in projects under increasingly tight budgets can only filter down to rental firms.

De Rijk says: "I think in general for telescopic cranes it is difficult, then for normal crawler cranes I think it is quite difficult but not too difficult. In the market that we work in they are spread all over Europe, so we have a nice portfolio to choose from.

"Prices were good five years ago, but the volumes of work are still going to be good the next ten years. What we have to do is get rid of 30-40% of the cranes in Europe then the prices will go up! But as long as this is not happening we will have to work hard to keep utilisation up while prices remain at the low levels."