‘Made in Italy’ flies abroad

22 December 2016

Paola De Pascali visited Italian crane manufacturers to analyse how the construction market is evolving after the 2008 recession. All now are orientated to exports.

The Italian construction market significantly dropped since the global credit crisis in 2008, losing nearly 50% of production value.

According to Eurostat’s index, which uses 2010 as the base year (2010=100), construction production has decreased from 117.2 in 2008 to 67.8 in 2015.

However, not all businesses have been equally affected by the recession.

Market monitor Atradius published in February 2016 a report on the construction performance in Italy, finding that most large construction companies have proved to be resilient due to their diversified portfolio of infrastructure works and export orientation. For example, in 2014 construction turnover generated by exports increased by 9.7% year-on-year, partly compensating for the slowdown of domestic turnover (down 6%).

Small and medium-sized companies have been severely affected by the decline due to decreased investment in private housing and limited bank loans.

The only exception was renovation works, which were supported by government incentives such as the super amortisation at 140%. This was a measure announced by the government in its 2016 budget. It introduces an exceptional capital allowance up to 140% for certain machinery and equipment purchased between 15 October 2015 and 31 December 2016.

The Italian Statistics Institute (ISTAT) says construction production slowed down to 2.6% year-on-year between January and October 2015. However, market indicators remain negative for investments in public housing and public infrastructure spending.

Most of the Italian crane manufacturers said banks are still very reluctant to provide any loans to construction businesses. As reported by Atradius, loans for private housing projects also remain subdued, even if the European Central Bank’s Quantitative Easing programme managed to inject liquidity and encourage investments.

“It seems that the recession has bottomed out, but a profound recovery is not yet on the horizon.

However, underwriting is more open for construction players who are export oriented and less dependent on the domestic public sector,” Atradius said. During Cranes Today’s visit all the crane manufacturers said their core business is targeted at the international markets.

Giulio De Luca, export manager for Montichiari-based Cormach, said: “Our production is mainly destined for foreign markets with 34% exported to Germany, the UK, Belgium and France, and 50% to regions like North and South America and Far East. Only a small percentage between 14 and 16% is for the domestic market.

“We have seen signs of recovery with a 14% year-on-year incease in sales in 2015. We expect similar growth for 2016.”

De Luca said they sell articulated cranes (from the medium range) in Europe and special products such as wallboard cranes in USA.

The most popular models are the 75000 and 50000 articulated cranes. During the IAA Hannover exhibition, Cormach debuted its new 95000 E8 F186.

Emilio Bertazzi, export sales manager at Fassi, said demand for knuckleboom cranes is mainly from European and North American markets.

“I can say that 2016 started well for heavy duty cranes with an increase of 15% compared to 2015 in the UK, Germany, Scandinavian countries and Spain,” Bertazzi said. “Brexit’s uncertainty has not only put on standby the construction sector in the UK, but also in Europe.”

When Bertazzi spoke to Cranes Today in September, he said the company was waiting for the results of the US election to see how the market will evolve in the next months.

Bertazzi said there has been a 10% sales growth compared to 2015 in Australia and the Middle East.

“The most popular range was the heavy duty cranes from 40tm upwards until last July, but over the last two months we saw a slight contraction in demand,” Bertazzi added. “Now we have a positive growth outlook with light-duty cranes up to 15tm.” Despite the fluctuation in the global market, Bertazzi said, the company feels confident to achieve positive results in the future.

“The Italian market depends on building renovation rather than building new infrastructures,” said Mauro Dellacasa, Fassi’s sales director for the Italian market.

“Even though the construction sector shows slight signs of recovery, we are still waiting for a review of the budgetary provisions of the Fiscal Compact.” This is an intergovernmental treaty signed by the EU member states, requiring national governments to run a balanced budget and setting a general budget deficit exceeding 30% of the gross domestic product.

Dellacasa said Fassi has recorded an increase in sales, particularly for heavy duty cranes.

“Compared to five years ago, we saw 20% growth in sales in Italy,” Dellacasa said. “We are still far from the golden years’ sales and I don’t think that we will return to those results in the short term. We had more than 60% decrease in sales over the last 10 years.”

Dellacasa said the company has also targeted some niche markets such as the marine, railway, and oil and gas sectors, which gave the opportunity to work with importers. The majority of these companies are based in Reggio- Emilia and Veneto.

Fassi is also investing in training, creating an association among dealers to improve after-sales service.

“As local customers can’t afford to buy new machines, they need to do maintenance. We are able to offer a personalised aftersales service with a widespread coverage,” Dellacasa said.

Silvio Chiapusso, communications manager at Fassi, said they are launching four new models: two light duty cranes, the F26A and the F32A, one from the medium range, the F305A, and a new heavy duty crane, the F710RA.

Fassi has recently made an agreement with Jekko, an Italian manufacturer of tracked mini cranes, headquartered in the province of Treviso.

Diego Tomasella, president of Jekko, explained the structure of the deal in terms of ownership stakes. Jekko’s ownership now consists of three parts with the same shareholding: the two owners of former parent Ormet SpA, Pierluigi Tonon and Diego Tomasella, and the owner of Fassi, Giovanni Fassi.

“As a consequence of this partnership, there will be a need to develop Jekko’s products at higher capacities,” Tomasella said.

“New models of Fassi’s articulated cranes will be mounted on crawler undercarriages, which we are already using on other models.”

Both companies have already some dealers in common, for example in the USA, in some parts of Canada, Israel, Uruguay, Spain, Australia, and elsewhere.

“Italy has never been a reference market for us because the end users have always been in foreign markets,” Tomasella said. “Nowadays the Italian market can’t provide any guidelines, orienting us to develop new models. It’s also true that the value of mini cranes is not always so understandable for everybody. Fortunately, we have seen an interest by some Italian rental companies, which realised how it is important to have these machines in their fleet to work in confined spaces that require precise movements.”

Even if this is a niche market, Tomasella said, it is growing at roughly 5% year-on-year. “There is a good demand for minicranes in the high range and we didn’t expect that,” he added. “However, in Italy the most popular range of mini cranes is the single door size, able to pass through 80cm. These small machines are usually rented rather than sold. Mini cranes from the high range are sold because they require a professional use. We always sell to hirers and crane owners who in turn rent our machines out to the end users.”

Around 20 of 200 minicranes produced per year are targeted at the Italian market. “We don’t expect to have a boom in sales in the short term because the government is not currently investing in the construction of high buildings,” Tomasella said.

“We will keep selling to international markets. Over the last year we have had excellent results in Germany and Unites States, followed by North European countries such as Belgium and the Netherlands.

Jekko saw 40% growth in volume produced over the last few years, as a result of a ‘good network’ in traditional and new markets and the development of new models.

“Working for international markets should not be considered a weak point, because if we didn’t work abroad, Jekko could not have developed such a range of innovative products,” Tomasella said. “Now, we are going to complete the existing range with additional features such as accessories, manipulators and jibs.”

Tomasella also explained how to reach some emerging markets like South America and North Africa. “We would need to change approach, proposing basic machines with less complex electronics,” Tomasella said.

“Conversely, minicranes are really popular in the Far East because they were first created there. We have already started selling in some regions of the Far East.”

Pierluigi Tonon, president of Ormet, Jekko’s parent company, made an overview of the segment of hydraulic cranes for trucks: “Italy has always been the major manufacturer of these machines, accounting for 35% of worldwide manufacturing.

“Truck mounted cranes are used for various applications including building and forestry. We have recorded a drop of almost 50% in sales over the last five years. We have bottomed out two years ago due to the strong competition with the used market, but now we have started to see signs of recovery thanks to some fiscal subsidies from the government.”

Headquartered in Minerbio, in province of Bologna, Effer manufactures truck-mounted cranes for the high range up to 300tm.

Reinhard Prantner, Effer’s export area manager for Central and North Europe, said cranes are usually manufactured following the lean production philosophy and the “kaizen” concept to meet very high quality standards.

“The Italian construction sector is a growth market for the upcoming years,” explained Enrico Vandelli, Effer’s area manager for North and Central Italy. “We have had a 15% increase in sales of our high range over the last years. After the recession in 2009, we expected to sell more products from medium range instead we kept selling from the high range.

“We sold 30 units from the midhigh range (70% in the North and 30% in the South of Italy) compared to 18 machines sold in 2015 and seven in the year before. The applications are in the building sector, renovation, electric and wind-turbine maintenance. The Italian demand includes apartment building at 30% and renovation at 70%.”

Vandelli added the National Institute for Insurance Against Accidents at Work (INAIL) gives a subsidy of 65%, but only big companies can really take advantage of that.

“There is also the super amortisation of 140% but the company needs to have a good profit, so these subsidies are related to the company’s trend.

“I think that the Italian construction market will be stable the next year, keeping the same trend as 2016,” he said.

Mauro Baldassin, Effer’s export manager, explained products exported abroad are not different to those sold in Italy. “We have a uniform growth in light and medium range from 10tm upward and a good expansion of midhigh range,” Baldassin said. “All of our products are really well accepted by customers, thanks to the continuous rotation system with slewing ring on many Effer models. What’s more, our clients can buy Effer cranes with an optional jib, with hoists and winches included.” Baldassin said that the ‘dark years of recession’ didn’t stop their worldwide development. “We consistently had a rate of growth above 10% over the last seven years. In 2016, there has been a rise of 20% in sales on 2015 figures and that’s extremely positive for us,” he added.

“After working for seven years to improve the distribution network and the after-sales service, we have recorded positive results and we aim to consolidate the established markets and to explore new areas. We have doubled the amount of countries, from 35 to 70. Our traditional markets include Israel, Benelux, Scandinavia, Unites States, Hong Kong and China. We are also targeting other markets like Australia, Singapore, UK, France, Latin America, and Peru.”

Effer product manager, Giampaolo Chiffi said the company also offers customised solutions with additional features.

“We have been working over the last four years on crane stabilisation, designing four types of stabilisers systems such as CroSStab and V-Stab,” Chiffi said.

“The CroSStab can allow customers to adjust the stabilisers diagonally in the opposite direction of the casing, extending the maximum stabilisation at 360°. Using the CroSStab you can have a free work area at the base of the crane to carry out heavy lifting. V-Stab is oriented permanently towards the vehicle cabin.

Exceptional results in front and side stability combined with compactness of the installed crane allow working in confined spaces.”

Effer has also upgraded many of its products with its Progress 2.0 control system to monitor stability, performance and speed in different working areas. “We are currently working on automatic opening and closing of the crane,” Chiffi said.

Effer also manufactures marine cranes and sells more than 50 machines every year in South America and Africa. Mirko Pallotti, sales export manager for marine cranes said: “This is not an easy market because it’s really competitive everywhere. However, we enjoyed a positive trend over the last years. Our machines are designed, made, and certified to work under typical hard working conditions in the offshore environment.”

After working for 30 years for Terex and Palfinger, Manotti decided in 2009 to go on its own, aiming to spread its brand of truck and rough terrain cranes all over the world.

The company is based in Boretto, a small town nearby Reggio Emilia. Stefania Gioia, marketing manager for Manotti, explained that until now the rough terrains have been designed more for countries outside the EU, but they have been recently designed to comply with CE guidelines and standards for the European market.

“At the moment our best market is the North Africa, followed by Asia, Qatar and Kuwait,” she said.

“With regard to the truck mounted cranes, we have delivered 60 machines from the small range to New Zealand. We have also had orders from Denmark and the Netherlands, Poland, France and Switzerland.”

“We usually produce 3 to 4 rough terrains per month, almost 50 per year,” Gioia said. “We usually manufacture per commission, but we have the most popular models, such as the Arm 600 and 350 rough terrains in stock.”

Gioia added that the company is currently working to extend the range, developing new models for rough terrains and truck-mounted cranes to improve their performance.

“We are designing truck-mounted cranes above 55t and we would like to extend the Arm models for the rough terrains from the 850 (85t) up to 1000- 1300 (100-130t),” she said.

“We are very happy about the positive results that we have had over the last years and we are very confident about the future.”

Based in Piacenza, Marchetti Autogru manufactures all terrain, crawler and city cranes, and truckmounted cranes.

Marcello Maestri, export manager at Marchetti Autogru, said: “From 1956 until the 1980s our main market was Italy and then the company started exporting, creating a network of dealers and agents all over the world.

“We sold almost 60 machines from all the product lines between 2005 and 2006 and nowadays we manufacture 20 machines every year, including crawler cranes and truck mounted cranes. As the construction market is not buoyant anymore, many cranes are sold abroad by the end users and as a result, they have reduced their fleets. At the moment our best sellers in Italy are the cranes mounted on commercial trucks that can travel without road permits (with boom height at roughly 43m).

“We also sell some units of our all terrains in Africa because they require simple machines with few electronic parts. However, our main markets are the UK and Africa, and we are also exploring the Far East.”

Maestri explained the offer has been changing over the last few years. He said: “Based on our experience, we are developing tailor made products and customised solutions to satisfy customers’ needs. This is a hard work, which requires a big effort on many levels such as designing and manufacturing.”

Maestri added: “One of our historic customers is Minguzzi, an Italian rental company, which uses our cranes to move statues in the Vatican.”

Manitowoc celebrated the launch of the new Potain Hup 40-30 at the end of September at the enhanced Niella Tanaro factory. This is the second model from the new Potain Hup range, after the Hup 32-27, which was launched at Bauma 2016 in Germany.

Manitowoc has significantly invested in new equipment and manufacturing methods at the Italian plant to improve quality and bring more efficiency to crane design.

“Welcoming hundreds of visitors to the Niella Tanaro factory for the launch of the Hup 40-30 is also a perfect way to celebrate the upgraded factory here,” says Diego Borgna, SVP, global manufacturing tower cranes.

“This factory is now one of Manitowoc’s most modern manufacturing facilities and uses a completely integrated lean production system known as “The Manitowoc Way”, focusing attention on adaptability to a changing market along with customer needs.”

Some of the factory improvements include new cutting and tooling equipment with laser and plasma cutters that ensure the highest level of precision for all crane components.

The new jib production line is semiautomatic and designed specifically for the jibs on Hup cranes. A new painting line, which covers 2,000 sqm, includes a shot blasting station with 16 turbines that are 50m long, as well as a new high quality painting and drying process.

Enrico Angiolini, sales director for South Europe at Manitowoc, said the Italian factory manufactures for both the Italian and foreign markets. The most popular markets for tower cranes are Germany, France, UK and Scandinavian countries. Mobile cranes are usually sold in Europe, United States, Middle and Far East.

Angiolini added: “We expect to have an increase in sales between 10 and 15% in 2016 than the previous year for earthmoving machines and as a result, there will also be a rise for lifting machinery.

“The tower cranes market has been more affected by recession than the mobile cranes one because it hit the residential sector. We have recently started to see signs of recovery in building renovation, especially in the major North Italian towns like Milan, Turin and Florence.”

Angiolini explained the financial crisis hit mobile cranes later because these machines are used mainly in the industrial and energy sectors.

“We had a positive growth in sales until 2010 and then we have had a slight decrease, especially in the rough terrain crane market because these machines are related to the commodity prices,” he said.

“Recently we have started to see good results for mobile cranes due to the super amortisation at 140%. As we sell to hire companies, they have had the opportunity to make large investments.”

Coordinator for the Italian Association of Lifting System, Elevation and Movement (AISEM) Federico Lovera, said: “The Italian mobile crane market for rough terrains has stabilised over the last years between 60 and 80 machines per year.

“Of course this amount of sales is still far from the peak that we had in 2007 with over 200 and almost 300 in 2008. In 2016 it’s expected that 100 units will be sold, 60 of them have already been sold in the second quarter of the year. With regard to the all terrain cranes, around ten units were sold in Italy in 2013, but the number has doubled over the last couple of years. It’s predicted that sales will slightly increase to between 25 and 30 units by the end of 2016.” Angiolini added: “We hope that the government will keep their promises, and invest more in infrastructure.

It’s also important to attract foreign investors in Italy. For example, Manitowoc erected the CityLife and UniCredit towers in Milan, and there are international investors behind these projects.”

Regarding the possible increase in demand for lifting machinery to rebuild towns crumbled by earthquake in the centre of Italy, Angiolini said: “It’s sad to tell and we don’t want to speculate on that terrible event but we think that we can have a request for our lifting machinery as happened in 2009 for Aquila’s earthquake.”

San Marco Macchine Edili, situated in the town of Borgomanero on the border between Lombardy and Piedmont, manufactures a wide range of construction equipment, including automatic hydraulic cranes and modular self-erecting tower cranes.

“The production line of San Marco Macchine Edili includes the design of machineries first and then, the construction of steel carpentries with the mechanical workings,” said the trading director, Antonio Cerutti. “The process concludes with the assembly of all the components.”

Cerutti said the recession has strongly affected his business: “From 1976 until 2007 we sold almost 250 tower and self-erecting tower cranes per year in Italy and other 200 in international markets.

“After these golden years, our sales dropped and I can say that institutions abandoned us. For example, the government didn’t allow us to scrap the old machines.”

Cerutti added that they are currently exploring new areas such as the Middle East, but it’s not easy to predict a long last profit there.

“Over the last few years we sold many cranes in North Africa, but now this region is not investing anymore in infrastructure due to the fall in oil prices,” he said. “Nowadays our main dealer is based in Germany because there is a high demand for tower cranes and we can sell our products, which comply to the EU regulations.” Based in Legnano nearby Milan, Raimondi has been manufacturing tower cranes since 1946.

In 2013 the company was acquired by KBW, a Middle Eastern investment company that works across multiple sectors and industries. Domenico Ciano, technical director at Raimondi, said: “Over the last 50 years we manufactured 16,000 cranes and 6,000 of them have been erected in Italy.

“After a period of stagnation, we have seen some signs of recovery with a demand for engineering studies to install machines on the jobsites. Sales are still limited in the Italian market because there is high competition with the used crane market. In Italy we are mainly working with after sales service and spare parts.”

Ciano is currently working with the National Union of Companies for Construction Equipment and Attachments (UNACEA) to create a tower crane association to understand what they need to do to re-launch the sector.

“I strongly believe that we should cooperate, making our common problems visible to the national and international institutions,” Ciano said. “One single voice can’t do anything.

The value of forming an association is to establish all together some common regulations and to get involved with other international associations such as the FEM.”

Next year, Raimondi is attending Conexpo for the first time thanks to the support of UNACEA.

Ciano said the Raimondi brand is going really well abroad: “There are over 10,000 jobsites globally with Raimondi Cranes on site. Last year we won a tender for the biggest jobsite in Europe, the Medical Centre in Ankara, Turkey and we have erected 38 tower cranes there.

“However, Raimondi Cranes recorded in 2015 its highest number of sales in Australia, followed by the Middle East, Europe and Turkey. “Combining France and Switzerland, 50 tower cranes were sold in 2015.

Our top selling models in France and Switzerland are the MRT223, the MRT294, and the MRT189. Three new Raimondi Cranes were recently sold to Germany, the models are the MRT189, the MRT294, and the MRT152.”

Ciano added that the most popular machines are in the mid-high range from 10t upwards with 70% of units sold and in the smaller range from 8t downwards with 30%.

“In 2015 we sold 200 units to international markets, but we are aiming to achieve sales of 400 units. I can say that we are seeing a growth of 25% per year,” he said.

“Now we are working for the JW Marriot Hotel in Qatar, employing four LR 213s that stand at height of 250m. Two other LR 213s have been sold in Canada, but we needed to modify the design of the electric system because the regulations are different there.”

Raimondi also welcomed key members of the Ontario Formwork Association in Legnano last September.

The Canadian delegation experienced hands-on demonstrations and presentations that focused on the company’s R&D progress, its client-servicing segment including bespoke detailing with extensive aftersales care, and its North American expansion plans.

Massimiliano Volpe, deputy general manager for Raimondi, said: “We believe that the Canadian market could be a very good avenue to enter the United States and we are ready to work hard to achieve our objectives.”

Even though Raimondi’s ownership is not Italian anymore, Ciano said, the mission of the manufacturer is to make Raimondi grow in Italy.

Ciano added: “We are currently looking into creating the Raimondi supreme lifting range, which could be addressed to the large production. We are about to acquire a new big factory in Legnano, because we aim to double our workforce in the next four years.”

“Thus, we are working on several projects: a new luffing crane of 300tm, which will be launched by next year; a flat-top tower crane of 500tm targeted at the North American market, as well as some simple and easy to mount machines for the Italian and other European markets.

Assembly and functional testing in Effer’s production area.
Testing a knuckleboom crane at the Cormach factory
Italian rental company Minguzzi uses Marchetti cranes, such as the TRIO 20.35 to move statues in the Vatican.
The Arm 600, one of the most popular rough terrain cranes for Manotti
Testing the Jekko SPK 60 telecrawler crane in the open-air area.