Taking a positive stand

Business is booming in China, a fact strikingly reflected in the size of the second Bauma China event in November. It was more than twice as big as the premiere event held in 2002, making it the largest international trade fair for the construction industry in Asia.The venue was Shanghai, the most densely populated city in the world, with a population of around 17 million covering an area 6,341 sq km.The city boasts a staggering 2,000 skyscrapers – more than on the entire west coast of the US – and in the past decade alone, a forest of space-age skyscrapers has sprouted along the banks of the Huangpu River, which
runs through the city.In the mid 1990s, Shanghai was, according to some reports, using a quarter of the world's cranes, and its breathtaking construction programme has not finished yet with 2,000 more skyscrapers planned or under construction.But commercial buildings are not the only construction projects that are flourishing in China. The country’s infrastructure is struggling to keep up with its rapid economic growth. According to the state-run China Daily, last year, 23 of China's 31 provinces and major cities had to ration power, up from 12 regions in 2002. As a consequence, big civil engineering projects including power plants, dams, and bridges are also booming.The Chinese government, meanwhile, has been maintaining a delicate balancing act – attempting to slow runaway growth at the same time as preserving its economy's momentum.According to UK-based management consultant Off-Highway Research, the Chinese crane market is dominated by domestic OEMs, with 17 accounting for 95% of sales. Xuzhou Heavy Machinery, Hunan Puyan, and Beijing Crane alone account for 60%. It was against this economic backdrop that the second Bauma China event took place in November. And the crane suppliers were out in force:LiebherrChina is Liebherr’s third most valuable market in terms of turnover (after Germany and Spain) with sales of around E50m). The company says it has sold around 40 mobile cranes and crawlers into China this year (compared with 200 into Germany, and 160-170 into Spain).Liebherr entered the Chinese market in 1978, and has hinted that it might start making cranes at its excavator factory in Dalian, which currently has spare capacity.However, according to Helmut Limberg, general manager of the company’s tower crane division – Liebherr-Werk Biberach in Germany: ‘Because there is still an almost unlimited supply of cheap labour in China, tower cranes do not yet play the part that they may do in the future, despite the current boom in the Chinese construction industry. Large-scale projects, that is to say multi-storey buildings in heavily built-up areas and major bridge pylons, are an exception to this.‘The number of tower cranes required in China was estimated at approximately 11,000 in 2003, but these are almost exclusively the simplest form of mass-produced cranes, which are not part of the Liebherr range.’Nonetheless, Liebherr used Bauma China as the launchpad for its 200 EC-HMc 10 Fr.tronic top-slewing tower crane, effectively a stripped down version of the EC-HM.The EC-HMc range is being offered especially for the Chinese market and, in addition to the model exhibited at Bauma China, includes machine sizes of 132mt, 154mt, and 280mt.Liebherr expects the crane to be used on large-scale infrastructure projects, as well as for building projects for the 2008 Olympics in Beijing and the 2010 World Fair in Shanghai.It adds: ‘Overall, demand for cranes of this size represents about one-fifth of total crane demand in China, amounting to some 10,000 units in the past year.’The 200 EC-HMc 10 FR.tronic has slewing gear featuring frequency converter (FR) technology, which uses a continuously-variable drive concept to cut operating costs and improve energy efficiency.Liebherr also showed the new LTM 1400-7.1 mobile crane, a 400t, seven-axle unit with an overall length of 18.45m and a turning-circle radius of 14.05m.With its 60m telescopic boom and fixed or luffing lattice jibs either 56m and 84m long, the new Y-pattern telescopic boom guying and the assembly jib and mast extension, the LTM 1400-7.1 is designed to perform a range of tasks at lifting heights up to 130m and a working radius of up to 100m.Finally, Liebherr showed the LTM 1100-4.1 mobile crane which is rated at 100t lifting capacity. In operational condition with basic ballast, the crane's weight is 48t. With the 52m long, six-section telescopic boom, a 14m long boom extension, and a 19m long double swing-away jib, the new crane has a 84m height under the hook.The LTM 1100-4.1 can be equipped with an optional second hoist gear, mountable without auxiliary crane during the erection of the counterweight. The 19m long double swing-away jib can be set into mounting position by remote-control and is operated at 0°, 20° or 40° inclination. Optionally, the swing-away jib angle can be adjusted continuously by hydraulic control and luffed under full load.TerexTerex says it has received orders for cranes worth E50m from China this year. The company only imports large 80t+ crawlers into the country, and at Bauma China Terex finalised business worth E15m on five cranes comprising three CC 2800-1 crawlers, each with a 600t lifting capacity and 9m radius; one CC 5600, and an AC 100 six-wheel all terrain crane with a 100t lifting capacity and 3m radius.The CC 5800, meanwhile, is a new crane with 800t lifting capacity, and the first machine will go to China.Terex chairman Ron DeFeo hinted that Terex could start manufacturing cranes in China (see Cranes Today, December, page 7), although the company has yet to confirm this. Its Beijing sales office employs five sales people, and five technicians operating from the Shanghai service-office look after the fleet of Demag cranes.Terex’s CC 2200 and the AC 350 on display at the fair are already operating in the country.ManitowocManitowoc Crane Group (MCG) company Potain has a factory in Zhangjiagang in Jiangsu province, which it has operated as a wholly owned enterprise since 2000.According to Eric Etchart, executive vice president of MCG Asia, although there are around 200 tower crane manufacturers in China (the overwhelming majority of which are state-owned enterprises), most produce smaller units, below 25tm. The market, he says, is seasonally cyclical – two-thirds of sales volume in PRC China is achieved from February – after the Chinese New Year – to end of September, before the Chinese national holidays.Potain’s MC310- 12T- 3t at jib end has been the company’s top-selling model in China so far, but Etchart anticipates demand for 10T cranes returning soon. Potain’s Chinese tower crane manufacturing operation began exporting about 18 months ago, primarily to Korea and the South East Asian market, and about 40 per cent of its production capacity is now exported.According to Etchart, China is the world’s largest tower cranes market (at least in terms of numbers). However, he adds, it is also the most fiercely competitive. In order to differentiate itself, Potain ships mainly to the premium market, which Etchart says is growing.He adds: ‘We have customers now who will pay a premium for higher quality, higher productivity, and higher safety. There is also a mass market with cheap stuff. We do not compete in this. A lot of our customers are state-owned construction companies. Lately, we have seen some private contractors coming into the market, but I would say 90-95 per cent of the sales are still through government companies.’However, he predicts that private construction companies will take a larger share of this market in the coming years.The biggest cranes ever manufactured by Potain will be used on the construction of Nanjing Bridge #3 over the Yangtze River in Nanjing, China. The new units – from the MD 3600 range – have been rated with a maximum lift capacity of 160t, which they will be able to handle out to 18.7m. For this project, both will be fitted with 40m jibs, and will be working at heights of up to 200m.Manitowoc has also found success in China for its crawler cranes, having sold around 25 in the last two years. Says Etchart: ‘The market for mobiles is definitely growing. For small all terrain cranes there is no market right now. The market is truck cranes, and here there are three or four very big Chinese domestic manufacturers that dominate. It is a very competitive industry.’MCG does not sell all terrain cranes below 100t in China. However, Etchart reveals: ‘We have recently delivered a TMK450, our largest all terrain crane, to a Chinese rental company, and it has been a very good business. I think 2004 is our best year for Grove [Manitowoc’s mobile crane division] cranes as well. We sold more than 10.‘We do not anticipate that these market segments are going to be damaged by the slowdown of the industry. There is a lot of deficit in electricity energy, and the Chinese government needs to keep up the pace. This is why we do not believe that the mobile and crawler cranes business is going to suffer from the slowdown of the China market.’TadanoEarlier this year Tadano formed a joint venture company called BQTadano with Chinese truck crane manufacturer Jing Cheng Construction. The JV began production from a new 120,000 sq m factory in August last year following its opening in March 2003. The factory has the capacity to produce 500/600 units a year.BQTadano launched three new cranes at Bauma China:4 ï„·The GT550E is a 55t capacity mobile crane with a maximum lifting height of 41.5/56m. The company has already sold one of these machines to an oilfield in China.4 ï„·The GT250E has a lifting capacity of 25t and maximum lifting height of 40.6m.4 ï„·A new rough terrain crane called the TR250E – with a maximum rated lifting capacity of 25t, and a lifting height of 30/37m – is also being marketed by BQTadano.Also on show was the GT700E 70t truck crane which has a German carrier and Japanese superstructure, and the ATF160G-5, a 160t all terrain crane which was launched at Bauma in Munich last March.Hitachi Sumitomo HS launched the UCX300 hydraulic wheel harbour crane at Bauma China. It has a 30t by 3m lifting capacity, a basic boom length of 9m, and optional boom extensions of 3m or 6m. The longest boom length is 24m (the basic boom plus one 3m extension and two 6m extensions).The machines are currently manufactured in Japan, but the company plans to start making them
at the Hitachi factory in Heifei, 300km west of Shanghai, in about a year.HS expects the UCX300 to sell particularly well in Italy, Spain, and countries that have recently joined the EU, as well as on small islands with ports.KobelcoKobelco recently opened new offices in Shanghai, China (as well as Dubai, UAE) to provide marketing, sales and engineering support services. It was present at Bauma China with a 250 ton CKE2500 on the stand.The company has sold 65 crawler cranes – comprising the CKE 1800, 2500, and 4000 – in the country in the last two years. It used Bauma China to launch five units to the Chinese market – the CKE600, 700, 800,900, and 1350 with lifting capacities of 60, 70, 80, 90, and 135t respectively.Meanwhile, Kobelco Cranes Europe has delivered two CKE2500 units in black-red Mammoet colours to Shanghai for a joint-venture operation in China between international rental companies Mammoet and Hovago.FushonThe trade with China is not all one way – some domestic manufacturers are already looking to increase their export sales. One such is Fushon Excavator Limited Corporation, a Chinese crawler crane manufacturer that has been trading for around 50 years. Until last year it was state owned, but was then bought out by private investors.Fushon sells around 200 units a year in China, which it manufactures in two factories – one in Fushon and another smaller plant in Dalian. It recently won a contract in Iran to expert 80 QUY50C units there next year.The company launched a new crane at Bauma China – the QUY80A – an 80t capacity crawler with a maximum boom length of 13/58m.ZoomlionAnother Chinese company with its sights set on the overseas market is Zoomlion, which claims to have produced China's first tower crane and first 100t truck crane. The company has embarked on what it calls an 'internationalisation' plan. It says it will achieve this in two ways.First, it plans to set up an export department this year to develop the overseas market for its tower cranes and the hydraulic truck cranes (which are manufactured by its Puyan division – the second truck crane brand in China after Xu Gong). This will focus its export efforts on the Middle East and Gulf areas.Secondly, it has set up an ‘international co-operation department’ in a bid to establish
joint ventures, and is talking to Japanese truck crane manufacturers, although it won’t reveal who.Zoomlion director Xiong Yanming, explains: ‘Through establishing joint ventures... we can save manufacturing costs, accelerate the supply period [for spare parts], and enhance competitive strength. Co-operation with overseas brands means we can integrate their international network and brand influence with Zoomlion's low manufacturing costs to expand our overseas market and brand reputation.’Puyan claims to have built the largest truck crane in China – the 300t QY300 – which it delivered to a Chinese railway company in July last year. The lifting capacity of the base boom is 160t at 5m working radius, and the capacity of the fully extended is 60t at 15m working radius. The maximum lifting height with boom is 30m, and with a jib, 60m.KatoJapanese construction plant giant Kato launched the NK-550VR truck crane, a 55t unit with a maximum boom length of 43m, and fly jib lengths of 9.2m and 15m.The company, which manufactures 800 truck cranes a year, currently imports around 50 25t, 30t, and 50t units a year into China, according to Yasushi Ishimaru, acting general manager of Kato’s overseas marketing department.He admits it is difficult to compete with China’s strong domestic crane manufacturing business, which, he estimates, produces 9,000 units each year, mostly truck cranes and a few rough terrain cranes.l The next Bauma China is planned
for November 2006 at the Shanghai
New International Expo Centre.