europe - Machinery Outlook

Transcription

machinery
VOLUME 3.14
OUTLOOK
EUROPE
®
A Publication of Manfredi & Associates
ISSUE 3
2014
INSIDE
•
GE Partners With Komatsu And
Forms A Global Mining Business
•
Volvo CE Cuts 450 Jobs In
Sweden
•
Doosan Launches Tier 4 Final
Non-DPF Compact Diesel
Engines
•
Volvo Inaugurats Its Technology
Center In Jinan, China.
•
JCB To Close German Factory
•
OEMs Roll Out EmissionsCompliant Equipment at
CONEXPO
•
Zeppelin Purchases Hochtief’s
Rental Division
•
Volvo CE Plant First Global
Construction Facility Powered
Entirely By Renewable Energy
HEARD IN THE DIRTTM
Bobcat Results Help Doosan Recovery, IPO listing In Korea
Bobcat had a good 2013. The company’s results are usually combined with those
of Doosan Infracore, but in a recent article in the Korea Times, Bobcat’s annual
results were separated from the parent company. We have converted the results
to U.S. dollars. In 2013, Bobcat had revenues of approximately €2.48 billion, a
64% increase compared with 2010. Operating profit rebounded from a loss of
€6.5 million in 2010 to €192.5 million in 2013. The Bobcat acquisition was a big
risk for Doosan, but it appears to be paying off. Doosan was widely criticized
for having overpaid for the business at €3.57 billion. The deal was funded with
a string of loans from the Korean government’s Korea Development Bank, and
Hanna Bank, Industrial Bank of Korea, KB Financial Group, Shinhan Investment
Corporation, Export-Import Bank of the Republic of China, Hana Bank and
Woori Investment & Securities.
(continued on page 3...)
GENERAL
Copyright © Manfredi & Associates
DISTRIBUTORS
MANUFACTURERS
RENTAL
ISSN 1464-1313
The content of this report represents our interpretation and analysis of inforrmation generally available to the public or released by responsible individuals in the subject companies, but is not guaranteed as to accuracy or completeness. It does not contain
material provided by our clients. Individual companies reported on and analyzed by Manfredi & Associates may be clients of this and or other Manfredi & Associates services. This information is not furnished in connection with a sale or offer to sell securities
or in connection with the solicitation of an offer to buy securities.
Manfredi & Associates,1157 North Indian River Drive, Cocoa, FL 32922, phone (847) 949-9080, fax (847) 949-9910 www.machineryoutlookeurope.com
machinery OUTLOOK EUROPE ®
Table of Contents
Ashtead Group Profits Up 51%. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Caterpillar CEO Says Rental Is Growing, But Is It A Secular Trend? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Caterpillar Files Protest Over Rail Contract. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Cramo Improves Profitability In Flat Year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Cummins Introduces Motor Generator And Power Electronics For Hybrid Commercial Vehicles. . . . . . . . . . . . . . . . . . . . . . . . 21
Cummins Partners With De Lage Landen For Rental Finance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Deere Dealer Zins Implement To Close . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Doosan Launches Tier 4 Final Non-DPF Compact Diesel Engines. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
GE Partners With Komatsu And Forms A Global Mining Business. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
GE To Develop High Speed Diesel, Komatsu Mining JV . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Haulotte 2013 Profits Up 3% . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Hertz Reports Fourth Quarter And Full Year 2013 Results, HERC To Be Spun Off. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Hertz To Sell Off Equipment Rental Business. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Hyundai To Broaden Product Scope With Backhoe-Loader Model And Compactor. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
JCB To Close German Factory . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Kobelco Sold 25 Cranes To Bigge At ConExpo. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Manitou Revenue Declined In 2013. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
New Bobcat 600 Frame Loaders Meet Tier 4 Final Without DPF. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
OEMs Roll Out Emissions-Compliant Equipment at CONEXPO. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Oshkosh Income Up In 1st Quarter 2014. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Ramirent Makes Branding Shift Towards Added Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Sany Launches New Telescopic Crawler Crane. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Sweden Braces For Fallout of Putin Tactics. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Takeuchi Shows Four Tier 4 Excavators At ConExpo. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Volvo CE Cuts 450 Jobs In Sweden. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Volvo CE Plant First Global Construction Facility Powered Entirely By Renewable Energy . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Volvo Inaugurats Its Technology Center In Jinan, China. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Wacker Neuson And De Lage Landen Agree On Finance Cooperation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
XCMG Hydraulic Excavator Breaks Foreign Monopoly. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Zeppelin Purchases Hochtief’s Rental Division. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Zoomlion Eyes Acquisitions To Bolster Sales and Profits. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
w w w. m a c h i n e r y o u t l o o k e u ro p e . c o m
© Manfredi & Associates, Inc
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ISSUE 3 2014
(....continued from front page)
Bobcat
Revenues and Profits
2010
Revenue (billions)
Operang profit (millions)
2011
2012 2013
€1.51 €2.16
€2.39 €2.47
-€6
€98
€141 €192
Separately, in September 2013 Doosan bundled the businesses it purchased from Ingersoll-Rand
Company Limited in 2007, and established Doosan Infracore Bobcat Holdings (DIBH), a 100%
subsidiary that will control Doosan Infracore International (DII) in the United States and Doosan
Holdings Europe (DHEL). DIBH includes Clark Equipment and Moxy Engineering AS and production
facilities in China and Brazil. Doosan issued an Initial Public Offering (IPO) of approximately 38 million
Global Depository Shares (GDS) in DIBH. The GDS were sold for approximately €7.99 per share for
which Doosan received approximately €290.5 million that it used to pay down debt.
The company’s intent is to eventually list DIBH on the New York Stock exchange within about two years.
As a prelude to that listing, DIBH just filed with the U.S. SEC to issue approximately €1.3 billion of debt
securities that will largely go to repay loans taken for the Bobcat acquisition. In addition to the €944.1
million first lien portion that will be used to refund the acquisition debt, the company is also seeking
a separate €290.5 million unsecured term loan, due in 2022, and a senior secured revolver worth €72.6
million with a five year term.
The Korea IPO document included a great amount of detail about DIBH that we have not seen before.
The document included nine months of operations for DIBH. We have converted Korean won into
dollars at generally accepted exchange rates for each year.
Bobcat represented approximately 55% of Doosan’s €5.278 billion of total revenues in 2012 and more
than 60% of Doosan’s construction equipment revenues. Doosan reported approximately €802.1 million
of other construction equipment revenues in 2012. Machine tools and engines accounted for almost
€1.45 billion of revenues. The company was profitable in both 2011 and in 2012, but slipped into a loss
during the first nine months of 2013. Company management said that it returned to a profit in the
fourth quarter of 2013. The 2013 decline was caused by a soft market in China and in Europe, buoyed by
advances in North America.
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ISSUE 3 2014
The company has been burdened by massive debt. In September last year, Doosan Infracore’s borrowings
totaled approximately $6 billion. Profits have been a problem since the acquisition because of its
borrowing expenses.
DIBH had an EBITDA margin of between 7% and 11% in recent years. In comparison the machinery
sector as a group has an average EBITDA margin of approximately 16%.
The adjusted debt to EBITDA ratio was at 5.7 times for the full year in 2013, with Moody’s (the bond
rating agency) expecting it to decline to about five times over the next 12 to 18 months.
Doosan Infracore
Sales by Segment and Profits
Year ended
December 31st
2011
2012
9 months ended
30-Sep
2012
2013
Sales (billions)
Construcon equipment
Machine Tools
Engines
Others
$5.831
$1.281
$0.690
-$0.162
$5.389
$1.295
$0.612
-$0.057
$4.320
$0.981
$0.358
$0.003
$4.176
$0.907
$0.437
$0.005
Total sales
$7.639
$7.239
$5.663
$5.525
Profit (millions)
$281
$358
$256
-$72
EBITDA (millions)
$814
$539
$504
$456
EBITDA Margin
11%
7%
9%
8%
The company also revealed its estimate of the worldwide market for its compact equipment in North
America and the market for its wheel loaders and hydraulic excavators in the other regions where it
operates. These estimates are in line with our figures for these product and region markets.
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ISSUE 3 2014
Doosan Infracore's Esmated Worldwide Market For Wheel Loaders & Excavators
By Region
(thousads of units)
Region
No. Am
Compact CE
Heavy CE
Wheel loaders
Excavators
Europe
Heavy CE
Wheel loaders
Excavators
China
Heavy CE
Wheel loaders
Excavators
Korea
Heavy CE
Excavators
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013E 2014E 2015E 2016E
75
89
98
89
91
64
33
40
53
60
56
62
69
74
14
17
19
25
22
30
23
32
19
25
17
19
10
10
12
12
17
18
19
24
17
22
19
24
21
26
23
28
17
27
11
32
18
35
23
40
26
47
24
36
12
19
16
22
21
27
19
27
18
25
18
25
18
26
19
27
83
32
103
27
109
24
126
34
150
50
149
59
138
81
202
145
220
159
149
103
142
85
141
86
140
88
140
92
5
5
8
8
6
6
8
8
9
12
10
10
DIHB provided a count of its dealers by region and by product line. To the best of our knowledge, this
is the first time these figures have been revealed. The company said it has 822 dealers in North America
and Oceania. This confirms our past estimate that Bobcat alone has approximately 600 dealers in North
America.
Doosan Infracore
Quanty of Dealers
(as of September 30, 2013)
Business Segment
Construcon Equipment
Machine Tools
Engines
Total
1,258
164
186
1,608
Region
Asia Pacific & Emerging Mkts
Europe, Middle East, Africa
North America and Oceania
China
Total
280
352
822
154
1,608
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ISSUE 3 2014
Another interesting piece of information provided in the IPO document are details of where the company
manufacturer its products, how much capacity it has and its capacity utilization for each location.
Doosan Infracore Manufacturing Locaons
Facility
Korea
Annual
Producon
Capacity
Floor Area (thousands
Square Feet of units)
Products Built There
Incheon
13,750,000
84
1,600,000
360,000
9.8
49.4
6.3
4.4
5.6
73%
6.1
2.5
91%
56%
161,000
n/a
n/a
n/a
680,000
100,000
63,250
43.2
500.7
40.1
33.5
355
19.3
77%
71%
48%
367,000
85.9
47.3
55%
370,000
37,500
18.9
1
10.7
0
57%
3%
Excavators
Wheel loaders
Engines
Machine tools
Compressors, light towers
generators
355,000
118,500
256,000
840,000
25
6
25
2.4
8.4
2.3
n/a
1.2
33%
38%
n/a
51%
26,882
n/a
n/a
n/a
Frameries, Belgium
Lyon, France
Pont Chateau, France
Dobris, Czech Republic
Slane, Ireland
Einesvage, Norway
Heavy excavators, wheeled excavators
Aachments
Compact CE
Compact CE
Aachments, quick couplers
Arculated trucks
250,000
215,000
150,000
215,000
100,000
185,000
1.5
12
1.6
16
12
0.4
1.1
6.3
1.2
11.3
6.1
0.2
70%
53%
75%
70%
51%
51%
Americana
Heavy excavators
366,000
1.5
0.1
10%
Changwon
Gunsan
Ansan
Excavators, wheel loaders
Engines
Machine tools
Heavy excavators, whee loaders
CE, engines, machine tool
parts and components
Producon
During Prior
12 months
(thousands Capacity
of units) Ulizaon
U.S.
Gwinner, ND
Wahpeton, ND
Litchfied, ND
Bismarck, ND
Statesville, NC
Atlanta, GA
Skid steers, compact track
and mini track loaders, compact excavator
Hydraulic components
Heavy aachments
Mini loader assembly,
Materail storage, king
Compressors, light towers
generators
Engines
China
Yantai
Yantai
Xuzhou
Yantai
Shnghai
Europe
Brazil
Of particular interest to us was the fact the company has capacity to build approximately 44,000 compact
machines including skid steer, rubber tracked loaders and compact excavators in North Dakota and
6
ISSUE 3 2014
another 17,600 at its plants in France and the Czech Republic. In the most recent 12 months the
company manufactured 56,000 compact machines.
It also has capacity in Incheon, Korea, to build nearly 50,000 diesel engines. The company is now
installing its Doosan engines in Bobcat products and production will not be enough to fulfill the Bobcat
engine requirements and supply loose engines to other customers; therefore we assume production in
Incheon will increase a great deal during the next year. As a side note, although the Doosan Tier IV
engines are performing well and have the advantage of not needing diesel particulate filters (PDFs),
Bobcat dealers with whom we have spoken have told us that some of their customers are complaining
because they prefer the Kubota engines that Bobcat used before because of the relative easy availability
of Kubota engine parts and the large number of Kubota engine dealers who could repair them. Bobcat
equipment owners must now purchase all their Doosan engine parts from Bobcat dealers and if repairs are
necessary have the Bobcat dealer fix the Doosan engines as well.
Also of interest is the 4,000 unit capacity the company has in Norway to build articulated trucks, which
of course is the former Moxy business. In the most recent 12 months, the company manufactured
approximately 2,000 units.
DIBH is doing very well in Europe. Its plants in Belgium where it builds excavators and wheeled
excavators is operating at more than 70% capacity. In contrast, the company’s China excavator and wheel
loader plants are operating at below 40% capacity.
GE Partners With Komatsu And Forms A Global Mining Business
Komatsu and GE Mining announced that they have formed a 50/50 joint venture with Komatsu to
develop and build underground mining equipment. The new company, Komatsu GE Mining Systems
LLC, will be located at the GE Transportation facility in Erie, Pennsylvania. Operations will begin
in April 2014. The two companies have been working together on above ground dump trucks, with
GE’s Transportation division lending its expertise in electric drive systems. Now it will provide that
expertise to Komatsu’s underground equipment. This deal comes at the same time that GE announced
a “breakthrough” in battery technology for mining equipment. Its Durathon battery has successfully
powered a mining scoop at Coal River Energy, located in Alum Creek, West Virginia. The battery is 25%
smaller and 50% lighter than traditional batteries used in similar applications and provides 40% more
operating range.
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ISSUE 3 2014
Komatsu and GE Transportation have been partners for Komatsu electric dump trucks for use in open-pit
mines, for which GE has supplied electric drive systems. By further building on the existing partnership,
the new company will combine GE’s electric power expertise, electric drive systems and battery
technologies with Komatsu’s vehicle and ICT technologies for mining equipment to deliver solutions to
global mining customers. No details have been announced about the amount of money each partner will
contribute to the venture.
Is GE gearing up to complete with Caterpillar in the mining equipment business? GE has already put
some serious money into the mining sector. This is the third move by GE into mining equipment products
in the past three years. In September 2012 GE announced the formation of its mining systems unit in
conjunction with its acquisition of Fairchild International based in West Virginia that manufacturers
underground mining equipment, for an undisclosed amount. The business was renamed GE-Fairchild.
Soon after that announcement GE announced the acquisition of Industrea Ltd. based in Queensland,
Australia, a provider of safety and productivity-enhancing mining equipment services, for approximately
€510.4 million. That venture is named GE Mining based in Brisbane, Australia.
GE claims it can to reach a global customer base with enhanced products based on its clean propulsion
systems, energy storage offering and world-class system integration capabilities. GE’s management claims
its global mining business is well positioned to add value. They expect to help miners maximize output
through more efficient movement of their products, generate and distribute power more efficiently, and
address their water management challenges.
Oshkosh Income Up In 1st Quarter 2014
Oshkosh Corporation reported fiscal 2014 first quarter profits of €40.08 million compared to €33.8
million in the first quarter of fiscal 2013. Consolidated revenues in the first quarter of fiscal 2014 were
€1.12 billion, a decrease of 12.6% compared to the prior year first quarter. Higher sales in each of the
company’s non-defense segments were more than offset by lower defense segment sales.
“First quarter results significantly exceeded our expectations driven by a combination of disciplined
execution and a strong product mix,” said Charles L. Szews, Oshkosh CEO. “The benefits of our MOVE
strategy were evident in our performance again this quarter. We believe MOVE is an effective roadmap to
lead Oshkosh to achieve our strategic targets.
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ISSUE 3 2014
Factors affecting first quarter results for the company’s business segments included:
Access Equipment – Access equipment segment sales increased 15% to €488 million for the first quarter
of fiscal 2014 compared to the prior year first quarter. Access equipment segment operating income
increased 84.6% to €65.9 million, or 13.5% of sales, compared to prior year first quarter operating income
of €35.7 million, or 8.4% of sales.
Fire & Emergency – Fire & emergency segment sales for the first quarter of fiscal 2014 increased 8.7% to
€144.5 million compared to the first quarter of fiscal 2013. Fire & emergency segment operating income
increased 28.5% to €5 million, or 3.5% of sales, compared to prior year first quarter operating income of
€3.9 million, or 2.9% of sales.
Commercial – Commercial segment sales increased 8.6 % to €140.6 million in the first quarter of fiscal
2014 compared to the first quarter of fiscal 2013. The increase in sales was primarily attributable to
improved aftermarket parts & service sales and higher concrete placement volume. Commercial segment
operating income increased 27.7% to €7.4 million, or 5.3% of sales, compared to €5.8 million, or 4.5%
of sales, in the first quarter of fiscal 2013. The increase in operating income was primarily a result of the
higher sales volume.
Defense – Defense segment sales decreased 41.9% to €351.3 million for the first quarter of fiscal 2014
compared to the first quarter of fiscal 2013. In the first quarter of fiscal 2014, defense segment operating
income decreased 59.3% to €18.1 million, or 5.2% of sales, compared to prior year first quarter operating
income of €44.4 million, or 7.4% of sales.
The company expects consolidated sales for fiscal 2014 will be approximately €4.85 billion to €5 billion,
reflecting an increase of €36.5 million on the low end of the range and a decrease of €36.5 million
on the high end of the range compared to the company’s previous expectations. The company expects
consolidated operating income to be between €357.7 million and €379 million. This reflects an increase
of €21.9 million to €25.5 million from the company’s previous operating income expectations, largely as
a result of expected stronger performance in the access equipment segment. The company now expects its
full-year effective tax rate to be 32%.
Manitou Revenue Declined In 2013
Manitou Group reported full-year 2013 revenues of €1.18 billion ($1.62 billion), down 7% from 2012. The
company also reported fourth-quarter 2013 revenues of €303 million ($409 million), representing a 1%
decrease compared with the same period in 2012.
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ISSUE 3 2014
Gehl, Manitou’s compact equipment division, reported fourth-quarter revenues of €58.1 million ($78.5
million), a decrease of 16% from the same period in 2012. Order intake grew to 2,361 units, with most
deliveries taking place in 2014. For 2013, the division reported revenues of €242.1 million ($327.2
million), down 1% from 2012.
The North American telehandler business ended the year with the highest backlog since 2009.
Additionally, the company’s skid steer business is affected by the cost increase linked to the transition to
Tier 4 Final engines.
The Industrial Material Handling Division reported quarterly revenues of €29.5 million ($39.9 million),
a decrease of 30% from fourth-quarter 2012. For the year, the division reported a revenue growth of 6%
compared to 2012, focusing its effort on forklift trucks.
The Rough Terrain Handling Division generated fourth-quarter revenues of €215.2 million ($290.9
million), a 9% increase from the same period in 2012. The division reported annual revenues of €809.7
million ($1.1 billion), down 5% from 2012. The company reported strong demand in the access platform
business, with weaker demand in the agricultural sector.
Kobelco Sold 25 Cranes To Bigge At ConExpo
Bigge Crane and Rigging, based in San Leandro, California, and Kobelco Cranes U.S.A., based in
Houston, Texas, shared a major milestone for both companies at this year’s CONEXPO. Bigge took
delivery of a Kobelco CK2750G crawler crane, one of 25 new crawler cranes Bigge has purchased from
Kobelco in 2014. The occasion marked the largest number of crawler cranes ever sold by Kobelco North
America to one dealer in a quarter.
“Bigge has been a very good dealer for us in the Western U.S. and Pacific Northwest,” said Jack Fendrick,
President of Kobelco Cranes North America. “They have gotten really good at retailing new cranes and
they have a lot invested in parts and servicing Kobelco crawler cranes.”
The new Kobelco cranes will be delivered to Bigge’s locations in Texas, Los Angeles and the San Franciso,
California area, and are available for sale and rent. Bigge’s crane rental fleet has more than 600 machines
in it, available for both bare lease and operated and maintained rentals out of locations in nine U.S. states
. Bigge provides all its customers with dedicated project managers, factory trained technicians, and field
support, and has a nationwide, strategic network of service locations.
10
ISSUE 3 2014
New Bobcat 600 Frame Loaders Meet Tier 4 Final Without DPF
Bobcat, based in Gwinner, North Dakota, announced the release of its first Tier-4 600 frame-size loaders
— the S630 and S650 skid-steer loaders and the T630 and T650 compact track loaders. These 74-hp
loaders provide the same performance benefits of the previous Tier 4 Interim models and meet Tier 4
Final standards without a diesel particulate filter (DPF). An ultra-low particulate combustion (ULPC)
engine significantly reduces particulate matter created in the combustion chamber and generates increased
torque over a broader range of engine speeds
Hyundai To Broaden Product Scope With Backhoe-Loader Model And Compactor
Hyundai Construction Equipment USA, based in Norcross, Georgia, made its entry into the backhoeloader market at ConExpo with its 14-ft. digging depth model H930C, that was previewed at
CONEXPO-CON/AGG. The machine is currently available in Latin America and will be released in
North America near the end of 2015.
The H930C features a 87-hp Perkins 1104C-44T engine that combines combustion technology with
internal exhaust gas recirculation, backhoe dig depth of 14 ft. 3 in., a loader bucket capacity of 28.3 cu.
ft., and an operating weight of 14,881 lbs. Also on display was the company’s new model HR120C-9
compactor suitable for soil and aggregate compaction in applications such as residential and commercial
site prep and road construction. The 26,455 pound roller comes with a 130 hp Duetz TCD 2012 L4
turbo, water cooled diesel engine, has a drum width of 6’10”, a drum diameter of 4’11” and a drum
thickness of 1.18 in.
Volvo CE Cuts 450 Jobs In Sweden
Volvo CE, based in Brussels, Belgium, announced plans to cut 450 jobs in Sweden due to lagging
profitability and an unfavorable product mix. The company had hoped to reduce employment on
a voluntary basis, but it didn’t work out. Volvo will offer severance pay and pensions to some of its
employees. Volvo CE currently has approximately 4,500 employees in Europe. The parent company The
Volvo group said in February it planned to cut a total of 4,400 jobs in a move that would involve staff also
in its trucks business and in areas such as sales and marketing. Company management said the staff cuts
were necessary because of an unfortunate product mix. The market for the company’s large machines,
which are produced in Sweden, is very slow right now, while the market for smaller machines, made in
France and Germany, is doing somewhat better.
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Doosan Launches Tier 4 Final Non-DPF Compact Diesel Engines
At ConExpo 2014 Doosan Infracore Engine Business Group launched three Tier 4 Final-compliant
compact diesel engines that do not require diesel particulate filters (DPF). The engines are designed for
the original equipment manufacturer (OEM) market. The three new engine models, D18, D24 and D34,
have a range from 1.8- to 3.4-liter displacement. The horsepower, depending on the configuration, is 50
to 110 hp and higher. The new compact engine will be installed in smaller Doosan excavators and air
compressors with plans to broaden the applications. In the future, the company plans to make the compact
engines available in non-Doosan machines such as forklifts and agricultural equipment. The company’s
goal is to grow its compact engine business from 30,000 units in 2014 to 100,000 units by 2018.
The company used ultra-low particulate matter combustion, or ULPC, to achieve a non DPF engine. The
ULPC was achieved through use of a specially designed engine combustion chamber that significantly
reduces the amount of particulate matter created during combustion. A non-DPF engine design prevents
the need for a larger mounting space, eliminates ash cleaning, enhances fuel economy and eliminates the
risk of thermal damage.
XCMG Hydraulic Excavator Breaks Foreign Monopoly
XCMG sold 9,000 excavators in 2013, ranking one of top two machinery manufacturers in China,
according to the company. XCMG reports its XE700C hydraulic excavator had a 34.7% market share of
the China market for that size of excavator.
Zoomlion Eyes Acquisitions To Bolster Sales and Profits
Zoomlion Heavy Industry Science and Technology Company Ltd., based in Changcha, Hunan Province,
announced that it is close to signing a truck joint venture with a major global truck manufacturer as it
seeks to diversify the types of equipment it manufactures and sells and to bolster its sales and profits.
Zoomlion is seeking to transform itself into a diversified manufacturer. The company has been in talks
with several global truck heavy-weights for a 50-50 vehicle and engine joint venture in China. The
company said that the joint venture will become a major player in the medium to higher-end heavy truck
segment in China, both in terms of capacity and technology know-how.
Other global truck makers have also set their sights on China where a massive urbanization drive is
pushing up demand for heavy trucks. Daimler Trucks formed a venture with Beijing Automotive’s truck
unit Beiqi Foton Motor Company in September 2011. Volvo teamed up with Dongfeng Motor Group to
build a heavy-truck plant early last year.
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China’s construction machinery industry slipped into a two-year downturn starting in 2012 as major
industry players struggled with mounting inventory and low utilization rates after a surplus in machinery
spending spurred by China’s massive stimulus program in 2008. Zoomlion’s net profit fell nearly 36% in
the first nine months of 2013. Zoomlion expects demand to resume this spring when construction sites
nationwide kick into full swing. The company expects the overall industry to grow 15% year on year in
2014. Zoomlion’s overseas operations contribute to about 10% of its overall revenue, helped in part by
its acquisition of Italian concrete machinery maker CIFA in 2008. Late last year, Zoomlion took over a
German dry mortar equipment producer M-Tec.
Deere Dealer Zins Implement To Close
Zins Implement, tied as the oldest John Deere dealership in the world, is closing this summer, part of a
trend toward larger consolidated dealerships. John C. Zins opened a general store in Nicollet, Minnesota,
in 1892 and got its first John Deere contract in 1899, the same year as Gilsinger John Deere, based in
Winimac, Indiana, also started. Soon after opening his general store, John C. Zins began expanding into
well drilling, plumbing, buying and selling livestock and selling farm equipment. While Zins got his first
contract with Deere and Co. in 1899, it was 19 years later that Deere purchased the Waterloo Gasoline
Traction Engine Company in Waterloo, Iowa, and tractors became part of the John Deere line.
Zins Implement has been operating as Kibble Equipment since it merged with Kibble in 2006. Kibble
has dealerships in a dozen locations in Minnesota. Butch Kibble said that with fewer farmers and facilities
relatively close together, closing the smaller Nicollet shop was inevitable. “To provide the level of service
we need to today and to have the work for our employees, we need the facilities that have the size and
scope. The days of having the Nicollet-sized stores is actually long gone,” Kibble said. The goal is to have
the 10 employees working in Nicollet move to other Kibble dealerships.
Kibble Equipment has been expanding in southern Minnesota in recent years. Two Kibble brothers started
Mankato Implement and Kibble Equipment and began acquiring other dealerships. Last spring they
merged as Kibble Equipment. Kibble is now one of the largest John Deere dealer groups in the U.S. and
Canada.
Volvo Inaugurats Its Technology Center In Jinan, China.
Volvo Construction Equipment announced that it inaugurated its Jinan Technology Center in Shangdong
province, China. The facility was officially opened on March 19. Engineers at the 50,000m2 site will
specifically focus on developing products and components for customers in emerging markets. The SEK
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270 million center combines design offices with workshops and facilities for testing both complete
machines and components. Currently there are more than 150 employees working at the center – the
majority of which are local engineers. Employee numbers are set to grow – the site can accommodate up
to 450 people.
The Jinan Technology Center consists of a test track, design offices and two testing buildings which
include component and prototype assembly workshops, as well as areas for testing the performance and
structure of equipment. The center was responsible for the successful development of the model L105
wheel loader – the first Volvo branded machine to be developed specifically for emerging markets. The
L105 was developed over a period of 25 months and launched at the end of 2012. Future projects at the
site include developing excavators, wheel loaders and road and utility products – all specifically designed
for emerging markets.
Caterpillar Files Protest Over Rail Contract
Caterpillar Inc. filed a new round of objections over the Illinois Department of Transportation’s decision
to award a €165 million contract for high-speed passenger railroad locomotives to Siemens AG and
Cummins Inc. The company said it filed complaints with the Illinois Procurement Policy Review Board
and the Cook County, Illinois, Chancery Court. About 32 locomotives are being purchased with federal
funds for five states, including California and Illinois that are developing high-speed intercity rail routes
with Amtrak. Illinois managed the locomotive purchase on behalf of the group. The Department of
Transportation last month rejected a protest from Caterpillar that alleged Siemens’s locomotive couldn’t
meet the contract’s 125-mile-per-hour speed requirement unless it was traveling downhill. Caterpillar said
it is counting on the procurement board and the court “to provide a fair and balanced review” of Illinois’s
bid selection process. Caterpillar’s latest complaint said the Transportation Department disregarded
various procedures and requirements when it evaluated Siemens’s offer.
“Caterpillar believes IDOT unfairly evaluated and scored offers and improperly relaxed the specified
performance requirements when making its selection,” said Billy Ainsworth, vice president of Caterpillar’s
railroad business, in a written statement. The Transportation Department has previously maintained that
the proposals were evaluated thoroughly and fairly.
The high-speed rail initiatives under way in California, Washington, Illinois, Michigan and Missouri
represent the first attempts in the U.S. at matching the high-speed rail service common in Europe and
Asia. The state projects received a boost from the 2009 federal stimulus legislation, which provided about
€5.8 billion for high-speed rail. Most of that money has been used for infrastructure work on track rightsof-way and signals. About €620.5 million from the stimulus bill and other sources was designated for
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locomotives and coaches. After the initial 32-locomotive contract for Siemens and orders for coaches,
about €182.5 million will be left for purchases of additional coaches and locomotives.
As the winning bidder, Siemens also received the right to supply up to 225 additional locomotives,
provided state or federal funding is available in the coming years. The additional orders could be worth
at least €1.1 billion for Siemens, based on its initial price of €5.11 million per locomotive. Siemens’s
locomotive will feature a 16-cylinder diesel engine that will be built by engine-maker Cummins in
Seymour, Indiana. Siemens, a German industrial conglomerate that is already supplying electric powered
locomotives for Amtrak’s Northeast Corridor passenger service, plans to assemble the high-speed diesel
locomotives at a plant in Sacramento, California. Caterpillar offered a locomotive with a 20-cylinder
engine, but it was priced higher at about €5.9 million per unit, or €189.8 million. MotivePower Inc., a unit
of Pennsylvania-based Wabtec Corporation, submitted the highest bid at €190.4 million.
The loss of the high-speed locomotive contract is a blow to Caterpillar’s strategy to expand its railroad
business. Caterpillar, the world’s largest manufacturer of construction and mining equipment, bought
Illinois-based locomotive maker Electro-Motive Diesel in 2010 with the intent of establishing a major
presence in a wide-open market in the U.S. for the next generation of passenger railroad locomotives.
Caterpillar closed an Electro-Motive assembly plant in Canada in 2012 in favor of a new plant in Muncie,
Indiana. The move positioned Electro-Motive to comply with the made-in-America mandate for federally
funded equipment for Amtrak. Without other U.S. outlets for high-speed rail service, Caterpillar sales
options for its new F125 locomotive are mostly limited to regional commuter railroads or slower-speed
Amtrak service.
Hertz Reports Fourth Quarter And Full Year 2013 Results, HERC To Be Spun Off
Hertz Global Holdings, Inc. reported record fourth quarter 2013 worldwide revenues of €1.9 billion, an
increase of 10.2% year-over-year. U.S. car rental revenues for the quarter increased 14.1% year-over-year to
€1.077 billion, primarily due to Dollar Thrifty, which was acquired on November 19, 2012, partially offset
by the December 2012 divestiture of Advantage. International car rental revenues for the quarter increased
5.8% year-over-year to €397.2 million. Revenues from worldwide Hertz Equipment Rental Company
(HERC) for the fourth quarter were €292.6 million, up 4.0% year-over-year. All other operations revenues
for the quarter increased 6.8% year-over-year to €98.4 million. Fourth quarter 2013 adjusted profits were
€88.4 million, versus €101.5 million in the same period of 2012.
Worldwide HERC total revenues were €292.6 million for the fourth quarter of 2013, a 4.0% increase from
the prior year period. The primary drivers of the increase were stronger equipment rental volumes, up 9.8%,
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and a 2.4% increase in pricing. Rental revenue in the fourth quarter was up against tough comparisons due
to increased rental activity at the end of 2012 related to Hurricanes Sandy and Isaac, which also caused an
unfavorable mix of equipment year-over-year. Adjusted pre-tax income for worldwide equipment rental
for the fourth quarter of 2013 was €62.3 million, an improvement of €2.19 million from €60.15 million
in the prior year period, primarily attributable to the effects of increased volume, improved pricing and
cost management initiatives including improved time and dollar utilization. Worldwide equipment rental
achieved an adjusted pre-tax margin of 21.3%.
Hertz To Sell Off Equipment Rental Business
Hertz management believes the stock market has not given the company full credit for its car rental
operations. According to Hertz management separating the company into two businesses represents an
opportunity to build on the strong position of the equipment rental business at a time when the macro
environment for the industry is improving. As a pure equipment rental company HERC should generate a
more targeted following among investors that will allow its true value to be appreciated.
Hertz management said that not a single equipment rental analyst covers HERC. By offering greater
visibility into its operating performance and detailed strategic plan, management believes it will receive a
better evaluation.
As a separate company the equipment rental business will have the scale and financial strength to expand
into new and existing markets capturing share in what remains a highly fragmented industry. In addition
to discipline growth, HERC will continue to drive the culture of operational excellence and follow clear
return criteria for investments.
As a combined company Hertz stock trades well below its counterparts with equipment rental companies
at average 17 times future earnings and Avis Budget, the only public rental car peer, trading at 16.6 times
future earnings. In contrast Hertz combined company multiple is lower at 12.7 times future earnings.
Hertz management values the HERC enterprise at approximately €3.29 billion.
The HERC spin-off is expected to yield $2.5 billion to Hertz of which $1 billion will be used to
repurchase up to 20% of the outstanding shares of Hertz and the rest to pay down debt. The repurchase
will boost the company’s earnings per share. Following the spin-off, HERC will have an estimated 335
branches in the U.S., Canada, France, Spain, China and Saudi Arabia, as well as through international
franchisees. The spin-off should be completed in early 2015 in a transaction that the IRS has ruled will be
tax-free to sharholders.
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HERC had annual revenues of more than €1.1 billion in 2013, with 38% of its 2013 revenues derived
from the construction market, 26% from industrial, 36% from other markets including oil and gas, and
from other specialty niche markets, such as pump and power, government services and the entertainment
industry. In reading the Hertz annual report, we have found a number of differences compared with
the way we calculate EBITDA that we question even after asking a company representative to explain.
According to the company HERC had 2013 Corporate EBITDA of €486.6 million. The company says
that Corporate EBITDA is a non-GAAP measure (Generally Accepted Accounts Practices).
Takeuchi Shows Four Tier 4 Excavators At ConExpo
At the Takeuchi display at ConExpo were four new or updated Tier 4 excavators ranging from the
1.6-metric-ton TB216 up to the 9-metric-ton TB290 that transitions the compact Takeuchi product line
into the “midi” market. Replacing the TB016 model, the new TB216 Tier 4 compact excavator features an
updated profile that houses a Yanmar Tier 4 Final engine, producing 15 hp. The TB016 has an operating
weight of 3,900 lbs. and features a retractable undercarriage.
TAKEUCHI
TB 216
Tier 4
TAKEUCHI TAKEUCHI
TB 228
TB 250
Tier 4
Tier 4
TAKEUCHI TAKEUCHI
TB 260
TB 290
Tier 4
Tier 4
Driveline
Engine Manufacturer
Yanmar
Yanmar
Yanmar
Yanmar
Yanmar
Engine Model
3 TNV 74
3 TNV 82A
4 TNV 88
4 TNV 86CT
4 TNV 98T
23.4 [17.5]
38 [28.4]
47.6 [35.5]
24.2 [18.1]
39.6 [29.6]
Net Engine Output
hp [ kW ]
Gross Engine Output
hp [ kW ]
15 [11.2]
Number Of Track Rollers/Side Std Undercarriage
Track Shoe Width
inches [ mm ]
66.5 [49.6]
69.2 [51.6]
3
3
5
5
5
9 [230]
11.8 [300]
15.7 [400]
15.7 [400]
17.7 [450]
Dimensions
Transport Length
/in [ mm ]
Transport Height Without Boom
Track Length On Ground
Tailswing Radius
Ground Clearance
/in [ mm ]
/in [ mm ]
inches [ mm ]
Width Over Standard Tracks
Dig Depth (Mono)
/in [ mm ]
8 [2445]
18 3 in [5550] 18 3 in [5550]
[6660]
8 3 in [2515]
8 6 in [2600]
[2565]
3 10 in [1155]
6 6 in [1985]
6 9 in [2050]
[2210]
3 6 in [1075]
4 3 in [1285] 4 8 in [1435]
4 3 in [1300]
[1650]
13.1 [335]
13 [330]
15 [385]
6 [1840]
6 7 in [2200]
[2200]
/in [ mm ]
Standard Dipper For Liing - Mono Boom
Ground Bearing Pressure Std Shoe
Reference Specificaon Weight
[4460]
7 5 in [2255]
8.1 [205]
4 9 in [1450]
/in [ mm ]
Main Pumps Maximum Flow
12 8 in [3870]
/in [ mm ]
PSI [ kPa ]
gallons (US) / min [ lt/min ]
lbs [ kg ]
Data provided by Spec Check
7 9 in [2390]
9 5 in [2875] 12 5 in [3785] 12 9 in [3895] 15 [4570]
3 9 in [1130]
4 9 in [1445] 5 9 in [1760] 5 10 in [1780]
7 [2130]
4.3 [29.6]
4.1 [28.4]
3.8 [26.5]
4.51 [31.1]
5.5 [37.9]
13.45 [50.9]
24.6 [93.3]
43.9 [166.2]
45.3 [171.5]
62.5 [236.6]
12509 [5674]
18780 [8518]
3902 [1770]
6100.1 [2767] 10646.1 [4829]
(Further data available)
The the Tier 4 compact excavator model TB240 with an operating weight of 8,289 lbs. offers a bucket
digging force of 9,959 lbf., a 15% increase from the previous TB235 model. The new TB240 features a
reinforced boom with larger cylinders and pins for improved durability. The body has been redesigned
to allow for ground-level panoramic serviceability, and features a large non-tilting operator’s station. The
new TB260 Tier 4 compact excavator has an operating weight of 12,509 lbs., and a bucket digging force
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ISSUE 3 2014
of 12,756 lbf. The new TB260 features a more powerful turbocharged Yanmar engine with more than
47 hp, provides smooth efficient power, and is Final Tier 4 compliant meeting the latest EPA emissions
requirements.
The model TB290 is one of the largest excavators in the Takeuchi lineup — second only to the TB1140
Series 2 at 34,000 lbs. — the all-new TB290 Tier 4 features an operating weight of 18,780 lbs. with
a bucket digging force of 16,568 lbf. The TB290 is powered by a turbocharged Tier 4 Yanmar engine
delivering 69 hp, the TB290 offers 15 ft. of dig depth and nearly 24.5 ft. of reach, positioning it as a viable
alternative to the backhoe loader.
JCB To Close German Factory
JCB has announced plans to close its factory in Gatersleben, Germany. JCB acquired the factory when it
bought German compaction equipment manufacturer Vibromax in 2005.
JCB said the decision had been taken to improve its competitiveness in the compaction sector following
a strategic review of the business and changes in global market conditions. “Demand for compaction
equipment has been improving in overall terms in recent years, but the emerging markets now account for
the bulk of demand,” it said in a statement. The closure of the Gatersleben factory will result in 145 job
losses, although it will create 90 jobs in the UK and India.
JCB CEO Graeme Macdonald said, “The decision to relocate production of compaction equipment to
factories in the UK and India is right for our business. The decision wasn’t taken lightly and the impact
on our employees in Germany is regrettable. This will improve competitiveness of JCB in the compaction
sector. It will also create a far more sustainable position on which we can build as we grow business in the
future.”
The company said it would shift production of the products made in Gatersleben by the end of June this
year. Walk-behind compactors and the two smallest tandem rollers in the range will be built at the JCB
Attachments factory in Uttoxeter, UK. Production of all soil compactors and two larger models of tandem
roller will be moved to JCB’s factory in Pune, India. The reorganization will also see the production of the
403 wheeled loader moved back to the UK following its previous transfer to Germany in 2011.
GE To Develop High Speed Diesel, Komatsu Mining JV
GE said it plans to develop a new high-speed diesel engine that will be available in the first quarter of
2016. The company said full details of the 1.5 MW diesel (approximately 2,000 hp) will be available
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ISSUE 3 2014
in the 2014 second quarter. GE made the announcement at the launch of its new Distributed Power
business in Jakarta, Indonesia, and as part of a $1.4 billion dollar investment in product upgrades and
developments.
Separately, Komatsu and GE Mining, a division of GE Transportation, announced a new collaboration
to develop next generation mining equipment. By combining their expertise in mining equipment and
propulsion systems, the companies will help meet the needs of customers and partners worldwide, with an
initial focus on developing solutions to increase customer productivity and safety for underground mines.
The new company, Komatsu GE Mining Systems, LLC, will be located at the GE Transportation facility
in Erie, Pennsylvania, and operations will begin in April 2014. Komatsu and GE will each own 50% of
the new company.
Komatsu and GE Transportation have been partners for Komatsu electric dump trucks for use in surface
mines, for which GE has supplied electric drive systems. By further building on the existing partnership,
the new company will combine GE’s electric power expertise, electric drive systems, and battery
technologies with Komatsu’s vehicle and information and communications technologies for mining
equipment to deliver innovative solutions to global mining customers.
OEMs Roll Out Emissions-Compliant Equipment at CONEXPO
New emissions-compliant equipment led the news at Conexpo-Con/Agg. January 1st was the deadline for
off-road mobile equipment manufacturers to meet Tier IV Final (T4F) diesel emissions standards set by
the Environmental Protection Agency (EPA). Off-road equipment manufacturers — and customers —are
seeing higher costs with the new emissions systems .
Caterpillar said the company had spent tens of billions of dollars over the years developing its emissions
systems. Included in that, presumably, was the cost of developing the company’s ACERT cooled EGR
system used in its highway engines before they were discontinued.
Case Construction spent €146 million just in T4 final research and development.
Construction equipment buyers will be paying more for any new T4F machine. Warren Anderson, brand
marketing manager for Case’s SSL, CTL and CWL compact loaders, said the emissions will add between
5% to 15% to the cost of new equipment. Cummins said equipment prices industrywide could increase
anywhere from 5% to 30%, depending on the manufacturer and size of equipment. End users may see
improved fuel efficiency with the cleaner engines, but the amount will depend on the application, the
emissions system configuration and other factors.
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Haulotte 2013 Profits Up 3%
Haulotte Group saw a return to growth during the 2013 financial year driven mainly by the North and
South American markets. The company’s revenue grew by 3% in 2013, compared to 2012, (5.5% excluding
the impact of exchange rates). Latin America was up 26% and Asia-Pacific was up 9%. Excluding foreign
exchange gains and losses, operating income from continuing operations stood at 5.2% of revenue against
3.3% in fiscal 2012. This increase was mainly due to the impact of additional volumes on the gross margin,
improved performance by the industrial division, and the management of fixed costs, said the company.
In monetary terms, operating income from continuing operations increased significantly to €11 million,
despite exchange gain and losses recorded at €4.82 million, and impairment charges in North America
of €3.65 million. Earnings before interest, taxes, depreciation, and amortization rose the most by 320%
to €25.3 million. The company saw a rise in discontinued operations profit of €8 million, up from €0.8
million in 2012, mainly resulting from the €8.6 million gain on sale of its UK rental business in June 2013.
Net financial debt more than halved during the year to €41.7 million, compared to €102.7 million at the
end of 2012.
“The start of 2014 is pointing towards a significant recovery of the business, particularly in Europe;
resulting in a significant increase in order books during the first months of the year,” said a company
spokesperson. “The growth of the global market is expected to be the same in 2014 as it was in 2013. This
should allow Haulotte Group to show more than 10% revenue growth in 2014 and an improvement in
EBIT.”
Caterpillar CEO Says Rental Is Growing, But Is It A Secular Trend?
During ConExpo in Las Vegas Caterpillar chairman and CEO Doug Oberhelman reiterated comments
he made during BAUMA in Munich last year that rental worldwide is a growing percentage of the
company’s business. Oberhelman said that if they aggregate it all Caterpillar dealer-owned rental fleets
then Caterpillar has the largest rental fleet in the world.
Dealers are independent in each territory and dealers have been asking for help. Oberhelman also
said contractors are among the company’s customer base who have extended the replacement cycle of
equipment, resulting in more demand for rental. As contractors and customers deal with less certain
futures, the pressure valve in replacement manifests itself through higher demand for rental. Equipment
rental utilization is better but Oberhelman said he doesn’t know for sure if this is due to a secular longterm trend or not.
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Cummins Introduces Motor Generator And Power Electronics For Hybrid Commercial Vehicles
Cummins Generator Technologies, based in Columbus, Indiana, announced availability of its CorePlus
Motor Generator and Power Electronics technology in the American market. Cummins believes there
is a strong market for engine electrification in medium- and heavy-duty commercial vehicles, and has
been investing in CorePlus technology, developing electrical Motor Generator and Power Electronics
innovation to ensure its global leadership position in the sector. The Cummins CorePlus Motor Generator
is available with power, torque and performance characteristics suitable for hybrid systems, electric vehicle
designs, range extender solutions and electrical power generation in vehicles. A Power Electronics package
embedding Cummins CorePlus controls software complements the Motor Generator.
The Cummins CorePlus Motor Generator is fitted between the vehicle engine and transmission, allowing
original equipment manufacturers (OEMs) to keep using their preferred engine and transmission. The
Motor Generator has an integral rugged housing to allow it to operate in the harsh environment of
the engine bay, and has the torsional strength to allow engine torque to be transferred through it to the
transmission. “The class-leading performance of the Cummins CorePlus motor generator has a peak
power of 90 kilowatts, peak torque of 660 Newton-meters and efficiencies greater than 95%,” said Robert
Lee, Executive Director – Power Generation Strategy.
Ashtead Group Profits Up 51%
Ashtead Group, based in Leatherhead, Surrey, UK, announced that pre-tax profits rose by 51% to €360.6
million for the first nine months of the year, ending 31 January, on revenues that were up 23% at €1.53
billion. Both A-Plant in the UK and Sunbelt Rentals in the US performed well and Ashtead said its full
year profits would be ahead of previous expectations.
Sunbelt rental revenues grew 22% to €1.08 billion, driven by a 17% increase in fleet on rent and 5%
improvement in yield. A-Plant delivered a 33% increase in rental revenue to €222.7 million, including the
acquired Eve Trakway business. Even without Eve, revenues were up 18%, reflecting 10% more fleet on
rent and 7% yield improvement.
Ashtead’s chief executive, Geoff Drabble, said; “Our strategy continues to be focused largely on organic
growth, supplemented by a range of bolt-on acquisitions. We invested €604.2 million in our rental fleet
and a further €104.6 million on acquisitions during the period. “Our markets remain strong and we
anticipate growing the Group’s fleet organically in the coming year in the low to mid teens percent range.”
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Cramo Improves Profitability In Flat Year
Cramo, based in Vantaa, Finland reported improved profitability in 2013, particularly in the second half
of the year, despite slightly lower sales and what it called the “weak economic situation”. Pre-tax profits
for the full year rose by 17.4% to €52.1 million on sales that were 5.1% lower at €660.6 million. In local
currencies, and excluding the impact of the divestments and the pooling of its Russian business with
Ramirent, revenues were actually up by 1.5%.
Ramirent said its results were good in Finland, Sweden and Eastern Europe, with improvements in
Norway. Its Danish operation also became profitable. Profitability improved in the final quarter in
Finland, Norway, Denmark and Eastern Europe and its modular space business maintained a high level in
all Nordic countries.
Vesa Koivula, president and CEO of Cramo Group, said; “Our work to improve operational efficiency
in recent years shows results. Despite the decrease in sales and the weak economic situation, our relative
profitability improved in 2013 particularly in the second half of the year.
After a strong expansion in earlier years, efficiency improvement has primarily taken the form of uniform
business practices and efficient processes across the Group. In 2013, we made good progress in the
implementation of consistent operating methods in all of our countries of operation, and our reformed
range of services was well received among customers.”
Mr Koivula said market forecasts for this year were favorable, but growth rates were likely to remain
moderate; “I am expecting the rental market to resume growth in the second half of the year at the latest.”
Wacker Neuson And De Lage Landen Agree On Finance Cooperation
Wacker Neuson, based in Munich, Germany, has agreed to a worldwide cooperation with De Lage
Landen (DLL), headquartered in Eindhoven (the Netherlands), to provide asset financing for its
customers. The two have created a “virtual joint venture” to offer finance under the Wacker Neuson
Finance brand. The German manufacturer said an increasing number of customers are financing their
equipment purchases to preserve liquidity, with a high proportion of compact equipment already being
financed.
“There are many reasons that speak for financing machines and equipment," said Cem Peksaglam, CEO
of Wacker Neuson. "One important reason is the reduced burden on our customers' liquidity. Financing
machines has become very attractive due to very good conditions as well as fast and uncomplicated
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processing." Finance packages for periods of between one and five years will be available. DLL is a whollyowned subsidiary of Netherlands-based Rabobank Group.
Cummins Partners With De Lage Landen For Rental Finance
Cummins Power Generation has signed a partnership with De Lage Landen (DLL) to provide tailored
financial packages to its rental customers and distributors in the US. The agreement, which is with
DLL’s Construction, Transportation & Industrial (CT&I) business unit, will “broaden and support” its
rental product offering, said Cummins. Cummins offers the North American rental market a range of
containerized rental generator sets from 60 kW to 2 MW.
“Financing is a new area for us and we are glad to partner with a company that has the right capabilities,
industry experience, and global reach that we need to support our rental business.”
Although the announcement is for finance in the US, the two companies said that ultimately there
was potential for the arrangement to cover multiple countries, with DLL’s global footprint matching
Cummin’s network across the world. De Lage Landen is a wholly-owned subsidiary of Rabobank Group
and specializes in asset-based financing programs for equipment manufacturers, dealers and distributors all
over the world
Ramirent Makes Branding Shift Towards Added Services
Ramirent, based in Vantaa, Finland, is to “reposition its brand” to focus on the knowledge and expertise
offered by its employees and promote the idea that it offers more than just products for rent. Under the
theme ‘Ramirent is more than machines’ it will promote the additional services that it provides in helping
clients plan their projects. Around a third of its revenues are already generated by non-product rentals,
including insurance, logistics and training. Ramirent’s previous brand slogan was Ramirent: Let’s Solve It.
Magnus Rosén, Ramirent’s CEO, said Ramirent’s yellow and blue identity was known all over its
territories, but people do not necessarily know all the company stands for; “The repositioning is a
statement that Ramirent is a company in transition. We are continuously improving our rental offering
through better equipment, service and sharing knowledge that will contribute to a better future for our
customers, our staff and the community”.
Zeppelin Purchases Hochtief’s Rental Division
Hochtieff AG, a large contractor based in Essen, Germany, announced that it has sold the majority of
its Streif Baulogistik rental business to Zeppelin Group, the Caterpillar dealer based in Friedrichshafen,
Germany. Zeppelin will merge the Streif “project service” business unit, which bundles construction-site
logistics and security services business, with its Zeppelin Rental division. Streif Baulogistik was ranked
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ISSUE 3 2014
as the 27th largest equipment rental business in Europe last year, with estimated rental revenues of €135
million. This compares with Zeppelin Rental’s 2013 sales of €288 million.
The deal, for an undisclosed price, will see Zeppelin Rental take on 230 Streif employees and acquire
its power, portable accommodation and project planning and logistics operations. Zeppelin is acquiring
Streif 's German and Austrian operations, with locations in Essen, Hamburg, Berlin, Frankfurt, Cologne,
Leipzig, Munich and Vienna. For Zeppelin Rental, the acquisition will give it greater exposure to one
of Germany’s largest contractors – a significant proportion of its activities were with parent company
Hochtief – and expand the services it can offer in project planning and logistics. Not included in the
acquisition is Streif ’s formwork and tower crane rental operations, including a fleet of more than 500
cranes. Hochtief said it was “considering its options” for these businesses.
Sany Launches New Telescopic Crawler Crane
Sany launched a 100 ton capacity telescopic boom crawler crane, the SCC8100TB, at ConExpo.
It has a 47.5 meter five section, full power boom with a pair of single stage double acting extension
cylinders. To save weight and increase capacity, a synthetic fiber rope is used instead of a wire one inside
the boom on the extension and retraction system. A heavy duty version of the crane with a four section
boom will also be offered. A swing away jib is standard and jibs are available from 10.7 to 18 m long.
Power is from a 224 kW Cummins QSL9-C300 Tier 4 Interim (Tier 4 Final by the end of 2014) diesel
engine driving Rexroth hydraulics. Line pull with the 24 mm hoist rope is 14.3 tons. The width of the
crawler undercarriage can be altered by hydraulically moving the track frames.
The basic machine, in Series 1 configuration, weighs 45 tons, is 16 m long, 3.45 m wide and 3.2 m tall
without crawlers. The crawler track frames are 7.93 m long, 900 mm wide and 1.26 m tall. Each weighs
11.5 tons. As Series 1 it can travel on three trucks. An extra truck is used for the Series 2 configuration
with an extra 20 tons of counterweight.
Volvo CE Plant First Global Construction Facility Powered Entirely By Renewable Energy
Volvo CE announced that its Braås facility is now carbon neutral. The 45,000-square-meter site in
southern Sweden, which specializes in the design and manufacture of articulated haulers, is now powered
entirely by renewable energy sources, including wind, biomass and hydropower, which do not produce
harmful emissions or contribute to the greenhouse effect. This achievement follows in the footsteps of
sister company Volvo Trucks, which recently became the first carbon neutral facility in the automotive
sector.
Braås’ first step towards carbon neutrality began in 1999, when it commissioned local energy supplier
Växjö Energi AB to install a district heating plant, fuelled by wood chips, to provide central heating for its
24
ISSUE 3 2014
employees – and the town’s residents. Braås then joined a Volvo Group initiative in 2007 that saw it switch
to green electricity (i.e., generated from renewable sources).
A Volvo spokesman based at the Braås facility, says, “Volvo CE is an important part of the community in
the region so it is essential that our environmentally-conscious decisions benefit not only our customers
and the world at large, but also our closest neighbors.”
These first two initiatives brought the site’s level of CO2 neutrality to 87% to 2008, with the final push
to reach 100% beginning two years ago. Staff identified the greatest source of energy consumption as the
liquefied petroleum gas (LPG) burners, which were used to heat the rust protection treatment ovens to
60°C. These were systematically replaced from September 2013 with district heating. The burners in the
component paint shop, which reach temperatures of 120° C, were also altered to electrical heating. In
addition, the site’s diesel forklifts were substituted with electric battery models. Meanwhile, locals and the
site’s 1,000 employees put pressure on Växjö Energi AB to run the district heating plant on biomass only.
Regular oil had previously also been used during peak times and maintenance.
Sweden Braces For Fallout of Putin Tactics
According to Swedish Finance Minister Anders Borg, Scandinavia’s biggest economy is bracing itself for
what may become a protracted standoff between Russia and Europe. “If the uncertainty persists in the
global economy for a prolonged period it will hurt a small, open export-dependent economy such as Sweden,”
Global stocks slumped after pro-Russia forces took control of the Crimean peninsula. Markets fluctuated
as investors tried to gauge the intentions of President Vladimir Putin following his retreat from a full-scale
military incursion into Ukraine. Sweden relies on exports for half its economic output, making it more vulnerable than most to any developments that put Europe’s nascent recovery at risk.
Sweden deployed fighter jets to the Baltic island of Gotland, which the country’s air force said followed
heightened activity in the region. Borg said that Sweden now needs to review its investment and trade relationship with Russia and potentially increase defense spending. “The uncertainty we have concerning the
decision making in Russia makes it justified to move in that direction,” he said.
A report showed Sweden’s economic expansion accelerated in the fourth quarter, as both household
spending and exports grew. Gross domestic product rose 1.7 % from the third quarter, compared with a
revised 0.5 % in the previous three-month period, Statistics Sweden said.
Recovery prospects have been brightening as the euro area, Sweden’s biggest export market, emerges from
its record-long recession. The €400 billion economy, home to companies such as Volvo AB and Scania AB,
sends about 70% of exports to Europe.
25
ISSUE 3 2014
How Will Tier IV Emission Regulations Impact
Construction Equipment Sales and Prices?
Your Business Will Be Impacted! Are You Prepared?
• How will equipment users respond to the increased costs involved?
• How will sales of new equipment be impacted?
• How will used equipment sales and prices be impacted?
• How will the US and Canadian equipment rental markets be effected?
• How will the worldwide construction equipment auction markets be impacted?
• Will changes in residual values effect lease and finance rates?
• How will sales outside Tier IV markets be effected?
• Will emission devices be disabled/modified for non-Tier IV markets?
• What is the future for low sulpher fuel in emerging markets?
Manfredi and Associates, publisher of Machinery Outlook Newsletter, will be conducting
extensive surveys of equipment users, distributors, manufacturers, and finance and lease
companies to answer these and other questions and forecast used equipment prices.
For more information on the scope of this important multi-client study, contact:
Frank Manfredi, 847 922-9816
Manfredi & Associates, Inc.
20934 West Lakeview Parkway
Mundelein, IL 60060
26
ISSUE 3 2014
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Mailing address: Manfredi & Associates, Inc.
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machinery
OUTLOOK
Manfredi & Associates
1157 North Indian River Drive,
Cocoa, FL 32922
CALENDAR OF EVENTS
Dates
Name
Description
Venue
Contact Details
2014
JUNE 10-12
Euro Mine Expo
Mining Equipment
Skelleftea, Sweden www.euromineexpo.com
JUNE 24-26
International Rental
Exhibition
Rental Exhibition
Amsterdam, The
Netherlands
www.ireshow.com
JUNE 24-26
APEX
Aerial Platforms/Lifting
Maastricht, the
Netherlands
www.apexshow.com
INTERMAT 2015
Construction Machinery
Paris, France
paris.intermatconstruction.com
2015
ARIL 20-25

europe - Machinery Outlook

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