Construction Machinery Middle East

ISSUE 3 012 JANUARY 2

THE CRATE ExpANSION Constructing the GCC’s

next generation of ports

FAMCO ON FIRE

Becoming a regional player

CRANES AT KHALIFA

Installing at Abu Dhabi’s new port

THE YEAR AHEAD

The shape of things to come PUBLICATION LICENSED BY IMPZ

Plus: ACROss THE INDusTRY

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NEWs & VIEWs

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MARkET ANAlYsIs

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TECHNOlOgY

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AND MORE

Contents

IS S U E 3 2012 JA N U A RY

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Editorial A new year and a new start for the region.

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NEws What’s happening across the region in the world of construction machinery.

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NEws aNalysis The story of how India is becoming one of the most influential and important producers of machinery for the region.

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HEavy HittEr CMME talks to Paul Floyd, managing director, Famco, on a stunning year that saw the distributor become a regional power house.

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MarkEt aNalysis There is a sea change in the way Gulf countries are doing trade with billions being invested into port development.

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30 49 52

futurE tEcHNology Following the release of its new JCB Ecomax T4 4.4 litre engine – the latest generation of the JCB Dieselmax engine – JCB is investing $50 million into its next generation off-highway engines to be ready for 2016.

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tHE big topic What’s in store for 2012? CMME looks at the year ahead for the construction machinery industry.

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spEcial rEport With the government putting the brakes on the economy, Chinese manufacturers are facing one of their first major challenges. Can they export themselves out of danger?

poiNt of viEw What’s up with telehandlers? Simply everything it seems.

CMME looks at a machine type, which thanks to infrastructure construction, whose time has come.

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Andreas Falk at Konecranes gives us an update on the construction of the massive Khalifa Port project.

sEctor focus We look at the demand for mobile cranes.

viEwpoiNt

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NEw products Machines keep on getting bigger and more powerful, CMME rounds up the months newest and greatest machines coming to a distributor near you.

ExaMiNiNg Excavators Everything you need to know about the finding, selecting and buying excavators. We also show you how to swith one on and dig your first trench

58

tHE last word One of America’s richest men could decide the fate of one of the industry’s favourite brands.

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Editor’s Letter

Publisher Dominic De SouSa COO naDeem HooD Managing DireCtOr RicHaRD JuDD eDiToRiaL eDitOr STepHen WHiTe stephen@cpidubai.com +971 4 440 9110 CreatiVe DireCtOr RuTH SHeeHY info@ruthsheehy.com graPhiC Designer GLenn RoXaS glenn@cpidubai.com COntributOrs conRaD eGbeRT, DaVe ReeDeR, KaRen YounG

A Unified ApproAch

aDVeRTiSinG

T

business DeVelOPMent DireCtOr micHaeL STanSFieLD michael@cpidubai.com +971 4 440 9128

he month of December started with one country in the Middle East celebrating its first 40 years of union and another outlying a unified vision for the future of the Gulf and its people.

The Riyadh Declaration championed by Saudi Arabia is stirring stuff. It lays out a blueprint for the Arab states of the Gulf, taking collaboration between the states further than ever before. As you may expect with declarations like this, greater economic integration (it even specifies monetary union is an ultimate goal) should be a priority. This is after all a region intent on securing a sustainable future but there’s much more to the proposal than that.

The indelible effects of the Arab Spring course through it, greater equality for all – men and women – citizens, the speeding up of comprehensive reforms, and co-ordinated bloc-power against threats to region security.

Most meaningful for the construction machinery industry was the commitment to regional development.

As anyone that has followed the progress on the Saudi-Oman highway since the mid-1980s will tell you, the region hasn’t always seen eye-to-eye or road to road when it comes to some cross-boarder construction projects. Even when their success would be mutually beneficial.

I feel those that buy and use construction machinery are almost uniquely positioned to understand how this could work and stand to benefit as much professionally as anyone else.

For example this issue features many companies that are operating across the region and are blazing trails in fresh markets after learning their trade elsewhere and offering something new.

This issue also looks ahead to some of the exciting projects that will encourage easier links and movement between regions and countries. Unlike elsewhere in the world at the beginning of 2012, things in the Middle East change, roads get built, ports become reality and the players from across the industry are coming ever closer.

The good news for the industry as we embark on the next 12 months is there is much to be done.

There is a lot of hard work ahead for us all although I can’t help but think that, in comparison, taking on the reigns of Construction Machinery Middle East (CMME) seems like a drop in the Indian Ocean.

stephen White, Editor, CMME

COMMerCial DireCtOr RaZ iSLam raz@cpidubai.com +971 4 440 9129

ciRcuLaTion Database anD CirCulatiOn Manager RaJeeSH m rajeesh@cpidubai.com +971 4 440 9147 pRoDucTion PrODuCtiOn Manager JameS p THaRian james@cpidubai.com +971 4 440 9146 DiGiTaL www.constructionmachineryme.com Digital serViCes Manager TRiSTan TRoY maaGma Web DeVelOPers JeRuS KinG baTion eRiK bRioneS JeFFeRSon De JoYa Louie aLma online@cpidubai.com +971 4 440 9100 pubLiSHeD bY

1013 centre Road, new castle county, Wilmington, Delaware, uSa branch office po box 13700 Dubai, uae Tel: +971 4 440 9100 Fax: +971 4 447 2409 pRinTeD bY printwell printing press LLc © copyright 2011 cpi all rights reserved While the publishers have made every effort to ensure the accuracy of all information in this magazine, they will not be held responsible for any errors therein.

Construction Machinery Middle east is brought to you by the team behind the Kingdom of saudi arabia’s largest construction machinery event, the Construction Machinery show. the next show takes place in Jeddah, 22-25 april 2012.

www.constructionmachineryshow. com

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News Round-Up

NEWS New machines, new offices, new projects, new initiatives - we look around the region at what’s new this month.

Khalifa port ComiNg

Konecranes has revealed that it has already installed 12 of the 30 cranes at Khalifa port, with full delivery scheduled to be completed by June this year. it was also announced this month that tratos is supplying 36 crane cable lengths for use on the port’s aSCs. Khalifa port is being built in five phases and it will take over from mina Zayed port this year.

not enough cranes in libya Libya cannot begin the difficult task of rebuilding because there are not enough cranes. The country is looking to foreign investment and oil production to fund its recovery but according to a senior banker that can’t happen until vital infrastruture is installed in the civil war ravaged country.

“There aren’t even enough cranes to start anything near the level of construction needed,” said Alaa El Huni, an investment banker. “On every level, from ability to construct, labour, the capacity of the ports, to the amount of machinery, we are not able to absorb the amount of investment we’d like to.”

IHE bringing Liebherr to Oman International Heavy Equipment (IHE) is to start selling Liebherr-Werk Ehingen cranes in Oman.

The Zubai Automotive Group-owned company is the existing partner for Liebherr’s concrete mixing products and will look to capitalise on Liebherr’s all-terrain crane’s growing reputation in the Middle East in the areas of oil and gas, crane rental and infrastructure building.

The Liebherr Mobile cranes range from 30 to 3000 tons in size and both the wheel and crawler systems variants will be available in Oman.

“This new agreement to market cranes extends our existing relationship where we have represented for many years Liebherr Cement Technology products in Omanm,” said Ram Mohan, general manager of IHE. “IHE is delighted with this exciting new arrangement with an international giant like the Liebherr Mobile Crane division and we are looking

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forward to working closely with them to provide outstanding customer service and after sales support for their cranes in Oman.”

Liebherr Middle East’s director of sales and service Holger Amann explained that IHE will be serviced by the German crane giant’s UAE operation.

“Our new partnership means that customers in Oman will now be able to

buy the new and used cranes and spare parts from stock held locally in Oman by IHE or from our regional base in Jebel Ali,” said Amann.

Qatar touted as new tractor market Qatar could emerge as a major new destination for tractors by companies such as John Deere after Qatar’s Crown Prince Sheikh Tamim bin Hamad bin Khalifa al-Thani issued a decree this year to organize the Qatar National Food Security Programme (QNFSP), tackling “one of the most pressing challenges that Qatar is facing.”

“Today, there are 1,400 farms in Qatar and they will increase to 3,000 farms with the new plan,” Fahad Bin Mohammed al-Attiya, the QNFSP’s chairman, told US Newspaper the Chiacgo Tribune. “We

anticipate that domestic food production, if new technologies are applied and the efficiency system enforced, can easily reach 60% of our market needs. We anticipate that domestic demand can be met by 60% to 70%.”

Meanwhile Frost and Sullivan believes Qatar along with Saudi Arabia will consume 50% of the GCC region’s building materials over the next decade. The analyst warned that the availability of skilled labour and construction equipment could hold back the speed of development.

$3.5m crane sale from Nakheel Some of Dubai’s ‘lost cranes’ will be back in the market this month as developer Nakheel looks to sell 13 cranes in Dubai. The developer which has just completed a restructuring of its $16 billion debt is best known for its work on the Palm Jumeirah project had originally intended the cranes to work on the abandonded Dubai Waterfront development.

In an advertisement posted in local newspapers Nakheel said each crane is worth approximately $270,000. It also added that none of the cranes are currently operational but are “new and unused”.

While buyers may be getting high quality low hour cranes many will not be entirely untouched.

According to Nakheel some of the cranes are partially erected although most remain stacked in unopened boxes as develivered by the manufacturer.

Sounds like potentially the cranes could be quite a steal for buyers and Nakheel can also start whittling down its debt – just another $15.98 billion to go.

China exCavator market slows Hitachi Construction Machinery’s CEO has revealed that the sales of excavators in China has slowed-down dramatically since the government introduced measures to control its overheating economy.

Michijiro Kikawa said that the company was expecting to see excavator sales fall by 30 percent in the year to March 31.

The figure demonstrates the fall in activity in mainland China and the effects of the European debt crisis that has managed to slow the previously robust

copco buys into china swedish power generator player atlas Copco has acquired certain assets of Chinese company Guangzhou linghein Compressor Co ltd to help drive its expansion in the country.

Chinese economy. In October last year the decrease was forecast at 20%.

Kikawa added that he believed that the market will not recover until March, he added that China will probably see no growth until June or July.

The sales downturn in China, the world’s biggest market for construction equipment, “will continue after the Lunar New Year” next month, Kikawa said in an interview at the company’s headquarters in Tokyo. “I had expected Chinese demand to come back sooner.”

linghein, founded in 2001, is located in Guangzhou in southeast China and has a strong regional presence with its industrial air compressors. it primarily produces small and medium-sized oil-injected rotary screw compressors. the acquired business will become part of atlas Copco Compressor technique’s industrial air division. linghein will continue to operate under its own brand, in line with atlas Copco strategy.

Hitachi Construction Machinery is Japan’s secondlargest heavy-equipment maker behind Komatsu and like its counterpart its overseas sales are being held back by the continuing strength of the yen.

Kikawa said that Hitachi is increasing the sourcing of components from outside Japan to keep control of its costs.

It is also looking to improve its overseas sales presence in the energy sector as well as concentrating on the post-quake rebuilding of Japan for orders as Chinese demand slows.

aD makes fitCh list

Abu Dhabi’s commitment to investing in its infrastructure will help make it one of the three best construction markets, according to Fitch Ratings. Bashar Al

Natoor, Fitch’s EMEA team director, said that Abu Dhabi, Saudi Arabia and Qatar have jumped ahead of Dubai but margins are tight for contractors.

“Infrastructure spending continues to be strong but with lower margins,” said Al Natoor.

“With increasing competition, Fitch expects this to remain the case over the next few years.”

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77

News Round-Up

“The The HM400-3 features a GVW of 73,740kg, hauling up to a 40mt payload at a max speed of 55.9 km/h.

Al dArwisH’s doHA dynApAc rusH Qatar’s Al Darwish Engineering WWL has invested in three new Dynapac compaction units to complete a contract for the laying and upgrading of roads in the Al Waab district of Doha, an area that is seeing extensive building of luxurious new residencies.

The contractor is carrying out the work for Ashgal, Qatar’s public works authority, under a US$37 million contract that was awarded in March 2010 and which is scheduled for completion in the first half of 2012.

The latest order comprises a Dynapac CC624HF double-drum vibratory compaction roller and two pneumatic-tyred rollers; all delivered at the beginning of the year by Dynapac’s local distributor, Oriental Trading Co, a division of the Petroserv Group.

The compaction machines join Al Darwish Engineering’s existing fleet of Dynapac rollers and compactors.

“Our entire road-surfacing fleet is Dynapac” says R S Boyle, Plant Manager for Al Darwish Engineering. “Using just one manufacturer helps us with planning and meeting the specifications, we have consistency in our maintenance operation, and we know that reliability in

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equipment and backup is part of the Dynapac brand.”

“At Al Waab, which is a very upmarket residential area that is growing quickly, our work has to be of the highest standard, because we are putting in infrastructure that has to serve long-term what will become an even more busy area than it now is.”

The work is being carried out in three packages and includes new and upgraded roads, junctions, peripheral roads, service roads and footpaths.

“We are compacting and rolling the road surface to a specification of 98%, ” says Mr Boyle. “The CC624 compacts the surface quickly, with a maximum of six passes, and the pneumatic-tyred roller completes the surface with, again, a maximum of six passes.”

“We are finding that working within the confines of small roads with tight turnings is not a problem, as the manoeuvrability of the rollers is backed up by our small Dynapac double-drum units that are designed for working close to the curb and in other restricted spots.”

“As we are working in small areas at a time, rather than on extensive stretches of road, Dynapac gives us enormous flexibility”, he adds.

the new hummer?

Renault is launching the civilian version of its military-grade Sherpa.

The first available version named Scout, has a big interior but a weakish engine of 215hp.

First for the industry Komatsu America has produced what could be its first world class articulated truck. With a net horsepower of 469 hp (350 kW), the HM400-3 is powered by a Komatsu SAA6D140E-6 engine and has been qualified to be EPA Tier 4 Interim and EU Stage 3B emissions certified.

Komatsu leveraged its leadership in technology and innovation —building on the proven Tier 3 engine platform — to design an environmentally friendly engine that increases power while decreasing fuel consumption.

cAT’S nEw P-LAYERS Cat has launched two new pipelayers the PL83 and PL87.

The new models retain the solid basic design of predecessors, but have increased lift capacity and slope capability.

Every Komatsu Tier 4 Interim construction machine comes standard with Komatsu CARE complimentary factory scheduled maintenance for 2,000 hours or the first three years, and includes two complimentary KDPF exchanges within the first 5 years. The HM400-3 features improved operating performance, lower fuel consumption, improved operator comfort.

The HM400-3 is equipped with KOMTRAX tech, which sends operating data to a secure website. wireless technology.

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News Round-Up Only ESMA-accredited inspectors will be able to work on Abu Dhabi’s projects.

cranes need to smarten up or pay up in uae

Crane inspectors in Abu Dhabi have been told the companies that do not comply with safety regulations will face heavy penalties. During the “Accreditation of Crane Inspection Bodies in Abu Dhabi” a senior representative for the capital’s municipality’s crane watchdog the Department Of Accreditation of Emirates Standardisation and Metrology Authority (ESMA) said the only accredited companies will be allowed to operate.

“The accreditation of inspection bodies is in line with the municipality of Abu Dhabi’s request to control the quality of products

The accredidation programme is intended to help raise safety standards in the UAE’s capital.

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and services offered by companies involved in the inspection of cranes,” said Eng Mohammed Saleh Badri, ESMA Acting Director General. “The accreditation aims to ensure that crane inspection bodies comply with international standards and specifications, and this in return contributes to promoting health and environmental safety and protection, as well as consumer protection, which is the main objective of the authority.”

According to ESMA, the symposium was attended by major players and consulting firms in the field of crane inspection as well as key government officials in the local and federal levels. The seminar aimed to make all cranes’ inspection bodies aware and familiar with ESMA’s accreditation requirements, compliance of which is a prerequisite to legitimately practising their businesses in Abu Dhabi.

Badri added: “It is our objective to make sure that only ESMA-accredited crane inspection entities are able to operate in the UAE.By ensuring high quality in the services offered in the UAE, we will be able to boost residents and investors’ trust and confidence in the country as a whole.”

Nasser Al Zaabi, head of inspection, explained the role of the municipality in the accreditation process and detailed the requirements that cranes inspection bodies need to comply. Ralph Nader of the International Insurance Brokers gave a lecture on the Principles of Professional Liability Insurance (PLI), which is one of the international standards for accrediting inspection bodies. PLI, one of the basic mechanisms for consumer protection, is a form of liability insurance that helps protect professional-providing individuals and companies from bearing the full cost of defending against a negligence claim made by a client, and damages awarded in such a civil lawsuit.

RTA’s new heavy rules The Dubai Roads and Transport Authority (RTA) has announced new initiatives in online and vehicle defect clearing services to further streamline their offerings for commercial and heavy vehicle operators.

The initiatives include new online payment methods with credit and debit cards for vehicle fleet licensing and registration to improve transaction and payment information.

The RTA also outlined the new Vehicle Defect Clearing Service (VDCS) Project - a three to four year implementation roadmap due to begin in 2012 aimed at

improving the safety of heavy vehicles on Dubai’s roads.

RTA Licensing Agency CEO Ahmed Bahrozyan, and Abdulla Al Mahra, Director of the RTA explained that: “The expansion of our online services makes doing business with the RTA easy.” Bahrozyan, who was speaking at the CVME Business Group managed by Streamline Marketing Group, added that up to 100 vehicle registrations can be completed online in a single transaction. “The VDCS project will focus on improved heavy vehicle safety to reduce road crashes and improve business efficiencies.”

MAN opeNs jordAN house man’s year of progress in the region is continuing apace with the announcement that its truck and bus distributor in Jordan, integrated automotive, has started construction on a new service and parts centre. man House will comprise a 10,000m2 service centre and a 600m2 parts centre. “our mission is to offer our customers the highest standards of after sales services as well as the commitment to providing them with the state of the art know how when it comes to

commercial business under the famous slogan of consistently efficient,” said Bilal al ribi, general manager of man Jordan.

He added, “our new centre will be inaugurated in the first quarter of 2012 and will have a brand new workshop capable of serving up to 10 trucks at one time while managing all the service process by the latest fully electronic dms system.” man has been aggressively pursuing new business across the region since it launched the tGs-WW last year.

XCMG bonds up for sale XCMG the world’s largest supplier of cranes has been given permission by the Chinese government to raise $800 million from a bond sale. The approval is likely to have been given following the company’s previous attempt to raise $1.1 billion in a share sale on the Hong Kong stock exchange in September 2011 was postponed in the wake of the financial debt crisis in Europe. Unlike Sany, which is also looking to raise money by selling shares to international investors, XCMG is largely state-owned and the company has stated previously that it needs cash to invest into its machinery development programme.

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BRANCHES Riyadh Tel: + 966 1 231 1931 / Fax: + 966 1 231 1031 Jeddah Tel: + 966 2 659 8500 / Fax: +966 2 659 8600 Jubail Tel / Fax: +966 3 363 4050

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News Round-Up

Landmark deaLs for mannai Hed Mannai Heavy Equipment Division (Mannai HED) has added equipment from globally acclaimed Sany Concrete Machinery to its portfolio.

With a universal market presence, the Sany Group plans to strengthen its presence in Qatar with its association with the Mannai HED. The Mannai HED will promote Sany products and support services for concrete machinery in the country. The agreement of exclusive dealership was signed with Sany Heavy Industry Co Ltd concrete machinery division during an event held recently at the Dubai Exhibition Centre. Signatories on the occasion were General Manager, Mannai Automotive Group Mohamed Helmy and Director Sales & Marketing of Sany GmbH Volker Wehner.

ME bidders join new Cat e-auction

cut

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The scope of representation covers Sany’s truck mounted concrete pumps, stationary concrete pumps, concrete batching plants, separate placing booms and truck mixers. Each of these products has many variants to be offered to suit specific operational needs of project sites.

General Manager of Mannai After Sales Luici Rubinacci said “Mannai HED is ready with the required resources to supply and support Sany products to its niche, Readymix market. Sany chose Mannai HED because of our strong presence and better understanding of the Qatari market. We are sure that this partnership will play a crucial role in the development of Qatar and its ambitious plans to provide first class infrastructure facilities”.

Middle East bidders joined in the action at Caterpillar’s first ever online auction.

Cat Auction Services said that the inaugural eQuipment Yard auction timed auction, exceeded its projected sales revenue by almost 10%. The auction also generated more than 32,000 catalog views and sold 98% of the 133 lots available, landing 4,200 pre-bids in the days leading up to the event.

Lots were sold to bidders from more than 10 countries, with lots going to Canada, Mexico,

Sany has invested heavily in research and development to ensure that it has provided advanced technology and customer-oriented products that make it a pioneer of the industry. It was due to its well respected reputation and existing technology and a product being among the world’s best, that Mannai HED wanted to make it a leading addition to its product offering.

Rubinacci said, “concrete machinery is by nature special; they have a long product life, are cost intensive and require demanding uptime in the project sites. Sany machines have established their technological prowess in the world. Their investment in Germany towards research and development and production is impressive and a significant testimony in their keenness to offer products that deliver superior performance at desirable prices.”

In a busy month for the company Mannai has also become the exclusive dealer in Qatar for Sinotruk, the leading brand of Chinese heavy duty trucks.

Mannai recently signed the dealership agreement with Sinotruk and placed initial orders.

The range of trucks includes tractor heads, tippers, tankers, mixers, and even special applications such as Defence vehicles.

Rubinacci said the arrival of Sinotruk in Qatar, at a time when the construction industry is booming, is an important milestone.

“While quality is never compromised, performance to price is the main aspect every contractor is looking at in order to stay competitive in the market. Sinotruk is right on the mark – it offers quality at attractive prices.”

Sinotruk have engaged in a series of joint ventures with some of the top truck manufacturers in the world such as Steyr (1983), Volvo (2003) and currently MAN (2009). Fred Pan, chief representative of Sinotruk, recalled that two top Mannai HED executives visited the Sinotruk plant in China where they were impressed with the quality and after sales support.

Sinotruk is already being used by certain corporates in Qatar. Mannai is keen to offer a comprehensive maintenance service to clients.

the United Arab Emirates, Saudi Arabia and Venezuela, among others. Domestically, lots went to buyers in nearly 40 states, with significant numbers going to Texas, California, Colorado, Pennsylvania, Wisconsin and Minnesota.

“We’re extremely pleased with the results of our first eQuipment Yard auction. The sales total significantly exceeded our projections, and the impressive participant traffic on our website shows that bidders value our TA-1 inspection reports, the

equipment videos and other in-depth information we have available,” said Cat Auction Services President Rick Albin.

“It’s further evidence that our buyer-be-informed approach is resonating with our customers.”

Cat Auction Services developed its eQuipment Yard timed auction platform to complement its live auction format and extend the company’s goal of providing consignors and buyers alike with the most powerful and complete suite of auction tools in the industry.

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News Analysis

IndIa Is ready to serve you

While many eyes in the Middle East were fixated on Big5 at the end of the year, perhaps the most important stories for the future of machinery supply in the region were coming not from Dubai but across the water in Delhi.

I

n a hectic few weeks, a whole host of companies announced plans for expansion, largely tied to enlarging their manufacturing footprints across the Indian subcontinent.

Doubtless attracted by the booming economy – even the most conservative forecast growth estimates say 10%-plus next year – and government pledges to continue infrastructure investment, manufacturers have rushed to pour money into the country. Indeed when it comes to attracting construction machinery dollars, India was the success story of 2011, arguably taking over from China.

While India has continued to boom from a manufacturing standpoint, China has found the going tougher this year with the domestic scene crowded and production costs rising. There is a growing frustration among international and Chinese manufacturers that the market is becoming more and more difficult despite its enormous size.

Naturally they have focused on other markets and countries like South America and India where the potential has not yet been exhausted.

Watching India at the end of 2011 was a lot like watching China five or ten years ago especially in the manner at which manufacturers were burying themselves into a mass land-grab; getting what partnerships they could, trying to secure market share in its relatively fresh territory.

Caterpillar has already sunk $1 billion into the country and announced in November that it will spend $210 million more to open the first overseas plant for Perkins and expand its off-highway truck plant in Chennai.

Rich Lavin, group president of Cat said the engine plant would have an initial capacity of 3,000 units per year before being scaled up to 5,000 units.

Most importantly for Middle East customers Caterpillar is hoping to export half the number produced at the proposed plant to serve the needs

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of countries in and around the region. Strangely as Lavin made the announcement he revealed that the company has not yet got a location for the plant, leading some cynical observers complaining that Cat is trying to start a tax break bidding war among India local authorities.

While others argue that Cat has been forced to bring the news into the public domain to boost its ailing engine business - the one blot on an otherwise stellar 2011 (especially the first six months) for the Peoria–based, giant.

Whatever the case may be, being in India is a sign to shareholders and competitors that your company is on the move.

Swedish manufacturer Volvo has done very well by producing excavators for the market and Vincent Tan, president of Volvo CE, Asia Region, said in November that it is tripling excavator production at its Bangalore plant in 2012 to meet demand.

He also announced that it is considering launching its own range of backhoe loaders into India. Clearly answering off the cuff by local journalists he confusingly told them: “Presently, Volvo does not have backhoe loader in its portfolio for India.

This is one product that is missing in our basket. However, we are presently studying the Indian market for launching this product. We have no definite timeframe to bring it here and will take a decision at an appropriate time.”

One company that has been more definite about the backhoe segment is Ashok Leyland John Deere Construction Equipment Company, the joint venture between Ashok Leyland and John Deere. November saw it finally launch its much anticipated 435 Backhoe , three years after the JV first announced it. The construction equipment market is growing between 20-25% if you look at

News Analysis

Komatsu in Kolkata?

Japanese manufacturers have endured a torrid 12 months with the Yen refusing to fall, the tsunami disaster and most recently the flooding in Thailand disrupting their production in the country. They are relative late-comers to the Indian market, but the Japan External Trade Organisation (JETRO), a government-related organisation that works to promote mutual trade and investment between Japan and rest of the world, is upbeat on their prospects in the country.

JETRO travelled with 13 construction equipment manufacturers from Japan to Excon 2011, the construction equipment event held in Bangalore last month. Director general Masaki Ida explained that most were looking for Indian partners.

“Japanese companies are well-known for their technology and we have 13 companies from Japan participating for the first time at Excon. At least three of them are actively looking at opportunities to enter into joint ventures with Indian CE makers and make use of the growing potential for equipment sales here in India,” said Ida. Emphasising that a “huge demand for Japanese construction equipment” exists in the Indian market, he said that most opportunities are in coal and iron ore mining, road construction and largescale infrastructure projects.

He added: “We invited 36 Indian companies including Ashok Leyland John Deere, L&T, Escorts Construction and JCB among others to discuss the possibility of forming JV in India.”

“JCB gAMBLED THAT INDIA WOuLD fOrgE AHEAD

WITH ITS INfrASTruCTurE AND fOr THE MOMENT IT IS LOOkINg LIkE A CLEVEr MOVE. IT HAS COME A LONg WAy SINCE DECIDINg TO EXPAND ITS INDIA fOOTPrINT THrEE yEArS AgO.” the aggregate of the last few years, says company chairman V Sumantran.

He adds: “While John Deere brings in their advanced technical knowhow and vast experience in global construction equipment space, Ashok Leyland would lend its in-depth knowledge of the Indian market, proven expertise in manufacturing, sourcing and distribution.”

Sumantran added that the JV is looking to produce at least two more products, including a wheel loader which will be launched in 2013.

Almost one in two backhoes in India are sold by JCB India and the company dominates the market.

Last month it revealed a range of new machines, including wheeled loaders, backhoes and excavators at EXCON 2011, one of India’s biggest construction machinery shows.

Already owning 50% of the construction equipment market in India and the JCB is expecting to have experienced growth of 45% in the country by the end of 2011. While it’s a sign of the healthy potential of the market, CEO Vipin Sondhi warned however that he expects that growth will slow.

“The rate of growth... we expect to slow down,” Sondhi told reporters prior to the opening of EXCON. “I would estimate 15%-plus (growth in the current fiscal)”.

JCB gambled that India would forge ahead with its infrastructure and for the moment it is looking like a clever move. It has come a long way since deciding to expand its India footprint three years ago. Sondhi noted that infrastructure has become a dominant theme across political parties and there are already signs that the “government is getting back to clearing large projects,” which he termed a positive trend.

In many ways JCB’s network of on-the-ground sales, servicing, supply chain management and production is the blueprint that other companies are desperate to emulate. India is also geographically and logistically an easier place to export from than China, and Sondhi stressed that it is already considering turning JCB India into a hub for serving other markets including the Middle East.

“We have already started exporting machines from Pune,” he explained.

IndIa’s lInks to the Uae Last year’s UAE-India trade volume topped $67 billion.

India-Dubai trade accounted for almost 80%. When it comes to foreign direct investments, India is the third largest investor

in the UAE and the UAE is the 10th largest investor in India.

Bilateral trade between India and the UAE has grown by 300 per cent in the last five years with the UAE emerging as India’s top

trading partner, representing 60 per cent of India’s exports to GCC countries in 2009-2010.

India-UAE trade is expected to touch $103.6 billion by 2025, according to HSBC.

September 2011 January 2012

CONSTRUCTION CONSTRUCTION MIDDLE EAST MIDDLE EAST

15 15

Heavy Hitter

Construction Machinery Middle East meets up with Paul Floyd to discuss an impressive year at Famco

Silver Service B

y any definition, it’s been quite a year at Famco, the heavy equipment dealer arm of Al-Futtaim Group. It’s gone from being a name in the UAE market to becoming (the process is ongoing) one of the region’s most important construction equipment suppliers.

That’s not to say the previous 12 months were not impressive but in hindsight 2010 was a relatively modest year for the company as it built up its rental business and consolidated its presence in the UAE market as the exclusive dealer for a number of big name, small niche companies such as Yanmar, the Japan-based power generator company and Linde, the German materials handling equipment provider.

Meanwhile, its relationship with Volvo Construction Equipment, the more profitable progeny of the break up of the Volvo group, gave it extra clout, even providing it with the opportunity to introduce arguably the year’s best new truck for the region in the FMX and twin pipelayers the PL4608 and PL6411. It also led to one of the most exciting acquisitions by a local distributor since the downturn in Saudi Arabia. Famco starts 2012 as it ended 2011, on a high.

Cracking the Saudi Arabian market has become a priority for the construction industry in the region. And so it is for Famco. As 2011 was closing it announced that it had acquired Al-Rehab

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Equipment, a distributor that comes with five branches across The Kingdom and the capability to push Volvo from Dammam to Jeddah.

Famco wants to flex its muscles in The Kingdom taking what it has learned elsewhere about providing joined up sales and service to new customers and Paul Floyd, managing director at Famco, says his company thinks that it is offers something new to a market that has stagnated.

“We’re going in with the five branch network that we acquired,” he explains. “We intend to increase that to an 11 branch network over the next three years. And that network expansion is linked directly with our overall objective to double our market share in that three-year period.

“We’ve acquired three really nice pieces of real estate in the three main areas of Jeddah, Riyadh and Dammam,” he continues. “We’re planning immediately for expansion and improvements to those locations, but in some of the others we can offer a first-class service from much smaller centres – we will still have the systems and processes in place that allow us to provide technical assistance and parts. We will have the right people with the right competence in place.”

While Floyd is reluctant to enter into the specifics of the company’s growth strategy – understandable in the early stages of establishing

its foothold in the Kingdom – he is willing to outlay Famco’s main objective.

“Our goal is to be a very clear number two in market share but at the same time number one in customer satisfaction. Everyone knows who the market leader is [Caterpillar] there’s no denying that. We know if we can replicate a lot of what we do here, and get a strong network, with the right parts and service organisation, we can be very successful.”

Upper most in his mind is the challenge of providing the level of fluid customer service Famco has nurtured in the UAE into the large expanse of the Kingdom.

Although he says, time served in Saudi, including 11 years working on ‘the other side of the fence’, has taught him that the company must concentrate its efforts in Riyadh to win business.

“Regardless of where the construction is taking place a lot of decisions are still being made in Riyadh – so that’s an importance place in terms of presence,” he says. “From our point of view, the geography of Saudi is such that if you are going to do it properly you need to take it into account and make sure your network is in place. The day when someone has a project going on in the empty quarter and you are 300km away from there you have a problem.”

Companies that are entering the Saudi market are being encouraged to take on local workers as part of the wider Saudisation job creation programme.

Floyd talks a lot about talent and he clearly views staff development as an integral element to the company’s regional aspirations.

The company Famco has acquired in Saudi is already a ‘green status’ company with the concerned Saudi Ministry and he says his team are determined “to keep it that way and invest more in local talent”.

“I think people are seeing that as we become more of a regional player, that Famco can be, from a career point of view, be quite attractive for people,” he says. “Even in Saudi Arabia, if you talk to companies in the Kingdom they tell you they have difficulties in attracting the right people. If you come and work for Famco you can come and work for a couple of years in the Kingdom, and after a few years you can move on but not leave the company. We think regionally we can build a strong talent pool.”

As part of the wider Al-Futtaim picture, Famco is building an academy for training and development of people, he says.

“We already do it, but we’re going to take it to another level. Localisation is a big part of our plan, especially in Saudi Arabia, we realise it is very important in all the Gulf Arab countries. We intend to recruit and develop local nationals and have them working in the local business.”

He says that viewing staff development in this will have very practical benefits in Saudi, especially in remote areas where the challenge to workers is as much mental as it is physical.

“A remote project down in the empty quarter is possibly a place someone would not want to be on a long-term basis. But if we can place them down there for six months we can rotate teams and let those people have a break from that harsh environment. We’ll get the consistency we want.

“FROM OUR pOInT OF vIEW, THE GEOGRApHy OF SAUdI IS

SUCH THAT IF yOU ARE GOInG TO dO IT pROpERLy yOU nEEd TO TAKE InTO ACCOUnT THE GEOGRApHy And MAKE SURE yOUR nETWORK IS In pLACE. THE dAy WHEn SOMEOnE HAS A pROJECT GOInG On In THE EMpTy qUARTER And yOU ARE 300KM AWAy FROM THAT yOU HAvE A pROBLEM.”

Volvo recognises FAMCO for silver service Famco, Volvo’s heavy machinery and construction equipment partner in the UAE and now Saudi Arabia was recognised with the Swedish company’s prestigious Volvo Silver Partnership Certificate in 2011. Volvo has yet to award any of its dealers across the world with a gold certificate and relatively few with the silver award.

Famco also won the ‘Material Handling Provider of the Year – 2011’ award at the Supply Chain and Transport Awards ceremony in Dubai.

According to Paul Floyd winning the Silver Partnership award followed a detailed analysis and stringent verification of systems, operational processes and quality standards.

“This is indeed a great honour for Famco and our Volvo Construction Equipment division.

Achievement of this certification is a clear statement that Famco has been judged to have not only developed rigorous operational and customer centric management systems, but also to have implemented these systems effectively across all Famco operations in

the UAE,” says Famco’s managing director.

He adds: “This is a testament to the hard work and dedication of all our employees who embrace Volvo’s superior global standards of operation, together with Volvo’s core values of Quality, Safety and Environmental Care. I thank Volvo Construction Equipment for recognising our capability and performance levels.“ Not one to rest on his laurels Floyd has outlined the next step for Famco.

“Our ambition now is to be Gold certified – an achievement that no Volvo distributor has yet reached.”

Volvo commended Famco for its excellence in general management and operational planning, staff training and sales and

marketing activities which contributed to the silver level certification.

“We at Volvo have high expectations and that’s why Volvo Construction Equipment is pleased to honour Famco with the Silver Certification in our Partnership Monitor programme,” said Lars Haglund, President of Volvo Construction Equipment – International. “Gaining this certificate is far from easy – and very few dealers have reached this advanced level. This status reiterates Famco’s consistency in surpassing the benchmark set by Volvo and we are extremely proud to have them as our UAE dealers.

“We wish them every success in graduating to the next level – the gold certification, yet to be achieved by a partner.”

January 2012

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Heavy Hitter

$400 billion According to Khaled Al-Aboodi, the chief executive officer of Islamic Corporation for the Development of the Private Sector, Saudi Arabia is leading the GCC in terms of infrastructure and real estate projects worth $400 billion over the next five years.

“OUr GOAL IS TO BE A VErY CLEAr nUMBEr TWO In

MArkET SHArE BUT AT THE SAME TIME nUMBEr OnE In CUSTOMEr SATISFACTIOn. WE knOW IF WE CAn rEpLICATE A LOT OF WHAT WE dO HErE, And GET A STrOnG nETWOrk, WITH THE rIGHT pArTS And SErVICE OrGAnISATIOn, WE CAn BE VErY SUCCESSFUL.” We are working a lot on employee engagement as you can’t just take people for granted. If people are expected to live in a harsher environment, they can’t be expected to be placed there and forgotten.

“This is something we have got to tune into and a look at with a more high level approach. These are all career development opportunities; there may be a workshop management job somewhere and if someone has been able to do a year in a harsh environment and make a name for themselves then they can move on to a role in a new location.”

As with Volvo, Famco is using its OEM deals as leverage for expanding its presence in some of the Gulf’s most exciting markets. Yanmar Marine has allowed it to enter the specialist marine market while Linde has proven to be particularly useful in ramping up its efforts in both Oman and Qatar.

“In the smaller markets it is more difficult for a dealer to make the required investment. They (Yanmar) saw the economies of scale that we have, and the ability to hold stock and to support with parts and service. It made sense for us to take it on.”

He continues: “Linde on the materials handling side has been doing well for us too. We were appointed the dealer for Oman, a market we know a lot about, and Qatar two years ago, in addition to the UAE, and on the back of that we have established Famco Oman and Famco Qatar as part of our wider regional expansion plan.”

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According to Floyd it is imperative even in a region with strong links like the Gulf to create a substantial physical presence in your target markets. Without it: “You can play but you’re never really going to succeed.”

He adds: “There’s an obvious cultural affinity with any gulf country but I think the big attraction for us is that although the products are already represented in those markets, I think the standards we have in FAMCO are possibly better than what you see in a lot of those markets.

“I’m not saying a lot of those dealers are bad, but I think on a general level if you look at the service levels in places like Oman, Qatar, and now Saudi Arabia – we think we can add a lot of value for fleet operators in those markets if we can replicate the standards we have achieved in the emirates.”

Floyd says that when it comes to new products and markets he prefers to take a long term view. If required the company is prepared to wait.

“We go in and establish a scale that we think is right for the products we are going to offer. We study the market so we know the competitors; we see the opportunities that we will focus on. We will build gradually but, again, I think there is room in Qatar and Oman [both set-ups are start ups and 2012 will be their first full trading year] for a company like Famco to put quality products in the market with top quality support.

“We have, over the last two to three years been looking strategically at various markets. You can’t just walk into a market without a plan of action.

That means the right partner with quality products.”

Floyd says that being an established name means Famco gets offered a lot of brands, most of which it turns down.

“We want to have premium brands but we need to know that they can work with us and partner with us. We create a joint business plan and go in with the goal to raise the standards in the market. But

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heavy hitter

it’s not every day that the right mix of ingredients come along.”

In the case of volvo and saudi Arabia he says that Famco made the plunge after encouragement from volvo Ce – who was already using Al-rehab: “It was a win-win and we’re delighted with the outcome.”

From the outside FAMCO appears to be an anomaly, it’s a uAe company that is actually doing rather well in a flat market. Floyd says that much of its momentum has come from its emphasis on service. “we’ve had a really good year. not only is revenue up but profitability is up too. the one thing we never lost sight of during the downturn was the concept of operating at the right standard and continuing to maximise the satisfaction level of the customer. you can never take the eye of the customer. you have to keep pushing in that direction.”

Floyd is keen to stress that Famco that any scars it may bear from the downturn have been turned into positives: “we got out of the downturn mode quickly – we wanted to deal with it efficiently then move on and take stock of the things we do well.

4,200km The Kingdom’s latest budget includes 4,200km of new roads and the expansion of King Khaled International Airport, the new King Abdullah Airport in Jazan, and the expansion of four regional airports.

FAMCO goes for world title

Four Famco employees beat teams from Algerian and Lebanon to win the right to compete in Volvo’s VISTA (Volvo International Service Technical Association) competition held in Gothenburg, Sweden last year.

The VISTA 2011 competition started in September 2010 with a record 13,704 participants from 75 countries. VISTA is open to all aftermarket employees within the Volvo Trucks and Buses global service network and is currently the largest competition for aftersales personnel in the world.

The Famco team comprised the fast minds and hands of Divakara Kuplottu, Thukaram Sapalya, Mohammad Shafi and Narayan Prabhu competed against 12 teams from MENA in their regional semifinal.

They went on to compete against 30 teams in Gothenburg for the right to call themselves Volvo’s best service, technical and aftersales team in the world.

All teams that qualified for the semi-finals were tested on questions supplied by the VISTA development team consisting of practical exercises and theoretical questions.

Frank O’Connor, general manager – Truck & Bus Division at the exclusive distributor for Volvo Trucks and Buses and Volvo Construction Equipment in the UAE, said the company was proud of the team’s achievement. ”We are extremely proud of our team. The aim of the competition is to develop and improve employees knowledge and skills and improve Volvo Trucks and Buses aftersales customer service,” he said.

“I’M nOt sAyIng A lOt OF thOse deAlers Are bAd, but

I thInk On A generAl level IF yOu lOOk At the servICe levels In plACes lIke OMAn, QAtAr, And nOw suAdI ArAbIA. we thInk we CAn Add A lOt OF vAlue FOr Fleet OperAtOrs In thOse MArkets.”

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now to be successful in the post-downturn market, businesses need to re-invent themselves to some extent and take a fresh look at the marketplace. It is a very different place to what was in 2007or 2008, and you have to do things differently.”

A personal highlight was the winning of the hard to obtain silver certificate for service from volvo.

Floyd puts this achievement in perspective: “there’s only two other companies in the international arena that have it” adding that winning the certificate took months of time and effort, including allowing volvo to audit every facet of the company.

“It is always satisfying to get recognised like this. there are kpIs and good practices we should be following and not all distributors are. A lot of the complicated things in the business are the ones that have the real value, in other words moving the metal is less complicated than what comes afterwards. If you can get that right in terms of product support, parts distribution, technicians and network, you can maximise service and really add value. that’s our philosophy.”

As he views products and markets, he sees a successful business as mixture of some key ingredients to succeed: “you need the right talent in your organisation with the right amount of experience and you have to be able to plan and monitor your way forward. you need to have a vision of what you want the businesses to look like. then you go can ahead in that manner.”

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Market Analysis

Port of call

The flow of goods in and out of the region increased once again last year and shows few signs of declining.

T

he Middle East has been a trading hub for hundreds of years, connecting the sea routes to Asia and Europe. The region is currently undergoing a massive overhaul of its port hubs and trade infrastructure.

Billions are being poured into projects across the region adding millions of TEUs to the capacities of the region’s ports.

According to EC Harris port expansion spending in the Gulf countries will reach $15 billion in five years and trade between the GCC and emerging markets has been growing at double-digit figures in the wake of a slowdown in debt crisis-hit Western countries, prompting the regional states to expand facilities at many of its 35 major ports. EC Harris’ most recent report on port development ranked the

GCC as the most attractive region in the world for investment in port developments, led by megaprojects such as Khalifa Industrial Zone and Oman’s Al Duqm and Port Khorfakkan in Sharjah.

This is despite the region already being wellserved by ports such as Jebel Ali port which is undergoing a major expansion.

Meanwhile the leading port inside the Gulf, Jebel Ali, is set to grow even bigger with DP World announcing that it is to expand its flagship port by an additional 4 million TEU. This will take total capacity to 19 million TEU by 2014.

There’s more ports in the pipeline too as they are increasingly being viewed as the way to diversify the gulf’s economies. The flow of trade is big business even becoming a political hot potato in some areas.

Kuwait and Iraq’s fragile relations were recently tested when they both announced plans to develop ports on the narrow Khor Abdullah waterway that separates the two countries. Both countries see their ports as essential elements to their aspirations of turning the northern Gulf into the entry point into Europe for trade and the oil and gas sector The Gulf remains Iraq’s main export point for its oil and the country desperately wants to upgrade its maritime infrastructure around Al Faw. Kuwait wants its planned Mubarak mega-port on Bubiyan Island to become the main entry point for overland transits to Europe.

“Rising trade with the emerging markets has thrown up massive business opportunities for GCC countries, encouraging them to invest heavily in their ports to raise capacity,”says Ahmed Mohammed Al Midfa, chairman of the Sharjah Chamber of Commerce and Industry.

He adds: “Most of these ports are also well placed to benefit from a gradual shift in trade routes — being ideally located between Asia and the Far East on one hand and the West, Central Europe, and Africa on the other.”

Midfa opened the Mastech 2011 Gulf maritime event in December. The event attracted over 300 delegates to its new conference on port building organised by the Gulf’s Middle East Alumni of Ship Technology (MAST). MAST president Rajesh Babu said that much of the talk in the conference room centred on the machinery needed to run the next generation of ports in the region.

“The sessions are designed to focus on next generation ship designs, shipping economics, technical innovations in maritime industry, marine heavy lift and transports and offshore oil and gas sectors,” says Babu.

The estimated infrastructure investment of $2 trillion by GCC states and the increasing focus in the manufacturing sector are also driving up cargo movements and utilisation of excess capacities.

This is helping to drive the sale of the specialist cranes needed to service the docks and ships,

January 2012

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Market Analysis

Jebel Ali Port sets Productivity record DP World, UAE the complex that includes Jebel Ali Port and the new DP World Airport achieved a new vessel productivity benchmark when its state-of-the-art cranes hit a record of 259 berth moves per hour while servicing the container liner MSC Madeleine at its flagship port in Dubai recently.

Concerted team effort and the port’s signature operational efficiencies ensured that 11,722 TEUs (twenty-foot equivalent container units), were handled within 28 working hours, beating previous productivity benchmarks.

The record set during the recent port call of the 349-metre long MSC Madeleine highlights billioN DP World’s leading position the Gcc plans to spend as one of the most efficient $15 billion on its ports in plus the huge variety of ancillary marine terminal operators in the next five years. materials handling equipment that the Middle East drawing praise will move the goods on to their final for its improving quay crane destinations. But first they need to be rates, which “deliver direct benefits built or completed. to the customers in terms of time and One close to finishing is Oman’s Al Duqm port, at cost saved”. its peak one of the biggest construction sites in the Mohammed Al Muallem, SVP and Middle East. Soon the excavators and trenchers will managing director at DP World, UAE, commented: “Operational efficiency is a make way for the permanent machinery that will watchword at DP World, UAE. We have set serve the port. The Ports and Maritime Affairs office out to demonstrate to our customers and the at the Ministry of Transport and Communications industry that we can consistently provide a tender for lifting and heavy transportation high quality of service. The new quay crane equipment was estimated to be worth at least $14 record set at our flagship Jebel Ali Port is million. The port is expected to open by the middle a result of all-round team work and we are of 2012, once STFA completes the $212 million delighted that our efforts are paying off construction of 30km of roads, wadi diversions and by directly benefitting our customers. We related infrastructure needed to complete the port. congratulate the operations team.”

One of the largest ports currently underway is Abu Dhabi’s Khalifa Port. The Middle East’s

$15

first semi-automated terminal in the Middle East opens its first section later this year. Phase 1A will have a capacity of 2 million TEU, although it opens with an initial capacity of 1.1 million TEU in the fourth quarter.

According to Abu Dhabi Terminals chief executive Martijn van de Linde the highly automated port will challenge the “status quo”, and befitting Abu Dhabi’s green aspirations make efficient use of the land area, reducing environmental impact and pushing regional standards to a “new level”.

“We don’t want to invent the wheel again, so Khalifa is based on a proven technology and performance,” adds Joost Achterkamp, project manager for Abu Dhabi Ports Company. “We have project challenges; the schedule is very tight. The first ASC will be on site 10 months after the contract is awarded and delivery of all the equipment and TOC will be 19 months after contract award.”

Dubai still ahead of the game dubai still dominates trade at the Gcc’s 35 port terminals despite the expansion and development of its rivals. According to the Markaz, the Kuwait-based financial research house, the region will spend $15 billion by 2016 to expand the 25 million teus handled in 2010 by 8 percent. dubai, which was ranked as the ninth largest in the world in 2010, with the other uAe ports has the highest share of volume in the Gcc at 59%. dubai alone handles 11.1 million teus per year. two of the region’s other big ports saudi Jeddah and salalah in oman are both performing strongly. saudi Jeddah was 30th with an annual throughput of 3.8 million teus in 2010 while salalah

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port ranked 32nd in 2010 with 3.5 million teus. “there is a robust growth in investments on seaports to increase capacity. so far, the highest investments have come from dubai and Abu dhabi. the other Gcc countries are also all set to improve their ports,” Markaz said.

“We arrive at a current total spending of $15 billion for the Gcc. these projects are all due for completion within the five-year period from mid-2011 to mid-2016.”

Markaz’ breakdown showed Abu dhabi has the most ambitious project, MidiZ which includes Khalifa Port valued at us$10 billion. Although competing with dubai may create

overcapacity. Qatar has witnessed various delays but now shows the first signs of catching up with Phase i of the New doha Port starting in March 2011.

Kuwait is progressing fast on its new bubiyan Port project while oman is consolidating on its past maritime success, it added.

According to the report, a shift in the direction and nature of trade is taking place between the Gcc and the world. it noted that about 30 years ago, the oecd accounted for 85% of the Gcc’s trade while by 2009, the emerging markets accounted for 45%. its figures showed trade between the Gcc and the emerging markets have been rising at 11% annually between 1980 and 2009, whereas the annual growth with the

oecd was only 5%: “the emergence of india and china has presented the Gcc with substantial opportunities as hubs.

Gcc ports need to ramp-up capacity, not only to cater to their own increasing needs, but also to develop a hub strategy. Most of them are ideally placed as a trade platform between Asia and the Far east on one hand and the West, central europe, and Africa on the other.” “the Gcc needs to greatly modernise and simplify its way of doing business especially in customs, immigration, and other businesses if it is to capitalize on this opportunity. other forms of transportation upgrade are happening or being planned in air, roads, and railways. seaports cannot lag behind.”

C

M

Y

CM

MY

CY

CMY

K

Viewpoint

Bringing cranes to Khalifa Konecranes won a $120 million contract to supply 30 automated stacking cranes at the new deepwater gateway port that ADPC is constructing at Khalifa Port in 2011.

Andreas Falk, Sales Director, Port Cranes & Lifttrucks, gives CMME an update.

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January 2012

CMME: What are Konecranes key benchmark projects in the region?

Andreas Falk: We have 30 ASC units at Khalifa Por t including the TOS system, which is the single biggest order for Konecranes ever and conducted within a ver y challenging time schedule.

We also delivered 11 reachstackers and 19 electric chain hoist cranes to the Kuwait Port authority, during 2011, to help boost productivity at Kuwait’s ports.

CMME: Khalifa Port is such an important project for Abu Dhabi – you could say there’s a lot hanging on it in terms of serving industry within the emirate. Can you provide an update on the delivery and installation of the cranes at the port?

AF: The delivery, erection and commissioning of the automated stacking cranes (ASC) at Khalifa is proceeding at full speed. Currently 12 cranes out of 30 are erected, all of which has been achieved only one year after the contract signing. By June all cranes should be handed over to customer.

CMME: What would you say are the major challenges at Khalifa?

AF: The very tight time schedule with only 18 months from contract signing to handover of the 30 units, including the TOS system. This has been made possible thanks to our automation technology and experience in automated cranes from around the globe tied together with our long experiences in project management.

Another challenge is our responsibility to also deliver the terminal operating system (TOS), and to integrate that with other equipment and systems at the terminal.

CMME: Can you explain in more detail what cranes will be used at the port?

AF: We are delivering automated stacking cranes, which are unmanned rail mounted gantry cranes for stacking containers at the container yard.

The ASCs are 10 container rows wide, and 1 over 5 containers stacking height. Cranes operation is fully automated with two cranes in each stack with the exception being picking or delivering containers to trucks where they are operated by remote control from a control room.

“ThErE WIll BE SEvErAl InTErESTIng POrT DEvElOPMEnT

PrOJECTS In ThE MIDDlE EAST rEgIOn In ThE COMIng yEArS. ThE ExPAnSIOn OF JEBEl AlI TO MEnTIOn OnE, ThE DEvElOPMEnT OF nEW DOhA POrT AnOThEr, AnD ThE rAIl nETWOrK ExPAnSIOnS In UAE AnD SAUDI ArABIA.” CMME: What other projects do you have in the pipeline?

AF: For automation cranes Konecranes has

development What are the company’s objectives for 2012?

AF : Konecranes Middle East will continue to

several projects in the order book and under discussion. In general there are several interesting port development projects in the Middle East region in the coming years. The expansion of Jebel Ali to mention one, the development of new Doha Port another, and the rail network expansions in UAE and Saudi Arabia.

develop our sales and dealer organisation and to continue to build our service department which is focused on offering service, support and modernisation schemes to crane customers in the region.

Konecranes has the biggest crane service operation in the world with close to 400,000 cranes under service contract, many being from other manufacturers. We also have state-of-theart service products like railQ and ropeQ which Middle East customers can now also benefit from.

Further to supporting our customers in the region, Konecranes has recently signed the lease for a spare parts distribution centre in the UAE to cover the Middle East region. Furthermore Saudicranes, which manufacture cranes in Jubail, Saudi Arabia was acquired by Konecranes during the last year and the integration will continue.

Finally, and most importantly, we will focus throughout the year on serving our customer in the best possible way and to live up to our commitment that we are “smarter where it matters” and to never let customers down.

CMME: What markets do you consider the most exciting right now?

AF : The UAE will continue to be ver y impor tant with DP World Jebel Ali as one of the biggest por ts in the world, and with the new KIZAD industr ial development including Khalifa port in Abu Dhabi.

Saudi Arabia shows strong and consistent growth and will invest in infrastructure to develop the country for the young and growing population.

Iraq is another growth market – it will continue if political stability will remain.

CMME: Konecranes Middle East makes a good illustration of the region’s continuing

Konecranes is installing 30 ASC cranes at Khalifa Port.

CMME: How are the cranes delivered to the Khalifa site?

AF: All critical components of the cranes are manufactured by Konecranes in Finland. Steel structures are manufactured from various factories we operate in Europe. The cranes come to the terminal in pieces and are erected on site.

CMME: How do the cranes actually work when in place?

AF: As I mentioned before, the cranes are railmounted and fully electric. Konecranes use a “state-of-the-art ‘anti sway’ active load control system which eliminates container sway and allows micro movement of spreader without trolley or gantry travel. This patented system allow the high precision required to obtain effective automated operation.

January 2012

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The Big Topic

2012: The year To come

CMME takes a look at what 2012 has in store for the construction machinery industry in the Middle East.

T

here are few greater certainties in the world than that if there’s an Intermat construction show on that year it promises to be an eventful one. Economic apocalypse? Done that. Global health crises? Yep, done that too - twice. It’s fair to say that previous events have demonstrated an almost unerring knack of arrowing in on that year’s crisis.

Indeed speak to the organisers of the show and they’re happy to share their unique gallows humour about the event’s hapless history.

“You could say we’ve not been lucky over the years,” says Veronique Arnal, sales director for Intermat. “In

30

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2009 we had the economic crisis, then before that SARS and bird flu.”

The last year was the most turbulent in recent memory, particularly for the global construction industry.

The Arab Spring brought instability to the economy while the Japanese tsunami decimated great swathes of production for the industry. It’s bad news then that with us still recovering from those blows that Intermat is planning not one but two events this year: Intermat and Intermat Middle East.

“We are introducing lots of new things to both shows,” continues Veronique. “But we know we have

a great event and it will be the biggest in 2012.”

Technically Arnal actually has three events to talk about. January sees the Pre-Intermat event take place in Ville De Point just outside Paris, the curtain raiser for the second and main event Intermat in April, which in the absence of Bauma in Germany and Conexpo will be the biggest opportunity for the global construction machinery industry to meet. Later in the year, Intermat Middle East will return to Abu Dhabi in October for its sophomore event, following a disappointingly quiet opening in the capital.

“That event will be very different. In fact it will be a very different event for the Middle East,” she enthuses. “We’ve taken on board what people said about the first event and will make sure that the right people – construction machinery people – will be there. The industry knows and understands Intermat.”

While she is understandably cautious about the Paris event given her past experiences, Intermat has always had a lot going for it. It has always managed to draw in an international audience and has considerable support from European manufacturers.

In the press blurb for the event there’s a quote from notable French economist Jean-Joseph Boillet who said that the “the heart of the battle is no longer found in the richest countries but rather in the emerging world”.

With Europe clearly needing to sell its way out of its latest financial crisis (especially traditional machinery sector powerhouses Italy and Spain) and with its foreign competition keen to promote its cost effectiveness to European contractors and industry, this year’s event promises to be one of the most well supported yet.

The president of Volvo Construction Equipment Jean-Marie Osdoit has predicted that the volatility in the European financial markets will help make the event “one of the most important construction shows” ever held in Europe.

This year really could be a turning point for the European industry. No one is quite sure where the market is heading and the competition from China and India is only getting greater. The German manufacturers had a bright first eight months to 2011 and even after it became clear the Italy and Spain were in great trouble, it was still performing

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The Big Topic

What’s in store for 2012 A quick look at the prospects of the Middle East’s biggest economies SAudi ArAbiA Economically speaking, Saudi Arabia had a pretty good year. Overall growth is expected at 5.8% this year, driven by a substantial increase in crude oil production and government spending. For the whole of 2011, non-hydrocarbon real GDP is expected to grow by 4.8%. Saudi Arabia’s GDP is set to hit $572-billion in 2011 from $435-billion in 2010, and ease back to $565 billion in 2012.

The Kingdom launched two spending programmes one after the other to the tune of $130 billion to build housing, create jobs and raise salaries. bAhrAin The IIF expects Bahrain’s real GDP to rise 3.3% in 2012 after rising a mere 2.2% in 2011. Following a turbulent year, Bahrain is expected due to receive USD10-billion as part of a USD20-billion fund from its GCC partners.

KuwAiT Kuwait had a steady year in 2011, but its fouryear development programme appeared to hit the buffers in the second half of the year. Kuwait, GDP is still expected to hit 4.4% on the back of record oil production, but as global crude demand eases in the year, that figure will scale back to 3.1%. While some projects appear to be stuck in limbo such as the Subiyah Causeway, the new port on Al Baniyas looks a goer, especially with Iraq determined to expand its near-by Al-Faw port.

OMAn The strike in the port of Sohar helped remind the Omani authorities that it needs to spend and it responded by increasing public sector jobs, raising salaries and pensions, and spending more on social sectors and infrastructure. The Saudi bank expects the Omani economy to see growth decline to 3.5% in 2012 from 4.0% in 2011.

QATAr Now riding high with the world’s biggest GDP. Qatar is expected to be the fastest-growing economy in the region in 2011, driven by about a 30% increase in LNG production while crude oil production remains flat. Whatever the oil price, with the World Cup to plan for, a rail network to build and the ambitious 2030 plan still proceeding Qatar will continue to command attention.

well thanks to favourable exchange rates. However there are now fears that the continent could be dragged back into recession, hurting even the most robust of manufacturers.

The debt crisis came at precisely the wrong time.

While it was in real terms performing below predownturn levels it was still on course for to meet London Consultancy group Off-Highway Research’s estimation of 10% growth (following 15% in 2010.)

For the next the group is predicting narrow growth of just 3%. The two biggest economies will feel the biggest crunch. The German market grew by 29% in 2010 that is likely to have declined by 4% in 2011.

The story is much worse in France where the 22% growth of 2010 declined to 7% in 2011.

“We have had an extremely difficult period over the past two or three years,” says Ralph Wezel, the general secretary of the committee for the European Construction Equipment. “When the crisis started we were at a peak booming in all areas of the world, so all companies were considering starting up new factories.

All of a sudden, sales dropped by roughly 40% in a year.

This was far more than in the automotive sector which got more attention politically.”

Across the pond, Caterpillar has seen the almost other-worldly increases of 60%-plus growth it managed to grab at the start of 2011 gradually fall over the last 12 months. Although it is still looking at 30% growth in the Middle East, the company is entering 2012 in much less boisterous mood than before. Sales are expected

2011: The year that was...

Japan Tsunami

North Africa erupts News of the Arab Spring captivated the world’s attention. First Tunisia, then Egypt and Libya entered into turmoil, sending contractors and machinery

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manufacturers into chaos, and dispersing the industry back across the globe. In Libya many workers and executives were left stranded at the country’s ports and

to grow 10% to 20% to around $63.8 billion to $69.6 billion across the year. The midpoint of $66.7 billion falls slightly below analysts’ average estimate of $67.3 billion, suggesting that the company is having to hedge its bets after a tumultuous 12 months.

“The preliminary outlook for 2012 sales and revenues is based on improving but slow growth in the developed parts of the world with continuing improvement in sales from what are currently low level,” wrote the company ahead of its latest financial report.

While the western markets stagnate, companies will continue to focus on the safer economies of the world. The Arab Spring has made many manufacturers cautious about North Africa but the Middle East still has some inviting location particularly the GCC states of Saudi Arabia.

Although both those countries come with their own caveats for manufacturers. Saudi Arabia is clearly prepared to spend big and has a lot of major projects still in the pipeline particularly in Jeddah but many machine makers are still perplexed on how best to tackle the market. Komatsu, having broken from its local dealer some time ago, is still without a partner in the market and it is breeding caution among new players to The Kingdom.

“Komatsu have a man in the country for years but he is still not able to sort out their problems. It makes you wonder how you can do it, if they can’t,” said a representative of a major Asian company.

exit points. South Korean companies such as Doosan were among the first to send their people back in, fearing that the competition might still a march on them.

March’s tsunami struck the heart of the Japanese manufacturing sector, decimating production in the country and also harming global supplies of parts and specialised technology. Both Putzmeister and Sany rushed to the country’s aid sending concrete pumps to the stricken Fukushima nuclear plant.

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The Big Topic

In a world racked with uncertainty, Saudi Arabia, one of the few countries with a budget for large infrastructure and residential projects, will remain highly inviting throughout 2012 (come April’s Construction Machinery Middle East event, CMME will see for itself how the country is progressing).

The Arab Spring has helped spur on its spending on roads, houses and frankly, everything needed to upgrade the standard of living in The Kingdom. And when work begins on it later this year, it will also start to build the world’s first kilometre high tower.

While Saudi is building high, Qatar is building fast.

Doha has already undergone a remarkable change with the development of Lusail and West Bay. Having clearly taken its inspiration from Dubai the country still has a lot to do if it is to get all its disparate plans together into one whole.

However the recent divvying up of Doha by regional authority Ashghal has given hope that Qatar has learned from the mistakes of its neighbours and will look to co-ordinate the works via experienced hands such as WS Atkins and Hyder Consulting. The big question for 2012 is whether the major work for the World Cup will now begin.

The country nears the third year of its 12 year timeline with few concrete signs of construction despite the preliminary work commencing on its infrastructure and transport system. While that is not unusual for tournaments on this scale, no country

has ever committed to making so much in so little time and this year will surely seem the contracts being handed out that will lead to machinery procurement later down the line. Likewise this year should be when the country reveals its overall plans for the World Cup and whether – as some have suggested – Qatar will decide to scale back some building such as hotels (opening up inter-GCC tourism for the event) following the most recent financial crisis.

This year also sees Iraq take control of its own destiny following the US withdrawal. The country is increasingly viewed as the next big market in the region for construction. While this year will surely be too early to deliver any surprises for the region’s suppliers, there is already a lot at stake in Iraq.

Placed perfectly to become the northern Gulf access point to link the Middle East to Europe, the country needs vital infrastructure upgrades and housing.

However security remains an issue – Exxon Mobil shocked a collection of journalists at recent news conference when they revealed their operation near Basra was still contending with rocket fire – and some companies such as Scania have already taken the step to expanding their operations there.

Others have preferred to be more cautious, developing contacts in the country and preparing to serve from more stable locations such as Dubai. As 2012 progresses, the cautious approach may not only be the safest but the only option for the industry.

UAE Seemingly in the eye of the storm in terms of the unrest that affected other areas in the Middle East, the UAE benefited from stability in 2011. The property market appears to be levelling off and its non-oil growth is expected to run at 4% during the year. There have been concerns that greater financial prudence may stall works particularly in the public sector, however the UAE can look forward to 2012 with cautious optimism.

IrAq A new era for Iraq will begin in 2012 with the withdrawal of the US forces. Iraq’s real GDP stood at 8.2% in 2011, a figure which is expected to rise by 8.4% in 2012 - the highest in the region, according to IIF estimates. The country is working hard at drawing in foreign know-how to rebuild its ports and infrastructure and assuming it can hold itself together, Iraq can start progressing towards becoming the new Saudi that many in the industry predict it will become.

LIbyA The picture of Gaddhafi’s forces relinquishing territories in Libya was soon followed by news of some of the braver elements of the construction industry returning to the country to re-establish themselves there. Libya’s oil wealth will help to attract foreign investment and expertise to restore oil production and rebuild the economy. Following the sharp contraction in output in 2011 (estimated at 54%), real GDP is projected to rebound sharply in 2012 and subsequent years, largely due to the gradual recovery of oil production and spending on infrastructure, which will mean greater demand for machinery.

EgypT The construction sector helped build a boom that had sustained Egypt’s economic growth amid the global downturn. However the removal of President Hosni Mubarak has been replaced with continued disruption to reform. The largest building companies say orders have dried up as government plans for new infrastructure projects seem to have been placed on hold as the country evaluates who are the eventual winners of the national elections.

2011: The year that was...

Thailand Floods

Europe crashes

Qatar starts World Cup

Months of Monsoon rain took its toll on production in Thailand, and Japanese

The debt crisis threatened to halt Europe’s recovery from the downturn.

Even the German manufacturing sector was beginning to show the strain.

Qatar announced two major programmes at the end of the year for transport and infrastructure. It may

manufacturers faced more disruption in their second home.

not have said it out loud, but the road to the World Cup in 2022 has already begun.

January 2012

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35

Special Report

Construction Machinery Middle East continues its preview of 2012 with a look at a critical year for the Chinese machinery industry.

The road from China I

t was a conversation that could have been repeated in a host of different places in 2011 but it was surprising to hear it coming from inside China.

“From April until now, the subcontractors on this road haven’t been paid any money. Right now, they owe our team at least $300,000,” Cui Jinmin, a man in charge of a crew of 15 workers on the $1.5 billion Shaanxi Province, told the visiting AP journalist. “There’s nothing we can do. The road’s owner [the local government] has no money; we can only wait.”

Jinmin is one of thousands left stranded by the cancellation of infrastructure projects that were

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originally meant to help keep the economies going in China’s many provinces but are now massively in debt. The provinces are estimated to owe $1.5 trillion in loans intended to fund infrastructure building and the government has recently called back some loans to stop the debt running out of control.

Unsurprisingly this has been a chastening experience for the country’s construction machinery sector.

Speaking at China’s showcase machinery event in November, BICES, a spokesman for XCMG said the company was entering 2012 cautiously: “The beginning of last year was good for us, but since

then the market has really slowed.”

The disappointment was palpable but understandable. For the first time companies such as XCMG, Zoomlion, Liugong, Shantui, Sany are facing the forces of economic realities.

The government’s applying of the brakes on the economy hurt and suddenly there are too many machines and not enough work.

The excavator segment is particularly critical.

It is among the most competitive markets in the world and companies have rushed in and pumped millions into capitalising on the versatile machine’s popularity.

Research and market analyst NPD estimates that in 2010 sales grew by 25% with Komatsu and Sany leading the way on the back of the infrastructure spending spree. However the threat of postponement to projects coupled with a saturated market is bad news.

“There’s just too many excavators,”complained an exasperated Zhan Chunxin, the chairman of Changsha Zoomlion Heavy Industry Science and Technology Development. “China is making too many excavators.”

Chunxin was speaking in June. Two months later the floor fell out of Europe’s economy spinning even the most robust of markets, China’s included, into disarray.

The CEO of Hitachi Construction Machinery, Japan’s second-largest heavy-equipment maker, is particularly pessimistic for the year ahead, predicting that Chinese demand for excavators will decline by as much as 30%.

Michijiro Kikawa said in an interview at the company’s headquarters in Tokyo: “I had expected Chinese demand to come back sooner,” Zoomlion’s problem is a poignant one. It’s competing with big names such as Caterpillar – which remains committed to increasing its China excavator production by 400% by 2014 - and

Komatsu in the excavator segment and an array of local manufacturers.

Not so long ago there was enough business for everyone to not make it a problem.

The reeling back of construction and machinery output has contributed to the country’s share of the global steel market falling by 4%, it’s still by far the biggest user of the material in world terms but in real terms that means it used 10% less steel than the year before.

Much of its domestic economic growth has been spurred on by the growth in home construction and ownership but that was recently described as imploding leaving real estate developers in disarray and creating a massive headache for the banks who were financing them. Moreover the Chinese government, which had been trying to curtail credit to slow its boiling inflation, abruptly changed course last month, reducing the amount of money banks must keep in reserve at the central bank for the first time since 2008. And of course, the foreign demand for Chinese exports has slowed as the global economy teetered.

The hard landing in China would have an immediate impact from Brazil to Russia, whose exports of steel, lumber and other commodities fed China’s construction boom. And it will slow the world economy, which relies on China as one of the only remaining engines of growth and high demand.

It’s been pretty hard on the Chinese machinery and heavy equipment industry too. Machines are more expensive to make in the country than ever before with the years of boom having had the downside of increasing the cost of the standard of living, labour and materials.

For the larger companies, that means looking to the few foreign markets (with the Middle East standing out) that are still relatively strong to take up the slack.

“IT’S BEEN PRETTy HARD ON THE CONSTRuCTION

MACHINERy AND HEAvy EquIPMENT INDuSTRy TOO. MACHINES ARE MORE EXPENSIvE TO MAKE IN THE COuNTRy THAN EvER BEFORE. FOR THE LARGER COMPANIES, THAT MEANS LOOKING TO FOREIGN MARKETS.”

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Special Report

Companies like Zoomlion and Sany are desperate to raise funding to broaden their manufacturing footprint and take market share in markets that are not yet dominated by one of the big two of Caterpillar and Komatsu.

Two of those markets, Russia and Brazil, are likely to not perform as strongly as in recent years with China ordering less of their metals and raw materials. But many of the countries in the Middle East, despite their comparatively small size are likely to become increasingly important oases for Chinese machinery.

The good news, from their point of view, is that they are better equipped than at any other time to take on this region. The Chinese majors invested heavily in the region last year, expanding their sales presence and opening new parts and distribution centres to take on the perception that they are not interested in the customer beyond the initial sale.

While signing off $2 million in machinery sales at the recent Big5 event, a spokesman at Sany, the creator of the world’s biggest crawler crane, the SCC86000TM, said that the company was focusing on the Middle East region and putting “effort and energy” here, adding that the company is optimistic about construction activity in the region.

It is also hopeful that it can do business in the energy sector, particularly in the enticing Iraq market.

Sany has set itself the target of doubling the share of its overseas sales within the next five years. It’s a competitive target but it’s confident it is attainable with the market shifting its habits

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XCMG Construction Machinery approved to issue CNY 5 billion bonds China Knowledge has reported that XCMG Construction Machinery Co Ltd one of the leading construction machinery makers, has received approval from the China Securities Regulatory Commission

to issue up to CNY 5.6 billion in corporate bonds.

The company said in a statement that the bonds will be issued in installments. It will issue up to CNY 2.8 billion of bonds in the

first tranche within six months after getting regulatory approval and the issue of the remaining bonds will be completed within 24 months after the approval.

XCMG Construction

Machinery said earlier that the bonds will have a maturity of less than ten years and that proceeds from the deal will be used to replenish the company working capital and repay bank loans.

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Special Report

Setting up Shop

SANY looking to double overseas presence Sany Heavy Industries wants almost half of its sales to come from foreign customers within five years, according to its deputy general manager, Nobuhiko Oku. A slow-down in sales in the domestic Chinese excavator

market is accelerating the company’s global ambitions. Oku said that the company is looking to set up factories in ten different countries.

Sany which already has plants in the US, Brazil and Germany will look towards emerging markets and resource-

rich countries for locations for the plants, he said.

Oku explained the company had set itself the target of increasing revenue generated from overseas sales by 10% to 40% within the next five years.

Oku is a former executive

of Komatsu and holds a Japanese passport and he told local Chinese media that he is one of 70 foreigners employed

by Sany to help shape its understanding of growing a global enterprise.

Oku affirmed: “We’d like to make Sany a big global brand.”

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MAJOR CONTRACTS. ThE PORT AT JEBEL ALI AND ITS FREE TRADE ZONE SuPPORTS OuR IMPORTS, AND ALLOWS uS TO ShIP MAChINES AND PARTS quICKLY INTO AND OuT OF ThE ENTIRE REGION.” and perceptions changing on the ability of Chinese companies to fulfil promises on improved servicing.

“After the financial crisis there was of course a fall in construction activity in the region, but from this year we predict that the market will go up,” he added. “That’s why we’re putting so much effort and energy here. We will also be looking to grow the employee numbers as the business grows.”

Sany has also stepped up its presence at the region’s shows, and soon after the close of the Big5, the company was participating at an oil and gas exhibition in Basra, Iraq. Kevin added that the company sees the country of one of huge potential amid its wide government spending plans, as is the energy sector.

“We don’t have the majority of our work in oil and gas, though we certainly supply to that sector.

We mainly still focus on construction, as well as mining,” said the spokesperson.

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Chinese companies are also stepping up their physical presence in the market. Bulldozer specialist (among a growing number of other things) Shantui opened a new facility in Jebel Ali Free Zone in July and officially launched its first Middle East subsidary, Shantui Construction Equipment FZE. Shantui’s managing director Wang Feng said the company will use the the facility as its main hub to serve the Middle East and North Africa markets: “This is an important step for us.

We start with $1 million worth of stock. Eventually the stock will be increased to $20 million,” he said at the launch.

When LiuGong opened its first ever PDC in Jebel Ali, it made sure its top brass was there to host the inauguration. Zeng Guang’an, LiuGong’s president, noted the move is a continuation of LiuGong’s global expansion strategy and that Dubai is ideally situated in the Middle East.

“Dubai represents an important expansion for LiuGong,” Zeng said. “In the past three years, we have continued to sign major contracts, such as our sale of 45 refurbished machines in Saudi Arabia, which occurred in June. Our dealers there have been very successful in placing LiuGong in customer demonstrations and at job sites. The port at Jebel Ali and its free trade zone supports our imports, and allows us to ship machines and parts quickly into and out of the entire region.”

LiuGong already has four dealers in the region in Dubai, Yemen, Saudi Arabia and Oman moving 500 machines a year. Wheel loaders and excavators are its top sellers. LiuGong Machinery Middle East is expected to become fully operational in early 2012. It will include 1,000 square meters of office space for support personnel, and a parts depot. It represents a $3.5 million investment and the operation will be run by the approachable Liang Yongjie who will serve as the general manager. The subsidiary is well equipped too with a sophisticated parts depot that ensures that LiuGong to warehouse parts close to customers and markets. Parts and machines will be imported to the depot, tested and made available for customer demonstrations. LiuGong claims it can now ship parts to Dubai and across the Middle East within 48 hours.

Chinese machinery manufacturers have come a long way since they started looking at the Middle East.

concrete@saudidiesel.com.sa

Reaching new heights in the region

Jeddah Tel 02 6877058, Fax 02 6812311 Riyadh Tel 01 4950898, Fax 01 2131779 Ext 212 Dammam Tel 03 8176593, Fax 03 8177169 Asir Tel 07 2234392, Fax 07 2215651 Email forklift@alj.com

Product Section

under the hood

Your essential update on the best in new construction equipment and heavy machinery in the market. Plus guides to new and future technology.

CONTENTS 44

ThiS mONTh’S rElEaSES

54

fuTurE TEChNOlOgy

• Komatsu HM400-3 • JCB 550-80 • Doosan DX300LC-3 • Caterpillar lighting up towers • 21 LC 400 power upgrades

Following the release of its new JCB Ecomax T4 4.4 litre engine – the latest generation of the JCB Dieselmax engine – JCB is investing $50 million into its next generation off-highway engine ready for 2016.

49

marKET aNalySiS

The mobile crane market.

56

ExamiNiNg ExCavaTOrS

Everything you need to know about the finding, selecting and buying excavators.

We also show you how to swith one on and dig your first trench.

52

POiNT Of viEw

What’s up with telehandlers? Simply everything it seems. CMME looks at a machine type, which thanks to infrastructure construction, whose time has come.

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Product Section

HM400-3

HM400-3 specs: GVW: 73t payload: 44.1t Max ground speed: 34.7mph engine: SAA6D140E-6 Tier 4i Loading height: 3.1m

Komatsu introduces the new HM400-3 articulated truck K

omatsu America introduced the HM400-3 articulated truck. The HM400-3 is powered by a Komatsu SAA6D140E-6 engine with 469 horsepower (350 kW), and is EPA Tier 4 Interim and EU Stage 3B emissions certified. Komatsu, building on its proven Tier 3 engine platform, designed a more environmentally friendly engine that increases power while decreasing fuel consumption.

With the introduction of the Komatsu CARE Program, every Komatsu Tier 4 Interim construction machine comes standard with complimentary factory scheduled maintenance for 2,000 hours or the first three years (whichever occurs first), and includes two complimentary Komatsu Diesel Particulate Filter (KDPF) exchanges within the first five years. The Komatsu

CARE program covers all new Komatsu Tier 4 Interim equipment, whether rented, leased or purchased.

The HM400-3 features a maximum GVW of 73,740 kg, hauling up to a 44.1 ton payload at its maximum ground speed of 34.7 mph. Improved operating performance, lower fuel consumption, improved operator comfort and enhanced serviceability are features of the HM400-3 that provide increased productivity and lower operating costs.* It aslo comes equipped with the latest KOMTRAX technology, which sends machine operating information to a secure website over WiFi. Data such as daily fuel consumption, machine utilization, operating hours, location, cautions and maintenance alerts are relayed to the web application for analysis.

JCB 550-80

JcB 550-80 specs: Maximum capacity: 5t Height: 8.1m engine power: 97kW or 108kW JCB Dieselmax Tier III speed: 40km/h Transmission: 4-speed Breakout force: 6.5t

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D

emand for improved lift performance and reach from has seen JCB release its highest-capacity telehandler. The manufacturer’s new 550-80 telehandler offers a maximum lift capacity of five tonnes and height of 8.1m.

Engine options include a 97kW or new 108kW JCB Dieselmax Tier III, the largest powerplant ever fitted to a JCB telehandler.

Linked to a four-speed powershift transmission, the machine also delivers 145 litres a minute variable flow hydraulics and high-flow pipework for optimised cycle times and auxiliary service performance.

The bigger JCB 550-80 sits on uprated heavy-duty axles with four-wheel braking, as well as wider wheel centres and larger tyres than its smaller colleagues.

Biggest ever telehandler from JCB According to JCB it hasn’t lost any speed, either, offering a top mark of up to 40km/h. In a first for JCB telehandlers, the 550-80 uses a ‘Z’ bar front linkage between the hydraulic tilt ram and the carriage. This design maximises the force generated by the piston side of the hydraulic ram, which, in conjunction with the ‘Z’ bar linkage, creates a massive breakout force of 6.5 tonnes - a 50 per cent increase on the 541-70 telehandler.

“This feature is especially beneficial when rehandling materials because it provides easy bucket fill and therefore greater productivity overall,” Greg said.

A low boom line contributes to excellent allround visibility.

The JCB 550-80 is also fitted with a new standard variable speed cooling and reverse fan.

DX300LC-3

Doosan ups the spec on 30t excavator DX300LC-3 SpeCS: Operating weight: 30,000 - 30,900 kg engine: Doosan DL08k engine power: 152 kW (201 HP) @ 1800 rpm (SAE J1995) Travel speed: 3.0 / 5.3 km/h Maximum traction: 34.9 / 19.4 ton Buckets: 0.80 - 1.75 m³ Bucket digging force: 185.3 kN Max. digging reach (Std Front): 10725 mm Max. digging depth (Std Front): 7305 mm

D

oosan’s new DX300LC-3 crawler excavator has an average of 6% more power across the board than the manufacturer’s previous models in the 30t weight class, the company says.

The new model has also designed to be more rugged and comfortable than before, as well as compliant with Stage IIIB emissions requirements.

The undercarriage, boom and arm have been made more robust, extending mean time before failure by more than 30%, Doosan claims.

The new ROPS and OPG certified cab 6% offers more space (+6%) for the operator. New features include proportional thumb wheel switches on the joysticks to control attachments and a 7-inch colour control console. All functions can be controlled from either the instrument panel or a new control next to the joystick. A new function allowing the operator to select and set engine speed, hydraulic flow and pressure for attachments, with several preset positions, is a standard feature.

The air suspension seat is heated and a new cab suspension system helps to cut vibration by 20% and reduce the sound level in the cab to 71 dBA. The cab is also pressurised to prevent particles from entering the cab.

The DX300LC-3 is powered by the Doosan DL08K

‘common rail’ 6-cylinder turbocharged diesel engine meeting Stage IIIB emission regulations through the use of exhaust gas recirculation (EGR) and diesel particulate filter (DPF) after-treatment technologies. At 159kW, the engine delivers 2% more power at a lower speed of 1800 rpm than the existing DX300LC Stage IIIA model, Doosan says.

Factory tests show a 5% to 10% reduction in fuel consumption, depending on the operating mode selected and the work being done.

A new ECO Gauge on the control panel helps the operator to lower fuel consumption by providing real time monitoring of fuel rate and actual engine-percent load. Two new operating modes (P+ mode: Power Plus and L: Lifting) improve controllability and efficiency.

Workload/hour outputs have increased by an average of 6% across the different power modes in the DX300LC-3. A new travel device has increased the maximum travel speed to 5.3km/h, while the drawbar pull is increased by 4% to 26,200kg and lifting capacities have been increased by 6%.

New hydraulic pumps and valves increase hydraulic flow by up to 11% and pressure (350-370 bar) to boost front, travel and power functions as well as increase lifting capabilities and reduce cycle times, it is claimed.

CaterpiLLar Lighting towers

Caterpillar to sell lighting towers C aterpillar’s road construction machinery division has signed a sales and marketing agreement with lighting tower manufacturer Powermoon Enterprises.

The deal allows Caterpillar Paving Products to sell certain Powermoon lights through its worldwide distribution network.

Products covered by the deal include balloon lights and accessories for night paving.

“This agreement helps to position Cat dealers as a total solutions provider for paving customers,” said Lieven Van Broekhoven, worldwide sales and marketing manager for Caterpillar Paving Products.

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Product Section

21 LC 400

Linden Comansa adds power to its lifts L Powerlift sPecs on the 21 lc 400 operating weight: 18t Jib length: 80m load: 18t old jib reach: 16.6 new jib reach: 18m old jib capacity: 3t new jib load capacity: 3.3t reach: 16.6m

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inden Comansa has launched its PowerLift system to improve the load chart of its tower cranes by 10% with reduced speeds.

This system, which allows to displace a maximum load to a major reach, is included as a standard in all tower cranes and will have no additional cost This month see all the cranes from series LC500, LC1100, LC1600, LC2100 and LC3000 from Linden Comansa incorporate the new PowerLif t system. The company claims it allows an improvement of 10% the load chart with reduced speeds. With the incorporation of this system, the cranes will be able to move the rated load that is indicated in the chart to a major distance (reach).

Linden Comansa’s R&D team has developed a system of control and limitation at the moment,

named PowerLift that, by means of the automatic reduction of the speed of trolley and hoist allows that occasionally the crane is capable of achieving an extra load up to 10% more to do certain works.

This system does not allow the crane to have bigger maximum load capacity, but allows to increase 10% the rated load that appears in the load charts up to the maximum load according to the data sheet, in the same way as it allows to displace the same maximum load to major reach.

For example: the 21 LC 400 / 18t tower crane, with 80m of jib length, can load 18,000 kg up to a reach of 16.6m. With the PowerLift system, the crane will be able to load the same 18,000 kg to a reach of 18m. And if this crane can load up to 3,000 kg at the jib end, with the PowerLift system will be able to load 3,300 kg.

POWER

YOUR PROJECTS WITH PEAX

Get in touch

Toll-Free 800 166 PEAX (7329) KSA A branch of Saudi Diesel Equipment Co. Ltd. www.peax.com info@peax.com

Market Analysis

Upwardly mobile Globalisation, competition and cost pressures have driven a decade of change for the mobile crane business

a

s anyone in the business will tell you, there are two constants in the life of cranes: up and of course down. As they enter 2012, those that sell and market mobile cranes are seemingly glad to report its the latter.

Mobile cranes are defined as machines equipped with a telescopic boom or lattice structure booms and carriers with tyres or crawlers they are used and moved often worldwide. Perhaps the three most common types are all-terrain mobile cranes (AT cranes), rough terrain mobile cranes (RT cranes) and crawler crane. Typically costly to buy, the investment volume for each mobile crane is very high (between $380,000 and $25 million), but they have found their niche in the repertoire of rental companies who are able to reclaim the costs over time.

In many ways, the rental companies have proven to be the saviour of the type. A decade ago the mobile cranes market was facing a crisis.

How a Mobile The two strongest markets of Crane works North America and Asia, where The all terrain crane is power-driven by the leading manufacturers were one or two engines and is typically allbased, had been in decline for a wheel drive. The crane component of the The order is a varied number of years and the reigning machine features hydraulically operated mixture of telescopic cranes AT back of capital spending was not winches and a telescopic boom with multiple extended sections. cranes and crawler chassis with only holding back manufacturing capacities of between 60 and 750 but development too. Only in tonnes. The majority of the cranes Europe, where players like Liebherr are 95 tonne five axle LTM 1095-5.1 and Demag remained strong, bucked the and 100 tonne LTM 1100-5.2. downward trend.

It also includes a considerable number of LTR Fast forward a decade and the mobile crane is undergoing a renaissance. Their adaptability in an 1060 and LTR 1100 telescopic crawler cranes. Al era of large scale infrastructure spending, especially Faris opted for these because it says “on longin emerging markets such as the Middle East, has term construction sites they are considerably made it the flexible friend of sub-contractors more efficient in operation than comparable offroad cranes”. working on government and prestige projects.

Liebherr is arguably Europe’s leading manufacturer Last month Construction Machinery ME reported that Sany had won a $2 million deal to sell its mobile of mobile cranes and Al Faris will be the latest cranes to a Saudi Arabian customer and this was beneficiary of the company’s decision at the start followed by the news that one of the UAE’s biggest of the last decade to aggressively pursue business in suppliers Al Faris Equipment took a huge step the sector.

At the beginning of the 1980s Liebherr-Werk forward in the segment with its latest order from Liebherr.The Dubai-based company is so confident Ehingen was the first manufacturer to introduce the in the market’s appetite for the machines that it has all-terrain mobile crane concept as an alternative ordered 47 Liebherr mobile cranes worth more than to the traditional truck crane, and this concept was adopted by the remaining mobile crane €40 million from the German manufacturer.

The first units have already been delivered and manufacturers in the years that followed.

The German company decided in 2000, to the order is due to be completed at the end of 2012.

Liebherr says another major order is expected early concentrate on three main areas to increase its next year for delivery in 2013. The cranes will be a global presence. The first, product development, saw significant addition to the Al Faris fleet which already more emphasis on its AT range plus with products such as the MK 80 it opened up the area of the includes 180 Liebherr cranes.

mobile construction crane, machines that combine the advantages of telescopic boom cranes and more conventional construction site cranes.

Secondly it wanted to expand its overseas sales and identified projects such as sports stadia, infrastructure and the energy sector. One of its earliest coups came in Spain where it sold 160 cranes to service the country which was spending heavily at the time ahead of the UEFA football championships and looking to add thousands of wind turbines to the Iberian penninsula – it will be interesting to see if the company and dealer United Rentals can carry on the momentum from working on the Heart of Doha project into the build-up for the similar-looking World Cup in Qatar.

Lastly it learnt from its European business that to succeed worldwide it needed to change the way that mobile cranes were offered to rental companies.

Liebherr cranes, like many other German brands, keep their value, and the company realised that it could benefit if it developed a fully functioning preowned business.

“The pre-owned crane business is of extreme importance. In many cases the sale of a new crane depends on the existing one being traded in,” GM Friedrich Bär said at the time. “Building up our pre-owned crane sales operation is thus an ongoing activ-ity that enables us to resell the cranes we have taken in part exchange.

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Market Analysis

“Also of eminent importance is the provision of credit purchase terms for mobile cranes. The higher the value of a pre-owned crane that is offered in part exchange after a period of use, the easier it is to arrange financial terms. High quality, long life and modern technical features ensure that Liebherr cranes have a high resale value on the secondhand market.”

The bounceback in demand for mobile cranes has had a knock on effect in the sector in some

surprising areas. Dunlop, for instance, entered the market in 2010 and the benefits have been almost immediate. According to one of its senior company representatives, sales of Dunlop Goodyear’s ER50 tyre for mobile cranes tyre increased by 173% in 2011. Paul Bould, earthmover tyre specialist for Goodyear Dunlop UK and Ireland said that the ER50, designed by Dunlop in Japan specifically for the mobile crane market has completed a successful launch phase.

Lattice cranes versus Telescopic cranes Srini Kadaba, Kanoo Machinery, vice chairman, Lifting Equipment Engineering Chapter, Saudi Council of Engineers explained the pros and cons of lattice cranes versus telescopic cranes.

• Better deliveries for Lattice Boom Cranes in relation to Hydraulic Telescopic Boom Cranes • Technological advances such as retracting undercarriages, has greatly increased transportability of these Cranes

The big brothers Big and mobile, harbour cranes, are also in much demand as we enter 2012. Manufacturers of mobile harbour cranes say they are increasingly in demand for handling commodities and suggest that demand is growing for new types of larger mobile cranes that are capable of meeting the need for heavy lifts of items as the port expansion continues across the globe.

For instance Liebherr said that demand for its mobile harbour cranes was exceptional last year and saw an 100% increase in sales compared to 2010 illustrating that the demand for sustainable investment in cargo handling equipment remains robust. By the end of 2011 a total of 25 of its massive MHCs were delivered to various customers throughout the Americas, 18 machines to Latin America and a further seven machines to Canada and the US. “Clients are only prepared to invest in cranes which are made to suit their own applications,” says a leading manufacturer. “These

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applications are both varied and different, and the issues that need to be addressed include not only the size and type of vessel, handling rates, planning and scheduling parameters, and the proportion of different types of cargoes handled (containers, bulk materials and general cargo) in terms of total volumes, but duration of use and local conditions.”

Typically, say manufacturers, users are asking for cranes with the following features: more intensive, rapid container handling on all sizes of vessels, including twinlift operation; container handling for specific vessel sizes, such as panamax and postpanamax ships; high handling speeds at low lifting capacities, when handling pallets of fruit, for example; container handling and a significant share of heavy lifts at multiple-cargo terminals in the vicinity of centres of heavy industry; large grab capacities for uninterrupted bulk handling with a high crane classification and, as a result, longer service life; and the

ability to switch from one type of handling operation to another from container to general cargo to bulk handling, particularly at smaller and medium sized multiplepurpose ports.

Also, as ships get larger and stacks higher, there is increased demand for higher towers, and higher tower mounted cabs, and ports and harbours want more flexibility to configure their cranes in terms of capacity, drives and hoisting speed.

When a need arises for additional handling capacity, delivery time is of central importance, as are features such as advanced propping technology with pressure monitoring.

Automatic operation has the advantage that it makes it possible to quickly level a crane, and reduce the time required to move a crane and prop it alongside a ship.

Depending on the application and ambient conditions, handling performance can be increased by up to 20% with the latest generation of advanced harbour cranes, manufacturers say.

• Quick set up time. Most manufacturers now claim that some of their cranes, even as large as 250-300 tonnes can be set up in 3 to 4 hours

nightmare to access and then fix problems in a hydraulic telescopic boom crane • Technological advances (onboard computers control everything in All Terrain Cranes from Engines, Transmissions & Crane functions) make it a challenge to find, train & retain suitable technicians to maintain and repair these type of cranes • More parts in a hydraulic mobile crane leads to the inevitable problem of more things to go wrong and also the cost of replacement of wear & tear items, such as seals & wear pads results in higher operating expenses

• Growth in markets. One example is in the wind energy sector. Crawler Cranes are better suited with higher capacity at greater heights & fixed boom lengths. Also suited to operate in Poor underfoot conditions.

• Wear & tear on suspension system & tires of All Terrain Crane.

Much cheaper to transport a Crawler Crane on a low bed trailer.

(Let’s not forget the current long lead times for All Terrain Crane tires)

• Complexity in the extension mechanism of boom sections makes it a

• Versatility.

Lattice Boom Cranes have superior pick & carry duties.

Point Of View

GET A HANDLE CMME looks at the ever-evolving telehandler. Although it may come with a high ticket price it doesn’t mean that it should stay out of reach of inventories.

A GuiDE To TELEHANDLErs

A

forklift on steroids, the telehandler could have a huge amount of uses in construction projects but they remain frustratingly too expensive for some companies. Fortunately a lot of manufacturers are now offering the machines in their rental fleets, making them a serious consideration for people who want to get up to those hard to reach places.

Telehandlers, or telescopic handler, as the name suggest have the same functions of forklifts but are much more versatile. This is because they have a single telescopic boom that can extend to altitudes that would make Tom Cruise giddy. It really is like a giant arm that comes with a variety of different hands at the end. Put a muck grab, a bucket, lift table or a giant fork on the end and you can quickly put the machine to work in a variety of tasks.

The main advantages of this type of machine

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are its multitude of uses or versatility and free movements and maneuverability. Telehandlers were able to exceed the popularity of cranes and forklifts by doing the jobs of both cranes and forklifts. This type of machine can easily reach the places which conventional forklifts cannot reach or cannot maneuver to. This type of machine is able to become more usable compared to forklifts without sacrificing its maneuverability; surprisingly this type of machine can be easily positioned and repositioned even if it has a solid and heavy chassis.

However, disadvantages come along these advantages. There are two main disadvantages that telehandlers: stability and the costliness of its improvements. It is in the nature of this machine to extend even up to the limits of gravity and calculated balance. However, the expertise that would limit the human error in machine

related accidents takes a long time of practice and education.

The stability issues that revolve around telehandlers are usually related to the radius limit of the machine. The radius pertains to the distance of the front wheels and the centre of the load of the boom. To aid in solving this problem manufacturers, retailers and service providers of this machine use advance computer calculations to balance out factors such as angel, height of the boom extension, weight of the load and counterweights.

Unfortunately, the presence of these aiding mechanisms opens up more problems particularly in the cost of operation. Solutions available to compensate for the limitations of this type of machine can include costing software and even additional machine expenses such as the

Many of the main manufacturers have recently revealed they have something new to offer the market with Doosan offering a new high capacity machine and Terex a rental special.

attachment of outriggers or mobile cranes to counterbalance the stability problems of this machine.

Many prefer to rent a telehandler rather than buy one. The advantages of renting is that the rental companies have expert operators who know the machine intimately.

Another advantage of renting a telehandler is that the rental can take care of its maintenance and storage. The equipment rental company will shoulder all of that including repairs in case of malfunction.

Over time, the value of the telehandler depreciates and take note however that as technology advances, the chances that your telehandler could soon be obsolete is high.

Telehandlers are also hard to transport. However if you are renting this machine, the equipment rental company can take charge transporting it.

If you are planning to buy a telehandler, then you will need to buy the truck that can transport it to various locations.

Something new from DooSan Doosan entered the high capacity telehandler market with the launch of a new range of models for the EMEA market at the end of 2011.

The four new telehandlers form an important and innovative extension to the wide range of products offered by Doosan for civil engineering, mining and quarrying applications, which includes medium and large excavators, wheel loaders and articulated dump trucks.

Offering maximum lift heights of 10m and lifting capacities from 7 to 21 tonne, the new Doosan high capacity telehandlers combine the flexibility of telescopic handlers with the power of wheeled loaders, the efficiency of rough terrain forklifts and the reach of mobile cranes.

Using buckets up to 4.5m³ in volume, the Doosan high capacity telehandlers are well suited to loading applications.

Featuring levelling as standard, the new high capacity telehandlers offer compact dimensions, an off-road design, and high mobility thanks to travel speeds up to 36 km/h.

The smallest model in the range is the DT70

telehandler which has a maximum lift capacity of 7 tonne, a maximum lift height of 9.7m and a maximum forward reach of 5.4m. The DT70 is driven by the Iveco NEF-TA diesel engine providing 93 kW of power at 2200 rpm.

The next larger model, the DT120, offers a maximum lift capacity of 12 tonne, a maximum lift height of 9.4m and a maximum forward reach of 4.9m. Power is provided by the 106 kW Perkins 1104D-ETA diesel engine.

The two largest models – the DT160 and the DT210 – both have a maximum lift height of 10.2m and maximum forward reach of 5.2m, with maximum lift capacities being 16 and 21 tonne, respectively.

Both the DT160 and DT210 are driven by the Perkins 1106D-ETA diesel engine providing 146 kW of power at 2200 rpm.

Something blue from terex Terex Aerial Work Platforms is set to unveil a new telehandler prototype at next month’s The Rental Show in the US. The 3.5 tonne capacity Genie GTH-844B is an overhaul on the current 844 model, comes packed with a Tier 4i engine and is a much more slimlined machine. The width of the machine has been trimmed from 2.59m to 2.43m which is surprising considering the engine has been relocated from rear-mount to right-side while the cab was completely redesigned.

Engine options include either Perkins or Deutz with the engine manufacturers’ allowed to decide what type of Tier 4i technology to utilise, although Perkins is using exhaust gas recirculation with a diesel particulate filter and diesel oxidation catalyst. Deutz is using an oxidation catalyst without the particulate filter.

The price has not been finalised although both Perkins and Deutz estimate that the price of their

units will be around $4,000 compared to the Tier 3 engine. Terex AWP also wanted to improve the environment for the operator by introducing a totally new control station. The GTH-844B will feature a tilt steering wheel, a lowered dash for better visibility, new gauge and switch packages and updated single-lever joystick control.

Although only currently planned as a western hemisphere model, it could soon appear in rental inventories and is a likely success in the used market later down the line.

Something uSeD from JCb JCB claims its telehandlers are the most popular brand in the market due to its versatility, productivity and low cost of ownership. Certainly the JCB 533-105 has proven to be a worthy workhorse on sites and nearing its first decade in the market is available in the $2530,000 price range.

The models are designed for the harsh environments and high utilisation that is part and parcel of your daily life, and are built to deliver the kind of reliability that ensures optimum uptime for your business.

The 533-105 is able to lift maximum payload of 3300kg to maximum lift height of 10.22m the 533105 meets the needs of the modern house builder who needs a stabilised machine, which is highly manoeuvrable and versatile.

The 533-105 is also fitted with 63kW (84.5 hp) engine, 4 speed powershift transmission, 3 mode steering with automatic wheel alignment, servo brakes and JCB cab with operator friendly two lever controls and eye level load moment indicator.

The 533-105 can be specified with a 74.2 kW (100 hp) turbo charged engine and fitted with a full range of suitable factory fitted options including industrial tyres, working lights, windscreen guard and air conditioning.

The JCB Q-fit self levelling carriage accepts pallet forks and a wide range of attachments.

“THE ADvANTAGES OF RENTING IS THAT ONE WIll NO

lONGER WORRy ABOUT OPERATING IT AS THE RENTAl COMPANIES HAvE ExPERT OPERATORS WHO kNOW THE MACHINE INTIMATEly.” January 2012

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Future Technology

JCB’s Tier 4 engine which goes into production later this year. The new £31 million investment will see the development of a new generation engine, which will go into production in 2016

J

JCB’s big project JCB is pumping money into one of its most exciting engine development programme’s ever.

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CB the world’s third largest manufacturer of construction equipment has announced plans for a new $50 million engine development project in the UK that will create around 350 jobs across its Midlands and Wales’ plants. It will also soon be releasing its new Tier 4 engine getting it up to speed with its competitors.

The programme is set to get underway after the company was awarded $6 million towards the cost from the UK government’s Regional Growth Fund (RGF).

Design and research into the new engine project will take place at JCB Power Systems in Derbyshire, where the company’s JCB Dieselmax engine is currently manufactured.

The development of the new engine – which will be installed in JCB’s own products and also sold to third parties – means almost 50 new advanced engineering jobs are available immediately at JCB Power Systems, with recruitment already underway.

The roles include engine design and development engineers, engine electronics and software engineers, quality technicians, manufacturing engineers, applications engineers, supplier development engineers and buyers. With the UK economy struggling, the move has been welcomed, by the time the engine goes into production in 2016, more than 300 additional jobs will be created across JCB’s Staffordshire, Derbyshire and Wrexham factories.

JCB CEO Alan Blake said: “Since we began production in 2004, JCB has led the way in offhighway engine development, with a range of fuel saving, clean and highly efficient engines.

“The announcement that we now intend to invest $50 million into developing our next generation engine is an important step in building on the success we have enjoyed so far and it will take the efficiency, productivity and environmental performance of our engines to new levels.

“The new JCB engine will give our products a huge competitive edge across global markets

*JCB opens new Heavy

products factory on a site outside Uttoxeter, adjacent to the JCB World Parts Centre.

*Production started of the

*JCB shuts the old

*JCB bounces back as

which is twice the level of 1975.

Bamfords factory in Utoxeter, following move to the new Heavy Products production unit.

2006

2008

2010

JCB 444 diesel engine. The first engine designed and manufactured by JCB.

*JCB has 4000 employees,

2004

profits jump 150% and the company hits $3 billion in sales.

2001

2005

2007

2009

2011

*JCB opened a factory in

*JCB bought Vibromax

*The Dieselmax

*JCB lays off temp staff

*Company

Brazil.

*Founder Joseph Cyril

Bamford died aged 84.

(a German compaction equipment company). That was the first time since 1968 that JCB bought a company.

*JCB opened a new factory

in China at Pudong close to Shanghai.

achieves a top speed of 563 kilometres per hour at the Bonneville Salt Flats in the US, making it the fastest Diesel vehicle in the world, breaking the 1973 record.

The Dieselmax is powered by two 4.4 litre JCB Diesel engines producing a total power of 1,119 kW.

DEvELOpIng OUr nExT gEnErATIOn EngInE IS An “ IMpOrTAnT STEp In BUILDIng On ThE SUCCESS WE hAvE EnJOyED SO FAr AnD IT WILL TAKE ThE EFFICIEnCy, prODUCTIvITy AnD EnvIrOnMEnTAL pErFOrMAnCE OF OUr EngInES TO nEW LEvELS.

”

and cuts hours due to downturn in markets.

celebrates its 65th anniversary.

which we anticipate will lead to substantially increased sales between 2016 and 2021.

“That rise in demand will result in the creation of an additional 300 positions at our UK factories in addition to almost 50 engineering roles we are recruiting for immediately.”

JCB began manufacturing its Dieselmax engine range in 2004. The company also opened a new engine production facility in India for the production of fuel-efficient engines for its Indian-built products.

JCB’s own engines now power more than 70% of the company’s equipment range. The same engines also powered the JCB Dieselmax car to a new world diesel landspeed record of 350.092mph on the Bonneville Salt Flats, USA in 2006.

Last year JCB announced it had made one of the biggest investments in its history to develop the off-highway sector’s cleanest engine, in readiness for increasingly stringent emissions legislation in both the United States of America and in Europe.

The move has been well received by original equipment manufacturers (OEM) from around the world, with a surge in demand for the awardwinning JCB Ecomax T4 engine range.

The company has recently developed the new JCB Ecomax T4 4.4 litre engine - the latest generation of the JCB Dieselmax engine. The investment has delivered an industry-first solution that eliminates the need for any exhaust after-treatment and delivers cost savings for customers. Indeed the 55kW (74hp) Ecomax engine requires no after-treatment for Tier 4 Final.

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Everything You Need To Know

Excavator Examination What do you need to look out for if you want to pick up an excavator? CMME shows how to pick the right machine for you.

E

xcavators are great for just about any kind of business since they are very easy to operate, have a small foot print, are very low in cost, and offer precise operation. If you are in need of some tips on how to operate an excavator, then you have come to the right place. Keep reading to learn how to get a general understanding of how to operate an excavator.

The first thing that you need to do is choose the correct size of the machine that you are going to be needing for your project. Excavators can come in a variety of sizes, from super compact. Excavators can weigh anywhere from 4000 and up.

The next thing that you should do is compare the costs of renting an excavator to buying an excavator. Typically the smallest machines, mini excavators can go for around $150 per day to rent. That does not include the cost of delivery,

How to get digging with excavators 1. Site the machine so you are within boom reach of the desired starting point. Push the two travel levers forward to move the machine forward in a straight path. Returning your left lever to neutral, or pulling it back, will turn the machine right. Pull both levers straight back to travel in reverse.

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2. Set your stabilisers down, if equipped. Push the control lever for this forward to drop the blade. Continue pushing the lever until the blade lifts the machine slightly. This helps stabilize the excavator during hard digging operations and rapid boom swings.

3. Push the main boom lever (typically the left joystick) forward to move the main boom away from you. Extend it about halfway through its range of travel. Push the dipper stick lever (right joystick) forward. Stop when it is about 2/3 through its range of travel.

4. Push the main boom lever forward again. At this point, the bucket teeth should be close to contact with the ground. Curl or open the bucket – usually by moving the right joystick left or right respectively – to get an optimum digging angle. For most soils, this would be about a 45-degree angle to the ground

pick up, fuel charges and any insurance needed.

With the price starting at $150 per day and going up from there, depending on the project or if your are trying to start up a business, you need to weigh the options as well as the pros and cons of buying a new or used excavator.

You should then check out the range of machines that are offered and if the company offers demonstrations. You should become very familiar with operating a excavator. Getting the feel of the machine will allow you to be able to successfully operate the machine on your own.

A second hand or used excavator cost less than a new one. The difference can be at least 25% to 50% of the new ones. The amount depends a lot on the existing condition of the excavator.

In addition one has to be careful because even though a used one is cheaper but it could cost a lot in term of repairs. Thus the total cost involved may make it not wor th buying.

Hence besides only knowing what’s on paper e.g. manufactured date, date of last service, a proper physical inspection of the machine is required before signing the purchase paper.

The physical inspection is normally being carried out in two stages. The first stage is carrying out a visual physical inspection. The second stage is performance or operation inspection.

When inspecting the engine, look around the engine compartment for sign of soot. Soot is from smoke and any sign will indicate that the engine would need overhauling. Also look around for any signs of engine oil leakages or neglect. Then look at the battery for signs of corrosion.

Also inspect the air cleaner system to ensure they are working as a small amount of dust/ dirt can cause engine damage. Next look at the cooling system, the cooling fans belt are tight, radiator clean as a damaged cooling and air system can cause engine overheat.

A well looked after excavator will have the following signs, a cab interior reasonable in good condition and the body does not suffer from major damages. Thus look out for out of place welding and patching up which would indicate major repairs done earlier. Minor tear and scratch are ok and common in used stuffs anyway. Next

5. As you make contact with the ground, pull on the dipper stick lever as you curl the bucket inwards. As the bucket fills with soil, curl to a level point to reduce spillage.

inspect the bucket, make sure nothing is bent underneath. If there are it means the excavator had been used to driving pilings, hammering rocks beside excavation. Hence due to these, a possibility that the excavator had been subjected to tasks beyond its capacity.

Next check the pivot points and look out for any slackness between pins and bushing.

Any slackness may indicate the need for replacement af ter buying it.

The most crucial pivot point is the one between the boom and the body. Check that, as it can be ver y expensive to replace if required.

And on the boom itself, inspect the boom with a straight edge and dipper stick to make sure they are not bend or twisted.

When inspecting the tracks, look at how much wear there is and if are any connection that link all the individual metal plates tracks are broken or suffered from tear.

A track that is near its operation life requires replacement. Thus the cost of replacement had to be factored in. Also inspect the condition of the sprockets and rollers individually as they may need replacement. At the same time, while you’re inspecting the track and undercarriage, check the oil level and cleanliness in the final drives.

Look out for leaks and wear. Make sure there are no water or foreign matter inside. Finally inspect the roller metal frame for signs of crack or repair, which is normally done by welding.

Having done the physical inspection, the next stage is operation. This is when the excavator engine starts up and after warming up, ask for a demonstration of movement of bucket, stick and boom. This is the time to look out for slackness, which normally indicates that the bushings require replacement.

This is also the best time to inspect the hydraulic cylinders and tubes. A well maintained machine would have no signs of leakage or scratch on the chrome surface of the cylinder. A leakage may indicate contaminated hydraulic system.

Also make sure that the cylinders are not bend or damaged. This is because due to the small tolerance between the chrome tube and cylinder.

Any dent in the cylinder will create a lot of wear and tear to the tubes and cylinders. Not to

6. Pull on the main boom lever, which will raise the bucket out of the ground. Adjust your bucket and dipper stick as required to clear the work area. Swivel your boom, usually by turning the left joystick left and right, to move the dug soil into a pile away from your trench.

“WHeN INSPeCTING THe

eNGINe, Look ArouNd THe eNGINe CoMPArTMeNT For SIGN oF SooT. SooT IS FroM SMoke ANd ANY SIGN WILL INdICATe THAT THe eNGINe WouLd Need overHAuLING. ALSo Look ArouNd For ANY SIGNS oF eNGINe oIL LeAkAGeS or NeGLeCT.”

mention introducing metal fragments into the hydraulic system.

Next check the tracks performance and that both tracks are rotating equally. A way to check this is to drive the excavator over a short distance to see if it runs straight. If it does, than the drive motor is working equally well.

Another way is to tilt the machine with the bucket and time the turnings of the track over a certain time.

Then do the same with the other track. Both should have the same amount of rotation. If not than there is something wrong with the drive motors.

Finally, check the performance of the swing system, which includes the gears and bearing.

The system should be able to rotate the cab and all with little or no def lection. It should stop and start smoothly and accurately without any sloppiness or lurching.

Any signs of sloppiness are a cause for concern. Perform the swing in both clockwise and counter clockwise direction.

7. When your trench reaches the proximity of the mini excavator, pull all levers to retract the main boom and dipper stick close to the machine, raise your stabiliser and reset the excavator, near the far reach of the boom. Continue digging.

8. To cover the trench, retract the main boom and dipper stick into its most compact form. If using a mini excavator you can carefully move the it into position to push soil with its ‘bulldozer’ blade. Do not drive over the trench until soil has filled the hole. Use the crawler tracks of the excavator to pack the soil into the trench.

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The Last Word w his rs to not allo g shareholde n own ki is as r “h h be ard wit in Decem bers of its bo em m x si e ac to repl ominees”. slate of six n last hand-picked kosh’s shares sh O 10% of t es gg bi e After buying gl me the sin ca be ng to n ah tr Ic e is now yi summer, e company. H that th g of in r n de ai ol pl shareh kosh com sh O of d ar bo pro-actively discredit the ntive ideas to ta bs su o n s it “provide e.” eholder valu measures enhance shar h retaliative it w et m e er w arles Szews Harsh words Chairman Ch d an O CE ’s from Oshkosh has Donnelly rated that he and Richard not demonst as y h n n pa ah m Ic “Mr. lead your co am that can olders. a plan or a te kosh shareh sh O l al e to e lu rly half of th and deliver va to control nea g in ve ti ek n se ta is bs Mr. Icahn ovided no su d, yet has pr value for all Oshkosh boar es to enhance ys al an or s idea a statement. ,” they said in rs de ol ahn and his eh ar sh ly asked Mr Ic ed d at pe re e e Company an “We hav s regarding th he ea , id te r da ei To th r e. team fo older valu eh ar sh te n ti ea cr for crea g how best to us any ideas h it w ed ss u pany should has not disc inks the Com th e h kosh at h w value or benefit of Osh ently for the e do not er ff “W di t. g en in be do her statem ot S an U id e sa th ,” dialogue that eeting in shareholders m r e terested in a in ld is o n h . ah re Ic a A sh shareholders believe that cide the e d all Oshkosh ld r u fo o n e c ow lu th is va h n s rsuing enhance later this mo s lieve he is pu sts a be h re e te y w in n d, e a ea p th st r “In com e h T t regard fo . ou G h L it J w f o da . n personal agen d all other shareholders future battle betwee is a ny an in p u t h selected as h g u of the compa e that he has been ca ar aw y e tl be th en ld rr d o are cu You shou shkosh an ndidates wh d r e inees four ca g the board of O n om his entities an n a of tr s e o on n or d n n ah a Ic it r w esto onship h employed by a long relati ad h billionaire inv as h o h anot her w ge.

Carl Icahn. ning in colle mmitted to controversy Icahn begin directors is co of d ar bo sh lieves “The Oshko rests and be your best inte in sts of g re n te ti in ac e to presents th re at e th d ar s interest of on that a bo , not just the e rs is de im ol ax eh m ar all sh oned to better positi rns for is tu r, re de or ol of ri e eh pe shar e su ruggle at on e and generat as a power st ng-term valu now it has lo d an t star ted of f es am n rs.” ’s biggest s, emergency one of its all shareholde the industry militar y tr uck the future of es er ak ov m y of le tt sh ba ko Osh t and a variet become a ands. ss equipmen red br ce e pt du ac h m ic en s, te n le as at te ic h ’s h ri t ve favou tr ucks bu Carl Icahn or ed st at el ve its -r in r n d io fo r an d fell sh has construct Entrepreneu ars as deman ard of Oshko ye bo of e ed e th m pl u or of rf co ol h ntr it has pe a tough reet wit to wrestle co US. However ud on Wall St t for e n fe s u th ic th co bl in on s ac pu m ct g u ow ry prod al sales n ny breakin ob become a ve pa gl m d co an e as th s date tives at better overse ace six candi senior execu nd revenue. he fails to pl re su en siderable grou to 17% of total ce silen of made up con ey as Th h . y st n Ea to pa ck h e m u os dl tr co The nts Oshk e board. as the Mid ner of US th ch ow e su on G pl ts Carl Icahn wa ci JL ke in of ar p m sh y the pr ownershi in emerging tween Oshko tential. re-assess its Icahn, alread merger G still has po ruled out a e “synergy” be ternatives JL se el n fe ca y r unities for rl ta and has not ea is cl look at al giant Nav ntial opport r. ta to bs ts su an y w ct e with Navista pa pe h but r products in ld help “We ex and Navistar ntial sale cou etration of ou n te pe po d a an as mpany said.

G on y.

JL adopti kets,” the co e compan ar th m – ie sell – for p g lo e n ve gi de er em y debt and les outside th t the specialit of f company kosh’s net sa bu sh g “O in al ok sc fi ov pr 10% in It took a lot of finally broke US grew from . pment maker ui in fiscal 2011 eq d % an 17 e es to ak m 10 to 20 vehicl e nc JLG & le increase sed vow of si Our goal is to its self-impo shareholders s it our oshkosh to as al % pe 30 this to a public ap llionaire Carl strategy bi In 2006, Oshkosh acquired USS al U n t io or at pp rn inte to not su control le st re w based access equipment manufacturer .” to on pt gains tracti Icahn’s attem at this d ar JLG Industries Inc for $3.2 billion.

JLG until 27 bo d s an y’ n For now of the compa . ng ti ee m has a facility in Southampton Township, future of JLG eholder Januar y, the month’s shar the of e on in state of Pennsylvania in the US. is h balance. ic Oshkosh, wh hangs in the urers ct Oshkosh had a 67 percent drop in fa u an m t es world’s bigg itar y earnings last quarter, but JLG’s d a major mil an s ck u tr t of en business soared. em at st sued a contractor, is r table arm fo JLG is a profi idered ns co is it t Oshkosh bu uct. a niche prod

e r u t u f s ’ G L J The fight for

I

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DX225LCA

Doosan. The closer you look, the better we get.

COUNTRY

DEALER

PHONE +973 17 250 871

BAHRAIN EGYPT

OTRAC

+20226977799

IRAQ

TRISTAR CO.

+964 750 466 1301

JORDAN

FARRADJ & CO.

+962 6 464 3900

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BAHRAH TRADING

OMAN

+965 1802 008 +968 2459 6434

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QATAR NAVIGATION

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SAUDI DIESEL EQUIP. CO.

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