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Construction
Sector Report
www.icd-research.com
Earthmoving Equipment – Market
Opportunities and Business
Environment, Analyses and
Forecasts to 2015 Reference code: CN0107SR
Published: August 2011
EXECUTIVE SUMMARY
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 2
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
1 Executive Summary
The consumption value of global earthmoving equipment increased at a CAGR of 1.13% during the review
period (2006–2010). Robust growth in the Asia-Pacific region has offset decline in the world‘s other two
significant markets, North America and Europe, which recorded CARCs of -10.69% and -8.28% over the
review period. The global economic crisis was one of the main factors behind steep industry contraction.
Loaders, the largest sector in the global earthmoving equipment market, achieved a CAGR of 2.28% during
the review period, increasing their market share from 36.5% in 2006 to 38.2% in 2010. The excavators sector
recorded the fastest growth rates with a CAGR of 2.43% and accounted for 35.6% of the earthmoving
equipment market, an increase of 1.7 percentage points over 2006. Construction tractors, the smallest
sector, recorded a CARC of -1.97% during the review period, observing a market share contraction of 29.6%
in 2006 to 26.1% in 2010.
Construction activities increased in most countries by 2010 a trend which is anticipated to continue over
2011, ICD projects the earthmoving equipment market to record positive growth and achieve a CAGR of
9.26%. While the Asia-Pacific region is expected to remain the industry‘s driving force over the forecast
period, North America and Europe are also expected to regain the growth momentum and achieve healthy
growth rates alongside South America and the Middle East.
Globally, the Asia-Pacific region represents the largest and fastest growing earthmoving equipment market,
valuing US$34.4 billion in 2010, equivalent to a 51.4% share of global consumption value. China has been
the sustaining force behind recent rapid expansion in the Asia-Pacific region, with construction activities for
the 2008 Beijing Olympics alongside significant infrastructural investments, in line with the government‘s
eleventh Five-Year Plan, 2006–2010, being key factors. Additionally, factors such as robust economic
growth, an expanding population and rapid urbanization are supporting growth rates across Asia-Pacific
countries such as Indonesia, India and the Philippines. In contrast to most countries in the region, Japan
recorded a CARC of -11.36% during the review period. However, the reconstruction activities following the
devastating earthquake and tsunami in March 2011 are expected to provide a significant thrust to the
earthmoving equipment market over the forecast period (2010–2015). China, South Korea, India and
Indonesia are additionally expected to continue their growth. Consequently, the earthmoving equipment
consumption value is projected to achieve a CAGR of 11.30% over the forecast period.
North America is the second largest earthmoving equipment market registering a 21.1% share of global
consumption value in 2010. The region recorded a CARC of -10.69% during the review period as the US
housing bubble burst in the wake of the sub-prime crisis causing construction activities to decline. The area
is currently undergoing a period of regional recovery and increased construction activity which is anticipated
to support the demand for earthmoving equipment, recording the second highest CAGR of 8.54% over the
forecast period. Growth will be bolstered by government stimulus packages, rising employment rates,
increased construction activity and improvements in consumer confidence. Although it was expected that the
debt crisis would give rise to challenges for the industry in the US, the US Congress is expected to pass a bill
that will raise the debt ceiling by US$2.4 trillion in 2011. Consumption of earthmoving equipment is forecast
to reach US$21.3 billion by 2015.
Europe was the second worst performing market during the review period with a CARC of -8.28%. As a
result of the global economic crisis the region additionally observed declining market shares, with global
share decreasing from 29.0% in 2006 to 19.6% in 2010. The decline was more severe across developed
economies in Western European, nations such as Spain, Italy, France and Germany, while developing
Central and Eastern European economies, such as Russia and Poland, recorded modest declines. As a
EXECUTIVE SUMMARY
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 3
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
result of the debt crisis, uncertain economic conditions across Western European are expected to mitigate
growth, with the region projected to achieve a CAGR of 5.27% over the forecast period. Limited growth is
expected to be supported by construction activities in less developed European economies such as Russia,
Hungary, Croatia, and Poland.
South America represented the second fastest growing earthmoving equipment market globally, with a
review period CAGR of 13.86%. Growth has been supported by the implementation of a political and
economic plan known as ―Democratic Security‖, in Colombia alongside a US$285.4 billion (BRL500.8 billion)
investment allocation by the Brazilian federal government for infrastructure development under the
Programade Aceleraçãodo Crescimento (PAC) program. Over the forecast period, Brazil will continue to
sustain growth levels within the region making significant investments for the construction of stadia and
transportation infrastructure associated with The 2014 FIFA World Cup and for The 2016 Olympic Games.
Mexico, Argentina and Colombia are additionally expected to record growth due to robust economic
expansion, increasing population and rapid urbanization. As a result, earthmoving equipment consumption is
projected to achieve a CAGR of 7.35% over the forecast period.
Globally, the Middle East is the smallest consumer of earthmoving equipment accounting for a 2.8% share of
overall consumption in 2010. During the review period, regional consumption expanded at a CAGR of 4.14%
with the UAE and Saudi Arabia registering significant growth rates, while simultaneously consumption
declined in Qatar and Turkey. The region observed increased levels of construction activity up until 2008 as
revenues from oil increased and governments across the region made attempts to diversify their economies
by investing in infrastructure. With construction activities recovering and Qatar and Saudi Arabia expected to
attract large investments over 2011, the earthmoving equipment consumption is forecast to expand at a
CAGR of 7.35% over the forecast period.
TABLE OF CONTENTS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 4
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
TABLE OF CONTENTS
1 Executive Summary .............................................................................................................. 2
1 Introduction ......................................................................................................................... 20
1.1 What is this Report About? ..............................................................................................................20
1.2 Definitions .......................................................................................................................................20
1.3 Summary Methodology ...................................................................................................................21
2 GLOBAL MARKET ENVIRONMENT ................................................................................... 24
2.1 Economic Indicators ........................................................................................................................24
2.1.1 GDP at Constant Prices............................................................................................................................ 24
2.1.2 GDP Per Capita at Constant Prices ......................................................................................................... 25
2.2 Demographics and Labor ................................................................................................................26
2.2.1 Population ................................................................................................................................................. 26
2.2.2 Growth in Mid-Age Population .................................................................................................................. 27
2.2.3 Employment Rate ..................................................................................................................................... 28
2.2.4 Unemployment Rate ................................................................................................................................. 29
2.3 Industrial Output Growth .................................................................................................................30
2.4 Services Growth ..............................................................................................................................31
2.5 Agriculture Growth ..........................................................................................................................32
2.6 Construction Value Added as a Percentage of GDP .......................................................................33
3 GLOBAL EARTHMOVING EQUIPMENT MARKET ANALYSIS .......................................... 34
3.1 Market Overview .............................................................................................................................34
3.2 Global Earthmoving Equipment Consumption .................................................................................36
3.2.1 Consumption Value .................................................................................................................................. 36
3.2.2 Consumption Value by Category .............................................................................................................. 38
3.3 Global Earthmoving Equipment Production .....................................................................................42
3.3.1 Production Value ...................................................................................................................................... 42
3.3.2 Production Value by Category .................................................................................................................. 44
4 NORTH AMERICA ................................................................................................................ 48
4.1 Market Environment ........................................................................................................................48
4.1.1 Economic Indicators ................................................................................................................................. 48
4.1.2 Monetary Indicators .................................................................................................................................. 49
4.1.3 Trade and Investment Indicators .............................................................................................................. 49
4.2 North America Earthmoving Equipment Market Analysis .................................................................50
4.3 Consumption ...................................................................................................................................52
4.3.1 Consumption Value .................................................................................................................................. 52
4.3.2 Consumption Value by Category .............................................................................................................. 54
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Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 5
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
4.4 Production .......................................................................................................................................58
4.4.1 Production Value ...................................................................................................................................... 58
4.4.2 Production Value by Category .................................................................................................................. 60
4.5 UNITED STATES ............................................................................................................................64
4.5.1 Consumption Value .................................................................................................................................. 64
4.5.2 Consumption Value by Category .............................................................................................................. 66
4.6 CANADA .........................................................................................................................................67
4.6.1 Consumption Value .................................................................................................................................. 67
4.6.2 Consumption Value by Category .............................................................................................................. 69
5 EUROPE ............................................................................................................................... 70
5.1 Market Environment ........................................................................................................................70
5.1.1 Economic Indicators ................................................................................................................................. 70
5.1.2 Monetary Indicators .................................................................................................................................. 71
5.1.3 Trade and Investment Indicators .............................................................................................................. 71
5.2 Europe Earthmoving Equipment Market Analysis ............................................................................72
5.3 Consumption ...................................................................................................................................74
5.3.1 Consumption Value .................................................................................................................................. 74
5.3.2 Consumption Value by Category .............................................................................................................. 76
5.4 Production .......................................................................................................................................80
5.4.1 Production Value ...................................................................................................................................... 80
5.4.2 Production Value by Category .................................................................................................................. 82
5.5 Germany .........................................................................................................................................85
5.5.1 Consumption Value .................................................................................................................................. 85
5.5.2 Consumption Value by Category .............................................................................................................. 87
5.6 SPAIN .............................................................................................................................................88
5.6.1 Consumption Value .................................................................................................................................. 88
5.6.2 Consumption Value by Category .............................................................................................................. 90
5.7 FRANCE .........................................................................................................................................91
5.7.1 Consumption Value .................................................................................................................................. 91
5.7.2 Consumption Value by Category .............................................................................................................. 93
5.8 ITALY ..............................................................................................................................................94
5.8.1 Consumption Value .................................................................................................................................. 94
5.8.2 Consumption Value by Category .............................................................................................................. 96
5.9 UNITED KINGDOM .........................................................................................................................97
5.9.1 Consumption Value .................................................................................................................................. 97
5.9.2 Consumption Value by Category .............................................................................................................. 99
5.10 CROATIA ...................................................................................................................................... 100
5.10.1 Consumption Value ................................................................................................................................ 100
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Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 6
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
5.10.2 Consumption Value by Category ............................................................................................................ 102
5.11 CZECH REPUBLIC ....................................................................................................................... 103
5.11.1 Consumption Value ................................................................................................................................ 103
5.11.2 Consumption Value by Category ............................................................................................................ 105
5.12 RUSSIA ........................................................................................................................................ 106
5.12.1 Consumption Value ................................................................................................................................ 106
5.12.2 Consumption Value by Category ............................................................................................................ 108
5.13 POLAND ....................................................................................................................................... 109
5.13.1 Consumption Value ................................................................................................................................ 109
5.13.2 Consumption Value by Category ............................................................................................................ 111
5.14 HUNGARY .................................................................................................................................... 112
5.14.1 Consumption Value ................................................................................................................................ 112
5.14.2 Consumption Value by Category ............................................................................................................ 114
5.15 SWITZERLAND ............................................................................................................................ 115
5.15.1 Consumption Value ................................................................................................................................ 115
5.15.2 Consumption Value by Category ............................................................................................................ 117
5.16 NETHERLANDS ........................................................................................................................... 118
5.16.1 Consumption Value ................................................................................................................................ 118
5.16.2 Consumption Value by Category ............................................................................................................ 120
6 ASIA-PACIFIC .................................................................................................................... 121
6.1 Market Environment ...................................................................................................................... 121
6.1.1 Economic Indicators ............................................................................................................................... 121
6.1.2 Monetary Indicators ................................................................................................................................ 122
6.1.3 Trade and Investment Indicators ............................................................................................................ 122
6.2 Asia-Pacific Earthmoving Equipment Market Analysis ................................................................... 123
6.3 Consumption ................................................................................................................................. 125
6.3.1 Consumption Value ................................................................................................................................ 125
6.3.2 Consumption Value by Category ............................................................................................................ 127
6.4 Production ..................................................................................................................................... 130
6.4.1 Production Value .................................................................................................................................... 130
6.4.2 Production Value by Category ................................................................................................................ 132
6.5 CHINA ........................................................................................................................................... 135
6.5.1 Consumption Value ................................................................................................................................ 135
6.5.2 Consumption Value by Category ............................................................................................................ 137
6.6 INDIA ............................................................................................................................................ 138
6.6.1 Consumption Value ................................................................................................................................ 138
6.6.2 Consumption Value by Category ............................................................................................................ 140
6.7 JAPAN .......................................................................................................................................... 141
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Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 7
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
6.7.1 Consumption Value ................................................................................................................................ 141
6.7.2 Consumption Value by Category ............................................................................................................ 143
6.8 SOUTH KOREA ............................................................................................................................ 144
6.8.1 Consumption Value ................................................................................................................................ 144
6.8.2 Consumption Value by Category ............................................................................................................ 146
6.9 AUSTRALIA .................................................................................................................................. 147
6.9.1 Consumption Value ................................................................................................................................ 147
6.9.2 Consumption Value by Category ............................................................................................................ 149
6.10 INDONESIA .................................................................................................................................. 150
6.10.1 Consumption Value ................................................................................................................................ 150
6.10.2 Consumption Value by Category ............................................................................................................ 152
6.11 MALAYSIA .................................................................................................................................... 153
6.11.1 Consumption Value ................................................................................................................................ 153
6.11.2 Consumption Value by Category ............................................................................................................ 155
6.12 PHILIPPINES ................................................................................................................................ 156
6.12.1 Consumption Value ................................................................................................................................ 156
6.12.2 Consumption Value by Category ............................................................................................................ 158
7 SOUTH AMERICA .............................................................................................................. 159
7.1 Market Environment ...................................................................................................................... 159
7.1.1 Economic Indicators ............................................................................................................................... 159
7.1.2 Monetary Indicators ................................................................................................................................ 160
7.1.3 Trade and Investment Indicators ............................................................................................................ 160
7.2 South American Earthmoving Equipment Market Analysis ............................................................ 161
7.3 Consumption ................................................................................................................................. 163
7.3.1 Consumption Value ................................................................................................................................ 163
7.3.2 Consumption Value by Category ............................................................................................................ 165
7.4 Production ..................................................................................................................................... 169
7.4.1 Production Value .................................................................................................................................... 169
7.4.2 Production Value by Category ................................................................................................................ 171
7.5 BRAZIL ......................................................................................................................................... 174
7.5.1 Consumption Value ................................................................................................................................ 174
7.5.2 Consumption Value by Category ............................................................................................................ 176
7.6 ARGENTINA ................................................................................................................................. 177
7.6.1 Consumption Value ................................................................................................................................ 177
7.6.2 Consumption Value by Category ............................................................................................................ 179
7.7 COLOMBIA ................................................................................................................................... 180
7.7.1 Consumption Value ................................................................................................................................ 180
7.7.2 Consumption Value by Category ............................................................................................................ 182
TABLE OF CONTENTS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 8
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
7.8 MEXICO ........................................................................................................................................ 183
7.8.1 Consumption Value ................................................................................................................................ 183
7.8.2 Consumption Value by Category ............................................................................................................ 185
8 MIDDLE EAST .................................................................................................................... 186
8.1 Market Environment ...................................................................................................................... 186
8.1.1 Economic Indicators ............................................................................................................................... 186
8.1.2 Trade and Investment Indicators ............................................................................................................ 186
8.2 The Middle Eastern Earthmoving Equipment Market Analysis ....................................................... 187
8.3 Consumption ................................................................................................................................. 189
8.3.1 Consumption Value ................................................................................................................................ 189
8.3.2 Consumption Value by Category ............................................................................................................ 191
8.4 Production ..................................................................................................................................... 194
8.4.1 Production Value .................................................................................................................................... 194
8.4.2 Production Value by Category ................................................................................................................ 196
8.5 SAUDI ARABIA ............................................................................................................................. 199
8.5.1 Consumption Value ................................................................................................................................ 199
8.5.2 Consumption Value by Category ............................................................................................................ 201
8.6 UNITED ARAB EMIRATES ........................................................................................................... 202
8.6.1 Consumption Value ................................................................................................................................ 202
8.6.2 Consumption Value by Category ............................................................................................................ 204
8.7 QATAR ......................................................................................................................................... 205
8.7.1 Consumption Value ................................................................................................................................ 205
8.7.2 Consumption Value by Category ............................................................................................................ 207
8.8 TURKEY ....................................................................................................................................... 208
8.8.1 Consumption Value ................................................................................................................................ 208
8.8.2 Consumption Value by Category ............................................................................................................ 210
9 Company Profile: AB Volvo .............................................................................................. 211
9.1 AB Volvo Company Overview ....................................................................................................... 211
9.2 AB Volvo - Business Description ................................................................................................... 211
9.3 AB Volvo - Main Products and Services ........................................................................................ 213
9.4 AB Volvo - History ......................................................................................................................... 213
9.5 AB Volvo - SWOT Analysis ........................................................................................................... 215
9.5.1 AB Volvo – Strengths .............................................................................................................................. 215
9.5.2 AB Volvo – Weaknesses ........................................................................................................................ 216
9.5.3 AB Volvo – Opportunities........................................................................................................................ 216
9.5.4 AB Volvo – Threats ................................................................................................................................. 217
9.6 AB Volvo – Company Information ................................................................................................. 218
9.6.1 AB Volvo - Key Competitors ................................................................................................................... 218
TABLE OF CONTENTS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 9
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
9.6.2 AB Volvo - Key Employees ..................................................................................................................... 219
10 Company Profile: Caterpillar Inc. ..................................................................................... 220
10.1 Caterpillar Inc. Company Overview ............................................................................................... 220
10.2 Caterpillar Inc. - Business Description ........................................................................................... 220
10.3 Caterpillar Inc. - Main Products and Services ................................................................................ 221
10.4 Caterpillar Inc. - History ................................................................................................................. 222
10.5 Caterpillar Inc. - SWOT Analysis ................................................................................................... 223
10.5.1 Caterpillar Inc. – Strengths ..................................................................................................................... 223
10.5.2 Caterpillar Inc. – Weaknesses ................................................................................................................ 224
10.5.3 Caterpillar Inc. – Opportunities ............................................................................................................... 224
10.5.4 Caterpillar Inc. – Threats ........................................................................................................................ 225
10.6 Caterpillar Inc. – Company Information ......................................................................................... 226
10.6.1 Caterpillar Inc. - Key Competitors ........................................................................................................... 226
10.6.2 Caterpillar Inc. - Key Employees ............................................................................................................ 226
11 Company Profile: Mitsubishi Heavy Industries, Ltd. ...................................................... 228
11.1 Mitsubishi Heavy Industries, Ltd. - Company Overview ................................................................. 228
11.2 Mitsubishi Heavy Industries, Ltd. - Business Description ............................................................... 228
11.3 Mitsubishi Heavy Industries, Ltd. - Main Products ......................................................................... 230
11.4 Mitsubishi Heavy Industries, Ltd. - History ..................................................................................... 232
11.5 Mitsubishi Heavy Industries, Ltd. - SWOT Analysis ....................................................................... 233
11.5.1 Mitsubishi Heavy Industries, Ltd. – Strengths ........................................................................................ 233
11.5.2 Mitsubishi Heavy Industries, Ltd. – Weaknesses ................................................................................... 234
11.5.3 Mitsubishi Heavy Industries, Ltd. – Opportunities .................................................................................. 234
11.5.4 Mitsubishi Heavy Industries, Ltd. – Threats............................................................................................ 235
11.6 Mitsubishi Heavy Industries, Ltd. – Company Information ............................................................. 236
11.6.1 Mitsubishi Heavy Industries, Ltd. - Key Competitors .............................................................................. 236
11.6.2 Mitsubishi Heavy Industries, Ltd. - Key Employees ............................................................................... 236
12 Company Profile: Hyundai Heavy Industries Co., Ltd. ................................................... 238
12.1 Hyundai Heavy Industries Co., Ltd. - Company Overview ............................................................. 238
12.2 Hyundai Heavy Industries Co., Ltd. - Business Description ........................................................... 238
12.3 Hyundai Heavy Industries Co., Ltd. - Main Products and Services ................................................ 240
12.4 Hyundai Heavy Industries Co., Ltd. - History ................................................................................. 241
12.5 Hyundai Heavy Industries Co., Ltd. - SWOT Analysis ................................................................... 242
12.5.1 Hyundai Heavy Industries Co., Ltd. – Strengths .................................................................................... 242
12.5.2 Hyundai Heavy Industries Co., Ltd. – Weaknesses ............................................................................... 243
12.5.3 Hyundai Heavy Industries Co., Ltd. – Opportunities .............................................................................. 243
12.5.4 Hyundai Heavy Industries Co., Ltd. – Threats ........................................................................................ 244
TABLE OF CONTENTS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 10
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
12.6 Hyundai Heavy Industries Co., Ltd. – Company Information ......................................................... 244
12.6.1 Hyundai Heavy Industries Co., Ltd. - Key Competitors .......................................................................... 244
12.6.2 Hyundai Heavy Industries Co., Ltd. - Key Employees ............................................................................ 245
13 Company Profile: Komatsu Ltd. ....................................................................................... 246
13.1 Komatsu Ltd. – Company Overview .............................................................................................. 246
13.2 Komatsu Ltd. – Business Description ............................................................................................ 246
13.3 Komatsu Ltd. – Main Products and Brands ................................................................................... 247
13.4 Komatsu Ltd. – History .................................................................................................................. 248
13.5 Komatsu Ltd. – SWOT Analysis .................................................................................................... 249
13.5.1 Komatsu Ltd. – Strengths ....................................................................................................................... 249
13.5.2 Komatsu Ltd. – Weaknesses .................................................................................................................. 250
13.5.3 Komatsu Ltd. – Opportunities ................................................................................................................. 251
13.5.4 Komatsu Ltd. – Threats .......................................................................................................................... 251
13.6 Komatsu Ltd. – Company Information ........................................................................................... 252
13.6.1 Komatsu Ltd. – Key Competitors ............................................................................................................ 252
13.6.2 Komatsu Ltd. – Key Employees ............................................................................................................. 252
14 Company Profile: Hitachi Construction Machinery Co., Ltd. ......................................... 254
14.1 Hitachi Construction Machinery Co., Ltd. - Company Overview ..................................................... 254
14.2 Hitachi Construction Machinery Co., Ltd. - Business Description .................................................. 254
14.3 Hitachi Construction Machinery Co., Ltd. - Main Products and Services ....................................... 255
14.4 Hitachi Construction Machinery Co., Ltd. - History ........................................................................ 256
14.5 Hitachi Construction Machinery Co., Ltd. - SWOT Analysis ........................................................... 257
14.5.1 Hitachi Construction Machinery Co., Ltd. – Strengths ............................................................................ 258
14.5.2 Hitachi Construction Machinery Co., Ltd. – Weaknesses ...................................................................... 258
14.5.3 Hitachi Construction Machinery Co., Ltd. – Opportunities ...................................................................... 259
14.5.4 Hitachi Construction Machinery Co., Ltd. – Threats ............................................................................... 260
14.6 Hitachi Construction Machinery Co., Ltd. – Company Information ................................................. 260
14.6.1 Hitachi Construction Machinery Co., Ltd. - Key Competitors ................................................................. 260
14.6.2 Hitachi Construction Machinery Co., Ltd. - Key Employees ................................................................... 261
15 Company Profile: Doosan Infracore Co., Ltd .................................................................. 262
15.1 Doosan Infracore Co. Ltd - Company Overview ............................................................................ 262
15.2 Doosan Infracore Co., Ltd - Business Description ......................................................................... 262
15.3 Doosan Infracore Co. Ltd - Major Products ................................................................................... 264
15.4 Doosan Infracore Co., Ltd - History ............................................................................................... 265
15.5 Doosan Infracore Co., Ltd - SWOT Analysis ................................................................................. 266
15.5.1 Doosan Infracore Co., Ltd – Strengths ................................................................................................... 266
15.5.2 Doosan Infracore Co., Ltd – Weaknesses .............................................................................................. 267
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© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
15.5.3 Doosan Infracore Co. Ltd – Opportunities .............................................................................................. 267
15.5.4 Doosan Infracore Co. Ltd – Threats ....................................................................................................... 268
15.6 Doosan Infracore Co., Ltd – Company Information ........................................................................ 269
15.6.1 Doosan Infracore Co. Ltd - Key Competitors.......................................................................................... 269
15.6.2 Doosan Infracore Co. Ltd - Key Employees ........................................................................................... 269
16 Company Profile: BEML Limited ...................................................................................... 270
16.1 BEML Limited - Company Overview .............................................................................................. 270
16.2 BEML Limited - Business Description ............................................................................................ 270
16.3 BEML Limited - Major Products Services and Brands ................................................................... 272
16.4 BEML Limited - History .................................................................................................................. 275
16.5 BEML Limited - SWOT Analysis .................................................................................................... 276
16.5.1 BEML Limited – Strengths ...................................................................................................................... 276
16.5.2 BEML Limited – Weaknesses ................................................................................................................. 277
16.5.3 BEML Limited – Opportunities ................................................................................................................ 277
16.5.4 BEML Limited – Threats ......................................................................................................................... 279
16.6 BEML Limited – Company Information .......................................................................................... 280
16.6.1 BEML Limited - Key Competitors ........................................................................................................... 280
16.6.2 BEML Limited - Key Employees ............................................................................................................. 280
17 Company Profile: Escorts Limited ................................................................................... 281
17.1 Escorts Limited Company Overview .............................................................................................. 281
17.2 Escorts Limited - Major Products ................................................................................................... 281
17.3 Escorts Limited – Company Information ........................................................................................ 282
17.3.1 Escorts Limited - Key Competitors ......................................................................................................... 282
17.3.2 Escorts Limited - Key Employees ........................................................................................................... 282
18 Company Profile: Telco Construction Equipment Company Limited ........................... 283
18.1 Telco Construction Equipment Company Limited Company Overview .......................................... 283
18.2 Telco Construction Equipment Company Limited - Business Description ...................................... 283
18.3 Telco Construction Equipment Company Limited - Major Products, Services and Brands ............. 284
18.4 Telco Construction Equipment Company Limited - History ............................................................ 285
18.5 Telco Construction Equipment Company Limited - SWOT Analysis .............................................. 286
18.5.1 Telco Construction Equipment Company Limited – Strengths ............................................................... 286
18.5.2 Telco Construction Equipment Company Limited – Weaknesses ......................................................... 287
18.5.3 Telco Construction Equipment Company Limited – Opportunities ......................................................... 287
18.5.4 Telco Construction Equipment Company Limited – Threats .................................................................. 288
18.6 Telco Construction Equipment Company Limited – Company Information .................................... 289
18.6.1 Telco Construction Equipment Company Limited - Key Competitors .................................................... 289
18.6.2 Telco Construction Equipment Company Limited - Key Employees ...................................................... 289
TABLE OF CONTENTS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 12
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
19 Annual Review ................................................................................................................... 290
20 Appendix ............................................................................................................................ 299
TABLE OF CONTENTS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 13
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
LIST OF FIGURES
Figure 1: Global GDP at Constant Prices (US$ Billion), 2006–2015 .................................................................................................................... 24 Figure 2: Global GDP Per Capita at Constant Prices (US$), 2006–2015 ............................................................................................................ 25 Figure 3: Global Population (Million), 2006–2015 ............................................................................................................................................... 26 Figure 4: Global Growth in Mid-Age Population (%), 2006–2015 ........................................................................................................................ 27 Figure 5: Global Employment Rate (%), 2006–2015 ........................................................................................................................................... 28 Figure 6: Global Unemployment Rate (%), 2006–2015 ....................................................................................................................................... 29 Figure 7: Global Industrial Output Growth (%), 2006–2015 ................................................................................................................................. 30 Figure 8: Global Services Growth (%), 2006–2015 ............................................................................................................................................. 31 Figure 9: Global Agriculture Growth (%), 2006–2015 .......................................................................................................................................... 32 Figure 10: Global Construction Value Added as a Percentage of GDP (%), 2006–2015 ..................................................................................... 33 Figure 11: Global Earthmoving Equipment Consumption Dynamics by Value (%), 2006–2015 ........................................................................... 34 Figure 12: Global Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ................................................................................. 36 Figure 13: Global Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ................................................................................. 37 Figure 14: Global Earthmoving Equipment Consumption Value by Category (%), 2006–2010 ............................................................................ 39 Figure 15: Global Earthmoving Equipment Consumption Value by Category (%), 2010–2015 ............................................................................ 41 Figure 16: Global Earthmoving Equipment Production Value (US$ Million), 2006–2010 ..................................................................................... 42 Figure 17: Global Earthmoving Equipment Production Value (US$ Million), 2010–2015 ..................................................................................... 43 Figure 18: Global Earthmoving Equipment Production Value by Category (%), 2006–2010 ................................................................................ 45 Figure 19: Global Earthmoving Equipment Production Value by Category (%), 2010–2015 ................................................................................ 47 Figure 20: North American Earthmoving Equipment Consumption Dynamics by Value (%), 2006–2015 ............................................................. 50 Figure 21: North American Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ................................................................... 52 Figure 22: North American Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ................................................................... 53 Figure 23: North American Earthmoving Equipment Consumption Value by Category (%), 2006–2010 .............................................................. 55 Figure 24: North American Earthmoving Equipment Consumption Value by Category (%), 2010–2015 .............................................................. 57 Figure 25: North American Earthmoving Equipment Production Value (US$ Million), 2006–2010 ....................................................................... 58 Figure 26: North American Earthmoving Equipment Production Value (US$ Million), 2010–2015 ....................................................................... 59 Figure 27: North American Earthmoving Equipment Production Value by Category (%), 2006–2010 .................................................................. 61 Figure 28: North American Earthmoving Equipment Production Value by Category (%), 2010–2015 .................................................................. 63 Figure 29: US Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ...................................................................................... 64 Figure 30: US Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ...................................................................................... 65 Figure 31: US Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015 .................................................................. 66 Figure 32: Canadian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ............................................................................ 67 Figure 33: Canadian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ............................................................................ 68 Figure 34: Canadian Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015........................................................ 69 Figure 35: European Earthmoving Equipment Consumption Dynamics by Value (%), 2006–2015 ...................................................................... 72 Figure 36: European Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ............................................................................ 74 Figure 37: European Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ............................................................................ 75 Figure 38: European Earthmoving Equipment Consumption Value by Category (%), 2006–2010 ....................................................................... 77 Figure 39: European Earthmoving Equipment Consumption Value by Category (%), 2010–2015 ....................................................................... 79 Figure 40: European Earthmoving equipment Production Value (US$ Million), 2006–2010 ................................................................................ 80 Figure 41: European Earthmoving Equipment Production Value (US$ Million), 2010–2015 ................................................................................ 81 Figure 42: European Earthmoving Equipment Production Value by Category (%), 2006–2010 ........................................................................... 83 Figure 43: European Earthmoving Equipment Production Value by Category (%), 2010–2015 ........................................................................... 84 Figure 44: German Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ............................................................................... 85 Figure 45: German Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ............................................................................... 86 Figure 46: German Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015 .......................................................... 87 Figure 47: Spanish Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ............................................................................... 88 Figure 48: Spanish Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ............................................................................... 89 Figure 49: Spanish Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015 .......................................................... 90 Figure 50: French Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ................................................................................ 91 Figure 51: French Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ................................................................................ 92 Figure 52: French Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015 ............................................................ 93 Figure 53: Italian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 .................................................................................. 94 Figure 54: Italian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 .................................................................................. 95 Figure 55: Italian Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015 ............................................................. 96 Figure 56: UK Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ...................................................................................... 97 Figure 57: UK Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ...................................................................................... 98
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© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
Figure 58: UK Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015 .................................................................. 99 Figure 59: Croatian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 .............................................................................100 Figure 60: Croatian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 .............................................................................101 Figure 61: Croatian Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015 ........................................................102 Figure 62: Czech Republic Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ..................................................................103 Figure 63: Czech Republic Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ..................................................................104 Figure 64: Czech Republic Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015 .............................................105 Figure 65: Russian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ..............................................................................106 Figure 66: Russian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ..............................................................................107 Figure 67: Russian Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015 .........................................................108 Figure 68: Polish Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 .................................................................................109 Figure 69: Polish Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 .................................................................................110 Figure 70: Polish Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015 ............................................................111 Figure 71: Hungarian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ..........................................................................112 Figure 72: Hungarian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ..........................................................................113 Figure 73: Hungarian Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015 .....................................................114 Figure 74: Swiss Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 .................................................................................115 Figure 75: Swiss Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 .................................................................................116 Figure 76: Swiss Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015 ............................................................117 Figure 77: Dutch Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 .................................................................................118 Figure 78: Dutch Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 .................................................................................119 Figure 79: Dutch Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015 ............................................................120 Figure 80: Asia-Pacific Earthmoving Equipment Consumption Dynamics by Value (%), 2006–2015 ..................................................................123 Figure 81: Asia-Pacific Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ........................................................................125 Figure 82: Asia-Pacific Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ........................................................................126 Figure 83: Asia-Pacific Earthmoving Equipment Consumption Value by Category (%), 2006–2010 ...................................................................128 Figure 84: Asia-Pacific Earthmoving Equipment Consumption Value by Category (%), 2010–2015 ...................................................................129 Figure 85: Asia-Pacific Earthmoving equipment Production Value (US$ Million), 2006–2010 ............................................................................130 Figure 86: Asia-Pacific Earthmoving Equipment Production Value (US$ Million), 2010–2015 ............................................................................131 Figure 87: Asia-Pacific Earthmoving Equipment Production Value by Category (%), 2006–2010 .......................................................................133 Figure 88: Asia-Pacific Earthmoving Equipment Production Value by Category (%), 2010–2015 .......................................................................134 Figure 89: Chinese Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 .............................................................................135 Figure 90: Chinese Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 .............................................................................136 Figure 91: Chinese Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015 .........................................................137 Figure 92: Indian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 .................................................................................138 Figure 93: Indian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 .................................................................................139 Figure 94: Indian Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015 ............................................................140 Figure 95: Japanese Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ...........................................................................141 Figure 96: Japanese Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ...........................................................................142 Figure 97: Japanese Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015 ......................................................143 Figure 98: South Korean Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 .....................................................................144 Figure 99: South Korean Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 .....................................................................145 Figure 100: South Korean Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015 ..............................................146 Figure 101: Australian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 .........................................................................147 Figure 102: Australian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 .........................................................................148 Figure 103: Australian Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015 ....................................................149 Figure 104: Indonesian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 .......................................................................150 Figure 105: Indonesian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 .......................................................................151 Figure 106: Indonesian Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015 ..................................................152 Figure 107: Malaysian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 .........................................................................153 Figure 108: Malaysian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 .........................................................................154 Figure 109: Malaysian Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015 ....................................................155 Figure 110: Philippine Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 .........................................................................156 Figure 111: Philippine Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 .........................................................................157 Figure 112: Philippine Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015 ....................................................158 Figure 113: South America Earthmoving Equipment Consumption Dynamics by Value (%), 2006–2015 ...........................................................161 Figure 114: South American Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ...............................................................163 Figure 115: South American Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ...............................................................164 Figure 116: South American Earthmoving Equipment Consumption Value by Category (%), 2006–2010 ..........................................................166 Figure 117: South American Earthmoving Equipment Consumption Value by Category (%), 2010–2015 ..........................................................168
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Forecasts to 2015 Page 15
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
Figure 118: South American Earthmoving Equipment Production Value (US$ Million), 2006–2010 ...................................................................169 Figure 119: South American Earthmoving Equipment Production Value (US$ Million), 2010–2015 ...................................................................170 Figure 120: South American Earthmoving Equipment Production Value by Category (%), 2006–2010 ..............................................................172 Figure 121: South American Earthmoving Equipment Production Value by Category (%), 2010–2015 ..............................................................173 Figure 122: Brazilian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ...........................................................................174 Figure 123: Brazilian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ...........................................................................175 Figure 124: Brazilian Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015 ......................................................176 Figure 125: Argentine Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 .........................................................................177 Figure 126: Argentine Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 .........................................................................178 Figure 127: Argentine Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015.....................................................179 Figure 128: Colombian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ........................................................................180 Figure 129: Colombian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ........................................................................181 Figure 130: Colombian Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015 ...................................................182 Figure 131: Mexican Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ...........................................................................183 Figure 132: Mexican Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ...........................................................................184 Figure 133: Mexican Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015.......................................................185 Figure 134: Middle East Earthmoving Equipment Consumption Dynamics by Value (%), 2006–2015 ................................................................187 Figure 135: Middle East Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ......................................................................189 Figure 136: Middle East Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ......................................................................190 Figure 137: Middle East Earthmoving Equipment Consumption Value by Category (%), 2006–2010 .................................................................192 Figure 138: Middle East Earthmoving Equipment Consumption Value by Category (%), 2010–2015 .................................................................193 Figure 139: Middle East Earthmoving Equipment Production Value (US$ Million), 2006–2010 ..........................................................................194 Figure 140: Middle East Earthmoving Equipment Production Value (US$ Million), 2010–2015 ..........................................................................195 Figure 141: Middle East Earthmoving Equipment Production Value by Category (%), 2006–2010 .....................................................................197 Figure 142: Middle East Earthmoving Equipment Production Value by Category (%), 2010–2015 .....................................................................198 Figure 143: Saudi Arabian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ..................................................................199 Figure 144: Saudi Arabian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ..................................................................200 Figure 145: Saudi Arabian Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015 .............................................201 Figure 146:UAE Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ..................................................................................202 Figure 147: UAE Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 .................................................................................203 Figure 148: UAE Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015 ............................................................204 Figure 149: Qatar Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ................................................................................205 Figure 150: Qatar Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ................................................................................206 Figure 151: Qatar Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015 ...........................................................207 Figure 152: Turkish Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 .............................................................................208 Figure 153: Turkish Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 .............................................................................209 Figure 154: Turkish Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015 ........................................................210
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LIST OF TABLES
Table 1: Global Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 .................................................................................... 36 Table 2: Global Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 .................................................................................... 37 Table 3: Global Earthmoving Equipment Consumption Value by Category/Sub Category (US$ Million), 2006–2010 .......................................... 38 Table 4: Global Earthmoving Equipment Consumption Value by Category/Sub Category (US$ Million), 2010–2015 .......................................... 40 Table 5: Global Earthmoving Equipment Production Value (US$ Million), 2006–2010 ........................................................................................ 42 Table 6: Global Earthmoving Equipment Production Value (US$ Million), 2010–2015 ........................................................................................ 43 Table 7: Global Earthmoving Equipment Production Value by Category/Sub Category (US$ Million), 2006–2010 .............................................. 44 Table 8: Global Earthmoving Equipment Production Value by Category/Sub Category (US$ Million), 2010–2015 .............................................. 46 Table 9: North American Economic Indicators, 2006–2010 ................................................................................................................................. 48 Table 10: North American Economic Indicators, 2010–2015 ............................................................................................................................... 48 Table 11: North American Monetary Indicators, 2006–2010 ............................................................................................................................... 49 Table 12: North American Monetary Indicators, 2010–2015 ............................................................................................................................... 49 Table 13: North American Trade and Investment Indicators, 2006–2009 ............................................................................................................ 49 Table 14: North American Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 .................................................................... 52 Table 15: North American Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 .................................................................... 53 Table 16: North American Earthmoving Equipment Consumption Value by Category/Sub category (US$ Million), 2006–2010 ........................... 54 Table 17: North American Earthmoving Equipment Consumption Value by Category/Sub category (US$ Million), 2010–2015 ........................... 56 Table 18: North American Earthmoving Equipment Production Value (US$ Million), 2006–2010 ........................................................................ 58 Table 19: North American Earthmoving Equipment Production Value (US$ Million), 2010–2015 ........................................................................ 59 Table 20: North American Earthmoving Equipment Production Value by Category/Sub category (US$ Million), 2006–2010............................... 60 Table 21: North American Earthmoving Equipment Production Value by Category/Sub category (US$ Million), 2010–2015............................... 62 Table 22: US Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ........................................................................................ 64 Table 23: US Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ........................................................................................ 65 Table 24: US Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million), 2006, 2010 and 2015.............................. 66 Table 25: Canadian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010.............................................................................. 67 Table 26: Canadian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015.............................................................................. 68 Table 27: Canadian Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million), 2006, 2010 and 2015 ................... 69 Table 28: European Economic Indicators, 2006–2010 ........................................................................................................................................ 70 Table 29: European Economic Indicators, 2010–2015 ........................................................................................................................................ 70 Table 30: European Monetary Indicators, 2006–2010 ......................................................................................................................................... 71 Table 31: European Monetary Indicators, 2010–2015 ......................................................................................................................................... 71 Table 32: European Trade and Investment Indicators, 2006–2009 ..................................................................................................................... 71 Table 33: European Earthmoving Equipment Value (US$ Million), 2006–2010 ................................................................................................... 74 Table 34: European Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ............................................................................. 75 Table 35: European Earthmoving Equipment Consumption Value by Category/Sub category (US$ Million), 2006–2010 .................................... 76 Table 36: European Earthmoving Equipment Consumption Value by Category/Sub category (US$ Million), 2010–2015 .................................... 78 Table 37: European Earthmoving Equipment Production Value (US$ Million), 2006–2010 ................................................................................ 80 Table 38: European Earthmoving Equipment Production Value (US$ Million), 2010–2015 ................................................................................. 81 Table 39: European Earthmoving Equipment Production Value by Category/Sub category (US$ Million), 2006–2010 ........................................ 82 Table 40: European Earthmoving Equipment Production Value by Category/Sub category (US$ Million), 2010–2015 ........................................ 84 Table 41: German Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ................................................................................ 85 Table 42: German Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ................................................................................ 86 Table 43: German Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million), 2006, 2010 and 2015 ...................... 87 Table 44: Spanish Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ................................................................................ 88 Table 45: Spanish Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ................................................................................ 89 Table 46: Spanish Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million), 2006, 2010 and 2015 ...................... 90 Table 47: French Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 .................................................................................. 91 Table 48: French Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 .................................................................................. 92 Table 49: French Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million), 2006, 2010 and 2015 ....................... 93 Table 50: Italian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ................................................................................... 94 Table 51: Italian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ................................................................................... 95 Table 52: Italian Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million), 2006, 2010 and 2015 ......................... 96 Table 53: UK Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ........................................................................................ 97 Table 54: UK Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ........................................................................................ 98 Table 55: UK Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million), 2006, 2010 and 2015.............................. 99 Table 56: Croatian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ..............................................................................100 Table 57: Croatian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ..............................................................................101
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© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
Table 58: Croatian Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million), 2006, 2010 and 2015 ....................102 Table 59: Czech Republic Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ...................................................................103 Table 60: Croatian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ..............................................................................104 Table 61: Czech Republic Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million), 2006, 2010 and 2015 .........105 Table 62: Russian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ...............................................................................106 Table 63: Russian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ...............................................................................107 Table 64: Russian Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million), 2006, 2010 and 2015 .....................108 Table 65: Polish Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ..................................................................................109 Table 66: Polish Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ..................................................................................110 Table 67: Polish Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million), 2006, 2010 and 2015 ........................111 Table 68: Hungarian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ...........................................................................112 Table 69: Hungarian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ...........................................................................113 Table 70: Hungarian Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million), 2006, 2010 and 2015 .................114 Table 71: Swiss Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ..................................................................................115 Table 72: Swiss Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ..................................................................................116 Table 73: Swiss Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million), 2006, 2010 and 2015 ........................117 Table 74: Dutch Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ..................................................................................118 Table 75: Dutch Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ..................................................................................119 Table 76: Dutch Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million), 2006, 2010 and 2015 ........................120 Table 77: Asia-Pacific Economic Indicators, 2006–2010 ....................................................................................................................................121 Table 78: Asia-Pacific Economic Indicators, 2010–2015 ....................................................................................................................................121 Table 79: Asia-Pacific Monetary Indicators, 2006–2010.....................................................................................................................................122 Table 80: Asia-Pacific Monetary Indicators, 2010–2015.....................................................................................................................................122 Table 81: Asia-Pacific Trade and Investment Indicators, 2006–2009 .................................................................................................................122 Table 82: Asia-Pacific Earthmoving Equipment Value (US$ Million), 2006–2010 ...............................................................................................125 Table 83: Asia-Pacific Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 .........................................................................126 Table 84: Asia-Pacific Earthmoving Equipment Consumption Value by Category/Sub category (US$ Million), 2006–2010 ................................127 Table 85: Asia-Pacific Earthmoving Equipment Consumption Value by Category/Sub category (US$ Million), 2010–2015 ................................129 Table 86: Asia-Pacific Earthmoving Equipment Production Value (US$ Million), 2006–2010 ............................................................................130 Table 87: Asia-Pacific Earthmoving Equipment Production Value (US$ Million), 2010–2015 .............................................................................131 Table 88: Asia-Pacific Earthmoving Equipment Production Value by Category/Sub category (US$ Million), 2006–2010....................................132 Table 89: Asia-Pacific Earthmoving Equipment Production Value by Category/Sub category (US$ Million), 2010–2015....................................134 Table 90: Chinese Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ...............................................................................135 Table 91: Chinese Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ...............................................................................136 Table 92: Chinese Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million), 2006, 2010 and 2015.....................137 Table 93: Indian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ..................................................................................138 Table 94: Indian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ..................................................................................139 Table 95: Indian Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million), 2006, 2010 and 2015 ........................140 Table 96: Japanese Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ............................................................................141 Table 97: Japanese Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ............................................................................142 Table 98: Japanese Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million), 2006, 2010 and 2015 ..................143 Table 99: South Korean Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ......................................................................144 Table 100: South Korean Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ....................................................................145 Table 101: South Korean Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million), 2006, 2010 and 2015 ..........146 Table 102: Australian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ..........................................................................147 Table 103: Australian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ..........................................................................148 Table 104: Australian Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million), 2006, 2010 and 2015 ................149 Table 105: Indonesian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ........................................................................150 Table 106: Indonesian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ........................................................................151 Table 107: Indonesian Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million), 2006, 2010 and 2015 ..............152 Table 108: Malaysian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ..........................................................................153 Table 109: Malaysian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ..........................................................................154 Table 110: Malaysian Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million), 2006, 2010 and 2015 ................155 Table 111: Philippine Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ..........................................................................156 Table 112: Philippine Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ..........................................................................157 Table 113: Philippine Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million), 2006, 2010 and 2015 ................158 Table 114: South American Economic Indicators, 2006–2010 ...........................................................................................................................159 Table 115: South American Economic Indicators, 2010–2015 ...........................................................................................................................159 Table 116: South American Monetary Indicators, 2006–2010 ............................................................................................................................160 Table 117: South American Monetary Indicators, 2010–2015 ............................................................................................................................160
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Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 18
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
Table 118: South American Trade and Investment Indicators, 2006–2010 ........................................................................................................160 Table 119: South American Earthmoving Equipment Value (US$ Million), 2006–2010 ......................................................................................163 Table 120: South American Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 .................................................................164 Table 121: South America Earthmoving Equipment Consumption Value by Category/Sub category (US$ Million), 2006–2010 .........................165 Table 122: South America Earthmoving Equipment Consumption Value by Category/Sub category (US$ Million), 2010–2015 .........................167 Table 123: South American Earthmoving Equipment Production Value (US$ Million), 2006–2010....................................................................169 Table 124: South American Earthmoving Equipment Production Value (US$ Million), 2010–2015.....................................................................170 Table 125: South America Earthmoving Equipment Production Value by Category/Sub category (US$ Million), 2006–2010 .............................171 Table 126: South America Earthmoving Equipment Production Value by Category/Sub category (US$ Million), 2010–2015 .............................173 Table 127: Brazilian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ............................................................................174 Table 128: Brazilian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ............................................................................175 Table 129: Brazilian Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million), 2006, 2010 and 2015 ..................176 Table 130: Argentine Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ...........................................................................177 Table 131: Argentine Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ...........................................................................178 Table 132: Argentine Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million), 2006, 2010 and 2015 ................179 Table 133: Colombian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 .........................................................................180 Table 134: Colombian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 .........................................................................181 Table 135: Colombian Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million), 2006, 2010 and 2015 ...............182 Table 136: Mexican Earthmoving Equipment Consumption Value (US$ Million), 2006–2010.............................................................................183 Table 137: Mexican Earthmoving Equipment Consumption Value (US$ Million), 2010–2015.............................................................................184 Table 138: Mexican Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million), 2006, 2010 and 2015 ..................185 Table 139: Middle East Economic Indicators, 2006–2010 ..................................................................................................................................186 Table 140: Middle East Economic Indicators, 2010–2015 ..................................................................................................................................186 Table 141: Middle East Trade and Investment Indicators, 2006–2009 ...............................................................................................................186 Table 142: Middle East Earthmoving Equipment Value (US$ Million), 2006–2010 .............................................................................................189 Table 143: Middle East Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 .......................................................................190 Table 144: Middle East Earthmoving Equipment Consumption Value by Category/Sub category (US$ Million), 2006–2010 ..............................191 Table 145: Middle East Earthmoving Equipment Consumption Value by Category/Sub category (US$ Million), 2010–2015 ..............................193 Table 146: Middle East Earthmoving Equipment Production Value (US$ Million), 2006–2010 ..........................................................................194 Table 147: Middle East Earthmoving Equipment Production Value (US$ Million), 2010–2015 ...........................................................................195 Table 148: Middle East Earthmoving Equipment Production Value by Category/Sub category (US$ Million), 2006–2010 ..................................196 Table 149: Middle East Earthmoving Equipment Production Value by Category/Sub category (US$ Million), 2010–2015 ..................................198 Table 150: Saudi Arabian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010....................................................................199 Table 151: Saudi Arabian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015....................................................................200 Table 152: Saudi Arabian Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million), 2006, 2010 and 2015 .........201 Table 153: UAE Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ..................................................................................202 Table 154: UAE Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ..................................................................................203 Table 155: UAE Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million), 2006, 2010 and 2015 ........................204 Table 156: Qatar Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 .................................................................................205 Table 157: Qatar Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 .................................................................................206 Table 158: Qatar Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million), 2006, 2010 and 2015 .......................207 Table 159: Turkish Earthmoving Equipment Consumption Value (US$ Million), 2006–2010 ..............................................................................208 Table 160: Turkish Earthmoving Equipment Consumption Value (US$ Million), 2010–2015 ..............................................................................209 Table 161: Turkish Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million), 2006, 2010 and 2015 ....................210 Table 162: AB Volvo , Key Facts .......................................................................................................................................................................211 Table 163: AB Volvo , Main Products and Services ...........................................................................................................................................213 Table 164: AB Volvo , History ............................................................................................................................................................................213 Table 165: AB Volvo ,, Key Employees .............................................................................................................................................................219 Table 166: Caterpillar Inc., Key Facts ................................................................................................................................................................220 Table 167: Caterpillar Inc., Main Products and Services ....................................................................................................................................221 Table 168: Caterpillar Inc., History .....................................................................................................................................................................222 Table 169: Caterpillar Inc., Key Employees .......................................................................................................................................................226 Table 170: Mitsubishi Heavy Industries, Ltd., Key Facts ....................................................................................................................................228 Table 171: Mitsubishi Heavy Industries, Ltd., Main Products .............................................................................................................................230 Table 172: Mitsubishi Heavy Industries, Ltd., History .........................................................................................................................................232 Table 173: Mitsubishi Heavy Industries, Ltd.,, Key Employees ..........................................................................................................................236 Table 174: Hyundai Heavy Industries Co., Ltd., Key Facts ................................................................................................................................238 Table 175: Hyundai Heavy Industries Co., Ltd., Main Products and Services ....................................................................................................240 Table 176: Hyundai Heavy Industries Co., Ltd., History .....................................................................................................................................241 Table 177: Hyundai Heavy Industries Co., Ltd.,, Key Employees .......................................................................................................................245
TABLE OF CONTENTS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 19
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Table 178: Komatsu Ltd., Key Facts ..................................................................................................................................................................246 Table 179: Komatsu Ltd., Main Products & Brands ............................................................................................................................................247 Table 180: Komatsu Ltd., History .......................................................................................................................................................................248 Table 181: Komatsu Ltd.,, Key Employees ........................................................................................................................................................252 Table 182: Hitachi Construction Machinery Co., Ltd., Key Facts ........................................................................................................................254 Table 183: Hitachi Construction Machinery Co., Ltd., Main Products and Services ............................................................................................255 Table 184: Hitachi Construction Machinery Co., Ltd., History.............................................................................................................................256 Table 185: Hitachi Construction Machinery Co., Ltd.,, Key Employees ..............................................................................................................261 Table 186: Doosan Infracore Co., Ltd, Key Facts ..............................................................................................................................................262 Table 187: Doosan Infracore Co. Ltd, Major Products .......................................................................................................................................264 Table 188: Doosan Infracore Co., Ltd, History ...................................................................................................................................................265 Table 189: Doosan Infracore Co. Ltd., Key Employees ......................................................................................................................................269 Table 190: BEML Limited, Key Facts .................................................................................................................................................................270 Table 191: BEML Limited , Major Products Services and Brands ......................................................................................................................272 Table 192: BEML Limited , History ....................................................................................................................................................................275 Table 193: BEML Limited., Key Employees .......................................................................................................................................................280 Table 194: Escorts Limited, Key Facts ...............................................................................................................................................................281 Table 195: Escorts Limited, Major Products .......................................................................................................................................................281 Table 196: Escorts Limited,, Key Employees .....................................................................................................................................................282 Table 197: Telco Construction Equipment Company Limited, Key Facts ...........................................................................................................283 Table 198: Telco Construction Equipment Company Limited, Major Products Services and Brands ..................................................................284 Table 199: Telco Construction Equipment Company Limited, History ................................................................................................................285 Table 200: Telco Construction Equipment Company Limited., Key Employees ..................................................................................................289
INTRODUCTION
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 20
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
1 Introduction
1.1 What is this Report About?
This report is the result of ICD‘s extensive market and company research covering the global earthmoving
equipment market. It provides detailed historic and forecast earthmoving equipment market values,
segmented at category level; regional analysis, and analysis of the leading companies in the market.
―Global Earthmoving Equipment– Market Opportunities and Business Environment, Analyses and Forecasts
to 2015‖ provides a top-level overview and detailed category and company-specific insights into the
operating environment for construction equipment companies. It is an essential tool for companies active
across the global construction value chain and for new companies considering entering the market.
NOTE: For the purposes of this report geographical regions consist of the following:
North America - United States and Canada
Europe - Germany, Spain, France, Italy, the United Kingdom, Croatia, Czech Republic, Russia, Poland,
Hungary, Switzerland and the Netherlands
Asia-Pacific - Australia, China, Japan, India, Indonesia, Malaysia, the Philippines and South Korea
South America - Argentina, Brazil, Colombia and Mexico
The Middle East - Saudi Arabia, the United Arab Emirates, Qatar, and Turkey
1.2 Definitions
For the purposes of this report, the following timeframes apply:
Review period: 2006 to 2010
Forecast Period: 2011 to 2015
Earthmoving equipments are part of the global construction equipment market, and can be categorized as
follows:
Excavators
Crawler/ Wheeled Excavators
Mini Excavators
Loaders
Backhoe loaders
Crawler/ Wheeled/Compact loaders
Skid-Steer loaders
Construction Tractors
Bulldozers/Crawlers Tractors
Wheeled Tractors
All data is collected in local currency. To avoid distortions due to currency fluctuations, all conversions are
made into US$, of current, historical and forecast data alike, by taking a yearly average exchange rate. All
the values in tables, with the exception of compound annual growth rate (CAGR) values, and compound
annual rate of change (CARC) are displayed to two decimal places, and therefore growth rates may appear
inconsistent with absolute values due to this rounding method.
INTRODUCTION
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Forecasts to 2015 Page 21
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1.3 Summary Methodology
All ICD reports are rigorously sourced and created according to a comprehensive four-stage methodology:
1) Market study
A. Standardization
Market definitions are specified using recognized industry classifications. The same definition is
used for every country
Annual average currency exchange rates for the latest complete year are collected. These are
applied across both historical and forecast data in order to remove exchange rate fluctuations
B. Internal audit
Review of in-house databases to gather existing data:
Historic market databases and reports
Company database
Construction magazine portfolio
Construction projects database
C. Trend monitoring and primary research
Review of the latest construction company and project trends
Biannual surveys using expert panels compiled from across the construction value chain:
Construction contractors
Equipment and material manufacturers and suppliers
Architects and designers
Project owners and financiers
Project advisors
INTRODUCTION
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Forecasts to 2015 Page 22
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2) Research
A. Sources
Collection of the latest market-specific data from a wide variety of respected industry sources:
Government statistics
Industry associations
Company filings
Broker reports
International organizations
B. Expert opinion
Collation of opinion taken from ICD journalist interviews of leading industry figures
Analysis of third party opinion and forecasts:
Broker reports
Industry associations
Construction media
Official government sources
C. Data consolidation and verification
Consolidation of data and opinion to create historical datasets
Creation of models to benchmark data across sectors and geographies
3) Analysis
A. Market forecasts
Feed of forecast data into market models:
Macroeconomic indicators
Industry-specific drivers
Analysis of ICD Construction Projects Database in order to identify trends by sector:
Latest project announcements
Financing shortfalls
Project cancellations and postponements
B. Report writing
Analysis of market data
Discussion of company and industry trends and issues
Integration of survey results
Annual review of financial deal and construction project trends
INTRODUCTION
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Forecasts to 2015 Page 23
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4) Quality control
A. Templates
Detailed process manuals
Standardized report templates and accompanying style guides
Complex forecasting tool used to ensure forecast methodologies are consistently applied
Quality control checklists
B. Quality control process
Competitor review
Senior level quality control
Randomized spot checks on data integrity
Benchmark checks across databases
Market data cross-checked for consistency with accumulated data from:
Construction Projects Database
Company filings
GLOBAL MARKET ENVIRONMENT
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 24
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2 GLOBAL MARKET ENVIRONMENT
2.1 Economic Indicators
2.1.1 GDP at Constant Prices
In 2010, global gross domestic product (GDP) at 2000 constant prices stood at US$37,177.3 billion, recording
a CAGR of 1.90% during the review period.
GDP growth is expected to increase at a CAGR of 3.51% over the forecast period to reach US$44,168.5
billion by 2015.
Figure 1: Global GDP at Constant Prices (US$ Billion), 2006–2015
Source: ICD Research Analysis / © ICD Research
Note: “Global” includes only those thirty countries which are analyzed in the report. Applicable for all the graphs and tables in the report.
GLOBAL MARKET ENVIRONMENT
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Forecasts to 2015 Page 25
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2.1.2 GDP Per Capita at Constant Prices
In 2010, global GDP per capita at 2000 constant prices stood at US$19,136.6 recording a CAGR of 1.35%
during the review period.
Global GDP per capita is expected to increase at a CAGR of 2.74% over the forecast period to vaule
US$21,909.0 by 2015.
Figure 2: Global GDP Per Capita at Constant Prices (US$), 2006–2015
Source: ICD Research Analysis / © ICD Research
GLOBAL MARKET ENVIRONMENT
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Forecasts to 2015 Page 26
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2.2 Demographics and Labor
2.2.1 Population
The global population reached 4.4 billion in 2010, recording a CAGR of 0.87% during the review period.
Over the forecast period, the global population is expected to increase at a CAGR of 0.79% to reach 4.6 billion
by 2015.
Figure 3: Global Population (Million), 2006–2015
Source: ICD Research Analysis / © ICD Research
GLOBAL MARKET ENVIRONMENT
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Forecasts to 2015 Page 27
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2.2.2 Growth in Mid-Age Population
During the review period growth in the mid-age population decreased from 2.0% to 1.4% and is anticipated to
remain at 1.4% over the forecast period.
Figure 4: Global Growth in Mid-Age Population (%), 2006–2015
Source: ICD Research Analysis / © ICD Research
GLOBAL MARKET ENVIRONMENT
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Forecasts to 2015 Page 28
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2.2.3 Employment Rate
The global employment rate increased from 54.3%–55.2% during the review period. By 2015, the global
employment rate is expected to reach 56.8%, an increase of 1.6 percentage points from figures in 2010.
Figure 5: Global Employment Rate (%), 2006–2015
Source: ICD Research Analysis / © ICD Research
GLOBAL MARKET ENVIRONMENT
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 29
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2.2.4 Unemployment Rate
The global unemployment rate decreased from 7.1% in 2006 to 6.9% in 2010. By 2015, the global
unemployment rate is expected to reach 6.5%, a decrease of 0.4 percentage points.
Figure 6: Global Unemployment Rate (%), 2006–2015
Source: ICD Research Analysis / © ICD Research
GLOBAL MARKET ENVIRONMENT
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Forecasts to 2015 Page 30
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2.3 Industrial Output Growth
In 2010, industrial output growth reached 11.9%, compared to 13.2% in 2006. Industrial output growth is
expected to decline to 5.3% in 2015, a of 6.6 percentage points in comparison with 2010 figures.
Figure 7: Global Industrial Output Growth (%), 2006–2015
Source: ICD Research Analysis / © ICD Research
GLOBAL MARKET ENVIRONMENT
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Forecasts to 2015 Page 31
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2.4 Services Growth
Annual services growth decreased from 12.0%–9.8% during the review period. By 2015 it is expected to
decline to 4.1%, a decrease of 5.7 percentage points from 2010.
Figure 8: Global Services Growth (%), 2006–2015
Source: ICD Research Analysis / © ICD Research
GLOBAL MARKET ENVIRONMENT
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 32
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2.5 Agriculture Growth
Annual agricultural growth output increased from 4.5%–7.7% during the review period. In 2015, agricultural
growth is expected to decline to 6.1%, a decrease of 1.6 percentage points from 2010.
Figure 9: Global Agriculture Growth (%), 2006–2015
Source: ICD Research Analysis / © ICD Research
GLOBAL MARKET ENVIRONMENT
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 33
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2.6 Construction Value Added as a Percentage of GDP
Construction value added as a percentage of GDP increased from 6.0%–6.2% during the review period. It is
expected to reach 6.3% by 2015, representing an increase of 0.1 percentage points compared to 2010 figures.
Figure 10: Global Construction Value Added as a Percentage of GDP (%), 2006–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT MARKET ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 34
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3 GLOBAL EARTHMOVING EQUIPMENT MARKET ANALYSIS
3.1 Market Overview
Global earthmoving equipment consumption underwent a period of strong recovery in 2010 registering a
growth of 23.2%, after recording a 32.0% decline in 2009. The recovery was supported primarily by the Asia-
Pacific market, China in particular. Driven by a 59.3% growth in consumption in the Chinese market, overall
consumption in Asia-Pacific market recorded a growth of 47.9% in 2010. Moreover, apart from Europe, which
recorded a decline of 3.2%, all other regional markets recorded positive growth in consumption in 2010, with
North America growing by 11.7% and Middle East by 8.1%.
Global consumption value reached US$67.0 billion in 2010 from US$64.1 billion in 2006, reflecting a CAGR of
1.13% during the review period. Consumption pattern has undergone a fundamental compositional change,
with Asia-Pacific overtaking North America as the largest consumer of earthmoving equipment in 2007. The
global economic crisis facilitated the region to firmly establish its position as the largest earthmoving
equipment consumer as construction activities only decelerated in the region in comparison to the declines
observed in the North American and European markets. Moreover, levels of recovery in 2010 were stronger in
the Asia-Pacific region. Consequently, Asia-Pacific‘s share of world consumption value increased from 30.6%–
51.4% during the review period, an increase of 20.8 percentage points. In contrast, North American and
European shares decreased by 13.6% and 9.4 % points respectively, accounting for 21.1% and 19.6% of the
global consumption value in 2010. South America and the Middle East accounted for 5.1% and 2.8%
respectively of global consumption value in 2010, with both the regions extending their market share during
the review period.
Figure 11: Global Earthmoving Equipment Consumption Dynamics by Value (%), 2006–2015
Note: Bubble size represents 2010 Market Value (US$ Million)
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT MARKET ANALYSIS
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Forecasts to 2015 Page 35
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Production value of earthmoving equipment increased from US$64.6 billion in 2006 to US$69.1 billion in 2010,
reflecting a CAGR of 1.71% during the reviewed period. In terms of production, Asia-Pacific established its
position as the market leader of earthmoving equipment during the review period. The region increased its
market share from 45.2% in 2006 to 59.9% in 2010, an increase of 14.7 percentage points. North America‘s
share contracted from 27.0%–18.8%, while Europe‘s share contracted from 25.2%–17.5% during the
corresponding period. Going forward, ICD anticipates the Asia-Pacific region to remain the fastest growing
market in terms of production, with a projected CAGR of 10.08% over the forecast period. Encouraged by
growth in the Asia-Pacific market, global production of earthmoving equipment is forecast to register a CAGR
of 8.66% over the forecast period and value US$104.7 billion.
The World Bank expects the global economy to grow between 3.0–4.0% per annum from 2011 to 2013, with
developing countries in regions such as Asia-Pacific (excluding Japan, Australia and South Korea), Eastern
and Central Europe, Middle East and South America growing at a much higher rate of 6.0–7.0%. As a result of
the high GDP growth, construction activities are also expected to grow at a healthy to robust pace in these
regions. Driven by construction activities in these regions, the earthmoving equipment consumption value is
projected to register a CAGR of 9.26% over the forecast period and value US$104.4 billion. Supported by
growth in the Chinese construction market, the Asia-Pacific region is projected to register the highest CAGR of
11.30% over the forecast period. Growth in the region will additionally be bolstered by the Indian government‘s
initiative to increase infrastructure spending from 7–10%. of the GDP from 7%, Japanese reconstruction
efforts following the devastating earthquake and tsunami of March 2011 and South Korean infrastructural
investments in preparation for hosting of the 2012 World Exposition (World Fair) and the 2018 Winter Olympic
Games. North America is projected to register a CAGR of 8.54% over the forecast period, with growth in
construction activities fostered by tax incentives introduced under the American Recovery and Reinvestment
Act (ARRA) in 2009. Other regions such the Middle East, South America and Europe are projected to achieve
CAGRs of 7.35%, 5.98% and 5.27% respectively over the forecast period.
EARTHMOVING EQUIPMENT MARKET ANALYSIS
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3.2 Global Earthmoving Equipment Consumption
3.2.1 Consumption Value
The consumption value of global earthmoving equipment stood at US$67.0 billion in 2010, an increase of
23.2% from 2009, recording a CAGR of 1.13% during the review period.
Table 1: Global Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 64,077.6
2007 74,550.3 16.3%
2008 80,064.4 7.4%
2009 54,417.8 -32.0%
2010 67,020.2 23.2%
CAGR 2006-2010 1.13%
Source: ICD Research Analysis / © ICD Research
Figure 12: Global Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT MARKET ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 37
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
Over the forecast period the consumption of global earthmoving equipment is expected to increase at a CAGR
of 9.26% and value US$104.4 billion in 2015.
Table 2: Global Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 67,020.2
2011 73,069.7 9.0%
2012 79,546.5 8.9%
2013 87,198.4 9.6%
2014 95,403.9 9.4%
2015 104,352.1 9.4%
CAGR 2010-2015 9.26%
Source: ICD Research Analysis / © ICD Research
Figure 13: Global Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT MARKET ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 38
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
3.2.2 Consumption Value by Category
In 2010, loaders accounted for the largest share of earthmoving equipment consumption value globally
accounting for 38.2% and valuing US$25.6 billion. Loaders were followed by excavators and construction
tractors with the two categories accounting for 35.6% and 26.1% respectively.
The excavators‘ category recorded the highest CAGR of 2.43% during the review period, followed by loaders
with 2.28%.
Table 3: Global Earthmoving Equipment Consumption Value by Category/Sub Category (US$ Million),
2006–2010
Category 2006 2007 2008 2009 2010 CAGR
2006–2010
Excavators 21,695.7 25,481.0 27,919.6 18,509.0 23,878.8 2.43%
Crawler/ Wheeled Excavators 14,821.7 17,710.5 19,834.8 13,538.6 18,393.8 5.55%
Mini Excavators 6,874.1 7,770.5 8,084.7 4,970.4 5,485.1 -5.49%
Loaders 23,408.3 28,113.5 30,274.1 19,690.4 25,616.0 2.28%
Backhoe loaders 4,393.6 4,845.9 4,774.9 2,326.3 2,498.3 -13.16%
Crawler/ Wheeled/Compact loaders 15,002.7 19,373.4 21,643.5 15,134.3 20,686.9 8.36%
Skid-Steer loaders 4,012.0 3,894.2 3,855.6 2,229.8 2,430.8 -11.77%
Construction Tractors 18,973.5 20,955.8 21,870.8 16,218.4 17,525.4 -1.97%
Bulldozers/Crawlers Tractors 6,202.4 6,938.6 7,177.6 5,431.5 5,990.9 -0.86%
Wheeled Tractors 12,771.1 14,017.2 14,693.2 10,786.9 11,534.5 -2.51%
Overall 64,077.6 74,550.3 80,064.4 54,417.8 67,020.2 1.13%
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT MARKET ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 39
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Figure 14: Global Earthmoving Equipment Consumption Value by Category (%), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT MARKET ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 40
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
Over the forecast period, loaders are expected to remain the largest category in earthmoving equipment,
accounting for a 40.0% share, valuing US$41.7 billion. Excavators are projected to account for a 37.2% share.
Loaders projected to achieve the fastest growth rate over the forecast period, with a CAGR of 10.26%;
followed by excavators with 10.19% and construction tractors with 6.32%.
Table 4: Global Earthmoving Equipment Consumption Value by Category/Sub Category (US$ Million),
2010–2015
Category 2010 2011 2012 2013 2014 2015 CAGR
2010–2015
Excavators 23,878.8 26,223.4 28,879.7 31,919.4 35,128.2 38,797.8 10.19%
Crawler/ Wheeled Excavators 18,393.8 20,244.6 22,434.3 24,923.2 27,531.1 30,546.9 10.68%
Mini Excavators 5,485.1 5,978.9 6,445.4 6,996.1 7,597.2 8,250.9 8.51%
Loaders 25,616.0 28,211.1 31,011.7 34,301.7 37,859.2 41,740.9 10.26%
Backhoe loaders 2,498.3 2,655.6 2,826.2 3,038.9 3,276.1 3,515.3 7.07%
Crawler/ Wheeled/Compact loaders
20,686.9 22,892.5 25,287.9 28,083.2 31,107.1 34,431.9 10.73%
Skid-Steer loaders 2,430.8 2,663.0 2,897.7 3,179.6 3,476.0 3,793.7 9.31%
Construction Tractors 17,525.4 18,635.2 19,655.1 20,977.4 22,416.4 23,813.4 6.32%
Bulldozers/Crawlers Tractors 5,990.9 6,413.2 6,785.3 7,281.3 7,805.5 8,331.6 6.82%
Wheeled Tractors 11,534.5 12,222.0 12,869.8 13,696.0 14,610.9 15,481.8 6.06%
Overall 67,020.2 73,069.7 79,546.5 87,198.4 95,403.9 104,352.1 9.26%
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT MARKET ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 41
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
Figure 15: Global Earthmoving Equipment Consumption Value by Category (%), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT MARKET ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 42
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
3.3 Global Earthmoving Equipment Production
3.3.1 Production Value
The production of global earthmoving equipment valued US$69.1 billion in 2010, an increase of 31.9% from
2009, after recording a CAGR of 1.71% during the review period.
Table 5: Global Earthmoving Equipment Production Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 64,587.7
2007 77,114.6 19.4%
2008 84,293.4 9.3%
2009 52,396.7 -37.8%
2010 69,122.8 31.9%
CAGR 2006-2010 1.71%
Source: ICD Research Analysis / © ICD Research
Figure 16: Global Earthmoving Equipment Production Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT MARKET ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 43
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Over the forecast period the production of global earthmoving equipment is anticipated to increase at a CAGR
of 8.66% and valueUS$104.7 billion in 2015.
Table 6: Global Earthmoving Equipment Production Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 69,122.8
2011 74,922.9 8.4%
2012 80,969.6 8.1%
2013 88,311.5 9.1%
2014 96,228.8 9.0%
2015 104,713.8 8.8%
CAGR 2010-2015 8.66%
Source: ICD Research Analysis / © ICD Research
Figure 17: Global Earthmoving Equipment Production Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT MARKET ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 44
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
3.3.2 Production Value by Category
In 2010, excavators accounted for the largest share of earthmoving equipment production accounting for
39.9% and valuing US$27.6 billion. Loaders represented the second largest category market with 38.6%
share of global production in 2010.
In terms of growth, loaders represented the fastest growing category with a CAGR of 3.51% over the forecast
period, followed by excavators with a CAGR of 2.56%.
Table 7: Global Earthmoving Equipment Production Value by Category/Sub Category (US$ Million),
2006–2010
Category 2006 2007 2008 2009 2010 CAGR
2006–2010
Excavators 24,959.3 30,196.5 34,070.0 18,909.7 27,614.4 2.56%
Crawler/ Wheeled Excavators 18,481.3 22,626.9 26,318.0 14,516.5 22,110.1 4.58%
Mini Excavators 6,478.0 7,569.6 7,752.0 4,393.3 5,504.3 -3.99%
Loaders 23,244.0 28,695.5 31,418.7 20,053.1 26,683.2 3.51%
Backhoe loaders 3,880.4 4,410.8 4,543.9 2,181.5 2,378.9 -11.51%
Crawler/ Wheeled/Compact loaders 15,925.7 20,796.5 23,396.6 15,833.5 22,021.2 8.44%
Skid-Steer loaders 3,438.0 3,488.1 3,478.2 2,038.1 2,283.0 -9.73%
Construction Tractors 16,384.4 18,222.7 18,804.6 13,433.9 14,825.2 -2.47%
Bulldozers/Crawlers Tractors 6,080.6 7,059.8 7,401.1 5,332.7 6,026.0 -0.23%
Wheeled Tractors 10,303.7 11,162.9 11,403.5 8,101.2 8,799.2 -3.87%
Overall 64,587.7 77,114.6 84,293.4 52,396.7 69,122.8 1.71%
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT MARKET ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
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© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
Figure 18: Global Earthmoving Equipment Production Value by Category (%), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT MARKET ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 46
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
Over the forecast period, loaders are expected to emerge as the largest category of earthmoving equipment
globally, accounting for a 41.1% share and valuing US$43.0 billion. Excavators are projected to account for
40.0% share and construction tractors for 18.9% share of global consumption value.
Loaders are expected to record the highest CAGR of 10.01% over the forecast period, followed by excavators
with a CAGR of 8.69% and construction tractors with representing a CARG of 5.98%.
Table 8: Global Earthmoving Equipment Production Value by Category/Sub Category (US$ Million),
2010–2015
Category 2010 2011 2012 2013 2014 2015 CAGR
2010–2015
Excavators 27,614.4 29,864.3 32,267.1 35,216.9 38,440.4 41,892.3 8.69%
Crawler/ Wheeled Excavators 22,110.1 23,959.7 25,944.9 28,407.9 31,091.7 33,967.3 8.97%
Mini Excavators 5,504.3 5,904.7 6,322.2 6,809.0 7,348.7 7,924.9 7.56%
Loaders 26,683.2 29,356.5 32,174.5 35,497.1 39,095.3 42,997.2 10.01%
Backhoe loaders 2,378.9 2,545.7 2,708.9 2,913.1 3,133.0 3,356.8 7.13%
Crawler/ Wheeled/Compact loaders
22,021.2 24,327.3 26,780.4 29,649.5 32,762.9 36,156.1 10.43%
Skid-Steer loaders 2,283.0 2,483.6 2,685.1 2,934.5 3,199.5 3,484.3 8.82%
Construction Tractors 14,825.2 15,702.0 16,528.1 17,597.5 18,693.1 19,824.4 5.98%
Bulldozers/Crawlers Tractors 6,026.0 6,393.3 6,753.7 7,224.0 7,712.0 8,212.7 6.39%
Wheeled Tractors 8,799.2 9,308.8 9,774.4 10,373.4 10,981.1 11,611.6 5.70%
Overall 69,122.8 74,922.9 80,969.6 88,311.5 96,228.8 104,713.8 8.66%
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT MARKET ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 47
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Figure 19: Global Earthmoving Equipment Production Value by Category (%), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 48
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
4 NORTH AMERICA
4.1 Market Environment
4.1.1 Economic Indicators
Table 9: North American Economic Indicators, 2006–2010
Indicators 2006 2007 2008 2009 2010 CAGR
2006–2010
GDP at constant prices (US$ billion) 12,825.2 13,158.4 13,244.4 12,893.6 13,398.7 1.10%
GDP per capita at constant prices (US$)
37,079.3 8,504.5 38,488.8 36,060.5 38,571.5 0.99%
Disposable income (US$ billion) 10,832.1 11,447.6 12,028.8 12,034.4 12,242.2 3.11%
Population (million) 330.7 333.9 337.0 340.5 343.8 0.97%
Employment rate (%) 60.3% 60.6% 60.2% 60.8% 61.1% N/A
Unemployment rate (%) 5.5% 5.3% 6.0% 5.6% 5.5% N/A
Industrial output growth (%) 8.8% 5.0% 2.8% -4.3% 9.1% N/A
Services growth (%) 10.7% 9.4% 4.3% -7.1% 10.2% N/A
Agriculture growth (%) -5.6% 17.1% -3.9% 1.2% 4.1% N/A
Source: ICD Research Analysis / © ICD Research
Table 10: North American Economic Indicators, 2010–2015
Indicators 2010 2011 2012 2013 2014 2015 CAGR 2010–2015
GDP at constant prices (US$ billion)
13,398.7 13,785.1 14,059.2 14,460.3 14,739.3 15,022.4 2.31%
GDP per capita at constant prices (US$)
38,571.5 39,147.1 39,556.2 40,085.5 40,384.1 40,667.4 1.06%
Disposable income (US$ billion) 12,242.2 12,961.4 13,282.2 13,828.2 14,197.4 14,655.7 3.66%
Population (million) 343.8 347.0 350.4 353.7 357.0 360.4 0.95%
Employment rate (%) 61.1% 61.2% 61.4% 61.7% 61.9% 62.1% N/A
Unemployment rate (%) 5.5% 5.6% 5.7% 5.6% 5.6% 5.6% N/A
Industrial output growth (%) 9.1% 4.5% 3.8% 3.8% 4.0% 4.0% N/A
Services growth (%) 10.2% 4.9% 5.0% 5.1% 4.9% 4.3% N/A
Agriculture growth (%) 4.1% 3.5% 2.5% 2.0% 4.5% 4.4% N/A
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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4.1.2 Monetary Indicators
Table 11: North American Monetary Indicators, 2006–2010
Indicators 2006 2007 2008 2009 2010
Wholesale Price Index (WPI) 104 107 114 107 115
Consumer Price Index (CPI) 152 156 161 161 161
Source: ICD Research Analysis / © ICD Research
Table 12: North American Monetary Indicators, 2010–2015
Indicators 2010 2011 2012 2013 2014 2015
Wholesale Price Index (WPI) 115 243 252 266 276 286
Consumer Price Index (CPI) 161 327 331 335 338 341
Source: ICD Research Analysis / © ICD Research
4.1.3 Trade and Investment Indicators
Table 13: North American Trade and Investment Indicators, 2006–2009
Indicators 2006 2007 2008 2009 CAGR 2006–
2009
Total exports (US$ billion) 1,932.8 2,162.6 2,376.5 1962.9 0.52%
Total imports (US$ billion) 2670.2 2848.0 3062.7 2373.4 -3.85%
Trade balance (US$ billion) -737.3 -685.4 -686.2 -410.5 N/A
FDI inflows in construction (US$ million) 11,665.8 12,962.0 9,821.1 11,068.6 -1.74%
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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4.2 North America Earthmoving Equipment Market Analysis
Despite earthmoving equipment consumption value recording a yearly growth of 11.7% in 2010 the North
American market recorded an overall CARC of -10.69% during the review period. Declining from US$14.2–
US$22.3 billion over 2006–2010, consumption value declined in both markets within the region, with the US
recording a CARC of -11.85% and Canada recording a CAGR of 5.71%. This decline in consumption was
characterized by a decline construction during the same period, coinciding with the sub-prime crisis. As a
result, contractors cancelled or postponed the purchase of earthmoving equipment, which resulted in a decline
of 34.0% in 2009‘s following a decline of 1.0% in 2008.
Figure 20: North American Earthmoving Equipment Consumption Dynamics by Value (%), 2006–2015
Note: Bubble size represents 2010 consumption value (US$ million)
Source: ICD Research Analysis / © ICD Research
With the North American market showing signs of recovery in 2010 and the construction industry expected to
recover fully by 2012, contractors have started replenishing their earthmoving equipment inventory, which
reached record low levels during the recession owing to financial constraints. The US accounted for a 78.5%
share of the regional consumption value of earthmoving equipment in 2010, growth achieved despite a 5.9%
decline in the construction industry. In terms of production, the US accounted 93.2% share of the market
revenue for earthmoving equipment in the North American market in 2010. US production for earthmoving
equipment was valued at US$12.1 billion in 2010, while overall production exhibited a CARC of -7.10% during
the review period, the US market recorded a CARC of -7.25% and the Canadian market of -4.88%.
ICD projects the consumption market for earthmoving equipment to grow at a CAGR of 8.54% over the
forecast period. The US is projected to record the faster CAGR of 8.66% over the forecast period. Growth in
the US is being supported by tax incentives, introduced under the ARRA in 2009, which is leading to a
recovery in the US residential market. In addition, the act comprised infrastructure investments of US$105.3
billion, healthcare investments of US$155.1 billion, educational investments of US$100 billion, and housing
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 51
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investments of US$14.7 billion. Going forward the US construction industry activity is expected to build in
momentum and support growth in the earthmoving equipment market.
Canada, the other market in the North American region, is projected to record a CAGR of 8.09% over the
forecast period. Growth is likely to be driven by construction industry recovery in 2010, anticipated to sustain
momentum achieve a CAGR of 4.88% over the forecast period. The Economic Action Plan (EAP), introduced
over 2009–2010, comprising investments of US$61.7 billion (CAD63.6 billion) for the period 2009–2012 is
expected to be the key supporter of growth for the industry.
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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4.3 Consumption
4.3.1 Consumption Value
Consumption of earthmoving equipment in North America valued US$14.2 billion in 2010, an increase
of11.7% over 2009 recording a CARC of -10.69% during the review period.
Table 14: North American Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 22,256.2
2007 19,389.7 -12.9%
2008 19,198.9 -1.0%
2009 12,677.4 -34.0%
2010 14,158.9 11.7%
CARC 2006-2010 -10.69%
Source: ICD Research Analysis / © ICD Research
Figure 21: North American Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 53
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ICD expects consumption of earthmoving equipment in North America to increase at a CAGR of 8.54% over
the forecast period to value US$21.3 billion in 2015.
Table 15: North American Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 14,158.9
2011 15,456.4 9.2%
2012 16,616.5 7.5%
2013 18,151.6 9.2%
2014 19,702.1 8.5%
2015 21,331.1 8.3%
CAGR 2010-2015 8.54%
Source: ICD Research Analysis / © ICD Research
Figure 22: North American Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 54
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4.3.2 Consumption Value by Category
In 2010, construction tractors accounted for a 59.0% share of earthmoving equipment consumption value in
North America, valuing US$8.3 billion. Loaders accounted for a 29.6% share of the region‘s market while
construction tractors comprised 11.4% share.
All categories in the North American earthmoving equipment market recorded a decline in consumption value
during the review period, with excavators registering the largest decline with a CARC of -23.38%.
Table 16: North American Earthmoving Equipment Consumption Value by Category/Sub category
(US$ Million), 2006–2010
Category 2006 2007 2008 2009 2010 CAGR 2006–2010
Excavators 4,677.9 3,808.0 4,112.9 1,346.9 1,612.1 -23.38%
Crawler/ Wheeled Excavators 2,629.0 2,222.5 2,230.9 645.0 809.6 -25.51%
Mini Excavators 2,048.9 1,585.5 1,882.0 702.0 802.5 -20.89%
Loaders 8,247.7 6,890.6 6,903.2 3,680.8 4,197.2 -15.54%
Backhoe loaders 2,118.6 2,017.8 1,911.2 567.0 660.3 -25.28%
Crawler/ Wheeled/Compact loaders 3,542.0 2,775.3 3,026.6 2,012.7 2,295.9 -10.27%
Skid-Steer loaders 2,587.1 2,097.6 1,965.3 1,101.1 1,241.1 -16.78%
Construction Tractors 9,330.5 8,691.1 8,182.9 7,649.7 8,349.6 -2.74%
Bulldozers/Crawlers Tractors 3,039.9 2,776.6 2,662.9 2,479.6 2,753.4 -2.45%
Wheeled Tractors 6,290.6 5,914.6 5,519.9 5,170.1 5,596.2 -2.88%
Overall 22,256.2 19,389.7 19,198.9 12,677.4 14,158.9 -10.69%
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 55
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Figure 23: North American Earthmoving Equipment Consumption Value by Category (%), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 56
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Over the forecast period, construction tractors are expected to remain the largest category in North America,
accounting for a 55.0% share and valuing US$11.7 billion. Loaders are expected to register the highest CAGR
of 10.99% over the forecast period and expand their market share to 33.1% in 2015, from 29.6% in 2010.
Table 17: North American Earthmoving Equipment Consumption Value by Category/Sub category
(US$ Million), 2010–2015
Category 2010 2011 2012 2013 2014 2015 CAGR 2010–2015
Excavators 1,612.1 1,775.8 1,931.3 2,120.9 2,318.4 2,529.9 9.43%
Crawler/ Wheeled Excavators 809.6 905.9 997.4 1,107.1 1,223.2 1,343.6 10.66%
Mini Excavators 802.5 869.9 933.9 1,013.8 1,095.2 1,186.3 8.13%
Loaders 4,197.2 4,692.8 5,176.4 5,774.6 6,395.6 7,070.4 10.99%
Backhoe loaders 660.3 718.8 773.5 845.4 917.7 995.3 8.55%
Crawler/ Wheeled/Compact loaders 2,295.9 2,588.1 2,872.9 3,221.3 3,580.8 3,975.2 11.60%
Skid-Steer loaders 1,241.1 1,385.8 1,530.0 1,707.8 1,897.1 2,099.9 11.09%
Construction Tractors 8,349.6 8,987.8 9,508.8 10,256.1 10,988.1 11,730.8 7.04%
Bulldozers/Crawlers Tractors 2,753.4 2,979.4 3,139.5 3,402.5 3,643.0 3,903.6 7.23%
Wheeled Tractors 5,596.2 6,008.4 6,369.3 6,853.6 7,345.1 7,827.2 6.94%
Overall 14,158.9 15,456.4 16,616.5 18,151.6 19,702.1 21,331.1 8.54%
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 57
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Figure 24: North American Earthmoving Equipment Consumption Value by Category (%), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 58
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4.4 Production
4.4.1 Production Value
During the review period, production value within the North American earthmoving equipment market recorded
a CARC of -7.10%. However, in 2010, production increased by 12.3% over 2009, and valued US$13.0 billion.
Table 18: North American Earthmoving Equipment Production Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 17,410.3
2007 16,690.8 -4.1%
2008 17,671.4 5.9%
2009 11,551.1 -34.6%
2010 12,966.6 12.3%
CARC 2006-2010 -7.10%
Source: ICD Research Analysis / © ICD Research
Figure 25: North American Earthmoving Equipment Production Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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ICD expects production in the North American earthmoving equipment market to increase from US$13.0 billion
in 2010 to US$18.8 billion in 2015. Over the forecast period the production of earthmoving equipment is
expected to increase at a CAGR of 7.68%.
Table 19: North American Earthmoving Equipment Production Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 12,966.6
2011 13,968.6 7.7%
2012 14,909.6 6.7%
2013 16,147.2 8.3%
2014 17,429.5 7.9%
2015 18,769.8 7.7%
CAGR 2010-2015 7.68%
Source: ICD Research Analysis / © ICD Research
Figure 26: North American Earthmoving Equipment Production Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 60
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4.4.2 Production Value by Category
In 2010, construction tractors accounted for the largest production value in the North American earthmoving
equipment market, accounting for a share of 54.1% and valuing US$7.0 billion. This was followed by loaders
with a production value of US$4.9 billion.
All the categories in the North American earthmoving equipment market registered a decline in production
value during the review period, with the excavators‘ category recording the largest decline at a CARC of -
17.40%.
Table 20: North American Earthmoving Equipment Production Value by Category/Sub category (US$
Million), 2006–2010
Category 2006 2007 2008 2009 2010 CAGR 2006–2010
Excavators 2,250.5 2,207.0 2,837.2 839.0 1,047.7 -17.40%
Crawler/ Wheeled Excavators 1,351.4 1,372.2 1,628.6 410.2 538.1 -20.56%
Mini Excavators 899.1 834.8 1,208.6 428.8 509.6 -13.23%
Loaders 7,971.7 7,307.2 7,818.7 4,057.4 4,903.9 -11.44%
Backhoe loaders 1,922.8 2,014.8 2,056.2 527.7 621.6 -24.60%
Crawler/ Wheeled/Compact loaders 3,637.1 3,141.0 3,626.9 2,352.8 2,919.7 -5.34%
Skid-Steer loaders 2,411.8 2,151.4 2,135.6 1,177.0 1,362.6 -13.30%
Construction Tractors 7,188.1 7,176.6 7,015.5 6,654.7 7,015.0 -0.61%
Bulldozers/Crawlers Tractors 2,881.5 2,911.8 2,915.7 2,808.4 3,151.2 2.26%
Wheeled Tractors 4,306.6 4,264.8 4,099.8 3,846.2 3,863.8 -2.68%
Overall 17,410.3 16,690.8 17,671.4 11,551.1 12,966.6 -7.10%
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 61
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Figure 27: North American Earthmoving Equipment Production Value by Category (%), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 62
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With a predicted CAGR of 6.11% and a category production value of US$9.4 billion, construction tractors is
forecast to be the largest category in the North American earthmoving equipment market in 2015. This
category is expected to account for a 50.3% share of production in the North American earthmoving
equipment market in 2015, a decrease of 4.1 percentage points over 2010. With a share of 40.6%, loaders are
expected to be the second largest production category in 2015.
Table 21: North American Earthmoving Equipment Production Value by Category/Sub category (US$
Million), 2010–2015
Category 2010 2011 2012 2013 2014 2015 CAGR 2010–2015
Excavators 1,047.7 1,157.6 1,271.1 1,409.3 1,556.9 1,718.0 10.40%
Crawler/ Wheeled Excavators 538.1 598.2 658.9 735.7 817.2 906.0 10.98%
Mini Excavators 509.6 559.4 612.1 673.6 739.8 812.0 9.76%
Loaders 4,903.9 5,361.1 5,818.2 6,378.5 6,975.1 7,614.0 9.20%
Backhoe loaders 621.6 679.6 727.6 800.4 877.4 955.1 8.97%
Crawler/ Wheeled/Compact loaders 2,919.7 3,186.1 3,465.8 3,790.1 4,136.9 4,511.2 9.09%
Skid-Steer loaders 1,362.6 1,495.4 1,624.7 1,788.0 1,960.8 2,147.7 9.53%
Construction Tractors 7,015.0 7,449.9 7,820.4 8,359.4 8,897.4 9,437.8 6.11%
Bulldozers/Crawlers Tractors 3,151.2 3,353.3 3,528.7 3,782.2 4,036.1 4,294.2 6.39%
Wheeled Tractors 3,863.8 4,096.6 4,291.7 4,577.3 4,861.3 5,143.6 5.89%
Overall 12,966.6 13,968.6 14,909.6 16,147.2 17,429.5 18,769.8 7.68%
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 63
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Figure 28: North American Earthmoving Equipment Production Value by Category (%), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 64
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
4.5 UNITED STATES
4.5.1 Consumption Value
Consumption of earthmoving equipment in the US valued US$11.1 billion in 2010, an increase of11.7% over
2009. During the review period the consumption value of earthmoving equipment recorded a CARC of -
11.85%.
Table 22: US Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 18,400.1
2007 15,466.8 -15.9%
2008 14,945.2 -3.4%
2009 9,951.8 -33.4%
2010 11,111.2 11.7%
CARC 2006-2010 -11.85%
Source: ICD Research Analysis / © ICD Research
Figure 29: US Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
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ICD expects the consumption of earthmoving equipment to increase at a CAGR of 8.66% over the forecast
period and valueUS$16.8 billion in 2015.
Table 23: US Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 11,111.2
2011 12,155.4 9.4%
2012 13,023.0 7.1%
2013 14,266.7 9.5%
2014 15,507.3 8.7%
2015 16,833.5 8.6%
CAGR 2010-2015 8.66%
Source: ICD Research Analysis / © ICD Research
Figure 30: US Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 66
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
4.5.2 Consumption Value by Category
In 2010, construction tractors accounted for the largest consumption value of earthmoving equipment in the
US with a 61.6% share and a value of US$6.8 billion. The loaders and excavators categories recorded the
second and third largest consumption values, at US$3.3 billion and US$946.5 million, respectively.
Table 24: US Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million),
2006, 2010 and 2015
Category/ Sub-Category 2006 2010 2015
Excavators 3,503.7 946.5 1,559.7
Crawler/ Wheeled Excavators 1,984.9 446.8 740.3
Mini Excavators 1,518.8 499.7 819.4
Loaders 7,219.7 3,315.9 5,807.2
Backhoe loaders 1,824.6 419.3 644.3
Crawler/ Wheeled/Compact loaders 3,155.3 1,910.9 3,383.8
Skid-Steer loaders 2,239.8 985.7 1,779.1
Construction Tractors 7,676.7 6,848.8 9,466.6
Bulldozers/Crawlers Tractors 2,383.0 2,408.0 3,330.9
Wheeled Tractors 5,293.7 4,440.8 6,135.7
Overall 18,400.1 11,111.2 16,833.5
Source: ICD Research Analysis / © ICD Research
Figure 31: US Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 67
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4.6 CANADA
4.6.1 Consumption Value
Consumption of earthmoving equipment in Canada valued US$3.0 billion in 2010, an increase of 11.8% over
2009. During the review period the consumption value of earthmoving equipment recorded a CARC of -5.71%.
Table 25: Canadian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 3,856.1
2007 3,922.9 1.7%
2008 4,253.8 8.4%
2009 2,725.7 -35.9%
2010 3,047.7 11.8%
CAGR 2006-2010 -5.71%
Source: ICD Research Analysis / © ICD Research
Figure 32: Canadian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 68
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ICD expects the consumption of earthmoving equipment in Canada to increase at a CAGR of 8.09% over the
forecast period and valueUS$4.5 billion in 2015.
Table 26: Canadian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 3,047.7
2011 3,300.9 8.3%
2012 3,593.5 8.9%
2013 3,885.0 8.1%
2014 4,194.8 8.0%
2015 4,497.6 7.2%
CAGR 2010-2015 8.09%
Source: ICD Research Analysis / © ICD Research
Figure 33: Canadian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 69
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4.6.2 Consumption Value by Category
In 2010, the construction tractors category accounted for the largest consumption value in the Canadian
earthmoving equipment market, with a share of 49.2% and a value of US$1.5 billion. The loaders and
excavators markets recorded the second and third largest consumption values, at US$881.3 million and
US$665.6 million, respectively.
Table 27: Canadian Earthmoving Equipment Consumption Value by Category/Sub-Category (US$
Million), 2006, 2010 and 2015
Category/ Sub-Category 2006 2010 2015
Excavators 1,174.2 665.6 970.2
Crawler/ Wheeled Excavators 644.1 362.8 603.2
Mini Excavators 530.1 302.8 366.9
Loaders 1,028.1 881.3 1263.2
Backhoe loaders 294.0 240.9 351.0
Crawler/ Wheeled/Compact loaders 386.7 385.0 591.4
Skid-Steer loaders 347.3 255.4 320.8
Construction Tractors 1,653.9 1,500.8 2,264.2
Bulldozers/Crawlers Tractors 657.0 345.3 572.7
Wheeled Tractors 996.9 1,155.4 1,691.5
Overall 3,856.1 3,047.7 4,497.6
Source: ICD Research Analysis / © ICD Research
Figure 34: Canadian Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and
2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 70
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5 EUROPE
5.1 Market Environment
5.1.1 Economic Indicators
Table 28: European Economic Indicators, 2006–2010
Indicators 2006 2007 2008 2009 2010 CAGR
2006–2010
GDP at constant prices (US$ billion) 8,906.9 9,132.4 9,134.2 8,754.6 8,892.9 -0.04%
GDP per capita at constant prices (US$)
17,410.1 18,276.8 18,054.6 16,763.4 17,050.0 -0.52%
Disposable income (US$ billion) 8,087.2 9,234.7 10,116.4 9,197.7 9,309.0 3.58%
Population (million) 525.2 526.0 526.8 526.7 526.6 0.07%
Employment rate (%) 41.9% 42.6% 42.8% 42.4% 42.7% N/A
Unemployment rate (%) 6.3% 5.4% 5.2% 5.9% 5.6% N/A
Industrial output growth (%) 7.8% 15.5% 13.3% -10.2% 4.4% N/A
Services growth (%) 7.3% 15.1% 13.2% -9.5% 4.1% N/A
Agriculture growth (%) 3.7% 14.6% 11.9% -7.6% 3.1% N/A
Source: ICD Research Analysis / © ICD Research
Table 29: European Economic Indicators, 2010–2015
Indicators 2010 2011 2012 2013 2014 2015 CAGR 2010–2015
GDP at constant prices (US$ billion)
8,892.9 9,064.8 9,255.7 9,455.6 9,660.6 9,862.3 2.09%
GDP per capita at constant prices (US$)
17,050.0 17,474.4 17,873.7 18,319.6 18,787.6 19,259.3 2.47%
Disposable income (US$ billion) 9,309.0 9,498.8 9,826.9 10,172.4 10,503.4 10,896.9 3.20%
Population (million) 526.6 526.4 526.1 525.7 525.3 524.8 -0.07%
Employment rate (%) 42.7% 42.8% 42.8% 43.0% 43.1% 43.2% N/A
Unemployment rate (%) 5.6% 5.4% 5.3% 5.2% 5.1% 4.9% N/A
Industrial output growth (%) 4.4% 3.6% 4.2% 4.2% 4.5% 4.3% N/A
Services growth (%) 4.1% 3.4% 4.1% 4.1% 4.4% 4.1% N/A
Agriculture growth (%) 3.1% 2.8% 3.0% 3.1% 4.6% 3.6% N/A
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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5.1.2 Monetary Indicators
Table 30: European Monetary Indicators, 2006–2010
Indicators 2006 2007 2008 2009 2010
Wholesale Price Index (WPI) 95.9 99.7 106.6 104.4 107.3
Consumer Price Index (CPI) 94.3 97.4 102.1 104.8 101.8
Source: ICD Research Analysis / © ICD Research
Table 31: European Monetary Indicators, 2010–2015
Indicators 2010 2011 2012 2013 2014 2015
Wholesale Price Index (WPI) 107.3 110.8 114.1 117.7 120.9 125.10
Consumer Price Index (CPI) 101.8 104.3 107.4 110.5 113.6 116.6
Source: ICD Research Analysis / © ICD Research
5.1.3 Trade and Investment Indicators
Table 32: European Trade and Investment Indicators, 2006–2009
Indicators 2006 2007 2008 2009 CAGR 2006–2009
Total exports (US$ billion) 4,719.7 5,485.2 6,168.3 2,506.1 -19.02%
Total imports (US$ billion) 4,562.5 5,292.7 5,941.3 2,323.8 -20.14%
Trade balance (US$ billion) 236.3 290.0 320.6 184.9 NA
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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5.2 Europe Earthmoving Equipment Market Analysis
The consumption value of earthmoving equipment in the European market contracted from US$18.6 billion in
2006 to US$13.2 billion in 2010, registering a CARC of -8.28% during the review period. Consumption value
began declining in many countries in 2008, but the high growth in Russia, Poland and France offset the
decline in other markets. However, in 2009, all countries within the European market faced decline and
consumption value declined by 46.5%, followed by a further decline of 3.2% in 2010. The impact of the global
economic crisis across the European construction industry caused this decline during the review period and
the introduction of fiscal packages and stimulus by governments across the region in 2010 arrived too late to
resolve the situation. All the earthmoving equipment markets in the region posted lower consumption values in
2010 as compared to 2006, with Spain recording the highest CARC of -29.23% during the review period. The
Spanish market, which had undergone a period of increasing construction activity until 2007 declined rapidly in
the aftermath of the economic crisis. In 2010, Housing starts had declined by 90% from a peak of 1 million in
2007. Though all countries observed decline, the rate of deceleration varied widely, with Croatia recording the
highest decline with a CARC of -25.39% and Poland recording the lowest CARC of -0.52%.
Figure 35: European Earthmoving Equipment Consumption Dynamics by Value (%), 2006–2015
Note: Bubble size represents 2010 consumption value (US$ million)
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 73
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European consumption of earthmoving equipment is highly consolidated with the five leading countries
accounting for 80.7% share of the region‘s total. Italy, Germany and the UK are the three largest earthmoving
equipment consumers in the region with a combined share of 58.2% of the total consumption value for 2010.
The three countries hold market shares of 25.3%, 18.7% and 14.2% respectively. Russia and France were
other significant consumers with consumption shares of 12.4% and 10.1% respectively.
During the review period, the production value of earthmoving equipment declined from US$16.3 billion in
2006 to US$12.1 billion in 2010, registering a CARC of -7.14%. Russia and Croatia were the only two
countries with positive CAGRs in production value during the review period, with CAGRs of 7.09% and 1.04%
respectively. In terms of production, the market has even greater concentrated with Italy, the UK and
Germany, the three largest producers accounting for 67.2% share of total production value for the region in
2010. Over the forecast period, ICD projects the earthmoving equipment production value to expand at a
CAGR of 4.67% with Croatia projected to achieve the highest CAGR of 7.42%; followed by the UK with a
CAGR of 5.94%, Hungary registering 5.69% and Poland recording 5.30%.
ICD projects the earthmoving equipment consumption value to reach US$17.0 billion in 2015, from US$13.2
billion in 2010, a CAGR of 5.27% over the forecast period. Growth is expected to be supported by an increase
in construction activity in less developed economies in Central and Eastern Europe such as Russia, Hungary,
Croatia, and Poland. These markets projected to achieve CAGRs of 9.38%, 8.64%, 7.27%, and 5.04%
respectively. The Russian construction industry is expected to record strong growth rates over the forecast
period owing to significant infrastructure investments required for hosting trade and sports events such as
Pacific Economic Cooperation (APEC) Summit 2012, the Winter Olympic Games 2014 and the FIFA World
Cup 2018. In contrast to increasing growth rates in Central and Eastern European nations, developed
economies in the Western European nations are forecast to achieve more modest rates of growth. It is
anticipated that growth in the UK will be supported by higher construction activities in the industrial
construction market, while infrastructure construction would be fostered by the 2012 Olympic Games in
London.
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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5.3 Consumption
5.3.1 Consumption Value
Consumption of earthmoving equipment in Europe valued US$13.2 billion in 2010, a decrease of 3.2% over
2009. The value of earthmoving equipment consumption recorded a CARC of -8.28% during the review
period.
Table 33: European Earthmoving Equipment Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 18,601.8
2007 25,209.3 35.5%
2008 25,407.5 0.8%
2009 13,597.7 -46.5%
2010 13,165.5 -3.2%
CARC 2006-2010 -8.28%
Source: ICD Research Analysis / © ICD Research
Figure 36: European Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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ICD expects the consumption of earthmoving equipment in Europe to increase at a CAGR of 5.27% over the
forecast period and value US$17.0 billion in 2015.
Table 34: European Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 13,165.5
2011 13,789.9 4.7%
2012 14,440.8 4.7%
2013 15,219.6 5.4%
2014 16,132.4 6.0%
2015 17,016.8 5.5%
CAGR 2010-2015 5.27%
Source: ICD Research Analysis / © ICD Research
Figure 37: European Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 76
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5.3.2 Consumption Value by Category
In 2010, excavators accounted for the largest share of earthmoving equipment consumption value in Europe,
with a 37.0% share and a value of US$4.9 billion. Construction tractors and loaders recorded the second and
third largest consumption values, at US$4.7 billion and US$3.6 billion, respectively.
Table 35: European Earthmoving Equipment Consumption Value by Category/Sub category (US$
Million), 2006–2010
Category 2006 2007 2008 2009 2010 CAGR
2006–2010
Excavators 7,536.3 9,958.9 9,371.9 4,933.3 4,873.2 -10.33%
Crawler/ Wheeled Excavators 4,840.6 6,388.2 6,028.6 3,091.8 3,066.1 -10.79%
Mini Excavators 2,695.8 3,570.7 3,343.3 1,841.5 1,807.0 -9.52%
Loaders 5,428.3 7,149.2 7,315.0 3,622.4 3,638.7 -9.52%
Backhoe loaders 1,684.1 2,049.1 1,937.8 1,058.7 1,043.5 -11.28%
Crawler/ Wheeled/Compact loaders 2,813.3 3,920.7 4,172.5 1,971.3 2,003.7 -8.13%
Skid-Steer loaders 930.9 1,179.4 1,204.7 592.4 591.5 -10.72%
Construction Tractors 5,637.1 8,101.2 8,720.7 5,042.1 4,653.6 -4.68%
Bulldozers/Crawlers Tractors 1,585.4 2,375.2 2,404.3 1,289.0 1,239.9 -5.96%
Wheeled Tractors 4,051.6 5,726.0 6,316.4 3,753.1 3,413.8 -4.19%
Overall 18,601.8 25,209.3 25,407.5 13,597.7 13,165.5 -8.28%
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 77
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Figure 38: European Earthmoving Equipment Consumption Value by Category (%), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 78
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The excavators‘ category is expected to remain the largest in Europe, accounting for 37.4% of the market and
valuing US$6.4 billion in 2015. The construction tractors and loaders categories are expected to record the
second and third largest consumption values, at US$5.8 billion and US$4.9 billion, respectively. The loaders
category is expected to record the highest CAGR of 5.98% over the forecast period.
Table 36: European Earthmoving Equipment Consumption Value by Category/Sub category (US$
Million), 2010–2015
Category 2010 2011 2012 2013 2014 2015 CAGR
2010–2015
Excavators 4,873.2 5,111.1 5,371.6 5,681.4 6,021.5 6,365.6 5.49%
Crawler/ Wheeled Excavators 3,066.1 3,218.8 3,382.6 3,573.8 3,790.2 4,006.1 5.49%
Mini Excavators 1,807.0 1,892.3 1,989.0 2,107.5 2,231.3 2,359.6 5.48%
Loaders 3,638.7 3,847.6 4,052.5 4,303.7 4,578.8 4,864.0 5.98%
Backhoe loaders 1,043.5 1,090.5 1,140.9 1,212.9 1,300.4 1,378.4 5.72%
Crawler/ Wheeled/Compact loaders 2,003.7 2,127.4 2,239.0 2,370.3 2,506.8 2,662.6 5.85%
Skid-Steer loaders 591.5 629.6 672.6 720.4 771.6 823.0 6.83%
Construction Tractors 4,653.6 4,831.1 5,016.7 5,234.6 5,532.0 5,787.1 4.46%
Bulldozers/Crawlers Tractors 1,239.9 1,306.6 1,374.4 1,455.5 1,554.2 1,648.5 5.86%
Wheeled Tractors 3,413.8 3,524.5 3,642.3 3,779.2 3,977.9 4,138.6 3.93%
Overall 13,165.5 13,789.9 14,440.8 15,219.6 16,132.4 17,016.8 5.27%
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 79
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Figure 39: European Earthmoving Equipment Consumption Value by Category (%), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 80
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5.4 Production
5.4.1 Production Value
During the review period the production value of the European earthmoving equipment market recorded a
CARC of -7.14%. However, in 2010 production increased by 0.3% over 2009 to value US$12.1 billion.
Table 37: European Earthmoving Equipment Production Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 16,279.1
2007 21,172.2 30.1%
2008 20,994.6 -0.8%
2009 12,073.1 -42.5%
2010 12,106.9 0.3%
CAGR 2006-2010 -7.14%
Source: ICD Research Analysis / © ICD Research
Figure 40: European Earthmoving equipment Production Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 81
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ICD expects production in the European earthmoving equipment market to increase from US$12.1 billion in
2010 to US$15.2 billion in 2015. Over the forecast period the production of earthmoving equipment in Europe
is expected to increase at a CAGR of 4.67%.
Table 38: European Earthmoving Equipment Production Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 12,106.9
2011 12,639.5 4.4%
2012 13,196.4 4.4%
2013 13,818.1 4.7%
2014 14,519.9 5.1%
2015 15,212.0 4.8%
CAGR 2010-2015 4.67%
Source: ICD Research Analysis / © ICD Research
Figure 41: European Earthmoving Equipment Production Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 82
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5.4.2 Production Value by Category
In 2010, excavators had the largest category production in the European earthmoving equipment market,
accounting for a share of 40.4% and valuing US$4.9 billion, followed by loaders with a production value of
US$3.9 billion. All categories recorded a decline in production during the review period with the excavators‘
category recording the highest CARC of -7.51%.
Table 39: European Earthmoving Equipment Production Value by Category/Sub category (US$
Million), 2006–2010
Category 2006 2007 2008 2009 2010 CAGR
2006–2010
Excavators 6,691.8 8,388.4 8,564.5 4,919.4 4,896.9 -7.51%
Crawler/ Wheeled Excavators 4,328.6 5,410.9 5,611.7 3,137.9 3,134.2 -7.75%
Mini Excavators 2,363.2 2,977.5 2,952.8 1,781.6 1,762.8 -7.07%
Loaders 5,195.5 6,811.6 6,754.4 3,760.8 3,890.5 -6.98%
Backhoe loaders 1,627.5 1,932.8 1,919.3 1,189.5 1,230.6 -6.75%
Crawler/ Wheeled/Compact loaders 2,857.6 3,939.5 3,900.5 2,047.5 2,128.4 -7.10%
Skid-Steer loaders 710.5 939.3 934.6 523.8 531.5 -7.00%
Construction Tractors 4,391.7 5,972.3 5,675.7 3,392.9 3,319.5 -6.76%
Bulldozers/Crawlers Tractors 1,488.6 2,100.1 2,048.4 1,227.0 1,173.8 -5.77%
Wheeled Tractors 2,903.1 3,872.2 3,627.3 2,165.9 2,145.7 -7.28%
Overall 16,279.1 21,172.2 20,994.6 12,073.1 12,106.9 -7.14%
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 83
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Figure 42: European Earthmoving Equipment Production Value by Category (%), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 84
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With a predicted CAGR of 4.73% and a production value of US$6.2 billion, excavators is forecast to be the
largest category in the European earthmoving equipment market in 2015. The category is expected to account
for a 40.6% share of production in the European earthmoving equipment market by 2015. With a share of
33.2%, the loaders category is expected to record the second largest production in 2015.
Table 40: European Earthmoving Equipment Production Value by Category/Sub category (US$
Million), 2010–2015
Category 2010 2011 2012 2013 2014 2015 CAGR
2010–2015
Excavators 4,896.9 5,101.0 5,326.6 5,582.3 5,880.4 6,170.2 4.73%
Crawler/ Wheeled Excavators 3,134.2 3,267.2 3,413.9 3,579.7 3,776.3 3,969.1 4.84%
Mini Excavators 1,762.8 1,833.8 1,912.7 2,002.6 2,104.1 2,201.0 4.54%
Loaders 3,890.5 4,111.2 4,318.6 4,544.8 4,798.0 5,051.4 5.36%
Backhoe loaders 1,230.6 1,298.1 1,368.7 1,447.9 1,534.7 1,621.8 5.68%
Crawler/ Wheeled/Compact loaders 2,128.4 2,252.7 2,359.8 2,469.6 2,597.0 2,725.0 5.07%
Skid-Steer loaders 531.5 560.3 590.1 627.3 666.2 704.7 5.80%
Construction Tractors 3,319.5 3,427.3 3,551.3 3,690.9 3,841.5 3,990.4 3.75%
Bulldozers/Crawlers Tractors 1,173.8 1,201.1 1,244.4 1,294.7 1,351.0 1,403.9 3.64%
Wheeled Tractors 2,145.7 2,226.2 2,306.9 2,396.3 2,490.6 2,586.6 3.81%
Overall 12,106.9 12,639.5 13,196.4 13,818.1 14,519.9 15,212.0 4.67%
Source: ICD Research Analysis / © ICD Research
Figure 43: European Earthmoving Equipment Production Value by Category (%), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 85
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5.5 Germany
5.5.1 Consumption Value
Consumption of earthmoving equipment in Germany valued US$2.5 billion in 2010, a decrease of 2.5% over
2009. During the review period the consumption value of earthmoving equipment recorded a CARC of -6.46%.
Table 41: German Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 3,212.9
2007 4,992.8 55.4%
2008 5,046.9 1.1%
2009 2,523.6 -50.0%
2010 2,460.2 -2.5%
CARC 2006-2010 -6.46%
Source: ICD Research Analysis / © ICD Research
Figure 44: German Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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ICD expects the consumption of earthmoving equipment in Germany to increase at a CAGR of 3.39% over the
forecast period and value US$2.9 billion in 2015.
Table 42: German Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 2,460.2
2011 2,553.2 3.8%
2012 2,625.2 2.8%
2013 2,701.5 2.9%
2014 2,802.3 3.7%
2015 2,905.8 3.7%
CAGR 2010-2015 3.39%
Source: ICD Research Analysis / © ICD Research
Figure 45: German Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 87
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5.5.2 Consumption Value by Category
In 2010, construction tractors accounted for the largest consumption value of earthmoving equipment in
Germany, with a share of 50.8% and a value of US$2.4 billion. The excavators and loaders categories
recorded the second and third largest consumption values, of US$640.4 million and US$570.3 million,
respectively.
Table 43: German Earthmoving Equipment Consumption Value by Category/Sub-Category (US$
Million), 2006, 2010 and 2015
Category/ Sub-Category 2006 2010 2015
Excavators 1,092.6 640.4 794.0
Crawler/ Wheeled Excavators 784.2 460.3 565.9
Mini Excavators 308.4 180.1 228.1
Loaders 738.8 570.3 661.8
Backhoe loaders 118.0 90.6 101.8
Crawler/ Wheeled/Compact loaders 597.2 461.4 538.6
Skid-Steer loaders 23.6 18.3 21.4
Construction Tractors 1,381.5 1249.4 1,450.0
Bulldozers/Crawlers Tractors 348.1 245.2 289.0
Wheeled Tractors 1,033.5 1,004.2 1,161.1
Overall 3,212.9 2,460.2 2,905.8
Source: ICD Research Analysis / © ICD Research
Figure 46: German Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 88
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5.6 SPAIN
5.6.1 Consumption Value
Consumption of earthmoving equipment in Spain valued US$361.9 million in 2010, a decrease of 19.8% over
2009. During the review period the consumption value of earthmoving equipment recorded a CARC of -
29.23%.
Table 44: Spanish Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 1,442.6
2007 1,996.8 38.4%
2008 1,184.7 -40.7%
2009 451.2 -61.9%
2010 361.9 -19.8%
CARC 2006-2010 -29.23%
Source: ICD Research Analysis / © ICD Research
Figure 47: Spanish Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 89
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
ICD expects the consumption of earthmoving equipment in Spain to increase at a CAGR of 1.92% over the
forecast period and value US$398.0 million in 2015.
Table 45: Spanish Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 361.9
2011 353.8 -2.2%
2012 361.5 2.2%
2013 371.9 2.9%
2014 384.4 3.4%
2015 398.0 3.5%
CAGR 2010-2015 1.92%
Source: ICD Research Analysis / © ICD Research
Figure 48: Spanish Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 90
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
5.6.2 Consumption Value by Category
In 2010, construction tractors accounted for the largest consumption value in the Spanish earthmoving
equipment market, with a share of 67.3% and a value of US$243.7 million. The excavators and loaders
categories recorded the second and third largest consumption values of US$66.6 million and US$51.6 million,
respectively.
Table 46: Spanish Earthmoving Equipment Consumption Value by Category/Sub-Category (US$
Million), 2006, 2010 and 2015
Category/ Sub-Category 2006 2010 2015
Excavators 558.9 66.6 80.2
Crawler/ Wheeled Excavators 439.1 51.3 61.7
Mini Excavators 119.8 15.3 18.5
Loaders 458.0 51.6 57.9
Backhoe loaders 246.5 26.5 29.7
Crawler/ Wheeled/Compact loaders 84.8 12.8 13.5
Skid-Steer loaders 126.7 12.2 14.7
Construction Tractors 425.8 243.7 259.9
Bulldozers/Crawlers Tractors 74.4 22.7 26.3
Wheeled Tractors 351.4 221.0 233.6
Overall 1,442.6 361.9 398.0
Source: ICD Research Analysis / © ICD Research
Figure 49: Spanish Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 91
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
5.7 FRANCE
5.7.1 Consumption Value
Consumption of earthmoving equipment in France valued US$1.3 billion in 2010, a decrease of 4.2% over
2009. During the review period the consumption value of earthmoving equipment recorded a CARC of -9.07%.
Table 47: French Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 1,939.6
2007 2,394.2 23.4%
2008 2,755.8 15.1%
2009 1,383.8 -49.8%
2010 1,326.1 -4.2%
CARC 2006-2010 -9.07%
Source: ICD Research Analysis / © ICD Research
Figure 50: French Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 92
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
ICD expects the consumption of earthmoving equipment in France to increase at a CAGR of 9.62% over the
forecast period and value US$4.3 billion in 2015.
Table 48: French Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 2,739.8
2011 3,025.5 10.4%
2012 3,327.3 10.0%
2013 3,657.4 9.9%
2014 3,992.2 9.2%
2015 4,336.8 8.6%
CAGR 2010–2015 9.62%
Source: ICD Research Analysis / © ICD Research
Figure 51: French Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 93
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
5.7.2 Consumption Value by Category
In 2010, the construction tractors category accounted for the largest consumption value in the French
earthmoving equipment market, with a share of 40.8% and a value of US$541.5 million. The excavators and
loaders categories recorded the second and third largest consumption values, at US$424.9 million and
US$359.7 million respectively.
Table 49: French Earthmoving Equipment Consumption Value by Category/Sub-Category (US$
Million), 2006, 2010 and 2015
Category/ Sub-Category 2006 2010 2015
Excavators 650.4 424.9 565.2
Crawler/ Wheeled Excavators 416.7 276.2 377.7
Mini Excavators 233.7 148.7 187.5
Loaders 617.7 359.7 464.8
Backhoe loaders 219.5 131.8 154.7
Crawler/ Wheeled/Compact loaders 307.2 178.4 250.8
Skid-Steer loaders 90.9 49.5 59.3
Construction Tractors 671.6 541.5 606.3
Bulldozers/Crawlers Tractors 149.5 140.1 170.2
Wheeled Tractors 522.1 401.4 436.1
Overall 1,939.6 1,326.1 1,636.3
Source: ICD Research Analysis / © ICD Research
Figure 52: French Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 94
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
5.8 ITALY
5.8.1 Consumption Value
Consumption of earthmoving equipment in Italy valued US$3.3 billion in 2010, a decrease of 0.4% over 2009.
However, during the review period the consumption value of earthmoving equipment recorded a CARC of -
8.03%.
Table 50: Italian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 4,649.8
2007 5,818.0 25.1%
2008 5,367.2 -7.7%
2009 3,341.4 -37.7%
2010 3,327.2 -0.4%
CAGR 2006-2010 -8.03%
Source: ICD Research Analysis / © ICD Research
Figure 53: Italian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 95
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
ICD expects the consumption of earthmoving equipment in Italy to increase at a CAGR of 5.21% over the
forecast period and value US$4.3 billion in 2015.
Table 51: Italian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 3,327.2
2011 3,470.6 4.3%
2012 3,635.7 4.8%
2013 3,836.7 5.5%
2014 4,077.2 6.3%
2015 4,289.8 5.2%
CAGR 2010-2015 5.21%
Source: ICD Research Analysis / © ICD Research
Figure 54: Italian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 96
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
5.8.2 Consumption Value by Category
In 2010, excavators accounted for the largest consumption value in the Italian earthmoving equipment market,
with a share of 52.9% and a value of US$1.8 billion. The loaders and construction tractors categories recorded
the second and third largest consumption values of US$907.3 million and US$658.3 million respectively.
Table 52: Italian Earthmoving Equipment Consumption Value by Category/Sub-Category (US$
Million), 2006, 2010 and 2015
Category/ Sub-Category 2006 2010 2015
Excavators 2,509.2 1,761.6 2,339.2
Crawler/ Wheeled Excavators 1,417.0 994.7 1,323.0
Mini Excavators 1,092.3 766.9 1,016.3
Loaders 1,226.3 907.3 1,181.5
Backhoe loaders 232.5 175.6 236.6
Crawler/ Wheeled/Compact loaders 541.5 397.0 503.2
Skid-Steer loaders 452.3 334.8 441.6
Construction Tractors 914.3 658.3 769.1
Bulldozers/Crawlers Tractors 452.1 334.0 392.4
Wheeled Tractors 462.2 324.3 376.7
Overall 4,649.8 3,327.2 4,289.8
Source: ICD Research Analysis / © ICD Research
Figure 55: Italian Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 97
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
5.9 UNITED KINGDOM
5.9.1 Consumption Value
Consumption of earthmoving equipment in the UK valued US$1.9 billion in 2010, an increase of 5.9% over
2009. However, during the review period the consumption value of earthmoving equipment recorded a CARC
of -10.03%.
Table 53: UK Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 2,857.9
2007 3,407.0 19.2%
2008 2,934.9 -13.9%
2009 1,768.8 -39.7%
2010 1,872.3 5.9%
CARC 2006-2010 -10.03%
Source: ICD Research Analysis / © ICD Research
Figure 56: UK Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 98
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
ICD expects the consumption of earthmoving equipment in the UK to increase at a CAGR of 6.13% over the
forecast period and value US$2.5 billion in 2015.
Table 54: UK Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 1,872.3
2011 1,995.8 6.6%
2012 2,095.4 5.0%
2013 2,226.5 6.3%
2014 2,381.4 7.0%
2015 2,521.2 5.9%
CAGR 2010-2015 6.13%
Source: ICD Research Analysis / © ICD Research
Figure 57: UK Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 99
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
5.9.2 Consumption Value by Category
In 2010, loaders accounted for the largest consumption value in the UK earthmoving equipment market, with a
share of 48.7% and a value of US$880.3 million. The excavators and construction tractors categories
recorded the second and third largest consumption values of US$497.8 million and US$494.2 million
respectively.
Table 55: UK Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million),
2006, 2010 and 2015
Category/ Sub-Category 2006 2010 2015
Excavators 986.4 497.8 591.9
Crawler/ Wheeled Excavators 676.7 329.6 372.1
Mini Excavators 309.7 168.2 219.8
Loaders 1,274.6 880.3 1228.2
Backhoe loaders 673.0 473.3 635.5
Crawler/ Wheeled/Compact loaders 574.9 388.4 565.4
Skid-Steer loaders 26.7 18.6 27.3
Construction Tractors 596.9 494.2 701.0
Bulldozers/Crawlers Tractors 177.3 113.9 151.8
Wheeled Tractors 419.6 380.3 549.2
Overall 2,857.9 1,872.3 2,521.2
Source: ICD Research Analysis / © ICD Research
Figure 58: UK Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 100
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
5.10 CROATIA
5.10.1 Consumption Value
Consumption of earthmoving equipment in Croatia valued US$53.5 million in 2010, a decrease of 43.6% over
2009. During the review period the consumption value of earthmoving equipment recorded a CARC of -
25.39%.
Table 56: Croatian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 172.7
2007 189.7 9.9%
2008 230.2 21.3%
2009 94.9 -58.8%
2010 53.5 -43.6%
CARC 2006-2010 -25.39%
Source: ICD Research Analysis / © ICD Research
Figure 59: Croatian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 101
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
ICD expects the consumption of earthmoving equipment in Croatia to increase at a CAGR of 7.27% over the
forecast period and value US$76.0 million in 2015.
Table 57: Croatian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 53.5
2011 58.1 8.7%
2012 64.1 10.2%
2013 68.1 6.3%
2014 71.9 5.6%
2015 76.0 5.6%
CAGR 2010-2015 7.27%
Source: ICD Research Analysis / © ICD Research
Figure 60: Croatian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 102
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
5.10.2 Consumption Value by Category
In 2010, construction tractors accounted for the largest consumption value in the Croatian earthmoving
equipment market with a share of 59.3% and a value of US$31.7 million. The excavators and loaders
categories recorded the second and third largest consumption values, of US$13.2 million and US$8.6 million
respectively.
Table 58: Croatian Earthmoving Equipment Consumption Value by Category/Sub-Category (US$
Million), 2006, 2010 and 2015
Category/ Sub-Category 2006 2010 2015
Excavators 71.8 13.2 17.5
Crawler/ Wheeled Excavators 45.6 8.4 11.2
Mini Excavators 26.2 4.8 6.3
Loaders 24.1 8.6 12.6
Backhoe loaders 4.2 1.5 2.2
Crawler/ Wheeled/Compact loaders 15.6 5.6 8.2
Skid-Steer loaders 4.3 1.5 2.3
Construction Tractors 76.8 31.7 45.9
Bulldozers/Crawlers Tractors 10.5 3.4 4.7
Wheeled Tractors 66.3 28.3 41.2
Overall 172.7 53.5 76.0
Source: ICD Research Analysis / © ICD Research
Figure 61: Croatian Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 103
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
5.11 CZECH REPUBLIC
5.11.1 Consumption Value
Consumption of earthmoving equipment in the Czech Republic valued US$383.9 million in 2010, a decrease
of 15.2% over 2009. During the review period the consumption value of earthmoving equipment recorded a
CARC of -5.37%.
Table 59: Czech Republic Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 478.7
2007 708.4 48.0%
2008 859.7 21.4%
2009 452.5 -47.4%
2010 383.9 -15.2%
CARC 2006-2010 -5.37%
Source: ICD Research Analysis / © ICD Research
Figure 62: Czech Republic Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 104
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
ICD expects the consumption of earthmoving equipment in the Czech Republic, to increase at a CAGR of
3.54% over the forecast period and value US$456.8 million in 2015.
Table 60: Croatian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 383.9
2011 396.9 3.4%
2012 409.9 3.3%
2013 425.9 3.9%
2014 437.3 2.7%
2015 456.8 4.5%
CAGR 2010-2015 3.54%
Source: ICD Research Analysis / © ICD Research
Figure 63: Czech Republic Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 105
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
5.11.2 Consumption Value by Category
In 2010, construction tractors accounted for the largest consumption value in the Czech Republic earthmoving
equipment market, with a share of 44.9% and a value of US$172.5 million. The excavators and loaders
categories recorded the second and third largest consumption values ofUS$160.3 million and US$51.1 million
respectively.
Table 61: Czech Republic Earthmoving Equipment Consumption Value by Category/Sub-Category
(US$ Million), 2006, 2010 and 2015
Category/ Sub-Category 2006 2010 2015
Excavators 170.0 160.3 178.2
Crawler/ Wheeled Excavators 104.1 99.3 109.7
Mini Excavators 65.9 61.0 68.5
Loaders 117.0 51.1 63.6
Backhoe loaders 24.9 12.7 16.4
Crawler/ Wheeled/Compact loaders 67.8 25.8 30.2
Skid-Steer loaders 24.4 12.6 17.0
Construction Tractors 191.6 172.5 215.0
Bulldozers/Crawlers Tractors 42.5 32.7 39.2
Wheeled Tractors 149.1 139.8 175.8
Overall 478.7 383.9 456.8
Source: ICD Research Analysis / © ICD Research
Figure 64: Czech Republic Earthmoving Equipment Consumption Value by Category (%), 2006, 2010
and 2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 106
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
5.12 RUSSIA
5.12.1 Consumption Value
Consumption of earthmoving equipment in Russia valued US$1.6 billion in 2010, an increase of 5.2% over
2009. During the review period the consumption value of earthmoving equipment recorded a CARC of -2.39%.
Table 62: Russian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 1,799.0
2007 2,654.7 47.6%
2008 3,729.9 40.5%
2009 1,551.8 -58.4%
2010 1,632.8 5.2%
CARC 2006-2010 -2.39%
Source: ICD Research Analysis / © ICD Research
Figure 65: Russian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 107
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
ICD expects the consumption of earthmoving equipment in Russia to increase at a CAGR of 9.38% over the
forecast period and value US$2.6 billion in 2015.
Table 63: Russian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 1,632.8
2011 1,763.5 8.0%
2012 1,906.0 8.1%
2013 2,078.5 9.0%
2014 2,311.6 11.2%
2015 2,556.6 10.6%
CAGR 2010-2015 9.38%
Source: ICD Research Analysis / © ICD Research
Figure 66: Russian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 108
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
5.12.2 Consumption Value by Category
In 2010, excavators accounted for the largest consumption value in the Russian earthmoving equipment
market with a share of 39.1% and a value of US$639.1 million. The loaders and construction tractors
categories recorded the second and third largest consumption values of US$502.1 million and US$491.7
million respectively.
Table 64: Russian Earthmoving Equipment Consumption Value by Category/Sub-Category (US$
Million), 2006, 2010 and 2015
Category/ Sub-Category 2006 2010 2015
Excavators 648.9 639.1 971.5
Crawler/ Wheeled Excavators 393.2 401.2 621.0
Mini Excavators 255.7 237.9 350.6
Loaders 575.9 502.1 809.2
Backhoe loaders 120.8 97.8 155.7
Crawler/ Wheeled/Compact loaders 335.4 308.2 474.9
Skid-Steer loaders 119.7 96.1 178.6
Construction Tractors 574.3 491.7 775.9
Bulldozers/Crawlers Tractors 186.8 227.2 430.9
Wheeled Tractors 387.5 264.5 344.9
Overall 1,799.0 1,632.8 2,556.6
Source: ICD Research Analysis / © ICD Research
Figure 67: Russian Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 109
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
5.13 POLAND
5.13.1 Consumption Value
Consumption of earthmoving equipment in Poland valued US$788.9 million in 2010, a decrease of 16.3% over
2009. During the review period the consumption value of earthmoving equipment recorded a CARC of -0.52%.
Table 65: Polish Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 805.5
2007 1,221.0 51.6%
2008 1,574.7 29.0%
2009 942.4 -40.2%
2010 788.9 -16.3%
CAGR 2006-2010 -0.52%
Source: ICD Research Analysis / © ICD Research
Figure 68: Polish Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 110
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
ICD expects the consumption of earthmoving equipment in Poland to increase at a CAGR of 5.04% over the
forecast period and value US$1.0 billion in 2015.
Table 66: Polish Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 788.9
2011 830.3 5.3%
2012 871.6 5.0%
2013 927.3 6.4%
2014 970.8 4.7%
2015 1,008.8 3.9%
CAGR 2010-2015 5.04%
Source: ICD Research Analysis / © ICD Research
Figure 69: Polish Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 111
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
5.13.2 Consumption Value by Category
In 2010, construction tractors accounted for the largest consumption value in the Polish earthmoving
equipment market, with a share of 52.5% and a value of US$413.8 million. The excavators and loaders
categories recorded the second and third largest consumption values of US$225.4 million and US$149.6
million respectively.
Table 67: Polish Earthmoving Equipment Consumption Value by Category/Sub-Category (US$
Million), 2006, 2010 and 2015
Category/ Sub-Category 2006 2010 2015
Excavators 255.1 225.4 294.0
Crawler/ Wheeled Excavators 162.0 144.2 189.6
Mini Excavators 93.1 81.2 104.4
Loaders 166.2 149.6 196.7
Backhoe loaders 28.7 25.6 36.1
Crawler/ Wheeled/Compact loaders 107.7 97.2 125.3
Skid-Steer loaders 29.8 26.7 35.3
Construction Tractors 384.2 413.8 518.1
Bulldozers/Crawlers Tractors 32.9 29.2 37.7
Wheeled Tractors 351.2 384.6 480.3
Overall 805.5 788.9 1,008.8
Source: ICD Research Analysis / © ICD Research
Figure 70: Polish Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 112
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
5.14 HUNGARY
5.14.1 Consumption Value
Consumption of earthmoving equipment in Hungary valued US$124.0 million in 2010, a decrease of 49.3%
over 2009. During the review period the consumption value of earthmoving equipment recorded a CARC of -
14.74%.
Table 68: Hungarian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 234.7
2007 331.6 41.3%
2008 393.9 18.8%
2009 244.7 -37.9%
2010 124.0 -49.3%
CARC 2006-2010 -14.74%
Source: ICD Research Analysis / © ICD Research
Figure 71: Hungarian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 113
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
ICD expects the consumption of earthmoving equipment in Hungary to increase at a CAGR of 8.64% over the
forecast period and value US$187.7 million in 2015.
Table 69: Hungarian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 124.0
2011 136.8 10.3%
2012 150.2 9.8%
2013 163.3 8.7%
2014 173.1 6.0%
2015 187.7 8.4%
CAGR 2010-2015 8.64%
Source: ICD Research Analysis / © ICD Research
Figure 72: Hungarian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 114
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
5.14.2 Consumption Value by Category
In 2010, the construction tractors category accounted for the largest consumption value in the Hungarian
earthmoving equipment market, with a share of 57.2% and a value of US$70.9 million. The excavators and
loaders categories recorded the second and third largest consumption values, at US$30.1 million and
US$23.1 million respectively.
Table 70: Hungarian Earthmoving Equipment Consumption Value by Category/Sub-Category (US$
Million), 2006, 2010 and 2015
Category/ Sub-Category 2006 2010 2015
Excavators 55.6 30.1 40.7
Crawler/ Wheeled Excavators 35.3 19.1 26.4
Mini Excavators 20.3 11.0 14.3
Loaders 54.6 23.1 29.6
Backhoe loaders 9.4 4.0 5.1
Crawler/ Wheeled/Compact loaders 35.4 15.0 19.1
Skid-Steer loaders 9.8 4.1 5.4
Construction Tractors 124.6 70.9 117.5
Bulldozers/Crawlers Tractors 9.4 5.0 6.5
Wheeled Tractors 115.1 65.9 110.9
Overall 234.7 124.0 187.7
Source: ICD Research Analysis / © ICD Research
Figure 73: Hungarian Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and
2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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5.15 SWITZERLAND
5.15.1 Consumption Value
Consumption of earthmoving equipment in Switzerland valued US$295.5 million in 2010, a decrease of 1.8%
over 2009. During the review period the consumption value of earthmoving equipment recorded a CARC of -
0.70%.
Table 71: Swiss Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 303.9
2007 323.1 6.3%
2008 311.0 -3.8%
2009 301.0 -3.2%
2010 295.5 -1.8%
CARC 2006-2010 -0.70%
Source: ICD Research Analysis / © ICD Research
Figure 74: Swiss Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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ICD expects the consumption of earthmoving equipment in Switzerland to increase at a CAGR of 2.25% over
the forecast period and value US$330.3 million in 2015.
Table 72: Swiss Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 295.5
2011 300.9 1.8%
2012 307.3 2.1%
2013 315.6 2.7%
2014 322.2 2.1%
2015 330.3 2.5%
CAGR 2010-2015 2.25%
Source: ICD Research Analysis / © ICD Research
Figure 75: Swiss Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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5.15.2 Consumption Value by Category
In 2010, excavators accounted for the largest consumption value in the Swiss earthmoving equipment market
with a share of 56.1% and a value of US$165.9 million. The construction tractors and loaders categories
recorded the second and third largest consumption values of US$74.2 million and US$55.4 million
respectively.
Table 73: Swiss Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million),
2006, 2010 and 2015
Category/ Sub-Category 2006 2010 2015
Excavators 170.6 165.9 184.3
Crawler/ Wheeled Excavators 119.8 117.2 133.3
Mini Excavators 50.9 48.7 51.0
Loaders 55.1 55.4 63.1
Backhoe loaders 0.3 0.1 0.2
Crawler/ Wheeled/Compact loaders 48.0 48.3 55.2
Skid-Steer loaders 6.8 6.9 7.7
Construction Tractors 78.2 74.2 82.9
Bulldozers/Crawlers Tractors 32.0 30.6 32.2
Wheeled Tractors 46.2 43.7 50.7
Overall 303.9 295.5 330.3
Source: ICD Research Analysis / © ICD Research
Figure 76: Swiss Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 118
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5.16 NETHERLANDS
5.16.1 Consumption Value
Consumption of earthmoving equipment in the Netherlands valued US$539.2 million in 2010, a decrease of
0.5% over 2009. During the review period the consumption value of earthmoving equipment recorded a CARC
of -6.46%.
Table 74: Dutch Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 704.4
2007 1,171.9 66.4%
2008 1,018.6 -13.1%
2009 541.7 -46.8%
2010 539.2 -0.5%
CARC 2006-2010 -6.46%
Source: ICD Research Analysis / © ICD Research
Figure 77: Dutch Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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ICD expects the consumption of earthmoving equipment in the Netherlands to increase at a CAGR of 3.79%
over the forecast period and value US$649.4 million in 2015.
Table 75: Dutch Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 539.2
2011 556.5 3.2%
2012 580.2 4.3%
2013 599.5 3.3%
2014 624.9 4.2%
2015 649.4 3.9%
CAGR 2010-2015 3.79%
Source: ICD Research Analysis / © ICD Research
Figure 78: Dutch Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 120
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5.16.2 Consumption Value by Category
In 2010, excavators accounted for the largest consumption value in the Dutch earthmoving equipment market,
with a share of 46.0% and a value of US$247.9 billion. The construction tractors and loaders categories
recorded the second and third largest consumption values of US$211.6 million and US$79.6 million
respectively.
Table 76: Dutch Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million),
2006, 2010 and 2015
Category/ Sub-Category 2006 2010 2015
Excavators 367.0 247.9 308.8
Crawler/ Wheeled Excavators 247.1 164.7 214.5
Mini Excavators 119.9 83.2 94.3
Loaders 120.0 79.6 95.0
Backhoe loaders 6.2 3.9 4.4
Crawler/ Wheeled/Compact loaders 97.8 65.6 78.2
Skid-Steer loaders 16.0 10.1 12.4
Construction Tractors 217.4 211.6 245.7
Bulldozers/Crawlers Tractors 69.8 55.8 67.5
Wheeled Tractors 147.5 155.8 178.2
Overall 704.4 539.2 649.4
Source: ICD Research Analysis / © ICD Research
Figure 79: Dutch Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015
Source: ICD Research Analysis / © ICD Research
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6 ASIA-PACIFIC
6.1 Market Environment
6.1.1 Economic Indicators
Table 77: Asia-Pacific Economic Indicators, 2006–2010
Indicators 2006 2007 2008 2009 2010 CAGR
2006–2010
GDP at constant prices (US$ billion) 9,919.3 10,539.8 10,899.4 10,946.5 11,693.4 4.20%
GDP per capita at constant prices (US$) 11,627.9 12,038.6 12,166.3 11,916.1 12,401.4 1.62%
Disposable income (US$ billion) 6,578.7 7,354.7 8,345.2 8,663.6 9,041.9 8.28%
Population (million) 2,954.5 2,982.3 3,010.0 3,038.1 3,065.9 0.93%
Employment rate (%) 62.1% 62.4% 62.2% 61.9% 62.3% N/A
Unemployment rate (%) 10.6% 10.2% 10.1% 10.3% 10.0% N/A
Industrial output growth (%) 14.0% 16.6% 12.3% -1.1% 14.2% N/A
Services growth (%) 10.5% 12.7% 7.5% -5.6% 9.0% N/A
Agriculture growth (%) 9.1% 17.7% 15.2% -0.4% 10.2% N/A
Source: ICD Research Analysis / © ICD Research
Table 78: Asia-Pacific Economic Indicators, 2010–2015
Indicators 2010 2011 2012 2013 2014 2015 CAGR
2010–2015
GDP at constant prices (US$ billion)
11,693.4 12,333.9 13,025.4 13,758.8 14,534.3 15,365.4 5.61%
GDP per capita at constant prices (US$)
12,401.4 12,791.6 13,201.7 13,614.0 14,034.8 14,467.1 3.13%
Disposable income (US$ billion) 9,041.9 9,812.3 10,421.4 11,128.6 11,934.9 12,891.3 7.35%
Population (million) 3,065.9 3,093.5 3,120.8 3,147.7 3,174.1 3,199.9 0.86%
Employment rate (%) 62.3% 62.4% 62.4% 62.6% 62.7% 62.9% N/A
Unemployment rate (%) 10.0% 9.9% 9.8% 9.7% 9.6% 9.5% N/A
Industrial output growth (%) 14.2% 8.1% 7.7% 7.5% 7.7% 7.9% N/A
Services growth (%) 9.0% 3.7% 3.5% 3.3% 3.4% 3.3% N/A
Agriculture growth (%) 10.2% 7.8% 7.0% 7.0% 7.4% 7.4% N/A
Source: ICD Research Analysis / © ICD Research
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6.1.2 Monetary Indicators
Table 79: Asia-Pacific Monetary Indicators, 2006–2010
Indicators 2006 2007 2008 2009 2010
Wholesale Price Index (WPI) 106 110 121 117 126
Consumer Price Index (CPI) 109 112 119 122 124
Source: ICD Research Analysis / © ICD Research
Table 80: Asia-Pacific Monetary Indicators, 2010–2015
Indicators 2010 2011 2012 2013 2014 2015
Wholesale Price Index (WPI) 126 130 134 139 144 149
Consumer Price Index (CPI) 124 129 133 138 144 149
Source: ICD Research Analysis / © ICD Research
6.1.3 Trade and Investment Indicators
Table 81: Asia-Pacific Trade and Investment Indicators, 2006–2009
Indicators 2006 2007 2008 2009 CAGR 2006–2009
Total exports (US$ billion) 2,842.9 3,370.7 3,856.7 1,950.4 -11.80%
Total imports (US$ billion) 2,552.3 2,978.5 3,558.6 1,781.2 -11.30%
Trade balance (US$ billion) 290.6 392.2 298.2 169.2 NA
Source: ICD Research Analysis / © ICD Research
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6.2 Asia-Pacific Earthmoving Equipment Market Analysis
The Asia-Pacific region is home to many construction markets, ranging from highly developed and established
economies such as Japan and Australia to some of the fastest growing and emerging economies such as
China, India and the Philippines. Consumption of earthmoving equipment was valued at US$41.4 billion within
the region in 2010, recording a growth of 47.9% over 2009. The market reacted strongly in 2010, following a
decline of 21.6% in 2009, due, in part, to economic stimulus and government incentives alongside frustrated
demand from inactivity in 2009. Investments in the infrastructure sector formed the foundation of the fiscal
packages announced by various governments during the period of prevalent economic contraction.. With
CAGRs of 59.3% and 56.0% respectively, China and South Korea were key to increased levels of growth in
2010.
As a result of the strong recovery in 2010, the consumption value of earthmoving equipment reached US$41.4
billion in 2010, from US$29.2 in 2006, recording a CAGR of 9.13% during the review period. China has been
the main driving force behind the growth in the review period, with a CAGR of 26.61%; followed by South
Korea posting growth rates of 11.85%, Indonesia recording 11.61% and the Philippines registering levels of
9.04%. Growth rates in India and Australia remained minimal with CAGRs of 0.92% and 0.52% respectively.
Conversely, consumption in the Japanese earthmoving equipment market recorded a CARC of -11.36%
during the review period.
Figure 80: Asia-Pacific Earthmoving Equipment Consumption Dynamics by Value (%), 2006–2015
Note: Bubble size represents 2010 consumption value (US$ million)
Source: World Market Intelligence Analysis /© World Market Intelligence
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 124
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As a result of the fast growth in the Chinese construction industry, the country‘s share of earthmoving
equipment consumption in the Asia-Pacific region increased from 52.3% in 2006 to 76.6% in 2010. Robust
growth within the Chinese construction industry was supported by an increase in construction activity as the
country prepares for the 2008 Beijing Olympics. Further growth is anticipated to be sustained through the
government‘s eleventh Five-Year Plan, 2006–2010, from which construction continues on building
infrastructure such as roads, bridges, ports and airports across the country. Japan represents the second
largest consumer with a market share of 10.0%, a decrease of 18.5 percentage points over 2006. The
country‘s declining market share is a result of the decelerated activity in the country‘s construction industry
and an aging and declining population being compounded by shrinking private investments and reduced
governmental investments following the global economic crisis.
China became the largest earthmoving equipment producer within the Asia-Pacific region, when it overtook
Japan in 2008. In 2010, China accounted for 63.0% share of the region‘s earthmoving equipment production,
with a value of US$26.1 billion. In comparison, Japan comprised 25.8% and valued US$10.7 billion.
Additionally, South Korea and India are significant producers with market shares of 5.1% and 4.5%
respectively. Overall, production value in the Asia-Pacific earthmoving equipment market valued US$41.4
billion in 2010, expanding from US$29.2 billion in 2006 and recording a CAGR of 9.13% during the review
period. ICD projects the production value of earthmoving equipment to register a CAGR of 10.08% over the
forecast period and value US$67.0 billion by 2015.
ICD expects the earthmoving equipment market consumption to moderate to a CAGR of 11.30% over the
forecast period with Japan expected to emerge as the fastest growing market as construction activity
anticipated to increase with the announcement of the US$2.6 billion (JPY23 trillion) East Japanese
Earthquake Reconstruction Program spread over the next ten years. China is expected to record the second
highest CAGR of 11.79% over the forecast period with construction activities expected to be supported by
high levels of foreign direct investment (FDI), a rise in manufacturing levels and government funding for large
scale infrastructure and industrial projects. Among other markets, the Philippines is projected to record a
CAGR of 11.17%; followed by South Korea with comprising 9.23%, India posting growth rates of 7.14%,
Malaysia registering 5.70%, Australia recording 5.62% and Indonesia accounting for a growth of 4.53%. In
South Korea construction activities will be supported by infrastructural investments in preparation for hosting
the 2012 World Exposition (World Fair) and the 2018 Winter Olympic Games. In addition, the country‘s raising
status in manufacturing, evident from the country‘s expanding exports level, are also expected to contribute as
growth drivers for the construction industry.
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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6.3 Consumption
6.3.1 Consumption Value
Consumption of earthmoving equipment in the Asia-Pacific region valued US$34.4 billion in 2010, an increase
of 47.9% over 2009. The value of earthmoving equipment consumption recorded a CAGR of 15.10% during
the review period.
Table 82: Asia-Pacific Earthmoving Equipment Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 19,609.2
2007 25,468.8 29.9%
2008 29,681.9 16.5%
2009 23,271.8 -21.6%
2010 34,420.7 47.9%
CAGR 2006-2010 15.10%
Source: ICD Research Analysis / © ICD Research
Figure 81: Asia-Pacific Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 126
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ICD expects the consumption of earthmoving equipment in Asia-Pacific to increase at a CAGR of 11.30% over
the forecast period and value US$58.8 billion in 2015.
Table 83: Asia-Pacific Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 34,420.7
2011 38,215.9 11.0%
2012 42,523.2 11.3%
2013 47,474.9 11.6%
2014 52,795.9 11.2%
2015 58,788.9 11.4%
CAGR 2010-2015 11.30%
Source: ICD Research Analysis / © ICD Research
Figure 82: Asia-Pacific Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 127
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6.3.2 Consumption Value by Category
In 2010, loaders accounted for the largest share of earthmoving equipment consumption value in the Asia-
Pacific region, with a 46.0% share and a value of US$15.6 billion. Excavators and construction tractors
recorded the second and third largest consumption values of US$15.6 billion and US$3.0 billion, respectively.
Loaders recorded the fastest growing consumption among end-user markets, with a CAGR of 17.13% during
the review period.
Table 84: Asia-Pacific Earthmoving Equipment Consumption Value by Category/Sub category (US$
Million), 2006–2010
Category 2006 2007 2008 2009 2010 CAGR
2006–2010
Excavators 8,311.3 10,266.8 12,548.7 10,516.3 15,592.9 17.03%
Crawler/ Wheeled Excavators 6,677.3 8,255.0 10,515.5 8,824.9 13,476.5 19.19%
Mini Excavators 1,634.0 2,011.8 2,033.2 1,691.5 2,116.3 6.68%
Loaders 8,416.4 12,387.5 13,961.0 10,648.7 15,842.6 17.13%
Backhoe loaders 247.0 311.6 332.0 237.7 259.3 1.23%
Crawler/ Wheeled/Compact loaders 8,027.0 11,888.9 13,456.5 10,260.5 15,429.1 17.75%
Skid-Steer loaders 142.5 187.0 172.5 150.5 154.2 1.98%
Construction Tractors 2,881.4 2,814.5 3,172.2 2,106.7 2,985.2 0.89%
Bulldozers/Crawlers Tractors 976.6 1,077.0 1,106.2 814.1 1,073.0 2.38%
Wheeled Tractors 1,904.9 1,737.5 2,066.0 1,292.6 1,912.2 0.10%
Overall 19,609.2 25,468.8 29,681.9 23,271.8 34,420.7 15.10%
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 128
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Figure 83: Asia-Pacific Earthmoving Equipment Consumption Value by Category (%), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 129
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Excavators‘ category is expected to be the largest earthmoving equipment category in the Asia-Pacific region,
accounting for a share of 46.0% and valuing US$27.4 billion in 2015. The loaders and construction tractors
categories are expected to record the second and third largest consumption values of US$27.1 billion and
US$4.3 billion respectively. Over the forecast period the excavators‘ category is expected to register the
fastest consumption growth in Europe with a CAGR of 11.97%.
Table 85: Asia-Pacific Earthmoving Equipment Consumption Value by Category/Sub category (US$
Million), 2010–2015
Category 2010 2011 2012 2013 2014 2015 CAGR
2010–2015
Excavators 15,592.9 17,420.6 19,539.3 21,946.9 24,476.3 27,443.2 11.97%
Crawler/ Wheeled Excavators 13,476.5 15,011.6 16,873.2 18,983.0 21,173.5 23,766.3 12.02%
Mini Excavators 2,116.3 2,409.0 2,666.1 2,963.9 3,302.8 3,676.9 11.68%
Loaders 15,842.6 17,602.4 19,569.1 21,850.5 24,339.4 27,067.7 11.31%
Backhoe loaders 259.3 280.6 302.7 329.7 359.2 390.4 8.53%
Crawler/ Wheeled/Compact loaders 15,429.1 17,159.7 19,095.6 21,339.9 23,789.3 26,475.1 11.40%
Skid-Steer loaders 154.2 162.1 170.9 180.9 190.9 202.2 5.57%
Construction Tractors 2,985.2 3,192.9 3,414.8 3,677.5 3,980.2 4,278.0 7.46%
Bulldozers/Crawlers Tractors 1,073.0 1,150.2 1,239.6 1,335.4 1,456.6 1,571.3 7.93%
Wheeled Tractors 1,912.2 2,042.7 2,175.2 2,342.0 2,523.6 2,706.7 7.20%
Overall 34,420.7 38,215.9 42,523.2 47,474.9 52,795.9 58,788.9 11.30%
Source: ICD Research Analysis / © ICD Research
Figure 84: Asia-Pacific Earthmoving Equipment Consumption Value by Category (%), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 130
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6.4 Production
6.4.1 Production Value
During the review period, the production value of the Asia-Pacific earthmoving equipment market recorded a
CAGR of 9.13%. Moreover, in 2010 production increased by 56.9% over 2009 and valued US$41.4 billion.
Table 86: Asia-Pacific Earthmoving Equipment Production Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 29,209.4
2007 37,178.3 27.3%
2008 42,908.4 15.4%
2009 26,410.3 -38.4%
2010 41,425.4 56.9%
CAGR 2006-2010 9.13%
Source: ICD Research Analysis / © ICD Research
Figure 85: Asia-Pacific Earthmoving equipment Production Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 131
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ICD expects production in the Asia-Pacific earthmoving equipment market to increase from US$41.4 billion in
2010 to US$67.0 billion in 2015. Over the forecast period the production of earthmoving equipment in the
Asia-Pacific region is expected to increase at a CAGR of 10.08%.
Table 87: Asia-Pacific Earthmoving Equipment Production Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 41,425.4
2011 45,491.6 9.8%
2012 49,835.0 9.5%
2013 55,088.3 10.5%
2014 60,776.0 10.3%
2015 66,967.5 10.2%
CAGR 2010-2015 10.08%
Source: ICD Research Analysis / © ICD Research
Figure 86: Asia-Pacific Earthmoving Equipment Production Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 132
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6.4.2 Production Value by Category
In 2010, excavators had the largest category production in the Asia-Pacific earthmoving equipment market,
accounting for a share of 50.3% and valuing US$20.8 billion, followed by loaders with a production value of
US$16.9 billion.
The loaders category recorded the fastest production growth among the individual categories of earthmoving
equipment in the Asia-Pacific region with a CAGR of 15.54% during the review period.
Table 88: Asia-Pacific Earthmoving Equipment Production Value by Category/Sub category (US$
Million), 2006–2010
Category 2006 2007 2008 2009 2010 CAGR 2006–2010
Excavators 15,487.6 18,968.0 21,807.5 12,410.3 20,840.7 7.70%
Crawler/ Wheeled Excavators 12,480.3 15,449.4 18,576.8 10,527.3 17,954.8 9.52%
Mini Excavators 3,007.3 3,518.6 3,230.8 1,882.9 2,885.9 -1.02%
Loaders 9,470.6 13,791.1 15,791.3 11,335.4 16,876.2 15.54%
Backhoe loaders 174.3 238.0 239.9 194.0 212.3 5.05%
Crawler/ Wheeled/Compact loaders 9,150.7 13,371.3 15,399.3 11,001.8 16,519.2 15.91%
Skid-Steer loaders 145.5 181.8 152.2 139.6 144.8 -0.14%
Construction Tractors 4,251.2 4,419.1 5,309.5 2,664.7 3,708.5 -3.36%
Bulldozers/Crawlers Tractors 1,485.9 1,776.6 2,095.8 994.6 1,369.9 -2.01%
Wheeled Tractors 2,765.3 2,642.5 3,213.7 1,670.0 2,338.5 -4.10%
Overall 29,209.4 37,178.3 42,908.4 26,410.3 41,425.4 9.13%
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 133
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Figure 87: Asia-Pacific Earthmoving Equipment Production Value by Category (%), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 134
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
With a predicted CAGR of 9.49% and a production value of US$32.8 billion, excavators are forecast to be the
largest category within the Asia-Pacific earthmoving equipment market in 2015. This category is also expected
to account for a 49.0% share of production by 2015. With a share of 43.1%, the loaders category is expected
to record the second largest production in 2015.
Table 89: Asia-Pacific Earthmoving Equipment Production Value by Category/Sub category (US$
Million), 2010–2015
Category 2010 2011 2012 2013 2014 2015 CAGR 2010–2015
Excavators 20,840.7 22,709.6 24,703.3 27,181.0 29,875.2 32,787.5 9.49%
Crawler/ Wheeled Excavators 17,954.8 19,574.5 21,314.4 23,492.2 25,852.3 28,398.5 9.60%
Mini Excavators 2,885.9 3,135.1 3,388.9 3,688.8 4,022.9 4,389.0 8.75%
Loaders 16,876.2 18,793.0 20,863.2 23,305.7 25,953.2 28,853.9 11.32%
Backhoe loaders 212.3 230.2 249.9 274.0 300.4 328.5 9.13%
Crawler/ Wheeled/Compact loaders 16,519.2 18,409.5 20,450.2 22,857.3 25,466.6 28,326.6 11.39%
Skid-Steer loaders 144.8 153.4 163.2 174.5 186.2 198.8 6.55%
Construction Tractors 3,708.5 3,988.9 4,268.6 4,601.6 4,947.7 5,326.0 7.51%
Bulldozers/Crawlers Tractors 1,369.9 1,483.5 1,602.2 1,743.2 1,894.2 2,055.9 8.46%
Wheeled Tractors 2,338.5 2,505.4 2,666.4 2,858.4 3,053.4 3,270.1 6.94%
Overall 41,425.4 45,491.6 49,835.0 55,088.3 60,776.0 66,967.5 10.08%
Source: ICD Research Analysis / © ICD Research
Figure 88: Asia-Pacific Earthmoving Equipment Production Value by Category (%), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 135
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
6.5 CHINA
6.5.1 Consumption Value
Consumption of earthmoving equipment in China valued US$26.4 billion in 2010, an increase of 59.3% over
2009. During the review period the consumption value of earthmoving equipment recorded a CAGR of
26.61%.
Table 90: Chinese Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 10,263.3
2007 15,402.8 50.1%
2008 18,405.1 19.5%
2009 16,549.1 -10.1%
2010 26,369.4 59.3%
CAGR 2006-2010 26.61%
Source: ICD Research Analysis / © ICD Research
Figure 89: Chinese Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 136
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
ICD expects the consumption of earthmoving equipment in China to increase at a CAGR of 11.79% over the
forecast period and value US$46.0 billion in 2015.
Table 91: Chinese Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 26,369.4
2011 29,441.3 11.6%
2012 32,912.9 11.8%
2013 36,887.5 12.1%
2014 41,271.3 11.9%
2015 46,044.6 11.6%
CAGR 2010-2015 11.79%
Source: ICD Research Analysis / © ICD Research
Figure 90: Chinese Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 137
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
6.5.2 Consumption Value by Category
In 2010, loaders accounted for the largest consumption value of earthmoving equipment in China, with a share
of 55.6% and a value of US$14.7 billion. The excavators and construction tractors categories recorded the
second and third largest consumption values of US$11.0 billion and US$673.3 million respectively.
Table 92: Chinese Earthmoving Equipment Consumption Value by Category/Sub-Category (US$
Million), 2006, 2010 and 2015
Category/ Sub-Category 2006 2010 2015
Excavators 2,833.8 11,031.8 19,471.1
Crawler/ Wheeled Excavators 2,454.1 9,841.6 17,373.7
Mini Excavators 379.6 1,190.2 2,097.4
Loaders 7,104.6 14,664.3 25,464.6
Backhoe loaders 15.2 47.7 78.1
Crawler/ Wheeled/Compact loaders 7,082.0 14,600.2 25,358.4
Skid-Steer loaders 7.3 16.4 28.1
Construction Tractors 325.0 673.3 1,108.9
Bulldozers/Crawlers Tractors 280.2 488.2 812.8
Wheeled Tractors 44.7 185.1 296.0
Overall 10,263.3 26,369.4 46,044.6
Source: ICD Research Analysis / © ICD Research
Figure 91: Chinese Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 138
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
6.6 INDIA
6.6.1 Consumption Value
Consumption of earthmoving equipment in India valued US$1.8 billion in 2010, an increase of 4.8% over
2009. During the review period the consumption value of earthmoving equipment recorded a CAGR of 0.92%.
Table 93: Indian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 1,738.9
2007 2,212.2 27.2%
2008 2,099.2 -5.1%
2009 1,720.7 -18.0%
2010 1,803.9 4.8%
CAGR 2006-2010 0.92%
Source: ICD Research Analysis / © ICD Research
Figure 92: Indian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 139
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
ICD expects the consumption of earthmoving equipment in India to increase at a CAGR of 7.14% over the
forecast period and value US$2.5 billion in 2015.
Table 94: Indian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 1,803.9
2011 1,920.8 6.5%
2012 2,064.4 7.5%
2013 2,217.6 7.4%
2014 2,371.1 6.9%
2015 2,546.6 7.4%
CAGR 2010-2015 7.14%
Source: ICD Research Analysis / © ICD Research
Figure 93: Indian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 140
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
6.6.2 Consumption Value by Category
In 2010, excavators accounted for the largest consumption value in the Indian earthmoving equipment market,
with a share of 56.8% and a value of US$1.0 billion. The loaders and construction tractors categories recorded
the second and third largest consumption values of US$560.6 million and US$218.7 million respectively.
Table 95: Indian Earthmoving Equipment Consumption Value by Category/Sub-Category (US$
Million), 2006, 2010 and 2015
Category/ Sub-Category 2006 2010 2015
Excavators 897.7 1,024.6 1,439.5
Crawler/ Wheeled Excavators 601.2 656.7 917.6
Mini Excavators 296.5 367.8 521.9
Loaders 545.0 560.6 794.8
Backhoe loaders 127.1 133.4 210.0
Crawler/ Wheeled/Compact loaders 340.8 343.6 479.4
Skid-Steer loaders 77.0 83.6 105.5
Construction Tractors 296.2 218.7 312.2
Bulldozers/Crawlers Tractors 93.1 93.9 136.9
Wheeled Tractors 203.1 124.8 175.4
Overall 1,738.9 1,803.9 2,546.6
Source: ICD Research Analysis / © ICD Research
Figure 94: Indian Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 141
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
6.7 JAPAN
6.7.1 Consumption Value
Consumption of earthmoving equipment in Japan valued US$3.5 billion in 2010, an increase of 21.7% over
2009. However, during the review period the consumption value of earthmoving equipment recorded a CARC
of -11.36%.
Table 96: Japanese Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 5,597.5
2007 5,407.1 -3.4%
2008 6,230.6 15.2%
2009 2,840.0 -54.4%
2010 3,455.9 21.7%
CARC 2006-2010 -11.36%
Source: ICD Research Analysis / © ICD Research
Figure 95: Japanese Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 142
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
ICD expects the consumption of earthmoving equipment in Japan to increase at a CAGR of 12.09% over the
forecast period and value reach US$6.1 billion in 2015.
Table 97: Japanese Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 3,455.9
2011 4,033.0 16.7%
2012 4,383.9 8.7%
2013 4,918.6 12.2%
2014 5,431.3 10.4%
2015 6,115.9 12.6%
CAGR 2010-2015 12.09%
Source: ICD Research Analysis / © ICD Research
Figure 96: Japanese Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 143
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
6.7.2 Consumption Value by Category
In 2010, the construction tractors category accounted for the largest consumption value in the Japanese
earthmoving equipment market, with a share of 47.1% and a value of US$1.6 billion. The excavators and
loaders categories recorded the second and third largest consumption values of US$1.6 billion and US$266.7
million respectively.
Table 98: Japanese Earthmoving Equipment Consumption Value by Category/Sub-Category (US$
Million), 2006, 2010 and 2015
Category/ Sub-Category 2006 2010 2015
Excavators 3,312.5 1,560.8 3,465.9
Crawler/ Wheeled Excavators 2,556.1 1,278.4 2,789.3
Mini Excavators 756.4 282.3 676.6
Loaders 435.6 266.7 348.0
Backhoe loaders 13.9 6.2 8.6
Crawler/ Wheeled/Compact loaders 408.4 254.6 331.5
Skid-Steer loaders 13.3 5.9 7.8
Construction Tractors 1,849.4 1,628.4 2,302.1
Bulldozers/Crawlers Tractors 448.9 306.3 388.5
Wheeled Tractors 1,400.5 1,322.1 1,913.6
Overall 5,597.5 3,455.9 6,115.9
Source: ICD Research Analysis / © ICD Research
Figure 97: Japanese Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and
2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 144
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
6.8 SOUTH KOREA
6.8.1 Consumption Value
Consumption of earthmoving equipment in South Korea valued US$1.6 billion in 2010, an increase of 56.0%
over 2009. During the review period the consumption value of earthmoving equipment recorded a CAGR of
11.85%.
Table 99: South Korean Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 1,029.1
2007 1,180.9 14.7%
2008 1,435.6 21.6%
2009 1,032.0 -28.1%
2010 1,610.4 56.0%
CAGR 2006-2010 11.85%
Source: ICD Research Analysis / © ICD Research
Figure 98: South Korean Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 145
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
ICD expects the consumption of earthmoving equipment in South Korea to increase at a CAGR of 9.23% over
the forecast period and value US$2.5 billion in 2015.
Table 100: South Korean Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 1,610.4
2011 1,571.6 -2.4%
2012 1,840.2 17.1%
2013 2,048.4 11.3%
2014 2,229.6 8.8%
2015 2,503.8 12.3%
CAGR 2010-2015 9.23%
Source: ICD Research Analysis / © ICD Research
Figure 99: South Korean Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 146
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
6.8.2 Consumption Value by Category
In 2010, excavators accounted for the largest consumption value in the South Korean earthmoving equipment
market, with a share of 82.1% and a value of US$1.3 billion. The construction tractors and loaders categories
recorded the second and third largest consumption values of US$160.0 million and US$128.1 million
respectively.
Table 101: South Korean Earthmoving Equipment Consumption Value by Category/Sub-Category
(US$ Million), 2006, 2010 and 2015
Category/ Sub-Category 2006 2010 2015
Excavators 772.7 1,322.3 2,175.6
Crawler/ Wheeled Excavators 755.8 1,303.1 2,148.1
Mini Excavators 16.9 19.2 27.6
Loaders 91.9 128.1 167.1
Backhoe loaders 2.3 1.6 2.2
Crawler/ Wheeled/Compact loaders 72.2 106.7 142.3
Skid-Steer loaders 17.4 19.7 22.6
Construction Tractors 164.6 160.0 161.1
Bulldozers/Crawlers Tractors 11.3 8.8 6.8
Wheeled Tractors 153.3 151.2 154.2
Overall 1,029.1 1,610.4 2,503.8
Source: ICD Research Analysis / © ICD Research
Figure 100: South Korean Earthmoving Equipment Consumption Value by Category (%), 2006, 2010
and 2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 147
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
6.9 AUSTRALIA
6.9.1 Consumption Value
Consumption of earthmoving equipment in Australia valued US$296.1 million in 2010, an increase of 1.0%
over 2009. During the review period the consumption value of earthmoving equipment recorded a CAGR of
0.52%.
Table 102: Australian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 289.9
2007 304.2 4.9%
2008 312.9 2.9%
2009 293.1 -6.3%
2010 296.1 1.0%
CAGR 2006-2010 0.52%
Source: ICD Research Analysis / © ICD Research
Figure 101: Australian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 148
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
ICD expects the consumption of earthmoving equipment in Australian to increase at a CAGR of 5.62% over
the forecast period and value US$389.2 million in 2015.
Table 103: Australian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 296.1
2011 309.6 4.6%
2012 326.7 5.5%
2013 347.8 6.5%
2014 368.6 6.0%
2015 389.2 5.6%
CAGR 2010-2015 5.62%
Source: ICD Research Analysis / © ICD Research
Figure 102: Australian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 149
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
6.9.2 Consumption Value by Category
In 2010, excavators accounted for the largest consumption value in the Australian earthmoving equipment
market, with a share of 44.0% and a value of US$130.2 million. The loaders and construction tractors
categories recorded the second and third largest consumption values of US$85.4 million and US$80.5 million
respectively.
Table 104: Australian Earthmoving Equipment Consumption Value by Category/Sub-Category (US$
Million), 2006, 2010 and 2015
Category/ Sub-Category 2006 2010 2015
Excavators 131.1 130.2 170.3
Crawler/ Wheeled Excavators 83.2 82.7 108.0
Mini Excavators 47.9 47.5 62.3
Loaders 85.5 85.4 114.1
Backhoe loaders 14.8 14.8 20.6
Crawler/ Wheeled/Compact loaders 55.4 55.4 73.6
Skid-Steer loaders 15.3 15.1 19.9
Construction Tractors 73.3 80.5 104.9
Bulldozers/Crawlers Tractors 29.4 33.9 44.7
Wheeled Tractors 43.9 46.6 60.2
Overall 289.9 296.1 389.2
Source: ICD Research Analysis / © ICD Research
Figure 103: Australian Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and
2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 150
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
6.10 INDONESIA
6.10.1 Consumption Value
Consumption of earthmoving equipment in Indonesia valued US$443.8 million in 2010, an increase of 6.9%
over 2009. During the review period the consumption value of earthmoving equipment recorded a CAGR of
11.61%.
Table 105: Indonesian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 286.1
2007 406.8 42.2%
2008 545.1 34.0%
2009 415.3 -23.8%
2010 443.8 6.9%
CAGR 2006-2010 11.61%
Source: ICD Research Analysis / © ICD Research
Figure 104: Indonesian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 151
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
ICD expects the consumption of earthmoving equipment in Indonesia to increase at a CAGR of 4.53% over
the forecast period and value US$553.8 million in 2015.
Table 106: Indonesian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 443.8
2011 467.4 5.3%
2012 486.9 4.2%
2013 506.0 3.9%
2014 531.6 5.1%
2015 553.8 4.2%
CAGR 2010-2015 4.53%
Source: ICD Research Analysis / © ICD Research
Figure 105: Indonesian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 152
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
6.10.2 Consumption Value by Category
In 2010, excavators accounted for the largest consumption value in the Indonesian earthmoving equipment
market, with a share of 62.7% and a value of US$278.3 million. The construction tractors and loaders
categories recorded the second and third largest consumption values of US$107.9 million and US$57.7 million
respectively.
Table 107: Indonesian Earthmoving Equipment Consumption Value by Category/Sub-Category (US$
Million), 2006, 2010 and 2015
Category/ Sub-Category 2006 2010 2015
Excavators 145.0 278.3 345.9
Crawler/ Wheeled Excavators 90.7 165.1 194.9
Mini Excavators 54.4 113.2 151.0
Loaders 77.8 57.7 74.2
Backhoe loaders 52.8 34.1 42.5
Crawler/ Wheeled/Compact loaders 24.9 23.6 31.7
Skid-Steer loaders 0.0 0.0 0.0
Construction Tractors 63.2 107.9 133.7
Bulldozers/Crawlers Tractors 63.2 107.9 133.7
Wheeled Tractors 0.0 0.0 0.0
Overall 286.1 443.8 553.8
Source: ICD Research Analysis / © ICD Research
Figure 106: Indonesian Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and
2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 153
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
6.11 MALAYSIA
6.11.1 Consumption Value
Consumption of earthmoving equipment in Malaysia valued US$301.7 million in 2010, an increase of 2.2%
over 2009. During the review period the consumption value of earthmoving equipment recorded a CARC of -
0.32%.
Table 108: Malaysian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 305.6
2007 441.1 44.3%
2008 505.0 14.5%
2009 295.2 -41.6%
2010 301.7 2.2%
CAGR 2006-2010 -0.32%
Source: ICD Research Analysis / © ICD Research
Figure 107: Malaysian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 154
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
ICD expects the consumption of earthmoving equipment in Malaysia to increase at a CAGR of 5.70% over the
forecast period and value US$398.0 million in 2015.
Table 109: Malaysian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 301.7
2011 318.3 5.5%
2012 337.4 6.0%
2013 357.6 6.0%
2014 378.7 5.9%
2015 398.0 5.1%
CAGR 2010-2015 5.70%
Source: ICD Research Analysis / © ICD Research
Figure 108: Malaysian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 155
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
6.11.2 Consumption Value by Category
In 2010, excavators accounted for the largest consumption value in Malaysia earthmoving equipment market,
with a share of 58.6% and a value of US$176.7 million. The construction tractors and loaders categories
recorded the second and third largest consumption values, at US$75.3 million and US$49.7 million
respectively.
Table 110: Malaysian Earthmoving Equipment Consumption Value by Category/Sub-Category (US$
Million), 2006, 2010 and 2015
Category/ Sub-Category 2006 2010 2015
Excavators 173.2 176.7 249.5
Crawler/ Wheeled Excavators 108.2 104.8 153.5
Mini Excavators 65.0 71.9 96.0
Loaders 52.2 49.7 59.0
Backhoe loaders 13.0 12.2 15.1
Crawler/ Wheeled/Compact loaders 31.3 28.7 33.1
Skid-Steer loaders 7.9 8.8 10.8
Construction Tractors 80.2 75.3 89.5
Bulldozers/Crawlers Tractors 34.6 14.3 17.3
Wheeled Tractors 45.6 61.1 72.2
Overall 305.6 301.7 398.0
Source: ICD Research Analysis / © ICD Research
Figure 109: Malaysian Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and
2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 156
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
6.12 PHILIPPINES
6.12.1 Consumption Value
Consumption of earthmoving equipment in the Philippines valued US$139.6 million in 2010, an increase of
10.5% over 2009. During the review period the consumption value of earthmoving equipment recorded a
CAGR of 9.04%.
Table 111: Philippine Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 98.7
2007 113.8 15.3%
2008 148.4 30.4%
2009 126.3 -14.9%
2010 139.6 10.5%
CAGR 2006-2010 9.04%
Source: ICD Research Analysis / © ICD Research
Figure 110: Philippine Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 157
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
ICD expects the consumption of earthmoving equipment in the Philippines to increase at a CAGR of 11.17%
over the forecast period and value US$237.1 million in 2015.
Table 112: Philippine Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 139.6
2011 153.8 10.2%
2012 170.8 11.0%
2013 191.3 12.0%
2014 213.6 11.6%
2015 237.1 11.0%
CAGR 2010-2015 11.17%
Source: ICD Research Analysis / © ICD Research
Figure 111: Philippine Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 158
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
6.12.2 Consumption Value by Category
In 2010, excavators accounted for the largest consumption value in the Philippine earthmoving equipment
market, with a share of 48.9% and a value of US$68.2 million. The construction tractors and loaders
categories recorded the second and third largest consumption values of US$41.1 million and US$30.3 million
respectively.
Table 113: Philippine Earthmoving Equipment Consumption Value by Category/Sub-Category (US$
Million), 2006, 2010 and 2015
Category/ Sub-Category 2006 2010 2015
Excavators 45.2 68.2 125.5
Crawler/ Wheeled Excavators 27.9 44.1 81.2
Mini Excavators 17.4 24.1 44.2
Loaders 24.0 30.3 45.9
Backhoe loaders 7.9 9.3 13.5
Crawler/ Wheeled/Compact loaders 11.9 16.3 24.9
Skid-Steer loaders 4.2 4.6 7.4
Construction Tractors 29.5 41.1 65.7
Bulldozers/Crawlers Tractors 15.8 19.7 30.6
Wheeled Tractors 13.7 21.4 35.1
Overall 98.7 139.6 237.1
Source: ICD Research Analysis / © ICD Research
Figure 112: Philippine Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and
2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 159
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
7 SOUTH AMERICA
7.1 Market Environment
7.1.1 Economic Indicators
Table 114: South American Economic Indicators, 2006–2010
Indicators 2006 2007 2008 2009 2010 CAGR
2006–2010
GDP at constant prices (US$ billion) 2,079.4 2,186.0 2,270.8 2,214.3 2,353.1 3.14%
GDP per capita at constant prices (US$) 5,868.8 6,153.1 6,353.4 6,171.8 6,487.3 2.54%
Disposable income (US$ billion) 1,590.2 1,855.4 2,092.1 1,952.6 2,072.2 6.84%
Population (million) 377.9 382.3 386.6 391.2 395.7 1.16%
Employment rate (%) 47.9% 48.2% 47.6% 47.2% 47.6% N/A
Unemployment rate (%) 8.5% 8.4% 8.6% 8.7% 8.6% N/A
Industrial output growth (%) 13.4% 10.7% 13.5% -8.9% 12.4% N/A
Services growth (%) 12.8% 11.4% 13.8% -5.9% 10.7% N/A
Agriculture growth (%) 11.9% 25.4% 22.3% 0.1% 12.8% N/A
Source: ICD Research Analysis / © ICD Research
Table 115: South American Economic Indicators, 2010–2015
Indicators 2010 2011 2012 2013 2014 2015 CAGR
2010–2015
GDP at constant prices (US$ billion) 2,353.1 2,448.1 2,552.6 2,658.7 2,765.2 2,870.8 4.06%
GDP per capita at constant prices (US$) 6,487.3 6,677.3 6,870.4 7,064.0 7,256.3 7,444.6 2.79%
Disposable income (US$ billion) 2,072.2 2,305.5 2,412.9 2,513.0 2,633.6 2,788.4 6.12%
Population (million) 395.7 400.2 404.6 409.0 413.3 417.6 1.08%
Employment rate (%) 47.6% 47.7% 48.1% 48.4% 48.7% 49.0% N/A
Unemployment rate (%) 8.6% 8.5% 8.4% 8.3% 8.2% 8.1% N/A
Industrial output growth (%) 12.4% 5.0% 4.6% 4.2% 3.7% 3.2% N/A
Services growth (%) 10.7% 4.4% 4.7% 4.1% 3.6% 3.0% N/A
Agriculture growth (%) 12.8% 12.3% 10.8% 11.4% 11.3% 10.5% N/A
Source: ICD Research Analysis / © ICD Research
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7.1.2 Monetary Indicators
Table 116: South American Monetary Indicators, 2006–2010
Indicators 2006 2007 2008 2009 2010
Wholesale Price Index (WPI) 106 112 123 127 137
Consumer Price Index (CPI) 109 115 123 129 133
Source: ICD Research Analysis / © ICD Research
Table 117: South American Monetary Indicators, 2010–2015
Indicators 2010 2011 2012 2013 2014 2015
Wholesale Price Index (WPI) 137 145 152 159 166 173
Consumer Price Index (CPI) 133 138 143 148 154 161
Source: ICD Research Analysis / © ICD Research
7.1.3 Trade and Investment Indicators
Table 118: South American Trade and Investment Indicators, 2006–2010
Indicators 2006 2007 2008 2009 2010 CAGR
2006–2010
Total exports (US$ billion) 413.96 479.75 541.25 619.95 481.70 0.14%
Total imports (US$ billion) 375.1 439.9 515.2 614.9 455.2 1.15%
Trade balance (US$ billion) 38.9 39.9 26.1 5.1 26.5 NA
Source: ICD Research Analysis / © ICD Research
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7.2 South American Earthmoving Equipment Market Analysis
Consumption of earthmoving equipment in the South American region valued US$3.4 billion in 2010, an
increase from US$2.0 billion in 2006, recording a CAGR of 13.86%. The region registered varied growth rates
with Colombia and Brazil recording robust CAGRs of 29.42%, while Argentina recorded a moderate CAGR of
0.68% and Mexico recorded a CARC of -3.92% during the review period. Strong growth in the consumption of
earthmoving equipment has been supported by construction industry CAGRs of 12.83% in Colombia and
14.46% in Brazil. In Colombia, growth has been sustained by the implementation of ―Democratic Security‖ a
political and economic plan which has improved security conditions and encouraged foreign investment. In
Brazil, construction activities have significantly increased as a result of the US$285.4 billion (BRL500.8 billion)
investment allocation by the federal government for infrastructure development under the Programade
Aceleraçãodo Crescimento (PAC) plan, investment of which was increased to BRL633.6 billion (US$361.1
billion) in February 2009.
Figure 113: South America Earthmoving Equipment Consumption Dynamics by Value (%), 2006–2015
Note: Bubble size represents 2010 consumption value (US$ million)
Source: World Market Intelligence Analysis /© World Market Intelligence
With South American countries displaying signs of recovery from the global economic crisis, consumption
value of earthmoving equipment market expanded by 8.1% in 2010. In 2009 consumption value had declined
by 12.8% however, the market was supported by stimulus packages and investments in the construction
industry in 2010, with the Argentinean construction industry expanding by 10%, Brazil by 22.3%, Colombia by
1.9% and Mexico by 3%. In 2010, Brazil was the largest market for earthmoving equipment within the South
American market and accounted for 56.2% share of the consumption value. Colombia was the second largest
market recording a 15.8% share, followed by Mexico acting for 14.4% and Argentina comprising 13.6%. Brazil
was also the largest producer of earthmoving equipment in the region, with the country accounting for a 75.9%
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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share of the production value within the region in 2010, followed by Argentina accounting for 12.9%, Mexico
comprising 9.3% and Colombia representing 1.9%.
ICD expects the consumption value of earthmoving equipment to moderate and achieve a CAGR of 5.98%
over the forecast period. Mexico is projected to record the fastest growth, with a CAGR of 7.06%. Frustrated
demand from a prolonged period of market inactivity is expected to support growth in the Mexican market
alongside fiscal and monetary measures implemented by the government in order to stimulate the economy
including tax breaks for corporate sector, increased public infrastructure spending, relaxation of policy rates
and reforms in healthcare and education sector. The Mexican government‘s US$250 billion infrastructure
expenditure plan over 2007–2012 is expected to sustain the infrastructure construction market. Brazil is
projected to record the second highest CAGR of 6.55% over the forecast period with growth being driven by
an expected CAGR of 10.75% over the forecast priod. Growth is anticipated to be supported by an allocated
investment of US$25.7 billion by the federal governments, states and municipalities for the construction of
stadia and transport infrastructure as part of the country‘s preparations to host The 2014 FIFA World Cup and
the 2016 Olympic Games. In addition, the World Bank has announced an investment of US$11.1 billion for
infrastructure projects related to these two major sporting events, alongside the PAC and PAC 2 schemes this
is expected to sustain growth in the Brazilian construction market which will have a positive impact on the
earthmoving equipment market
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7.3 Consumption
7.3.1 Consumption Value
Consumption of earthmoving equipment in South America valued US$3.4 billion in 2010, an increase of 8.1%
over 2009. The value of earthmoving equipment consumption recorded a CAGR of 13.86% during the review
period.
Table 119: South American Earthmoving Equipment Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 2,039.1
2007 2,652.5 30.1%
2008 3,635.1 37.0%
2009 3,171.1 -12.8%
2010 3,427.1 8.1%
CAGR 2006-2010 13.86%
Source: ICD Research Analysis / © ICD Research
Figure 114: South American Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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ICD expects the consumption of earthmoving equipment in South America to increase at a CAGR of 5.98%
over the forecast period and value US$4.6 billion in 2015.
Table 120: South American Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 3,427.1
2011 3,633.9 6.0%
2012 3,843.0 5.8%
2013 4,079.6 6.2%
2014 4,323.9 6.0%
2015 4,581.0 5.9%
CAGR 2010-2015 5.98%
Source: ICD Research Analysis / © ICD Research
Figure 115: South American Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
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7.3.2 Consumption Value by Category
In 2010, excavators accounted for the largest share of earthmoving equipment consumption value in South
America, with a 39.4% share and a value of US$1.4 billion. Loaders and construction tractors recorded the
second and third largest consumption values of US$1.1 billion and US$967.0 million respectively. Excavators
recorded the fastest growing consumption among end-user markets in South America with a CAGR of 17.19%
during the review period.
Table 121: South America Earthmoving Equipment Consumption Value by Category/Sub category
(US$ Million), 2006–2010
Category 2006 2007 2008 2009 2010 CAGR
2006–2010
Excavators 716.8 944.2 1,392.4 1,304.0 1,351.9 17.19%
Crawler/ Wheeled Excavators 409.6 558.4 766.9 738.0 779.4 17.45%
Mini Excavators 307.2 385.7 625.5 566.0 572.6 16.85%
Loaders 655.8 911.8 1,172.1 992.5 1,108.2 14.01%
Backhoe loaders 190.6 289.1 394.0 313.3 369.0 17.96%
Crawler/ Wheeled/Compact loaders 262.6 354.4 472.3 449.7 471.6 15.76%
Skid-Steer loaders 202.6 268.3 305.8 229.5 267.6 7.20%
Construction Tractors 666.5 796.6 1,070.6 874.6 967.0 9.75%
Bulldozers/Crawlers Tractors 278.4 289.0 417.3 407.4 465.5 13.71%
Wheeled Tractors 388.1 507.5 653.3 467.2 501.4 6.62%
Overall 2,039.1 2,652.5 3,635.1 3,171.1 3,427.1 13.86%
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Figure 116: South American Earthmoving Equipment Consumption Value by Category (%), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 167
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The excavators‘ category is expected to be the largest earthmoving equipment market in South America,
accounting for a share of 39.3% and a value of US$1.8 billion in 2015. The loaders and construction tractors
categories are expected to record the second and third largest consumption values of US$1.5 billion and
US$1.3 billion respectively. Over the forecast period the loaders category is expected to register the fastest
consumption growth in South America with a CAGR of 6.40%.
Table 122: South America Earthmoving Equipment Consumption Value by Category/Sub category
(US$ Million), 2010–2015
Category 2010 2011 2012 2013 2014 2015 CAGR
2010–2015
Excavators 1,351.9 1,433.1 1,511.8 1,605.0 1,700.0 1,800.4 5.90%
Crawler/ Wheeled Excavators 779.4 828.1 876.8 932.2 989.6 1,048.9 6.12%
Mini Excavators 572.6 605.0 635.0 672.8 710.4 751.5 5.59%
Loaders 1,108.2 1,176.8 1,251.7 1,333.1 1,419.7 1,511.4 6.40%
Backhoe loaders 369.0 387.1 413.0 437.7 465.4 492.6 5.95%
Crawler/ Wheeled/Compact loaders 471.6 494.9 519.1 544.9 572.1 600.4 4.95%
Skid-Steer loaders 267.6 294.8 319.6 350.5 382.1 418.4 9.35%
Construction Tractors 967.0 1,024.0 1,079.5 1,141.5 1,204.2 1,269.3 5.59%
Bulldozers/Crawlers Tractors 465.5 496.7 524.5 556.7 587.1 619.5 5.88%
Wheeled Tractors 501.4 527.3 555.0 584.8 617.0 649.8 5.32%
Overall 3,427.1 3,633.9 3,843.0 4,079.6 4,323.9 4,581.0 5.98%
Source: ICD Research Analysis / © ICD Research
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Figure 117: South American Earthmoving Equipment Consumption Value by Category (%), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 169
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7.4 Production
7.4.1 Production Value
During the review period the production value of the South American earthmoving equipment market recorded
a CAGR of 12.20%. In 2010 production increased by 11.7% from 2009 and valued US$2.4 billion.
Table 123: South American Earthmoving Equipment Production Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 1,523.4
2007 1,891.8 24.2%
2008 2,499.3 32.1%
2009 2,160.4 -13.6%
2010 2,414.1 11.7%
CAGR 2006-2010 12.20%
Source: ICD Research Analysis / © ICD Research
Figure 118: South American Earthmoving Equipment Production Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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ICD expects production in the South American earthmoving equipment market to increase from US$2.4 billion
in 2010 to US$3.5 billion in 2015. Over the forecast period the production of earthmoving equipment in South
America is expected to increase at a CAGR of 7.52%.
Table 124: South American Earthmoving Equipment Production Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 2,414.1
2011 2,599.5 7.7%
2012 2,789.0 7.3%
2013 2,999.9 7.6%
2014 3,226.3 7.5%
2015 3,468.3 7.5%
CAGR 2010-2015 7.52%
Source: ICD Research Analysis / © ICD Research
Figure 119: South American Earthmoving Equipment Production Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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7.4.2 Production Value by Category
In 2010, loaders had the largest category production in the South American earthmoving equipment market,
accounting for a share of 39.4% and a value of US$952.0 million, followed by excavators with a production
value of US$736.7 million.
The loaders category recorded the fastest production growth among the individual categories of earthmoving
equipment in South American with a CAGR of 14.32% during the review period.
Table 125: South America Earthmoving Equipment Production Value by Category/Sub category (US$
Million), 2006–2010
Category 2006 2007 2008 2009 2010 CAGR
2006–2010
Excavators 454.5 555.9 764.2 651.8 736.7 12.84%
Crawler/ Wheeled Excavators 273.5 346.0 438.9 384.4 424.5 11.62%
Mini Excavators 181.0 209.9 325.3 267.5 312.2 14.61%
Loaders 557.4 730.1 988.6 841.8 952.0 14.32%
Backhoe loaders 147.4 215.7 317.4 260.3 304.0 19.84%
Crawler/ Wheeled/Compact loaders 248.7 308.7 427.2 394.1 414.6 13.64%
Skid-Steer loaders 161.4 205.8 244.0 187.4 233.4 9.67%
Construction Tractors 511.5 605.8 746.6 666.8 725.3 9.12%
Bulldozers/Crawlers Tractors 207.8 251.5 317.4 279.5 307.1 10.25%
Wheeled Tractors 303.7 354.3 429.2 387.3 418.2 8.33%
Overall 1,523.4 1,891.8 2,499.3 2,160.4 2,414.1 12.20%
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 172
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Figure 120: South American Earthmoving Equipment Production Value by Category (%), 2006–2010
Source: ICD Research Analysis / © ICD Research
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Forecasts to 2015 Page 173
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With a predicted CAGR of 7.91% and a production value of US$1.4 billion, the loaders category is forecast to
be the largest in the South American earthmoving equipment market in 2015. This category is also expected
to account for a 40.2% share of production in the European earthmoving equipment market in 2015. With a
share of 31.3%, the excavators‘ category is expected to record the second largest production in 2015.
Table 126: South America Earthmoving Equipment Production Value by Category/Sub category (US$
Million), 2010–2015
Category 2010 2011 2012 2013 2014 2015 CAGR 2010–2015
Excavators 736.7 797.8 860.9 930.9 1,006.1 1,086.1 8.07%
Crawler/ Wheeled Excavators 424.5 457.7 491.6 529.4 569.8 612.6 7.61%
Mini Excavators 312.2 340.1 369.4 401.6 436.2 473.5 8.69%
Loaders 952.0 1,026.6 1,105.5 1,193.7 1,289.4 1,392.8 7.91%
Backhoe loaders 304.0 326.6 350.8 378.0 406.6 436.5 7.50%
Crawler/ Wheeled/Compact loaders 414.6 437.0 459.8 484.3 510.7 538.3 5.36%
Skid-Steer loaders 233.4 263.0 294.9 331.4 372.1 418.1 12.36%
Construction Tractors 725.3 775.1 822.5 875.2 930.9 989.3 6.41%
Bulldozers/Crawlers Tractors 307.1 329.8 350.8 374.2 398.5 424.2 6.68%
Wheeled Tractors 418.2 445.4 471.7 501.0 532.4 565.2 6.21%
Overall 2,414.1 2,599.5 2,789.0 2,999.9 3,226.3 3,468.3 7.52%
Source: ICD Research Analysis / © ICD Research
Figure 121: South American Earthmoving Equipment Production Value by Category (%), 2010–2015
Source: ICD Research Analysis / © ICD Research
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7.5 BRAZIL
7.5.1 Consumption Value
Consumption of earthmoving equipment in Brazil valued US$1.9 billion in 2010, an increase of 7.5% over
2009. During the review period the consumption value of earthmoving equipment recorded a CAGR of
24.09%.
Table 127: Brazilian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 811.8
2007 1,075.3 32.5%
2008 1,596.7 48.5%
2009 1,790.4 12.1%
2010 1,925.2 7.5%
CAGR 2006-2010 24.09%
Source: ICD Research Analysis / © ICD Research
Figure 122: Brazilian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 175
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ICD expects the consumption of earthmoving equipment in Brazil to increase at a CAGR of 6.55% over the
forecast period and value US$2.6 billion in 2015.
Table 128: Brazilian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 1,925.2
2011 2,057.2 6.9%
2012 2,180.9 6.0%
2013 2,324.1 6.6%
2014 2,476.5 6.6%
2015 2,643.4 6.7%
CAGR 2010-2015 6.55%
Source: ICD Research Analysis / © ICD Research
Figure 123: Brazilian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 176
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7.5.2 Consumption Value by Category
In 2010, excavators accounted for the largest consumption value of earthmoving equipment in Brazil, with a
share of 40.5% and a value of US$780.3 million. The loaders and construction tractors categories recorded
the second and third largest consumption values of US$635.4 million and US$509.5 million respectively.
Table 129: Brazilian Earthmoving Equipment Consumption Value by Category/Sub-Category (US$
Million), 2006, 2010 and 2015
Category/ Sub-Category 2006 2010 2015
Excavators 329.3 780.3 1085.9
Crawler/ Wheeled Excavators 188.7 456.0 640.8
Mini Excavators 140.6 324.3 445.1
Loaders 245.0 635.4 876.1
Backhoe loaders 70.3 212.9 276.7
Crawler/ Wheeled/Compact loaders 102.3 268.4 337.4
Skid-Steer loaders 72.5 154.0 262.0
Construction Tractors 237.5 509.5 681.5
Bulldozers/Crawlers Tractors 98.2 236.3 309.6
Wheeled Tractors 139.4 273.3 371.8
Overall 811.8 1,925.2 2,643.4
Source: ICD Research Analysis / © ICD Research
Figure 124: Brazilian Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and
2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 177
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7.6 ARGENTINA
7.6.1 Consumption Value
Consumption of earthmoving equipment in Argentina valued US$467.3 million in 2010, an increase of 9.5%
over 2009. During the review period the consumption value of earthmoving equipment recorded a CAGR of
0.68%.
Table 130: Argentine Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 454.9
2007 623.9 37.2%
2008 757.9 21.5%
2009 426.9 -43.7%
2010 467.3 9.5%
CAGR 2006-2010 0.68%
Source: ICD Research Analysis / © ICD Research
Figure 125: Argentine Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 178
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ICD expects the consumption of earthmoving equipment in Argentina to increase at a CAGR of 4.99% over
the forecast period and value US$596.1 million in 2015.
Table 131: Argentine Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 467.3
2011 489.7 4.8%
2012 514.1 5.0%
2013 542.2 5.5%
2014 569.4 5.0%
2015 596.1 4.7%
CAGR 2010-2015 4.99%
Source: ICD Research Analysis / © ICD Research
Figure 126: Argentine Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 179
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7.6.2 Consumption Value by Category
In 2010, loaders accounted for the largest consumption value in the Argentinean earthmoving equipment
market, with a share of 39.7% and a value of US$185.6 million. The construction tractors and excavators
categories recorded the second and third largest consumption values of US$159.3 million and US$122.4
million respectively.
Table 132: Argentine Earthmoving Equipment Consumption Value by Category/Sub-Category (US$
Million), 2006, 2010 and 2015
Category/ Sub-Category 2006 2010 2015
Excavators 104.9 122.4 162.9
Crawler/ Wheeled Excavators 57.5 67.2 90.8
Mini Excavators 47.4 55.2 72.1
Loaders 159.2 185.6 241.4
Backhoe loaders 54.2 64.6 86.0
Crawler/ Wheeled/Compact loaders 61.8 85.2 109.6
Skid-Steer loaders 43.1 35.8 45.8
Construction Tractors 190.8 159.3 191.8
Bulldozers/Crawlers Tractors 18.3 36.9 49.7
Wheeled Tractors 172.5 122.4 142.1
Overall 454.9 467.3 596.1
Source: ICD Research Analysis / © ICD Research
Figure 127: Argentine Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and
2015
Source: ICD Research Analysis / © ICD Research
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Forecasts to 2015 Page 180
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7.7 COLOMBIA
7.7.1 Consumption Value
Consumption of earthmoving equipment in Colombia valued US$540.4 million in 2010, an increase of 4.8%
over 2009. During the review period the consumption value of earthmoving equipment recorded a CAGR of
29.42%.
Table 133: Colombian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 192.6
2007 334.2 73.5%
2008 535.5 60.2%
2009 515.8 -3.7%
2010 540.4 4.8%
CAGR 2006-2010 29.42%
Source: ICD Research Analysis / © ICD Research
Figure 128: Colombian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 181
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ICD expects the consumption of earthmoving equipment in Colombia to increase at a CAGR of 3.65% over the
forecast period and value US$646.6 million in 2015.
Table 134: Colombian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 540.4
2011 556.7 3.0%
2012 577.3 3.7%
2013 602.6 4.4%
2014 625.9 3.9%
2015 646.6 3.3%
CAGR 2010-2015 3.65%
Source: ICD Research Analysis / © ICD Research
Figure 129: Colombian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 182
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7.7.2 Consumption Value by Category
In 2010, the excavators‘ category accounted for the largest consumption value in the Colombian earthmoving
equipment market, with a share of 53.7% and a value of US$290.3 million. The construction tractors and
loaders categories recorded the second and third largest consumption values of US$134.5 million and
US$115.7 million respectively.
Table 135: Colombian Earthmoving Equipment Consumption Value by Category/Sub-Category (US$
Million), 2006, 2010 and 2015
Category/ Sub-Category 2006 2010 2015
Excavators 92.9 290.3 341.0
Crawler/ Wheeled Excavators 53.9 165.7 195.7
Mini Excavators 39.0 124.6 145.3
Loaders 43.3 115.7 143.9
Backhoe loaders 12.8 39.8 50.0
Crawler/ Wheeled/Compact loaders 17.1 46.4 57.7
Skid-Steer loaders 13.4 29.4 36.2
Construction Tractors 56.3 134.5 161.7
Bulldozers/Crawlers Tractors 30.0 81.7 96.9
Wheeled Tractors 26.3 52.8 64.8
Overall 192.6 540.4 646.6
Source: ICD Research Analysis / © ICD Research
Figure 130: Colombian Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and
2015
Source: ICD Research Analysis / © ICD Research
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Forecasts to 2015 Page 183
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7.8 MEXICO
7.8.1 Consumption Value
Consumption of earthmoving equipment in Mexico valued US$494.1 million in 2010, an increase of 12.8%
over 2009. During the review period the consumption value of earthmoving equipment recorded a CARC of -
3.92%.
Table 136: Mexican Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 579.7
2007 619.1 6.8%
2008 745.0 20.3%
2009 438.0 -41.2%
2010 494.1 12.8%
CAGR 2006-2010 -3.92%
Source: ICD Research Analysis / © ICD Research
Figure 131: Mexican Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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ICD expects the consumption of earthmoving equipment in Mexico to increase at a CAGR of 7.06% over the
forecast period and value US$694.9 million in 2015.
Table 137: Mexican Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 494.1
2011 530.3 7.3%
2012 570.8 7.6%
2013 610.7 7.0%
2014 652.1 6.8%
2015 694.9 6.6%
CAGR 2010-2015 7.06%
Source: ICD Research Analysis / © ICD Research
Figure 132: Mexican Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
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7.8.2 Consumption Value by Category
In 2010, the loaders category accounted for the largest consumption value in the Mexican earthmoving
equipment market, with a share of 34.7% and a value of US$171.5 million. The construction tractors and
loaders categories recorded the second and third largest consumption values of US$163.6 million and
US$158.9 million respectively.
Table 138: Mexican Earthmoving Equipment Consumption Value by Category/Sub-Category (US$
Million), 2006, 2010 and 2015
Category/ Sub-Category 2006 2010 2015
Excavators 189.6 158.9 210.6
Crawler/ Wheeled Excavators 109.4 90.5 121.5
Mini Excavators 80.2 68.5 89.1
Loaders 208.3 171.5 250.0
Backhoe loaders 53.3 51.6 79.9
Crawler/ Wheeled/Compact loaders 81.4 71.6 95.7
Skid-Steer loaders 73.6 48.3 74.4
Construction Tractors 181.8 163.6 234.3
Bulldozers/Crawlers Tractors 132.0 110.7 163.2
Wheeled Tractors 49.9 53.0 71.1
Overall 579.7 494.1 694.9
Source: ICD Research Analysis / © ICD Research
Figure 133: Mexican Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and
2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 186
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8 MIDDLE EAST
8.1 Market Environment
8.1.1 Economic Indicators
Table 139: Middle East Economic Indicators, 2006–2010
Indicators 2006 2007 2008 2009 2010 CAGR
2006–2010
GDP at constant prices (US$ billion) 752.7 789.0 816.8 802.1 839.2 2.76%
GDP per capita at constant prices (US$) 18,702.2 19,503.0 20,432.8 20,792.8 21,172.7 3.15%
Population (million) 104.1 105.9 107.6 109.3 111.0 1.61%
Employment rate (%) 59.3% 59.9% 61.6% 61.6% 62.6% N/A
Unemployment rate (%) 4.7% 4.8% 5.0% 5.0% 5.0% N/A
Industrial output growth (%) 21.9% 20.2% 35.1% -16.4% 19.2% N/A
Services growth (%) 18.5% 17.1% 20.9% -10.8% 14.8% N/A
Agriculture growth (%) 3.4% 10.2% 19.6% -9.7% 8.4% N/A
Source: ICD Research Analysis / © ICD Research
Table 140: Middle East Economic Indicators, 2010–2015
Indicators 2010 2011 2012 2013 2014 2015 CAGR
2010–2015
GDP at constant prices (US$ billion) 839.2 874.8 909.7 955.8 998.1 1,047.7 4.54%
GDP per capita at constant prices (US$) 21,172.7 21,832.8 22,390.4 24,611.9 25,671.5 27,706.7 5.53%
Population (million) 110.9 112.6 114.2 115.7 117.2 118.7 1.36%
Employment rate (%) 62.6% 63.6% 64.1% 65.1% 65.9% 66.6% N/A
Unemployment rate (%) 5.0% 4.9% 4.7% 4.6% 4.5% 4.5% N/A
Industrial output growth (%) 19.2% 10.0% 8.7% 7.1% 7.3% 7.2% N/A
Services growth (%) 14.8% 7.7% 6.8% 5.4% 5.9% 5.7% N/A
Agriculture growth (%) 8.4% 4.3% 5.1% 4.2% 4.2% 4.5% N/A
Source: ICD Research Analysis / © ICD Research
8.1.2 Trade and Investment Indicators
Table 141: Middle East Trade and Investment Indicators, 2006–2009
Indicators 2006 2007 2008 2009 CAGR 2006–2009
Total exports (US$ billion) 549.0 637.6 803.9 703.8 8.63%
Total imports (US$ billion) 403.9 495.4 597.0 560.5 11.55%
Trade balance (US$ billion) 145.2 142.2 207.0 143.4 NA
Source: ICD Research Analysis / © ICD Research
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8.2 The Middle Eastern Earthmoving Equipment Market Analysis
Consumption of earthmoving equipment in the Middle East market valued US$1.8 billion in 2010, from US$1.6
billion in 2006, recording a CAGR of 4.14% during the review period. Consumption value fluctuated widely in
the region, with UAE recording the highest CAGR of 19.18%, followed by Saudi Arabia recording 11.41%,
while Qatar and Turkey recorded negative CARCs of 1.34% and 10.87% respectively, during the review
period. Growth in the UAE market has been fostered by large scale commercial and infrastructure
investments, FDI‘s and revenues from the oil industry. However, in 2008 growth in the regions construction
market decelerated as a result of the global economic crisis, which had a direct effect on the earthmoving
equipment segment. A decline in construction activity had a direct impact on the consumption value of
earthmoving equipment, which decreased by 20.6% in 2009.
Figure 134: Middle East Earthmoving Equipment Consumption Dynamics by Value (%), 2006–2015
Note: Bubble size represents 2010 consumption value (US$ million)
Source: ICD Research Analysis / © ICD Research
After weak growth in 2009, construction activity recorded substantial rates of growth in 2010, with Turkey
recording a CAGR 23.7%, Saudi Arabia registering 6.1%, and the UAE posting a growth rate of 3.0%. As a
result, the consumption value of earthmoving equipment increased by 8.7% in 2010. The UAE was the largest
earthmoving equipment market in the region and accounted for 36.6% share of the region‘s total consumption
value for 2010. This was followed by Saudi Arabia, Turkey and Qatar with market shares of 30.9%, 23.7% and
8.8% respectively. In terms of production, Turkey is the sole producer of earthmoving equipment in the region.
In 2010, the country‘s production value reached US$209.8 million, increasing from US$165.5 million in 2006,
and recording a CAGR of 6.11% during the review period. Other countries in the region are completely
dependent on imports for meeting their internal requirements for earthmoving equipment.
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Going forward, ICD projects the earthmoving equipment consumption market value US$2.6 billion in 2015 and
record a CAGR of 7.35% over the forecast period. Construction activities are expected to continue with Qatar
anticipated to emerge as the fastest growing regional market with a CAGR of 9.73%; followed by Saudi Arabia
with 9.23%, Turkey with 6.75% and the UAE with 5.41%. In Qatar, growth in the construction industry and the
earthmoving equipment market will be supported by significant infrastructure investments in preparation for the
2022 FIFA World Cup. Moreover, Saudi Arabia has planned investments of US$435–450billion in their
domestic construction industry over the next five years. The Turkish construction industry exhibits strong
growth potential due to demanding expansion in the country‘s infrastructure as a result of favorable social and
economic conditions.. Plans for a network of high-speed rail connections in order to help reduce reliance on
road transportation have been announced. Furthermore, a housing shortage in Istanbul in a key factor in
increased levels of construction activity in the country with expected demand for 0.9–1.0 million housing units
annually through 2015.
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8.3 Consumption
8.3.1 Consumption Value
Consumption of earthmoving equipment in the Middle East valued US$1.8 billion in 2010, an increase of 8.7%
over 2009. The value of earthmoving equipment consumption recorded a CAGR of 4.14% during the review
period.
Table 142: Middle East Earthmoving Equipment Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 1,571.4
2007 1,830.1 16.5%
2008 2,141.0 17.0%
2009 1,699.7 -20.6%
2010 1,848.1 8.7%
CAGR 2006-2010 4.14%
Source: ICD Research Analysis / © ICD Research
Figure 135: Middle East Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 190
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ICD expects the consumption of earthmoving equipment in the Middle East to increase at a CAGR of 7.35%
over the forecast period and value US$2.6 billion in 2015.
Table 143: Middle East Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 1,848.1
2011 1,973.6 6.8%
2012 2,122.9 7.6%
2013 2,272.6 7.1%
2014 2,449.6 7.8%
2015 2,634.3 7.5%
CAGR 2010-2015 7.35%
Source: ICD Research Analysis / © ICD Research
Figure 136: Middle East Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 191
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8.3.2 Consumption Value by Category
In 2010, loaders accounted for the largest share of earthmoving equipment consumption value in the Middle
East, with a 44.9% share and a value of US$829.4 million. Construction tractors and excavators recorded the
second and third largest consumption values of US$569.9 million and US$448.8 million respectively.
Table 144: Middle East Earthmoving Equipment Consumption Value by Category/Sub category (US$
Million), 2006–2010
Category 2006 2007 2008 2009 2010 CAGR
2006–2010
Excavators 453.5 503.2 493.7 408.4 448.8 -0.26%
Crawler/ Wheeled Excavators 265.3 286.4 292.9 239.0 262.1 -0.30%
Mini Excavators 188.2 216.8 200.8 169.4 186.7 -0.21%
Loaders 660.0 774.5 922.9 746.1 829.4 5.88%
Backhoe loaders 153.4 178.4 199.9 149.5 166.2 2.03%
Crawler/ Wheeled/Compact loaders 357.7 434.2 515.5 440.2 486.6 8.00%
Skid-Steer loaders 148.8 161.9 207.4 156.4 176.5 4.36%
Construction Tractors 458.0 552.3 724.4 545.3 569.9 5.62%
Bulldozers/Crawlers Tractors 322.0 420.7 586.9 441.4 459.2 9.28%
Wheeled Tractors 136.0 131.6 137.5 103.9 110.8 -4.99%
Overall 1,571.4 1,830.1 2,141.0 1,699.7 1,848.1 4.14%
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 192
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Figure 137: Middle East Earthmoving Equipment Consumption Value by Category (%), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 193
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Loaders category is expected to be the largest earthmoving equipment in the Middle East, accounting for a
share of 46.6% and a value of US$1.2 billion in 2015. The construction tractors and excavators categories are
expected to record the second and third largest consumption values of US$748.2 million and US$658.6 million
respectively.
Table 145: Middle East Earthmoving Equipment Consumption Value by Category/Sub category (US$
Million), 2010–2015
Category 2010 2011 2012 2013 2014 2015 CAGR
2010–2015
Excavators 448.8 482.7 525.6 565.2 612.0 658.6 7.97%
Crawler/ Wheeled Excavators 262.1 280.1 304.2 327.2 354.5 382.0 7.82%
Mini Excavators 186.7 202.6 221.4 238.0 257.4 276.6 8.18%
Loaders 829.4 891.5 962.0 1,039.9 1,125.7 1,227.4 8.15%
Backhoe loaders 166.2 178.5 196.1 213.1 233.4 258.6 9.24%
Crawler/ Wheeled/Compact loaders 486.6 522.3 561.3 606.8 658.1 718.7 8.11%
Skid-Steer loaders 176.5 190.6 204.6 219.9 234.2 250.1 7.22%
Construction Tractors 569.9 599.3 635.3 667.6 711.9 748.2 5.60%
Bulldozers/Crawlers Tractors 459.2 480.2 507.3 531.2 564.6 588.8 5.10%
Wheeled Tractors 110.8 119.1 128.0 136.4 147.3 159.5 7.56%
Overall 1,848.1 1,973.6 2,122.9 2,272.6 2,449.6 2,634.3 7.35%
Source: ICD Research Analysis / © ICD Research
Figure 138: Middle East Earthmoving Equipment Consumption Value by Category (%), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 194
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8.4 Production
8.4.1 Production Value
During the review period the production value of the Middle East earthmoving equipment market recorded a
CAGR of 6.11%. Moreover, in 2010 production increased by 4.0% from 2009 and valued US$209.8 million.
Table 146: Middle East Earthmoving Equipment Production Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 165.5
2007 181.5 9.7%
2008 219.7 21.0%
2009 201.7 -8.2%
2010 209.8 4.0%
CAGR 2006-2010 6.11%
Source: ICD Research Analysis / © ICD Research
Figure 139: Middle East Earthmoving Equipment Production Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 195
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ICD expects production in the Middle East earthmoving equipment market to increase from US$209.8 million
in 2010 to US$296.3 million in 2015. Over the forecast period the production of earthmoving equipment in
Middle East is expected to increase at a CAGR of 7.15%.
Table 147: Middle East Earthmoving Equipment Production Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 209.8
2011 223.7 6.6%
2012 239.5 7.1%
2013 258.0 7.7%
2014 277.1 7.4%
2015 296.3 6.9%
CAGR 2010-2015 7.15%
Source: ICD Research Analysis / © ICD Research
Figure 140: Middle East Earthmoving Equipment Production Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 196
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8.4.2 Production Value by Category
In 2010, excavators had the largest category production in the Middle East earthmoving equipment market,
accounting for a share of 44.0% and a value of US$92.3 million, followed by loaders with a production value of
US$60.5 million and construction tractors with US$57.0 million.
The construction tractors category recorded the fastest production growth among the individual categories of
earthmoving equipment in the Middle East with a CAGR of 8.05% during the review period.
Table 148: Middle East Earthmoving Equipment Production Value by Category/Sub category (US$
Million), 2006–2010
Category 2006 2007 2008 2009 2010 CAGR
2006–2010
Excavators 74.8 77.2 96.6 89.2 92.3 5.37%
Crawler/ Wheeled Excavators 47.5 48.4 62.0 56.7 58.6 5.38%
Mini Excavators 27.3 28.7 34.6 32.5 33.7 5.36%
Loaders 48.8 55.4 65.8 57.7 60.5 5.50%
Backhoe loaders 8.4 9.5 11.2 10.0 10.5 5.60%
Crawler/ Wheeled/Compact loaders 31.6 36.0 42.7 37.4 39.3 5.56%
Skid-Steer loaders 8.8 9.9 11.9 10.3 10.7 5.22%
Construction Tractors 41.8 49.0 57.3 54.9 57.0 8.05%
Bulldozers/Crawlers Tractors 16.8 19.9 23.8 23.2 24.0 9.40%
Wheeled Tractors 25.1 29.1 33.5 31.7 33.0 7.11%
Overall 165.5 181.5 219.7 201.7 209.8 6.11%
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 197
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Figure 141: Middle East Earthmoving Equipment Production Value by Category (%), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 198
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With a predicted CAGR of 7.17% and a production value of US$130.4 million, excavators‘ category is forecast
to be the largest one in the Middle East earthmoving equipment market in 2015. This category is also
expected to account for a 44.0% share of production in the European earthmoving equipment market in 2015.
With a share of 28.7%, the loaders category is expected to record the second largest production in 2015.
Table 149: Middle East Earthmoving Equipment Production Value by Category/Sub category (US$
Million), 2010–2015
Category 2010 2011 2012 2013 2014 2015 CAGR
2010–2015
Excavators 92.3 98.3 105.3 113.4 121.8 130.4 7.17%
Crawler/ Wheeled Excavators 58.6 62.1 66.1 71.0 76.0 81.1 6.72%
Mini Excavators 33.7 36.2 39.2 42.5 45.8 49.3 7.94%
Loaders 60.5 64.6 69.1 74.3 79.7 85.1 7.06%
Backhoe loaders 10.5 11.2 12.0 12.9 13.9 14.9 7.33%
Crawler/ Wheeled/Compact loaders 39.3 41.9 44.8 48.2 51.6 55.0 6.96%
Skid-Steer loaders 10.7 11.5 12.3 13.2 14.2 15.2 7.17%
Construction Tractors 57.0 60.8 65.2 70.2 75.6 80.8 7.22%
Bulldozers/Crawlers Tractors 24.0 25.6 27.6 29.7 32.2 34.6 7.54%
Wheeled Tractors 33.0 35.2 37.6 40.5 43.4 46.2 6.98%
Overall 209.8 223.7 239.5 258.0 277.1 296.3 7.15%
Source: ICD Research Analysis / © ICD Research
Figure 142: Middle East Earthmoving Equipment Production Value by Category (%), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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Forecasts to 2015 Page 199
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8.5 SAUDI ARABIA
8.5.1 Consumption Value
Consumption of earthmoving equipment in Saudi Arabia valued US$571.1 million in 2010, an increase of 9.6%
over 2009. During the review period the consumption value of earthmoving equipment recorded a CAGR of
11.41%.
Table 150: Saudi Arabian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 370.6
2007 538.8 45.4%
2008 685.9 27.3%
2009 521.2 -24.0%
2010 571.1 9.6%
CAGR 2006-2010 11.41%
Source: ICD Research Analysis / © ICD Research
Figure 143: Saudi Arabian Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 200
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ICD expects the consumption of earthmoving equipment in Saudi Arabia to increase at a CAGR of 9.23% over
the forecast period and value US$887.8 million in 2015.
Table 151: Saudi Arabian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 571.1
2011 618.5 8.3%
2012 672.5 8.7%
2013 732.5 8.9%
2014 808.4 10.4%
2015 887.8 9.8%
CAGR 2010-2015 9.23%
Source: ICD Research Analysis / © ICD Research
Figure 144: Saudi Arabian Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 201
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8.5.2 Consumption Value by Category
In 2010, loaders accounted for the largest consumption value of earthmoving equipment in Saudi Arabia, with
a share of 49.0% and a value of US$279.9 million. The construction tractors and excavators categories
recorded the second and third largest consumption values of US$275.7 million and US$15.5 million
respectively.
Table 152: Saudi Arabian Earthmoving Equipment Consumption Value by Category/Sub-Category
(US$ Million), 2006, 2010 and 2015
Category/ Sub-Category 2006 2010 2015
Excavators 14.3 15.5 27.7
Crawler/ Wheeled Excavators 8.2 8.5 15.3
Mini Excavators 6.0 7.0 12.4
Loaders 170.6 279.9 490.3
Backhoe loaders 40.3 55.4 103.9
Crawler/ Wheeled/Compact loaders 91.3 165.6 303.8
Skid-Steer loaders 39.0 58.9 82.6
Construction Tractors 185.8 275.7 369.7
Bulldozers/Crawlers Tractors 172.5 237.9 305.2
Wheeled Tractors 13.3 37.9 64.5
Overall 370.6 571.1 887.8
Source: ICD Research Analysis / © ICD Research
Figure 145: Saudi Arabian Earthmoving Equipment Consumption Value by Category (%), 2006, 2010
and 2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 202
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8.6 UNITED ARAB EMIRATES
8.6.1 Consumption Value
Consumption of earthmoving equipment in the UAE valued US$676.6 million in 2010, an increase of 8.2%
over 2009. During the review period the consumption value of earthmoving equipment recorded a CAGR of
19.18%.
Table 153: UAE Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 335.4
2007 473.3 41.1%
2008 782.5 65.3%
2009 625.2 -20.1%
2010 676.6 8.2%
CAGR 2006-2010 19.18%
Source: ICD Research Analysis / © ICD Research
Figure 146:UAE Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 203
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ICD expects the consumption of earthmoving equipment in the UAE to increase at a CAGR of 5.41% over the
forecast period and value US$880.7 million in 2015.
Table 154: UAE Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 676.6
2011 708.5 4.7%
2012 749.9 5.8%
2013 785.3 4.7%
2014 831.1 5.8%
2015 880.7 6.0%
CAGR 2010-2015 5.41%
Source: ICD Research Analysis / © ICD Research
Figure 147: UAE Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 204
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8.6.2 Consumption Value by Category
In 2010, loaders accounted for the largest consumption value in the UAE earthmoving equipment market with
a share of 47.5% and a value of US$321.7 million. The excavators and construction tractors categories
recorded the second and third largest consumption values of US$219.0 million and US$135.9 million
respectively.
Table 155: UAE Earthmoving Equipment Consumption Value by Category/Sub-Category (US$ Million),
2006, 2010 and 2015
Category/ Sub-Category 2006 2010 2015
Excavators 97.7 219.0 315.6
Crawler/ Wheeled Excavators 56.4 126.1 180.8
Mini Excavators 41.3 92.9 134.7
Loaders 155.6 321.7 408.9
Backhoe loaders 36.8 66.8 91.0
Crawler/ Wheeled/Compact loaders 83.3 183.8 219.2
Skid-Steer loaders 35.6 71.1 98.8
Construction Tractors 82.1 135.9 156.3
Bulldozers/Crawlers Tractors 72.9 129.6 146.2
Wheeled Tractors 9.2 6.4 10.0
Overall 335.4 676.6 880.7
Source: ICD Research Analysis / © ICD Research
Figure 148: UAE Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
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8.7 QATAR
8.7.1 Consumption Value
Consumption of earthmoving equipment in Qatar valued US$162.8 million in 2010, an increase of 14.4% over
2009. During the review period the consumption value of earthmoving equipment recorded a CARC of -1.34%.
Table 156: Qatar Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 171.8
2007 102.2 -40.5%
2008 182.2 78.2%
2009 142.2 -21.9%
2010 162.8 14.4%
CARC 2006-2010 -1.34%
Source: ICD Research Analysis / © ICD Research
Figure 149: Qatar Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
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ICD expects the consumption of earthmoving equipment in Qatar to increase at a CAGR of 9.73% over the
forecast period and value US$259.0 million in 2015.
Table 157: Qatar Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 162.8
2011 177.8 9.3%
2012 195.2 9.8%
2013 215.2 10.3%
2014 236.5 9.9%
2015 259.0 9.5%
CAGR 2010-2015 9.73%
Source: ICD Research Analysis / © ICD Research
Figure 150: Qatar Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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8.7.2 Consumption Value by Category
In 2010, the construction tractors category accounted for the largest consumption value in the Qatari
earthmoving equipment market, with a share of 36.8% and a value of US$59.9 million. The loaders and
excavators categories recorded the second and third largest consumption values of US$56.6 million and
US$46.3 million respectively.
Table 158: Qatar Earthmoving Equipment Consumption Value by Category/Sub-Category (US$
Million), 2006, 2010 and 2015
Category/ Sub-Category 2006 2010 2015
Excavators 30.1 46.3 76.8
Crawler/ Wheeled Excavators 17.4 26.6 44.2
Mini Excavators 12.7 19.6 32.6
Loaders 85.4 56.6 91.5
Backhoe loaders 20.2 11.2 17.2
Crawler/ Wheeled/Compact loaders 45.7 33.5 54.5
Skid-Steer loaders 19.5 11.9 19.8
Construction Tractors 56.3 59.9 90.7
Bulldozers/Crawlers Tractors 37.3 44.8 69.6
Wheeled Tractors 19.0 15.1 21.1
Overall 171.8 162.8 259.0
Source: ICD Research Analysis / © ICD Research
Figure 151: Qatar Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and 2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 208
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8.8 TURKEY
8.8.1 Consumption Value
Consumption of earthmoving equipment in Turkey valued US$437.7 million in 2010, an increase of 6.5% over
2009. However, during the review period, the consumption value of earthmoving equipment recorded a CARC
of -10.87%.
Table 159: Turkish Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Year US$ Million % Growth
2006 693.6
2007 715.6 3.2%
2008 490.4 -31.5%
2009 411.1 -16.2%
2010 437.7 6.5%
CARC 2006-2010 -10.87%
Source: ICD Research Analysis / © ICD Research
Figure 152: Turkish Earthmoving Equipment Consumption Value (US$ Million), 2006–2010
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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ICD expects the consumption of earthmoving equipment in Mexico to increase at a CAGR of 6.75% over the
forecast period and value US$606.8 million in 2015.
Table 160: Turkish Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Year US$ Million % Growth
2010 437.7
2011 468.7 7.1%
2012 505.4 7.8%
2013 539.7 6.8%
2014 573.6 6.3%
2015 606.8 5.8%
CAGR 2010-2015 6.75%
Source: ICD Research Analysis / © ICD Research
Figure 153: Turkish Earthmoving Equipment Consumption Value (US$ Million), 2010–2015
Source: ICD Research Analysis / © ICD Research
EARTHMOVING EQUIPMENT REGIONAL ANALYSIS
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8.8.2 Consumption Value by Category
In 2010, the loaders category accounted for the largest consumption value in the Turkish earthmoving
equipment market, with a share of 39.1% and a value of US$171.3 million. The excavators and construction
tractors categories recorded the second and third largest consumption values of US$168.0 million and
US$98.3 million respectively.
Table 161: Turkish Earthmoving Equipment Consumption Value by Category/Sub-Category (US$
Million), 2006, 2010 and 2015
Category/ Sub-Category 2006 2010 2015
Excavators 311.4 168.0 238.5
Crawler/ Wheeled Excavators 183.2 100.9 141.7
Mini Excavators 128.2 67.2 96.8
Loaders 248.4 171.3 236.6
Backhoe loaders 56.2 32.8 46.4
Crawler/ Wheeled/Compact loaders 137.5 103.9 141.2
Skid-Steer loaders 54.8 34.6 49.0
Construction Tractors 133.8 98.3 131.6
Bulldozers/Crawlers Tractors 39.3 46.9 67.8
Wheeled Tractors 94.5 51.5 63.8
Overall 693.6 437.7 606.8
Source: ICD Research Analysis / © ICD Research
Figure 154: Turkish Earthmoving Equipment Consumption Value by Category (%), 2006, 2010 and
2015
Source: ICD Research Analysis / © ICD Research
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9 Company Profile: AB Volvo
9.1 AB Volvo Company Overview
AB Volvo (Volvo) is a commercial transport solutions providing company. Its product portfolio includes buses,
construction equipment, trucks, and drive systems for marine and industrial applications alongside aircraft
engine components. Volvo manufactures a wide range of trucks, such as light-duty trucks, heavy-duty trucks
and midsize-duty trucks under the Volvo, Renault, Mack, and UD brand names. The company additionally
offers financial services, industrial IT solutions and logistics solutions to customers. Volvo operates production
facilities in 19 countries and markets its products in over 180 countries including Sweden, France, Japan, the
US, China, Brazil and South Korea. The company is headquartered in Goteborg, Sweden.
Table 162: AB Volvo , Key Facts
Corporate Address VHQ, Gothenburg, , 405 08, Sweden
Telephone + 46 31 660000
Fax + 46 31 537296
URL www.volvo.com
Industry Construction
Ticker Symbol, Exchange VOLV A (Stockholms Fondboers)VOLV B (Stockholms Fondboers)
No. of Employees 90,409
Fiscal Year End December
Revenue (US$ Million) 34,607.71
Revenue (SEK Million) 264,749.00
Locations Australia, China, India, Japan, Republic of Korea, Singapore, Austria, Belgium, Finland, France, Italy, Netherlands, Norway, Russian Federation, Sweden, Switzerland, Canada, United States, Brazil, Mexico
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
9.2 AB Volvo - Business Description
Volvo is a supplier of commercial transport solutions. The company, through its subsidiaries, manufactures and
markets trucks, buses, aircraft engine components, construction equipment and drive systems for marine and
industrial applications. As of December 31, 2010, the company employed 90,409 people.
Volvo operates its business through six segments: Trucks, Construction Equipment, Buses, Volvo Penta,
Volvo Aero, and Customer Finance.
Through the Trucks segment, the company manufactures a large range of medium-heavy to heavy trucks for
regional transport, long-haul and construction operations under the Volvo, Renault, Mack, and UD brand
names. The company offers medium heavy to heavy trucks for regional transport and construction operations
under Volvo brand. Under the Mack brand it manufactures heavy duty trucks targeted at heavy regional
transport and vocational markets. Under UD brand name the company supplies a broad range of light, medium
and heavy-duty trucks.. The company additionally offers light trucks and heavy trucks under the Renault brand
name. During the FY2010, the Trucks segment contributed 62.6% towards the total revenues of the company.
Through the Construction Equipment segment, the company offers products, services and spare parts used in
road construction and mining and forestry industry maintenance. The segment has operational presence in
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over 125 countries globally. Products offered through this segment includes articulated haulers, wheel loaders,
motor graders, pavers, milling machines, wheeled and crawler excavators, compactors and a broad range of
compact equipment such as backhoe loaders, wheel loaders, excavators and skid-steer loaders. During
FY2010, the Construction Equipment segment contributed 20.2% towards the total revenues of the company.
Through the Buses segment, the company offers city and intercity buses, coaches and chassis alongside
service programs which include financing and service contracts for vehicle and transport management
systems. The segment also offers hybrid buses, such as Volvo 7700 Hybrid. During the FY2010, the Buses
segment contributed 7.7% towards the total revenues of the company.
Under the Volvo Penta segment, the company offers marine engines and drive systems for marine
applications. During FY2010, the Volvo Penta segment comprised 3.3% of the company‘s total revenues.
Through Volvo Aero segment, the company develops and produces components for aircraft, rocket and gas
turbine engines alongside an extensive range of productivity-boosting services, including sales of spare parts
for aircraft engines and aircraft, and the repair and overhaul of aircraft engines and gas turbines. The company
additionally develops combustion chambers and rocket engine turbines supporting the European space
program. During FY2010, the Volvo Aero segment contributed 2.9% towards the total revenues of the
company.
Through the Customer Finance segment, the company offers customer and dealer financing. During FY2010,
the Customer Finance segment contributed 3.4% towards the total revenues of the company.
Geographically, the company operates under six segments: Western Europe, Eastern Europe, North America,
South America, Asia, and Other markets.
During FY2010, the Western Europe segment accounted for 33.9% of the company‘s total revenues, while
Eastern Europe, North America, South America, Asia, and Other markets contributed with 4.9%, 17.6%,
10.8%, 25.2%, and 7.5%, respectively.
The company‘s research and development (R&D) activities are focused on developing sustainable solutions,
such as engines for renewable fuels, and light trucks. During FY2010, the company‘s R&D expenses valued
US$1,801.5 million (SEK12,970.00 million), comprising 4.9% of the total revenues.
In 2010, the company received orders for the delivery of 463 bus chassis in Curitiba, Brazil and Quito,
Ecuador. The firm additionally secured orders for the delivery of 650 buses in Australia and 409 coaches in
Mexico. Volvo sold its subsidiary in the US, Volvo Aero Services to H.I.G. Capital, a private investment firm
and entered into a technological agreement with Yamaha Motor Co., Ltd to develop boat control system.
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9.3 AB Volvo - Main Products and Services
Volvo‘s key products and services include:
Table 163: AB Volvo , Main Products and Services
Products Services
Trucks Customer financing
Buses Insurance services
Components for aircraft and rocket engines Treasury operations
Backhoe loader Wheel loaders Fleet management
Articulated haulers Financing and leasing options
Motor graders Maintenance, repair and overhaul services
Skid steer loaders Leasing options
Excavators Logistic solutions Industrial
Drive systems for marine applications IT solutions
Drive systems for industrial applications
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
9.4 AB Volvo - History
Table 164: AB Volvo , History
Year Event type Description
2010 Stake Sale The company sold its equity interest in Jinan Huawo Truck Corporation to China National Heavy Duty Truck Group Corporation (CNHTC).
2010 Contracts/Agreements The company entered into an agreement with ORIX of Indonesia Finance (ORIF) to provide finance program to its customers in Indonesia.
2010 New Products/Services The company launched its new truck, the Volvo FMX, at the Bauma international machinery fair in Munich.
2009
Contracts/Agreements
The company's subsidiary, Volvo IT, entered into a three year agreement with the City of Goteborg in Sweden to run low-cost mainframe environments.
2009 Contracts/Agreements The company entered into an agreement with the French engine manufacturer Snecma to supply components for the engine of Boeing 737 aircraft.
2008
Contracts/Agreements
Volvo Aero and Rolls-Royce entered into a risk and revenue sharing agreement for the Trent XWB engine for the Airbus A350XWB aircraft, under which Volvo Aero will develop and manufacture the intermediate compressor case, a key engine component.
2008
Contracts/Agreements
The company‘s Volvo Aero entered into an agreement with aircraft engine manufacturer Pratt & Whitney to join P&W‘s Geared Turbofan engine program.
2008
New Products/Services
Volvo introduced Volvo I-Sync, a new automated transmission for the Volvo FL distribution truck.
2008
New Products/Services
The company‘s subsidiary Mack launched a new prestige truck, Titan.
2007
Acquisitions/Mergers/Takeovers
The company‘s Volvo Aero acquired the composite company Applied Composites in Linkoping.
2007
Divestiture
The company‘s subsidiary, Volvo Group Real Estate sold Sorred Energi to Goteborg Energi for US$38.8 million (SEK279 million).
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Table 164: AB Volvo , History
2007
Corporate Changes/Expansions
The company acquired US based Ingersoll Rand‘s road development equipment division.
2007 Acquisitions/Mergers/Takeovers Volvo acquired Japanese truck maker Nissan Diesel Motor.
2006
Asset Purchase
The company's Volvo Construction Equipment acquired 70% of shares in Lingong, a construction machinery manufacturer in China.
2006 Asset Purchase The company acquired a 13% stake in Nissan Diesel for US$208.4 million (SEK1.5 billion).
2006
Contracts/Agreements
The company's Volvo Aero entered into a contract for the production of the largest component in an aircraft engine, the fan case, for the Rolls-Royce Trent 1000 engine.
2005
Contracts/Agreements
The company's subsidiary Volvo Aero received a contract worth US$277.8 million (SEK2 billion) to produce aircraft engine components for General Electric.
2004 Contracts/Agreements The company entered into a strategic alliance with ArvinMeritor to supply axles.
2004 Acquisitions/Mergers/Takeovers The company's subsidiary, Volvo Penta acquired, Marco Motors.
2004
Acquisitions/Mergers/Takeovers
The company's subsidiary, Volvo Aero acquired Aero Craft through its strategic alliance with Carlton Forge Works.
2004 Asset Purchase The company acquired the remaining 50% stake of the North American bus manufacturer Pervost Car.
2004 Acquisitions/Mergers/Takeovers Volvo Construction Equipment acquired the engine re-manufacturing assets of Echo Industries.
2003
Corporate Changes/Expansions Volvo established an assembly facility for heavy trucks in Moscow.
2003 Asset Purchase The company purchased the assets of Volvo distribution business from LB Smiths.
2002 Corporate Changes/Expansions The company opened a new factory in Poland and established production facilities in Shanghai, China.
2001 Acquisitions/Mergers/Takeovers The company acquired the truck manufacturers, Mack and Renault VI.
1999 Acquisitions/Mergers/Takeovers Volvo sold its passenger car business to Ford Motor Company.
1997 Contracts/Agreements Volvo entered into an agreement with Mitsubishi to extend their joint venture to truck business operations.
1997 Acquisitions/Mergers/Takeovers Volvo purchased the bulldozer manufacturer, Champion of Canada.
1994 Business / Operations Closure The company shut down its Kalmar plant in the US.
1989 Corporate Changes/Expansions The company established the Uddevalla Plant in Sweden.
1986 Acquisitions/Mergers/Takeovers Volvo acquired GM Heavy Truck Corporation.
1981
Acquisitions/Mergers/Takeovers
The company acquired White Motor Corporation in the US and AB Hoglund and Company in Saffle, Sweden.
1980 Corporate Changes/Expansions Volvo established a new plant for producing bus chassis and trucks in Curitiba, Brazil.
1969 Acquisitions/Mergers/Takeovers Volvo acquired the Olofstrom plant.
1965 Corporate Changes/Expansions Volvo established a diesel engine plant in Skovde, Sweden.
1965 Corporate Changes/Expansions The company established a plant in Ghent, Belgium, to manufacture cars.
1963 Corporate Changes/Expansions The company started its car assembly business in Halifax, Canada.
1950 Acquisitions/Mergers/Takeovers Volvo acquired Bolinder Munktell, a construction equipment manufacturer.
1946 New Products/Services The company produced the first small agricultural tractor.
1942 Acquisitions/Mergers/Takeovers The company acquired Kopings Mekaniska Verkstad, a gearbox manufacturer.
1941 Asset Purchase Volvo acquired a majority holding in Svenska Flygmotor.
1935 Stock Listings/IPO The company was listed on the Stockholm Stock Exchange.
1930 Acquisitions/Mergers/Takeovers The company acquired Pentaverken Skovde, an engine manufacturer.
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Table 164: AB Volvo , History
1927 Incorporation/Establishment Ab Volvo was founded in Sweden.
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
9.5 AB Volvo - SWOT Analysis
Volvo is one of the leading suppliers of commercial transport solutions, which include buses, construction
equipment, trucks, drive systems for marine and industrial applications alongside aircraft engine components.
The company‘s strong geographical presence and its diversified product lines are its main strengths, however,
product recalls remain an area of concern. Going forward, environmental regulations and rising production
costs may impact the company‘s performance. However, focus on emerging economies and a strategic
agreement with Yamaha Motor Co., Ltd will present new growth opportunities for the company.
9.5.1 AB Volvo – Strengths
Strength – Comprehensive Product Portfolio
Volvo‘s comprehensive product portfolio aids the company to offer a large range of products to its customers,
mitigating the risk associated with revenue concentration in one segment. Volvo operates its business through
six segments: Trucks, Construction Equipment, Buses, Volvo Penta, Volvo Aero, and Customer Finance.. The
firm‘s comprehensive product portfolio allows the company to cater to a range of customer needs which in turn
supports revenue growth.
Strength - Diversified Geographical Presence
The diversified geographical presence of Volvo enables the firm to serve a large customer base, ensuring a
strong top line performance. Volvo operates production facilities in 19 countries and markets its products in
more than 180 countries including Sweden, France, Japan, the US, China, Brazil and South Korea. Volvo
operates its business under six geographic segments: Western Europe, Eastern Europe, North America, South
America, Asia, and Other markets. During FY2010, the Western Europe segment contributed 33.9% towards
the total revenues of the company, while Eastern Europe, North America, South America, Asia, and Other
markets contributed 4.9%, 17.6%, 10.8%, 25.2%, and 7.5%, respectively. A diversified global presence
enables the company to focus on large assets that will sustain production over many decades at low cost. This
ensures the profitability of the company through the inevitable economic cycles.
Strength - Strong Sales Growth
Volvo‘s strong sales growth enables it to undertake growth initiatives. The company holds a strong position in
the trucks and buses market across the world and in FY2010, reported a sales growth of 21.2%, which was
above the heavy machinery and vehicles industry average sales growth of 14.4%. Moreover, the company‘s
competitor, Navistar International Corporation reported a sales growth of 4.9% over the same period. The
strong performance of the company can be attributed to strong sales growth of its Trucks segment, which
recorded growth of 20.4% on the back of increasing demand and market conditions. Increasing revenues will
fuel the company‘s growth, enabling the firm to expand its market share.
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9.5.2 AB Volvo – Weaknesses
Weakness - Decrease in Current Assets
The decrease in Volvo‘s current assets is a concern area, indicating the firm‘s deteriorating liquidity position.
Volvo‘s current ratio was 1.1 at the end of FY2010, below the heavy machinery and vehicles industry average*
of 1.46. In contrast, competitor Navistar International Corporation reported a current ratio of 1.6 during
FY2010. The declining current ratio of the company can be attributed to its decreasing current assets. During
FY2010, the company‘s current assets decreased by 5.04%, which resulted in the decline in its current ratio. A
lower than heavy machinery and vehicles industry average* current ratio indicates that the company is in a
weaker financial position than other companies in the industry. Furthermore, the declining liquidity ratio of the
company may affect its capacity to pursue growth initiatives.
Weakness - Frequent Product Recalls
Frequent product recalls will tarnish the brand image of the company besides adding up new costs. For
example, in January 2011, the company announced the recall of certain model 2011 VNL trucks manufactured
from March 23–December 22, 2010. These vehicles are suspected to have the potential to start without
warning due to faulty wiring. In November 2010, the company recalled certain 2006–2010 VN models, 2007
and 2009 VHD models and 2007–2009 VT truck models manufactured during November 2005, through
October 2009. Additionally, in October 2010, Volvo announced the recall of certain 2008-2011 VHD‘s, VNL‘s,
VNM‘s and 2008-2010 VT vehicles for their failure to comply with Part 567 certification requirements.
Furthermore, in August 2010, the company recalled certain model year 2009–2010 VN trucks manufactured
during 2008–2009 and in June 2010, recalled certain 2001–2006 VNL and VNM trucks fitted with TRW sealed
drag links. Such widespread product recalls will result in significant losses principally due to the various costs
associated with the recall process, the destruction of product inventory, and lost sales due to the unavailability
of the product for a period of time. The company will suffer additional losses from a significant product liability
judgment which would result in a loss of consumer confidence in its products, which could have a material
adverse effect on the company‘s business results and the value of its brands.
9.5.3 AB Volvo – Opportunities
Opportunity - Focus on Emerging Markets
The company‘s focus on emerging markets is expected to enhance its top-line performance. According to The
World Bank, various stimulus packages announced by respective governments to bring economies back to a
level of stability will result in global output expanding by 3.2% in 2011. India, Russia and Brazil are expected to
grow at a GDP of 8%, 3% and 3.9% in 2011, respectively. Furthermore, according to the official estimates,
GDP growth rate for India is projected reach 9% in 2012. Volvo is focused on enhancing its presence in fastest
growing markets such as Brazil and India. During FY2010, the company recorded a sales growth of 71% in
Brazil and in February 2011, received orders for delivering 463 bus chassis in Curitiba in Brazil and Quito in
Ecuador. In addition, Volvo has planned to increase its manufacturing facilities in India to further strengthen its
position in the Indian market prompted by budgetary support to the urban transport system. The growth
potential is evident by the recent order for delivery of 100 triple-axle Volvo 9400XL coaches placed by
Vijayanand Road Lines Logistics, VRL in December 2010. Volvo bought out its partner‘s stake of 30% in the
joint venture Volvo Buses India Private Limited, in December 2010 indicating the company‘s strategic focus on
the growth potential of the Indian market. Volvo‘s strong focus on operational expansion in emerging markets
will further enhance its top-line performance.
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Opportunity - Demand for Hybrid Vehicles
Volvo will be in a position to take advantage of increased opportunities in the fuel efficient vehicles market, with
advanced technologies such as hybrids, clean diesel engines, flexible-fuel ethanol vehicles and turbocharged
direct injection system. The company‘s R&D activities are focused on developing sustainable solutions, such
as engines for renewable fuels, and light trucks. In May 2010, the company launched the production of its
hybrid buses, Volvo 7700 Hybrid and Volvo B5L Hybrid. The firm additionally secured orders for the delivery
of150 hybrid buses in Europe and initiated the test driving of hybrid technology buses in South America and
Mexico, to launch hybrid buses in the US. According to the US government‘s Energy Information
Administration total sales of hybrid vehicles is expected to increase from 2.3% of new light duty vehicles (LDV)
sales in 2007 to 20.6% and 39.6% by 2015 and 2030, respectively. It is further forecast that the number of
hybrid vehicles sold could reach 7.9 million in 2030. With hybrid vehicles set to become the mainstay of the
future automobile market, the company has opportunities to gain a higher market share and increase its
revenues.
Opportunity - Strategic Agreement with Yamaha Motor Co., Ltd
Strategic initiatives taken by Volvo are expected to drive its growth going forward. Volvo has entered into
various strategic agreements to strengthen its business. For example, the company entered into a
technological agreement with Yamaha Motor Co., Ltd (Yamaha) in December 2010, to develop boat control
systems. The agreement is likely to create technological synergies vital for taking advantage of the growing
demand within the marine industry for such control systems. Furthermore, the agreement enabled the
company to distribute its marine engines in Japan in collaboration with Yamaha and in February 2011, Volvo
and Yamaha established joint working groups for the evaluation of potential areas for deeper collaboration.
The agreement will offer ample growth opportunities for the company going forward.
9.5.4 AB Volvo – Threats
Threat - Currency Fluctuations
Volvo operates in many parts of the world and as a result, is affected by fluctuations in foreign exchange rates.
Fluctuations in the value of the currency will have an impact on operations. Based in Sweden, the firm has
been generating a significant share of its revenue and incurring expenditures in various currencies. During
FY2010, the company generated 38% of its total revenues from Europe, 28% from the Americas and 25% of
total revenues from Asia. With the company marketing its products in over 180 countries worldwide, it is
exposed to the volatility of currency fluctuations which will have a direct impact on its top and bottom-line
performance.
Threat - Increase in Production Cost
The rising raw material costs have been an area of concern for the company. Volvo uses various raw materials
such as steel and aluminum. The prices of these raw materials accounts for a significant share of the
company's total cost of goods sold. Due to the increase in the commodity prices, the cost of raw materials and
energy has also increased drastically. The company may incur loss in sales volume to the extent price
increases are taken into account. In addition, continuous supply could be affected by weather conditions,
national emergencies, strikes, governmental controls, natural disasters or supply shortages. Price fluctuations
and non availability of raw materials will have a material effect on the firm‘s production cost and in turn the
operational performance.
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Threat - Stringent Environmental Regulations
Volvo‘s operations are regulated by a broad range of state, local and foreign health, safety and environmental
laws. These laws govern air emissions, wastewater discharges and the handling, storage disposal and release
of wastes and hazardous substances. With rising concern for environment protection, Volvo may be exposed
to increased litigation, compliance costs and unforeseen environmental remediation expenses. For example,
the Kyoto Protocol calls on industrialized countries to reduce their greenhouse gas emissions by 5.2% annually
over 2008–2012, compared to the emissions in 1990. Another important development is Clean Air Act (CAA)
passed by several developed nations, including the UK, The US, and Canada. During 2008, the EPA extended
the stricter emission standards to the engines manufactured by the company during 2005. The company
disagreed with the EPA's interpretation and the dispute was referred to a US court. Both the parties are
awaiting the final decision of the court. Rise in compliance costs and in some cases remedial costs may
increase the operational costs of the company in turn affecting profit margins.
9.6 AB Volvo – Company Information
9.6.1 AB Volvo - Key Competitors
The following companies are Volvo‘s main competitors:
Cummins Inc.
PACCAR Inc
Daimler Trucks North America LLC
Navistar International Corporation
MAN SE
Scania AB
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9.6.2 AB Volvo - Key Employees
Table 165: AB Volvo ,, Key Employees
Name Job Title Board Level
Leif Johansson Chief Executive Officer - Volvo Group, President, Director
Executive Board
Staffan Jufors President - Volvo Trucks Senior Management
Stefano Chmielewski President - Renault Trucks Senior Management
Dennis Slagle President - North American Trucks, Chief Executive Officer - North American Trucks
Senior Management
Satoru Takeuchi President - UD Trucks Senior Management
Hakan Karlsson President - Volvo Buses Senior Management
Olof Persson President - Volvo Construction Equipment Senior Management
Goran Gummeson President - Volvo Penta Senior Management
Staffan Zackrisson President - Volvo Aero Senior Management
Peter Karlsten President - Volvo Powertrain, Senior Vice President - Technology
Senior Management
Stefan Johnsson Senior Vice President Senior Management
Mikael Bratt Chief Financial Officer, Senior Vice President Senior Management
Eva Persson Senior Vice President, General Counsel - Volvo Group
Senior Management
Peter Bijur Director Non-Executive Board
Jean-Baptiste Duzan Director Non-Executive Board
Ying Yeh Director Non-Executive Board
Lars Westerberg Director Non-Executive Board
Ravi Venkatesan Director Non-Executive Board
Anders Nyren Director Non-Executive Board
Louis Schweitzer Chairman Non-Executive Board
Martin Linder Director Non-Executive Board
Per Lojdquist Senior Vice President Senior Management
Jan-Eric Sundgren Senior Vice President Senior Management
Berth Thulin Director Non-Executive Board
Martin Weissburg President - Volvo Financial Services Senior Management
Par Ostberg Senior Vice President, President - Trucks Asia Senior Management
Mikael Sallstrom Director Non-Executive Board
Hanne de Mora Director Non-Executive Board
Lars Ask Director Non-Executive Board
Peteris Lauberts Director Non-Executive Board
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
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10 Company Profile: Caterpillar Inc.
10.1 Caterpillar Inc. Company Overview
Caterpillar, Inc. is the world's leading manufacturer of construction and mining equipment, diesel and natural
gas engines, and industrial gas turbines. The company offers these products and services through three
businesses divisions: machinery, engines and financial products. The company has a product portfolio of
approximately 300 products in 23 countries, a client base in 200 countries and has more than 480 facility
locations, half of which are outside of the US. The company‘s divisions and subsidiaries include Cat Financial,
Caterpillar Logistics Services, Progress Rail, Cat Remanufacturing Services, Perkins and FG Wilson.
Caterpillar employs more than 93,000 employees and is headquartered in Peoria, Illinois, US.
Table 166: Caterpillar Inc., Key Facts
Corporate Address 100 NE Adams Street, Peoria, Illinois (IL), 61629, United States
Telephone + 1 309 6751000
Fax + 1 309 6756620
URL www.cat.com
Industry Construction
Ticker Symbol, Exchange CAT (New York Stock Exchange)
No. of Employees 97,487
Fiscal Year End December
Revenue (US$ Million) 32,396.00
Revenue (Local Currency) NA
Locations Australia, China, India, Indonesia, Japan, Malaysia, Belgium, France, Germany, Hungary, Ireland, Italy, Netherlands, Poland, United Kingdom, Nigeria, South Africa, Tunisia, Canada, United States, Brazil, Mexico
Source: Annual Report, Company Website, Primary and Secondary Research / / © ICD Research
10.2 Caterpillar Inc. - Business Description
Caterpillar Inc., (Caterpillar) based in the US, is involved in the production of construction and mining
equipment, diesel and natural gas engines and industrial gas turbines. The company has a network of 178
dealers spread across North America, Latin America, the Asia-Pacific region, Europe, Africa and the Middle
East (EAME) region. During FY2009, the company gained 69% of its sales from customers outside of the US
and provides rental services through 1,500 outlets worldwide.
Caterpillar operates through three business divisions: machinery, engines and financial products.
The machinery division is involved in the design, manufacture and distribution of forestry, construction and
mining machinery. In addition to the design, manufacture, remanufacture and maintenance of rail-related
products the machinery division also provides logistics services. This division has a product portfolio of 300
products, including track and wheel tractors, track and wheel loaders, pipe layers, motor graders, wheel
tractor-scrapers, track and wheel excavators, backhoe loaders, log skidders, off-highway trucks, articulated
trucks, paving products and skid steer loaders. During FY2009, the division accounted for 56.01% of the
company‘s total revenues.
The engines division of the company designs manufactures markets and sells electric power generation
system engines that run on diesel and natural gas. The division additionally manufactures engines for use in
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marine vehicles, on-highway vehicles and locomotives. Furthermore, the division produces engines for
petroleum, construction, industrial and agricultural uses. Its product portfolio comprises engines ranging from
10–21,000 horsepower. Caterpillar also designs, manufactures and services industrial gas turbine power
system solutions for the oil, gas and power generation industries. These power system solutions range from
1,600–30,000 horsepower. In FY2009, this division accounted for 35.16% of the company‘s total revenues.
The financial products division of the company operates through Caterpillar's wholly-owned subsidiary, Cat
Financial. This division provides a range of financial alternatives to clients and dealers for solar gas turbines,
machinery and engines, alongside other equipment and marine vessels. Cat Financial operates through more
than 40 offices and subsidiaries spread across the Americas, Asia, Australia and Europe. In FY2009, this
division accounted for 15.73% of the total company revenue.
The company's geographical regions are categorized as North America, Latin America, the EMEA and the
Asia-Pacific. During FY2009, the company generated total revenue of US$12,359 million from its North
America region, US$3,903 million from Latin America, US$8,902 million from the EMEA region and US$7,232
million from the Asia-Pacific.
In August 2010, the company‘s wholly-owned subsidiary, Progress Rail Services, acquired Electro-Motive
Diesel (EMD), an original equipment manufacturer of diesel-electric locomotives based in LaGrange, Illinois,
for US$928 million. This acquisition will enable the company to expand its operations in energy power
systems.
10.3 Caterpillar Inc. - Main Products and Services
The company‘s main products and services include:
Table 167: Caterpillar Inc., Main Products and Services
Products Services
Construction equipment (bulldozers, excavators, wheel loaders)
Caterpillar
Machines CAT
Work tools Cat Financial
Engines Cat Logistics
Generator sets Cat Reman
Transfer switches Cat The Rental Store
Uninterruptible power supply (UPS) FG Wilson
Switchgear turbines Mak
Electronics Perkins
Cat machine security systems
Services:
Financing
Insurance
Locomotive and railcar remanufactured components
Logistics
Maintenance and support
OEM solutions
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Table 167: Caterpillar Inc., Main Products and Services
Remanufacturing
Rental
Solar turbine customer services
Track and way maintenance
Railcar rebuilding and engineering
Training
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
10.4 Caterpillar Inc. - History
Table 168: Caterpillar Inc., History
Year Event type Description
2009
Acquisitions/Mergers/Takeovers
The company acquired JCS Co. Ltd., a subsidiary of Jinsung T.E.C. Co. Ltd., a manufacturer of undercarriage components for earthmoving and other off-road machinery based in South Korea.
2009
Contracts/Agreements
The company entered into a joint venture with Navistar International Corp. to form a new company, NC2 Global LLC, to serve the global commercial truck market.
2008
Acquisitions/Mergers/Takeovers
The company acquired 60% in share in Shandong Machinery Co. Ltd (SEM). Through this deal, SEM became a subsidiary of Caterpillar. SEM is a manufacturer of wheel loaders in China.
2008
Acquisitions/Mergers/Takeovers
The company completed its acquisition of Lovat, Inc., a manufacturer of tunnel boring machines.
2008
Acquisitions/Mergers/Takeovers
Caterpillar increased its stake in Shin Caterpillar Mitsubishi Ltd. (SCM) to 67% and renamed SCM as Caterpillar Japan Ltd.
2008
Contracts/Agreements
Caterpillar formed a strategic alliance with Navistar International Corp. to focus on global truck business opportunities and engines.
2008
Acquisitions/Mergers/Takeovers
Caterpillar acquired certain assets of Gremada Industries, Inc., a leader in the processes of remanufacturing and reclaiming metal parts and components.
2008
Contracts/Agreements
The company and Trimble Navigation Ltd. formed a new joint venture company and a new distribution agreement.
2007
Acquisitions/Mergers/Takeovers
Caterpillar acquired Eurenov S.A.S., a European remanufacturer of engines and components
2006
Corporate Changes/Expansions
The company's subsidiary, Caterpillar Logistics Services, Inc. opened a new parts distribution center in the Lingang Industrial Area in Shanghai.
2001 New Products/Services Caterpillar introduced the 6 Sigma.
1998 New Products/Services The company launched the world's largest off-highway truck (the 797).
1997 Acquisitions/Mergers/Takeovers Caterpillar acquired Perkins Engines, based in the UK.
1986 Corporate Changes/Expansions Caterpillar Tractor Co. changes its name to Caterpillar Inc.
1983
Corporate Changes/Expansions
Caterpillar Leasing Co. was expanded to offer equipment financing options to its clients worldwide and was renamed Caterpillar Financial Services Corp.
1965 Corporate Changes/Expansions Caterpillar Mitsubishi Ltd. was renamed as Shin Caterpillar Mitsubishi Ltd.
1963
Acquisitions/Mergers/Takeovers
Caterpillar and Mitsubishi Heavy Industries Ltd. entered into a joint venture agreement in Japan and formed Caterpillar Mitsubishi Ltd.
1950 Acquisitions/Mergers/Takeovers Caterpillar Tractor Co. Ltd. was established in Great Britain.
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Table 168: Caterpillar Inc., History
1925
Incorporation/Establishment
Caterpillar Tractor Co. was formed as a merger between Holt Manufacturing Co. and C. L. Best Tractor Co.
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
10.5 Caterpillar Inc. - SWOT Analysis
Caterpillar is a construction equipment manufacturer offering machinery and engines for the construction
sector. Caterpillar also provides financial products as financial alternatives via insurance and loans on
machinery and engines. The company's strong global market presence, supported by an extensive dealer
network, product R&D activities are its strengths, while going forward, the growth of emerging markets and a
positive outlook for equipment manufacturers could ensure strong growth. However, its declining market share
and limited liquidity position are areas of concern for the company. Regulations and legal proceedings,
combined with a negative outlook for the US construction industry, could also affect the company's growth.
10.5.1 Caterpillar Inc. – Strengths
Strength – Research and development
Caterpillar focuses on product-oriented R&D to develop new machines, engines and components. The
research team identifies new and better applications for existing products. During FY2009, the company's
expenditure on R&D accounted for 4.4% of its total revenue, an increase from 3.4% of revenue in FY2008.
The R&D activities of the company resulted in the launch of various new products, including the CX31-P600
and CX35-P800 transmissions for the petroleum market and the C175-16 diesel offshore drilling generator set
for offshore applications. A focus on research and development helps the company to stay ahead of
technological changes and introduce products and services before any other competitor.
Strength - Global presence
Geographically diverse operations aid Caterpillar to mitigate the various risks associated with overdependence
on a particular region or country. The company manufactures over 300 products in 23 countries across the
world, marketing those products in 200 countries. The firm also has a total of more than 480 facilities
worldwide and distributes its products through a strong dealer network of 178 dealers, spread across North
America, Latin America, the Asia-Pacific and the EAME region. In FY2009, the company received 69% of
sales from customers outside of the US, while it generated 38.14% of its total revenue from North America,
12.04% from Latin America, 24.47% from the EMEA region and 22.32% from the Asia-Pacific. A large
geographical presence provides new growth avenues for the company, which is advantageous over some of
its competitors with limited geographical diversification.
Strength - Strong product offerings
Caterpillar is the global leader in construction and mining equipment, diesel and natural gas engines, and
industrial gas turbines. The firm is additionally one of the leading services providers through Cat Financial,
Caterpillar Remanufacturing Services, Caterpillar Logistics Services, Inc. and Progress Rail Services Corp.
The company categorizes its products across the machinery, engines and financial products divisions.
Caterpillar operates through more than 40 offices and subsidiaries spread across the Americas, Asia, Australia
and Europe. A diverse product offering has enabled the company to cater to a diverse client base.
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10.5.2 Caterpillar Inc. – Weaknesses
Weakness - Declining market share in sector
Caterpillar‘s revenue declined at a CARC of -2.83% during FY2005–2009. This was below the construction
equipment sector average of 5.86%. A lower than sector average revenue CAGR may indicate that the
company has underperformed, which may be attributed to a weak competitive position, an inferior products
and services portfolio, or a lack of innovative products and services. For example, one of the company‘s
competitors, Komatsu, recently introduced its Autonomous Haulage System FrontRunner proprietary system,
which was deployed at the Rio Tinto mine in Australia. This system is expected to significantly increase
productivity at the mine, which is in a location where it is difficult to secure sufficient manpower.
Weakness - Limited liquidity position
The company's current ratio was 1.39 at the end of FY2009. This was below the construction equipment sector
average of 1.56. A lower than sector average current ratio indicates that the company is in a weaker financial
position than other companies in the sector and may have difficulty in paying its short-term obligations.
However, the current ratio of the company increased from 1.21 in FY2008, which indicates the company is
working towards improving its liquidity position.
Weakness - Declining efficiency
In FY2009, the company recorded a decrease in its turnover ratios, indicating an underutilization of resources
compared to FY2008. The fixed asset turnover ratio and working capital turnover declined from 4.5 and 9.22 in
FY2008 to 2.62 and 4.32 in FY2009 respectively. Furthermore, its capital employed turnover declined from
8.42 in FY2008 to 3.71 in FY2009. The lower utilization of resources often leads to increase in operational
costs. The company must focus on its resource utilization for optimum results, and to increase the growth
prospects and profitability of the company.
10.5.3 Caterpillar Inc. – Opportunities
Opportunity - Emerging markets
The company can take advantage of the growth of infrastructure sectors in developing nations, as these
sectors account for almost of all global construction spending. The infrastructure sectors of the majority of
developed and developing countries are currently in receipt of substantial funding from respective
governments due to financial packages to stimulate economic growth following the recent global financial
crisis. For example, in 2010, China‘s National Development and Reform Commission (NDRC) announced an
investment of RMB682.2 billion in 23 new development projects in impoverished western regions as part of
efforts to increase domestic consumer demand. Furthermore, the Chinese non-residential construction sector
is expected to grow between 12%–14% per annum until 2012.
In addition, the construction sectors of Argentina and Venezuela are expected to grow at an annual rate of 5%
until 2012. India, the second largest populated economy after China, also has substantial development plans
to improve and upgrade its infrastructure and utility facilities to support its economic growth. Caterpillar already
has manufacturing facilities, offices and dealers in India, China and Latin American countries. In order to
sustain its operations and financial stability in the face of a decline in the US construction industry, the
company should increase its focus on emerging markets.
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Opportunity - Positive outlook for equipment manufacturers
Caterpillar can benefit from the expected increase in future sales of farm equipment in the US. According to
the Association of Equipment Manufacturers (AEM) annual "outlook" survey, manufacturers predict increased
business in 2011 and 2012. In 2010, tractor sales in the US are expected to be the strongest for 100-
horsepower tractors. In addition, the Obama Administration's American Recovery and Reinvestment Act of
2009 (ARRA) has provided funding for heavy-duty diesel, on-road vehicles and off-road equipment owners to
retrofit their engines to reduce diesel emissions. The funding represents a six-fold increase from the 2008
funding level and will be administered by the Environmental Protection Agency (EPA). There is also a potential
demand for heavy-duty diesel emission control systems, as fleet owners plan to take advantage of the US$300
million stimulus funding under the Diesel Emissions Reduction Act (DERA) program of EPA. The company can
capitalize on this scenario by utilizing its expertise in agricultural machines and engines.
Opportunity - Rising demand for renewable power
The global impact of climate change and the increasing importance of environment protection have increased
the demand for renewable energy. The contribution of renewable sources to the global energy supply
increased from 750 gigawatts in 2001 to 1,047 gigawatts in 2008. The industry is expected to further increase
its capacity base to 1,378 gigawatts by 2013. According to an Advanced International Policy (AIP) developed
by the European Renewable Energy Council (EREC), renewable energy sources will contribute almost 50% to
total primary energy consumption by 2040. Governmental initiatives and policies incentivizing investment in
renewable energy include a reduction in capital costs upfront via subsidies and rebates, a reduced capital cost
after purchase via tax benefits, production tax credits, concessionary loans and other financial assistance, and
reduced capital and installation costs through bulk procurement. These policies are in force in many countries,
including the US and Europe. The company deals with power systems that support alternative energy sources,
including two Cat landfill gas low emission generators in Atlanta, which extract waste gases for electricity
generation. The company could expand its expertise in this field to increase growth and take advantage of the
increasing importance of renewable energy.
10.5.4 Caterpillar Inc. – Threats
Threat - Grey market heavy equipment sales
Sales of heavy equipment through the grey market could have a negative impact on the company. Grey
market heavy equipment sales were a more serious problem in the 1990s, when the US construction market
was growing rapidly. This issue could worsen with the recovery of the US construction industry from the
current global economic downturn, while the overseas markets remain depressed. For example, Chris Johnson
Equipment, Inc. of Michigan illegally imported 29 Hyundai-branded wheel loaders and excavators and sold
them to US customers, violating federal fair competition and other laws. Gray market importers pose a problem
to the company and other legitimate dealers by offering equipment manufactured for other markets by the
company, leading to the loss of sales.
Threat - Negative outlook of the US construction Industry
The outlook of the US construction industry is negative. According to the AIA Consensus Construction
Forecast Panel non-residential construction activity declined by an estimated 13.4% in 2010. The commercial
and industrial construction sectors were also weak with estimated declines of almost 20% in most of the main
categories. Institutional construction also recorded an estimated decline of 2% in the same year. As the
company generates approximately 38.14% of its revenue from North America, the negative outlook for the US
construction industry may adversely affect the company‘s performance in the next five years.
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Threat - Environmental regulations
The company's facilities and operations are governed by environmental laws and regulations concerning
emissions, discharges into water and air, and the generation, transportation, storage, handling, treatment and
disposal of non-hazardous and hazardous waste materials. With engines subject to extensive regulations, the
company is faced with the challenge of improving product technology, and is forced to make substantial
investments in R&D. Furthermore, the company has to comply with the emission and noise related regulations
of the Environmental Protection Agency (EPA), state regulatory agencies in the US and various regulatory
agencies in its countries of operation. Any non-compliance to applicable regulations may lead to fines and
other penalties. For example, in February 2009, the Illinois Attorney General filed a complaint containing seven
counts for violating state environmental laws and regulations. Each count carries statutory penalties of
US$50,000 per violation and US$10,000 per day of violation. Furthermore, in March 2009, the EPA served a
notice to Caterpillar for seeking civil penalties for violations of the Clean Water Act and Oil Pollution Act. These
cases are pending, and the significant legal costs associated with these proceedings may have a negative
effect on the company‘s profitability.
10.6 Caterpillar Inc. – Company Information
10.6.1 Caterpillar Inc. - Key Competitors
The following companies are Caterpillar‘s the main competitors:
Komatsu Ltd. Hitachi Construction Machinery Co.,Ltd.
10.6.2 Caterpillar Inc. - Key Employees
Table 169: Caterpillar Inc., Key Employees
Name Job Title Board Level
James W. Owens Chairman, Director Non-Executive Board
Richard P.Lavin President - Group Senior Management
Stuart L. Levenick Group President Senior Management
Douglas R. Oberhelman Vice Chairman, Chief Executive Officer Senior Management
Edward J. Rapp Group President Senior Management
Gerard R. Vittecoq Group President Senior Management
Steven H. Wunning Group President Senior Management
W. Frank Blount Director Non-Executive Board
John R. Brazil Director Non-Executive Board
Daniel M. Dickinson Director Non-Executive Board
John T. Dillon Director Non-Executive Board
Jananne A. Copeland Chief Accounting Officer Senior Management
Eugene V. Fife Director Non-Executive Board
Gail D. Fosler Director Non-Executive Board
Juan Gallardo Director Non-Executive Board
David R. Goode Director Non-Executive Board
Peter A. Magowan Director Non-Executive Board
William A. Osborn Director Non-Executive Board
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Table 169: Caterpillar Inc., Key Employees
Charles D. Powell Director Non-Executive Board
Edward B. Rust, Jr Director Non-Executive Board
Joshua I. Smith Director Non-Executive Board
James B. Buda Vice President, Secretary, General Counsel Senior Management
Bradley M. Halverson Controller, Vice President - Financial Services Senior Management
Susan C. Schwab Director Non-Executive Board
Christopher C. Spears Senior Management
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
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11 Company Profile: Mitsubishi Heavy Industries, Ltd.
11.1 Mitsubishi Heavy Industries, Ltd. - Company Overview
Mitsubishi Heavy Industries, Ltd. (MHI) is a manufacturer of heavy machinery. The company supplies to
energy, aircraft, space, ship and ocean, transportation, material handling, environment, automotive, industrial
machinery, infrastructure, living and leisure and defense industries. MHI operate through five business
divisions: Shipbuilding & Ocean Development, Power Systems, Machinery and Steel Structures, Aerospace
and Mass and Medium-Lot Manufactured Machinery. The company principally operates worldwide and is
headquartered in Tokyo, Japan.
Table 170: Mitsubishi Heavy Industries, Ltd., Key Facts
Corporate Address 2-16-5, Konan, Minato-ku, , 108-8215, Japan
Telephone + 81 3 67163111
Fax + 81 3 67165800
URL www.mhi.co.jp
Industry Energy and Utilities , Alternative Energy , Construction , Power
Ticker Symbol, Exchange 7011 (The Tokyo Stock Exchange)
No. of Employees 68,608
Fiscal Year End March
Revenue (US$ Million) 32,232.16
Revenue (in JPY Million) 2,940,887.00
Locations Japan
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
11.2 Mitsubishi Heavy Industries, Ltd. - Business Description
MHI is a manufacturer of heavy machinery based in Japan. The firm supply machinery to the energy, aircraft,
space, ship and ocean, transportation, material handling, environment, automotive, industrial machinery,
infrastructure, living and leisure, and defense industries. MHI operates in Europe; Oceania; North America and
Latin America; Asia and Africa.
MHI operates through five business divisions: Aerospace, Machinery & Steel Structures, Mass and Medium-
Lot Manufactured Machinery, Power Systems, and Shipbuilding and Ocean Development.
The company‘s Aerospace division is involved in the manufacturing, installation, sale and repair of fighters,
helicopters, structural parts and components of commercial transport aircraft, aero engines, missiles,
torpedoes, space systems, launch services via launch vehicles. The total value of new orders in FY2010 for
the firm‘s Aerospace division decreased to US$5.0 billion (JPY435.5 billion) from US$5.8 billion (JPY510.8
billion) in FY2009. This decrease was attributed to the fall in demand for defense- related products and
commercial aircraft. For FY2010, the Aerospace division accounted for 16.7% of the company‘s total revenue.
The company‘s Machinery and Steel Structures division offers an extensive range of transportation systems,
chemical plants, steel manufacturing machinery, cranes, material handling system and other products for vital
infrastructure.
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This division is involved in the manufacturing, installation, sale and repair of transportation systems, toll and
fare collection machinery and other ITS equipment, petrochemical plants, flue gas desulfurization systems,
flue gas CO2 recovery plants, oil and gas production plants, compressors and turbines, iron and steel
manufacturing machinery, automotive products, medical systems, bridges, hydraulic gates, stacks, parking
systems. MHI began full-scale manufacturing and sales of radiotherapy equipment and established a joint
venture company to assess the business viability of organic electroluminescence (OEL) panels for lighting
applications. For FY2010, the Machinery and Steel Structures segment accounted for revenues of US$6.2
billion (JPY542.0 billion), which is 18.10% of the company‘s total revenue.
The Mass and Medium-Lot Manufactured Machinery division comprises five divisions: General Machinery and
Special Vehicles; Air-conditioning & Refrigeration Systems; Paper & Printing Machinery; Machine Tool and
Industrial Machinery division. The company‘s General Machinery and Special Vehicles division engages in the
manufacturing, installation, marketing and services of forklift trucks, construction machinery, earthmoving and
grading machinery, medium and small-sized engines, turbochargers, agricultural machinery, tractors and
special vehicles.
The Air-conditioning & Refrigeration Systems division produces automotive thermal systems and chilling
systems. Whereas the Paper & Printing Machinery division supplies sheet-fed offset presses, commercial web
offset presses, newspaper offset presses, corrugating and box making machines. The company‘s Machine
Tool division manufactures large machine tools, gear cutting machinery, precision cutting tools, engine valves
and power transmissions. The company‘s Industrial Machinery division manufactures injection molding
machines, used in the production of plastic products, beverage filling and packaging machines. For FY2010,
the Mass and Medium-Lot Manufactured Machinery division accounted for revenues of US$6.2 billion
(JPY544.3 billion), which accounted for 18.18% of the company‘s total revenue.
The company‘s Power Systems division develops energy conservation measures, petroleum substitutes and
new forms of energy and manufactures, installation, sale and repair of boilers, steam turbines, gas turbines,
diesel engines, water turbines, wind turbines, SCR (DeNOx) system, marine machinery and desalination
plants. It is also involved in manufacturing, installation, sale and repair of nuclear power plants and equipment,
advanced reactor plants, nuclear fuel cycle plants and nuclear fuel. For FY2010, the Power Systems division
accounted for revenues of US$12.2 billion (JPY1,066.0 billion), which accounted for 35.6% of the company‘s
total revenue.
The Shipbuilding and Ocean Development division develops and constructs a large range of vessels and
oceanic structures. MHI manufactures, installs, sells and repairs crude oil carriers, container ships, cruise
ships, car ferries, LPG carriers, LNG carriers, defense vessels and offshore structures. For FY2010, the
Shipbuilding & Ocean Development division accounted for revenues of US$2.6 billion (JPY230.6 billion),
which is 7.70% of the total revenue of the company.
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11.3 Mitsubishi Heavy Industries, Ltd. - Main Products
The company‘s key products include the following:
Table 171: Mitsubishi Heavy Industries, Ltd., Main Products
Products
Shipbuilding and Ocean Development
Crude oil carriers
LPG carriers
RO/RO ships
Heavy lifters
Fisheries patrol and survey vessels
Survey observation and cleaning vessels
Oil Recovery Ships
Underwater Vehicle
Various automated systems
Pumps for ships
Marine Engine
Power Systems
Fossil Fuel Power Plant:
Conventional power plant
GTCC (Gas Turbine Combined Cycle power plant)
IGCC (Integrated coal Gasification Combined Cycle)
Boilers
Industrial boiler
Boilers machinery
Steam Turbines
Industrial steam turbine
Gas Turbines
Pumps for thermal power plant
Instrumentation and Control
Flue gas Desulphurization plant
Renewable Energy Power Plant:
Photovoltaic Power Generation
Wind Turbine Generators
Geothermal power plant
Water turbine plant
Nuclear Power Generation:
PWR
Reactor Coolant System
Reactor Internals
Core and Fuel
Reactor Vessel
Steam Generator
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Table 171: Mitsubishi Heavy Industries, Ltd., Main Products
Engine Power Plant:
Diesel Power Plant
Gas Engine Power Plant
GENERATOR SET
Machinery and Steel Structures
Transportation systems
Toll and fare collection machinery
ITS equipment
Petrochemical plants
Oil and gas production plants
Compressors and turbines
Iron and steel manufacturing machinery
Automotive products
Medical systems
Semiconductor production equipment
Other advanced equipment
Aerospace
Fighters
Helicopters
Structural parts and components of commercial transport aircraft
Aero engines
Missiles
Torpedoes
Space systems
Mass and Medium-Lot Manufactured Machinery
Forklift trucks
Construction machinery
Earthmoving and grading machinery
Turbochargers
Agricultural machinery
Air-conditioners
Automotive thermal systems
Chilling systems
Large machine tools
Gear cutting machinery
Precision cutting tools
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
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11.4 Mitsubishi Heavy Industries, Ltd. - History
Table 172: Mitsubishi Heavy Industries, Ltd., History
Year Event type Description
2009 Contracts/Agreements In a joint venture with AREVA, Mitsubishi Materials Corporation (MMC) and Mitsubishi Corporation (MC) established a fully-fledged nuclear fuel fabrication business.
2009 Corporate Changes/Expansions MHI separated its paper and printing machinery division and established a new company dedicated to printing and paper converting machinery operations.
2009 Corporate Changes/Expansions MHI established a joint venture in Thailand with EGAT for providing maintenance services to high-temperature components of gas turbines.
2008 Corporate Changes/Expansions MHI transferred its pulp and paper machinery business to Metso Paper to concentrate business resources into focused areas.
2008 Corporate Changes/Expansions The company established Mitsubishi Aircraft Corporation (MAC) to conduct its newly launched Mitsubishi Regional Jet business operations.
2008 New Products/Services MHI launched the Mitsubishi Regional Jet (MRJ), a next-generation regional jetliner.
2007 Others
MHI‘s technology contract management system came into operation. This system manages a whole host of information related to joint R&D and patent application contracts such as data about the organizations MHI has signed intellectual property contracts with, relevant internal departments, and contract periods.
2007 Corporate Changes/Expansions MHI established a regional head office in Singapore to reorganize and expand its engine business in Asia.
2006 Contracts/Agreements MHI entered into a joint venture with Shenyang Pump Co. Ltd. in China to conduct sales and engineering relating to pumps.
2006 Corporate Changes/Expansions The company established a regional office in Dubai to the Middle East countries.
2005 Corporate Changes/Expansions Mitsubishi Heavy Industries India Precision Tools, Ltd. Is established in India to expand its production capacities for precision cutting tools.
2004 Corporate Changes/Expansions Mitsubishi Heavy Industries de Mexico, SA de CV, is established in Mexico, to expand the firms plants and large machinery business,
2004 Contracts/Agreements Hitachi and MHI integrated their air-conditioning and refrigeration operations.
2003 Contracts/Agreements MHI has entered into an agreement with Harbin Turbine Company Limited, Heilongjiang Province, China, to provide key components to Harbin Turbine for their super-critical steam turbines.
2003 New Products/Services MHI developed a high performance centrifugal compressor which finds application in gas injection equipment for oil and gas sector.
2002 Corporate Changes/Expansions The company has entered into French Nuclear power plant market in cooperation with COMEX NUCLEAIRE, a company based in France.
2001 New Products/Services MHI produced its first lifelike robotic fish, Mitsubishi Animatronics.
2000 Contracts/Agreements MHI and Hitachi, Ltd. agreed to form a broad-based partnership in the area of metal rolling mills.
1999 New Products/Services MHI developed the world's first technology to produce superior-grade graphite by microwaves.
1999 Corporate Changes/Expansions Mitsubishi Heavy Industries Australia, Pty. Ltd., is established..
1970 Corporate Changes/Expansions MHI's automobile department became independent and Mitsubishi Motors Corporation began manufacturing and marketing automobiles.
1964 Corporate Changes/Expansions All three entities, West Japan Heavy-Industries, Ltd., Central Japan Heavy-Industries, Ltd. and East Japan Heavy-Industries, Ltd. were consolidated and the firm was reborn as MHI.
1950 Corporate Changes/Expansions MHI was divided into three entities: West Japan Heavy-Industries, Ltd., Central Japan Heavy-Industries, Ltd. and East Japan Heavy-Industries, Ltd.
1934 Corporate Changes/Expansions The firm‘s shipbuilding business turned into Mitsubishi Shipbuilding Co., Ltd., and was again launched as MHI.
1934 Corporate Changes/Expansions MHI established its position as the largest private firm in Japan, manufacturing ships, heavy machinery, airplanes, and railroad cars.
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Table 172: Mitsubishi Heavy Industries, Ltd., History
1884 Incorporation/Establishment Yataro Iwasaki, the founder of Mitsubishi took the lease of a Government-owned Nagasaki Shipyard. He named it Nagasaki Shipyard & Machinery Works, and started the shipbuilding business on a full scale.
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
11.5 Mitsubishi Heavy Industries, Ltd. - SWOT Analysis
MHI is a manufacturer of heavy machinery in Japan. The company supplies to the energy, aircraft, space, ship
and ocean, transportation, material handling, environment, automotive, industrial machinery, infrastructure,
living and leisure, and defense industries. Its broad product portfolio allows it to fulfill the needs of various
industries and offers the potential for growth and expansion. However, the global economic crisis and
increasing input costs may have adverse impact on the company's business performance.
11.5.1 Mitsubishi Heavy Industries, Ltd. – Strengths
Strength - Diversified Operations
MHI‘s large product range and diversified business operations offsets the risks associated with operating in
any one particular business segment. A diverse product portfolio spanning various industries limits the effects
of fluctuations in global economic trends alongside overall business performance. Additionally, the company‘s
significant expertise in diversified markets allows it to reposition it operations in order to benefit from
opportunities and growing demand in various segments.
Strength - Research and Development Activities
The company‘s R&D activities develop new technologies and products and upgrade existing product offering
to meet the changing needs of its customers. In the energy sector, MHI develops energy conservation
measures, petroleum substitutes and new forms of energy. For the Aerospace sector, the company is planning
to expand its business through participation in several development projects for new commercial aircrafts. It
also helps Japan‘s space program acting as a systems administrator in launch vehicle development.
Additionally, MHI increased spending in R&D activities to US$1.5 billion (JPY129,262 million) for 2010
compared to US$1.2 billion (JPY101,332 million) for 2009. Increasing emphasis on R&D adds the capabilities
to introduce several new products and upgrade its existing portfolio. This helps the company to retain its
clients by meeting their changing needs and procure new business.
Strength - Strong Liquidity Position
MHI has improved its liquidity position during FY2010 strengthening its financial ability to support smooth
operational functioning. The company is working to improve asset efficiency by reducing trade receivables and
inventories alongside raising the utilization rate of its property, plant and equipment. This indicates that the
company is in a strong liquidity position and is more capable of meeting its short term obligations ensuring
operational efficiency.
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11.5.2 Mitsubishi Heavy Industries, Ltd. – Weaknesses
Weakness - Declining Operating Margin and ROE
MHI‘s operating margin decreased from 2.07% in FY2009 to 1.64% for the FY2010. The decrease in margins
was due to increase in operations costs that recorded at 98.35% of total sales for 2010 as compare to 97.21%
in 2009. Further, the operating margin of 1.64% was below the Construction Equipment sector average* of
8.44%. A lower than sector average* operating margin may indicate inefficient cost management or a weak
pricing strategy by the company as a result the return on equity (ROE) was 1.1% at the end of FY2010.
Furthermore, this may indicate that the company is not be using shareholders' money as efficiently and that it
is generating low returns compared to other companies in the sector .This indicates that MHI‘s management
has low focus on profitability.
Weakness - Underutilization of Resources
In FY2010, the company recorded a decrease in its turnover ratios implying underutilization of resources
compared to previous year. The fixed asset turnover and working capital turnover declined to 3.31 and 2.31,
respectively, in FY2010 as compared to 3.82 and 2.88, respectively, in FY2009. This indicates that the
company has not utilized its resources to optimum level as compare to its previous year. Lower utilization of
resources mitigates the efforts for optimum results and it could also lead to increase in opportunity costs.
Weakness - Declining Market Share in Sector
The company‘s sales growth has decreased from 5.38% in FY2009 to -12.88% in FY2010. As a result MHI‘s
CAGR for revenue was 1.31% during 2006–2010. This was below the Construction Equipment sector
average* of 17.17%. A lower than sector average* revenue CAGR may indicate that the company has
underperformed and lost market share over the last four years. MHI‘s underperformance could be attributed to
a weak competitive position or inferior products and services coupled with a lack of innovative products.
11.5.3 Mitsubishi Heavy Industries, Ltd. – Opportunities
Opportunity - Infrastructure Demand in Emerging Countries
Increasing infrastructure expenditure across emerging countries provides opportunities for expansion. In 2010,
MHI identified the Machinery & Steel Structures segment as a Growth Business due to the infrastructure
investments in emerging markets that are expected to touch US$33 trillion (JPY2,898.1 trillion) through the
end of next 20 years. The construction equipment market across the globe, excluding the US and Canada, is
by 13% in 2011–2012. The growth is primarily led by developing economies such as China, India and Brazil.
For example, the Union Minister of Roads and Transportation, Mr. Kamal Nath, announced at the inaugural
section of CII's Excon 2009 that India‘s earthmoving and construction equipment industry's revenue has grown
at over 40% annually in between 2004–2007, reaching US$2.3 billion (JPY202 billion) in 2007. This figure is
expected to reach US$12-13 billion (JPY1,053.8-1,141.7 billion) by 2015. Additionally, MHI is planning to
double production this financial year to meet demand from China and Indonesia. Such long term expenditure
in infrastructure development could create increasing demand for company's products and services in all its
operational markets.
Opportunity - Energy Sector Demand
MHI can pursue opportunities provided by the growing trends in the renewable energy sector, especially the
wind energy market. According to Energy Information Administration (EIA), 3.3 trillion kilowatt hour of new
renewable power generation is projected to add to the global energy generation capacity by 2030. Of which,
hydroelectric power is expected to account for 1.8 trillion kilowatt hours (54%) and energy from wind power is
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expected to account from 1.1 trillion kilowatt hours (33%). Renewable energy markets are an area of
importance for the US government. To offset the pressure of emission reduction China is planning to increase
its nuclear power capacity to 75 megawatts by 2020, which is eight times that of the current nine-megawatt
capacity in the year 2010. As MHI already has presence in the Nuclear power sector it will benefit from these
growing trends. The proposed doubling of renewable energy is expected to account for a share of 6% of the
US electricity supply by the end of 2011. Wind power installed in Japan accounted for as little as 1.88 GW,
about 0.3% of the electricity demand, however, it accounts for more than 10% of all energy consumption
demand in Denmark and Spain. MHI has increased its focus on this sector to capitalize on the prevailing
trends.
Opportunity - Rising Demand for Turbochargers
MHI is currently observing an increased demand for turbochargers and it is meeting this demand by
establishing a global turbocharger business network in Japan, Europe and Asia. Currently, the company is
working towards doubling its production capacity for small-size turbochargers from the current 3.6 million units
per annum to 6.9 million by the end of FY2011 in order to secure a 25% share of the global market. According
to the company, the successful implementation of the expansion plan would make it the second largest
turbocharger manufacturer in the world. The company is taking various upgrade initiatives, which include an
upgrade of the factory in Sagamihara, Japan and a new production base in Thailand to assist in production
and supply of major turbocharger components to the Main Plant in Sagamihara. In Europe, MHI plans to
increase its final assembly capacity by 800,000 units to raise output to the level of 2.8 million units.. The
successful implementation of the company‘s initiatives to meet the increasing demand for turbochargers would
not only improve its financial conditions but also strengthen its current position in the market.
11.5.4 Mitsubishi Heavy Industries, Ltd. – Threats
Threat - Shortage of Skilled Labor
Shortage of skilled personnel in Japan could affect the company's performance in domestic market. In addition
to a prevailing shortage of skilled personnel, Negative growth in the Japanese population could pose
challenges for the company. Japan recorded -0.4% natural birth increase and -0.06% in average rate of
increase in the country‘s population. The average rate of increase is expected to fall further to -1.05% by 2050.
Furthermore, the population of the country is ageing with median age of 49. Shortage of efficient human
resource coupled with negative population growth and an ageing population might pose serious challenges for
the company affecting its project deliverables.
Threat - Volatile Input Prices
MHI is currently facing increases in the price of raw materials, which is driving up the cost of finished
manufacture products. Volatile raw material prices could have a material impact on the operational costs of the
company. The primary raw materials used in the cranes production include Iron, steel, copper and welding
products. The ever increasing prices of raw materials, especially steel and copper, will put pressure on MHI‘s
margins. Moreover, the Japanese government has decided to increase the wage rates from US$0.1 (JPY8.3)
per hour to US$0.1 (JPY11.4) per hour by 2020. This would be achieved by increasing wages by 3% each
year which will further impede the company's cost of production. MHI‘s operational costs have increased to
98.35% of total sales for FY2010 as compared to 97.21% in FY2009. Due to increase in operating cost the
company has to increase it margin and which will in turn increase the competition in the markets.
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Threat - Sluggish Growth in Japanese Economy
The Japanese economy saw the implementation of restrictive lending conditions by financial institutions
making it difficult for real estate companies to raise enough capital, which led to the deterioration of financial
position of Japan‘s property developers and construction companies. As a result MHI stand observe a
decrease in revenues due to unfavorable economic conditions across Japan. Slow growth in the Japanese
economy and other parts of the globe has lowered the revenues of most of the company‘s business segments.
In turn, consumer confidence is also being negatively affected. Conversely,, the unemployment rate in Japan
has begun to increase, however, according to the International Monetary Fund; the Japanese economy is
forecasted to decrease in growth from 2.4 % in 2010 to 1.8 % in 2011, which was lowered by 0.2% from its
previous projection. Moreover, according to data released by Ministry of Land, Infrastructure, Transport and
Tourism of Japan, construction orders fell by 25% in April 2010. Japan is MHI‘s main market, accounting for
half of its total net sales. The prevailing slow market conditions and continued downturn could have a negative
impact on the financial performance of the company.
11.6 Mitsubishi Heavy Industries, Ltd. – Company Information
11.6.1 Mitsubishi Heavy Industries, Ltd. - Key Competitors
The following companies are MHI‘s main competitors:
IHI Corporation
Studsvik AB
Foster Wheeler Ltd.
Japan Nuclear Fuel Limited
China State Shipbuilding Corporation
11.6.2 Mitsubishi Heavy Industries, Ltd. - Key Employees
Table 173: Mitsubishi Heavy Industries, Ltd.,, Key Employees
Name Job Title Board Level
Kazuo Tsukuda Chairman Non-Executive Board
Hideaki Omiya President Executive Board
Ichiro Fukue Director, Senior Executive Vice President Executive Board
Hiroshi Kan Senior Executive Vice President, Director Executive Board
Sunao Aoki Senior Executive Vice President, Director Executive Board
Katsuhiko Yoshida Executive Vice President, Director Executive Board
Shiro Iijima Executive Vice President, Director Executive Board
Katsuhiko Yasuda Director, Executive Vice President Executive Board
Akira Sawa Director, Executive Vice President Executive Board
Teruaki Kawai Executive Vice President, Director Executive Board
Shunichi Miyanaga Executive Vice President, Director Executive Board
Yoshiaki Tsukuda Executive Vice President, Director Executive Board
Yujiro Kawamoto Executive Vice President, Director Executive Board
Makoto Shintani Senior Vice President Senior Management
Takashi Abe Senior Vice President Senior Management
Akira Hishikawa Senior Vice President Senior Management
Hisashi Hara Senior Vice President Senior Management
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Table 173: Mitsubishi Heavy Industries, Ltd.,, Key Employees
Takato Nishizawa Senior Vice President Senior Management
Noriaki Fuseya Senior Vice President Senior Management
Takumi Saito Senior Vice President Senior Management
Masafumi Wani Senior Vice President Senior Management
Atsushi Maekawa Senior Vice President Senior Management
Kiyoshi Yamauchi Senior Vice President Senior Management
Eiji Tsuchida Senior Vice President Senior Management
Shigero Masamori Senior Vice President Senior Management
Shinichi Yoshida Senior Vice President Senior Management
Koji Hiramoto Senior Vice President Senior Management
Kazuyuki Kato Senior Vice President Senior Management
Takashi Kobayashi Senior Vice President Senior Management
Shigeki Iwamatsu Senior Vice President Senior Management
Toshio Kodama Senior Vice President Senior Management
Yukinori Horiguchi Senior Vice President Senior Management
Masahiko Arihara Senior Vice President Senior Management
Toshiro Yagami Senior Vice President Senior Management
Yorihiko Kojima Director Non-Executive Board
Yoshihiro Sakamoto Director Non-Executive Board
Akihiro Wada Director Non-Executive Board
Ken Watabe Senior Vice President Senior Management
Takashi Sudo Senior Vice President Senior Management
Hisakazu Mizutani Senior Vice President Senior Management
Yoichi Kujirai Senior Vice President Senior Management
Kazuo Sohma Senior Vice President Senior Management
Akihiko Fujiwara Senior Vice President Senior Management
Shigeto Matsumura Senior Vice President Senior Management
Yasukuni Yamasaki Senior Vice President Senior Management
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
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12 Company Profile: Hyundai Heavy Industries Co., Ltd.
12.1 Hyundai Heavy Industries Co., Ltd. - Company Overview
Hyundai Heavy Industries Co., Ltd. (HHI) is a leading global shipbuilder, and provides its products and
services to heavy industries worldwide. It manufactures and markets containerships, LNG carriers, tankers,
floating units, oil and gas facilities, diesel engines, propellers, transformers, excavators, wheel loaders and
other heavy industry products. HHI operates six business divisions: Shipbuilding, Offshore and Engineering,
Industrial Plant and Engineering, Construction Equipment, Electro Electric Systems, and Engine and
Machinery. The company has operations in Africa, Asia, North America, South America and Europe. HHI is
headquartered in Ulsan, South Korea.
Table 174: Hyundai Heavy Industries Co., Ltd., Key Facts
Corporate Address 1, Junha-Dong, Ulsan, 682-792, Republic of Korea
Telephone +82 52 202 2114
Fax +82 2 746 4662
URL english.hhi.co.kr
Industry Energy and Utilities, Construction, Transport and Logistics, Power
Ticker Symbol, Exchange 009540 (Korea Stock Exchange(KOSE))
No. of Employees 24,982
Fiscal Year End December
Revenue (US$ Million) 22,871.42
Revenue (in KRW Million) 29,254,382.09
Locations China, India, Japan, Republic of Korea, Singapore, Vietnam, Belgium, Bulgaria, France, Greece, Hungary, Netherlands, Russian Federation, Angola, Nigeria, United Arab Emirates, USA
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
12.2 Hyundai Heavy Industries Co., Ltd. - Business Description
HHI is one of the world‘s leading shipbuilders. The company, along with its subsidiaries and affiliates,
manufactures and markets LNG carriers, containerships, tankers, oil and gas facilities, floating units, diesel
engines, excavators, propellers, transformers, wheel loaders and other heavy industry products.
The company classifies its operations into six divisions: Shipbuilding, Offshore and Engineering, Construction
Equipment, Electro Electric Systems, Engine and Machinery, and Industrial Plant and Engineering.
The Shipbuilding division manufactures crude oil tankers, chemical tankers, product carriers, LNG and LPG
carriers, general cargo ships, bulk carriers, passenger ships, naval and special ships. Since 1972, the
shipbuilding division has manufactured and delivered 1,600 vessels to 252 ship owners in 47 countries
worldwide. HHI‘s Special and Naval Shipbuilding Division (SNSD) is the Korean Navy‘s licensed national
defense industrial shipbuilder and engineering consultant, and manufactures submarines, naval ships and
auxiliary service vessels. During FY2009, the Shipbuilding division generated 42.6% of company‘s total
revenues, and at the end of FY2009, this division had an order backlog of US$26,681 million (KRW30,777,601
million).
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The Offshore and Engineering division is specialized in the development of oil and gas fields, production and
installation of large turnkey facilities for drilling work, additionally providing other engineering procurement and
construction (EPC) services. The division‘s products and services include floating units, fixed platforms,
pipeline and subsea facilities and offshore installation services. The division has completed 3,000,000 tons of
offshore facilities and 5,100 kilometers of subsea pipelines in 49 projects for over 30 clients. It has completed
150 projects including over 100 EPCI projects for the oil and gas industry worldwide. During FY2009, the
Offshore and Engineering division generated 16.2% of the company‘s total revenues. As of December 2009,
this division‘s order backlog was US$9,714 million (KRW11,205,488 million).
The Engine and Machinery division manufactures marine diesel engines, propellers and crankshafts. This
division‘s product base includes marine propulsion engines, crankshafts, cylinder liners, turbochargers,
propellers, shafts, rudders, diesel power plants, packaged power stations, robots and robotic systems, and
submerged cargo pump systems. During FY2009, the Engine and Machinery division generated 13.1% of the
company‘s total revenues. At the end of FY2009, this division had an order backlog of US$5,722 million
(KRW6,600,556 million).
HHI‘s Electro Electric Systems division provides turnkey solutions for power plants. These services include the
design, engineering, manufacturing, installation and commissioning of electric and electronic systems to power
plants, substations, locomotives, marine vessels and subways. It also manufactures and markets gas-insulated
switchgears, transformers, high-voltage circuit breakers, motors and other electronic products. During FY2009,
the Electric and Electronic Systems division generated revenues of US$2.4 billion (KRW2,712 billion), an
increase of 40.9% over FY2008 and representing12.8% of the company‘s total turnover. As of December 31,
2009, the Electro Electric Systems division had an order backlog of US$1,839 million (KRW2,121,360 million).
The company‘s Industrial Plant and Engineering division provides project management services in
engineering, procurement and construction projects. It also constructs power plants, oil and gas plants, gas
processing plants, refineries and petrochemical plants, both in domestic and overseas locations. The division
also produces and supplies environmental facilities, such as desulphurization and dust collection facilities, to
power plants. During FY2009, the Industrial Plant and Engineering division generated 9.0% of the company‘s
total revenues. At the end of FY2009, this division‘s order backlog was US$7,191 million (KRW8,295,106
million).
The Construction Equipment division manufactures heavy construction equipment such as hydraulic
excavators, wheel loaders, industrial lift trucks, forklifts and skid-steer loaders. With four global operation
centers in the US, Europe, India and China, the company has a production capacity of 22,000 units per year,
and has a distribution network spread across 108 countries with 479 local distributors. During FY2009, the
Construction Equipment division generated 5.6% of the company‘s total revenues. At the end of FY2009, this
division had an order backlog of US$1,105 million (KRW1,274,662 million).
The company and its subsidiaries operate across Africa, Asia, North America, South America and Europe. The
company has operations in finance and other sectors through affiliate businesses such as Hyundai Samho
Heavy Industries, Hyundai Mipo Dockyard, Hyundai Venture Investment and Hyundai Futures. The company
operates through subsidiaries, including Hyundai Heavy Industries Co. Nigeria, Ltd., Taishan Financial Leasing
Co., Ltd., Hyundai Heavy Industries Europe NV, and Hyundai - Enova ITC.
HHI has four principal research and development (R&D) centers: the marine research, industrial research,
electro mechanical research and techno design institutes. Its overseas research centers are located in China,
Hungary and the US.
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In May 2010 the company signed a US$600 million (KRW692,194 million) contract with Southern California
Edison (SEC) in the US to provide 230 kv and 500 kv transformers for 10 years from 2010. HHI also acquired
a 10% stake in Brazilian shipbuilder Offshore Services X (OSX).
12.3 Hyundai Heavy Industries Co., Ltd. - Main Products and Services
HHI‘s key products and services include:
Table 175: Hyundai Heavy Industries Co., Ltd., Main Products and Services
Products Services
Crude oil tankers Design & engineering
Chemical tankers Construction & trial services
Product carriers Project management
LNG / LPG carriers Integrated logistic support
Passenger ships Combat system integration
Naval and special ships Pipeline & subsea facilities
Other container ships Construction of various power, oil and gas plants
Floating units
Fixed platforms
Marine engines
Turbochargers
Propellers
Packaged power stations
Robots
Transformers
High-voltage circuit breakers
Switchgears
Motors
Generators
Other electric products
Hydraulic excavators
Wheel loaders
Skid-steer loaders
Forklift trucks
Hydraulic machinery
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
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12.4 Hyundai Heavy Industries Co., Ltd. - History
Table 176: Hyundai Heavy Industries Co., Ltd., History
Year Event type Description
2009 New Products/Services The company released its new 21-ton wheel excavator, Robex 210W.
2009 Acquisitions/Mergers/Takeovers The company acquired a controlling stake of 50% and one share in Hyundai Corporation.
2009 Acquisitions/Mergers/Takeovers The company agreed to acquire a 67.6% stake in Khorol Zerno LLC, an agricultural management company, for around US$6.5 million (KRW7,498.0 million).
2009 Corporate Awards The company was awarded the International Forum Design Award and Pin-Up Design Awards 2009 for the HiMSEN Engine and Excavator, designed by HHI‘s Techno Design Institute.
2009 Contracts/Agreements The company signed a US$250 million (KRW288,385 million) contract with South Africa's electricity utility, Eskom Holdings Ltd., to supply high-voltage transformers for ten years.
2009 Corporate Awards The company was honored with the President's Award for Labor Relations Grand Prix of 2009 from the Ministry of Labor.
2009 Corporate Awards The company was honored with the 2009 Labor-Management Culture Award by the Korean Ministry of Labor and Korea Labor Foundation.
2009 Contracts/Agreements The company's Industrial Plant and Engineering Division was awarded a U$$0.1 billion (KRW 66 billion) contract for a natural gas pipeline by Korea National Oil Corporation.
2008 Corporate Changes/Expansions The company's Construction Equipment division opened a facility in Moscow, Russia.
2008 Acquisitions/Mergers/Takeovers HHI acquired stakes in two CJ Group financial units.
2008 New Products/Services The company developed the Hi-Mate remote management system for excavators.
2008 Corporate Changes/Expansions The company‘s subsidiary Hyundai Construction Equipment India Pvt Ltd. established a plant in India to manufacture construction equipment, principally excavators.
2007 Acquisitions/Mergers/Takeovers HHI‘s Electro Electric Systems acquired Ideal Electric, a US-based rotating machinery manufacturing company.
2007 Contracts/Agreements HHI signed a memorandum of understanding with Gunsan to build a ship block factory.
2007 New Products/Services The company developed the first Korean dual-fuel diesel electric propulsion system for LNG carriers.
2007 Acquisitions/Mergers/Takeovers The company established Wartsila Hyundai Engines, Ltd., a 50:50 joint venture with the Finland-based Wartsila Corporation.
2006 Corporate Changes/Expansions The Construction and Equipment division opened a parts and service center in Korea‘s North Chungcheong Province.
2006 Corporate Changes/Expansions HHI announced the establishment of a holding company in Shanghai, China, with capital of US$30 million (KRW34,606.2 million), to focus on the local market.
2006 Contracts/Agreements The company signed an agreement with Jiangsu Shagan Group Cp., Ltd. to procure 180,000 tons of steel plates annually for shipbuilding.
2005 Corporate Awards The company‘s electric motor received an IECEx International Certification.
2005 New Products/Services HHI developed Korea‘s first marine hydraulic pump, and also introduced the new HBR-7 series of fork-lifts.
2005 Contracts/Agreements The company entered into a strategic supply agreement with Thomas Equipment Ltd. to distribute steer skid loaders.
2004 Corporate Awards Korea‘s Ministry of Commerce, Industry and Energy selected two company products, its synchronous generators and four-stroke diesel engines, as World-Class Products for 2004.
2004 New Products/Services HHI launched series of new forklift models equipped with EPA-certified Tier-2 engines.
2003 Corporate Changes/Expansions The company formed a third joint venture in China.
2002 New Products/Services HHI developed the world‘s largest propeller, with a 9.1m diameter and 29m
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Table 176: Hyundai Heavy Industries Co., Ltd., History
circumference.
2001 New Products/Services HHI delivered the world‘s largest floating production storage and offloading (FPSO) unit.
2000 New Products/Services The company manufactured a marine diesel engine, the first of its kind in Korea.
1999 Stock Listings/IPO HHI was listed on the Korean Stock Exchange with ticker 009540.
1989 Commercial Operation HHI delivered the world‘s largest 40,000 ton jacket to Exxon Co., US.
1989 Acquisitions/Mergers/Takeovers The company merged with Hyundai Engines Co., Ltd.
1985 Corporate Awards HHI was selected as a world-class shipbuilder by Japan‘s Diamond Magazine.
1984 Corporate Changes/Expansions The company founded the Hyundai Maritime Research Institute.
1983 Corporate Changes/Expansions HHI established the Hyundai Industrial Research Institute (HIRI).
1978 Corporate Changes/Expansions The company's name was changed from Hyundai Shipbuilding & Heavy Industry Co., Ltd. to Hyundai Heavy Industries Co., Ltd.
1977 Others The company acquired ISO 14001 certification.
1973 Incorporation/Establishment Hyundai Heavy Industries Co., Ltd. was originally established as Hyundai Shipbuilding & Heavy Industry Co., Ltd. (HHI).
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
12.5 Hyundai Heavy Industries Co., Ltd. - SWOT Analysis
HHI is one of the world‘s leading heavy industry companies, providing a large variety of products and services.
A strong emphasis on R&D, market leadership and diversified business operations are the key strengths of the
company, although lawsuits remain an area of concern. Risks associated with rising raw material prices and a
decline in the shipbuilding market may limit the firm‘s growth plans, but the expansion in the wind turbine
market and development of advanced technologies may provide growth opportunities for the company.
12.5.1 Hyundai Heavy Industries Co., Ltd. – Strengths
Strength - Strong R&D
HHI‘s focus on R&D activities enhances the company‘s offerings, enabling it to serve a diversified customer
base. The company‘s R&D division creates innovative products and market-driven technologies through four
research institutes in Korea, the US, Hungary and China. Its research organization has over 1,400 projects in
progress at any given time, and in 2009, HHI invested US$0.1 billion (KRW164 billion) towards its R&D
activities. This strong focus on R&D enables the company to offer innovative products, maintain its competitive
position and achieve a top-five global market share across 25 product categories.
Strength - Diversified Business Operations
The company‘s diversified business operations help it to serve a diversified customer base, ensuring strong
revenue performance. HHI operates through six divisions: Shipbuilding, Industrial Plant and Engineering,
Engine and Machinery, Electro Electric Systems, and Construction Equipment.
These diversified operating divisions help the company to serve a broad customer base, enabling it to maintain
its leading position in the market.
Strength - Industry Leadership
The company‘s industry leadership position helps it to attract a large customer base. HHI is one of the world‘s
leading heavy industry companies. The shipbuilding division is a world leader in shipbuilding with a market
share of 15%, and its Offshore & Engineering division operates the world‘s largest offshore yard, with 215
acres. The company‘s Engine & Machine division is the world‘s largest marine diesel engine builder with a
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35% market share in 2009, and the Electro Electric Systems Division is the world‘s largest manufacturer of
marine generators with a market share of 45% in 2009. The company‘s leadership position in various markets
helps it to attract and serve a substantial customer base, giving the company a significant competitive edge.
12.5.2 Hyundai Heavy Industries Co., Ltd. – Weaknesses
Weakness - Lawsuits
The company has been involved in various legal proceedings, claims and governmental investigations over the
past few years, which may result in penalties and fines. The major proceedings against the company include
four legal actions filed by its employees for damages from an industrial disaster, amounting to US$0.2 million
(KRW242 million), and a US$17.5 million (KRW19,415 million) penalty imposed by the Korean Fair Trade
Commission. This involvement in various legal proceedings may have a negative impact on the company‘s
brand image.
12.5.3 Hyundai Heavy Industries Co., Ltd. – Opportunities
Opportunity - Strategic Expansion in Wind Market
The company is focusing on expanding its operations in the wind turbine market, which should enable it to tap
the growing opportunities in wind power. In April 2010, the company signed an agreement with Datang
Shandong Power Generation Co., Ltd. and Weihai City Government to construct a 600MW capacity joint wind
turbine manufacturing plant, which will be completed by the end of 2010, and operational from January 2011.
The plant is 80% owned by Hyundai and 20% by Datang Shandong Power Generation. In January 2010, the
company signed a memorandum of understanding (MoU) with Yunus Brothers for the Yuna Project to build a
wind farm with a 50MW capacity at Sindh in Southern Pakistan. This project is expected to generate 15 MW of
electricity and supply over 60,000 households. In March 2010, HHI completed a US$0.1 billion (KRW105.7
billion) wind turbine manufacturing plant at Gunsan Industrial Complex, Jeollabuk-do, Korea. This plant is
currently producing 1.65MW wind turbines with annual capacity of 600MW, and the company is focusing on
expanding the plant‘s wind turbine lines to produce 2MW onshore and 5MW offshore wind turbines, as well as
expanding its annual manufacturing capacity to 800MW by 2013. In 2009 the company took orders for six
1.65MW wind turbines from Wave Wind in USA, and six wind turbines from Taebak in Korea. With a strong
focus on expanding wind turbine manufacturing plants in rapidly emerging markets such as China and Korea,
the company should strengthen its position these markets.
Opportunity - Developing Advanced Technologies
The company‘s focus on developing advanced technologies may help it to further strengthen its position in the
market. In January 2009, the company completed its expansion project at Dock No. 1, creating the world‘s first
T-shaped dry dock. This will double the dock‘s annual turnover from four 10,000 TEU-class containerships to
eight. In September 2008, HHI launched a new 80-ton excavator, which is equipped with a powerful, newly
developed tier-3 engine, giving the excavator increased operating capabilities with lower emissions. It also
upgraded its 7-series LPG forklifts with a powerful 4.3-liter GM engine for improved operator ergonomics and
performance. Its LPG forklift range now includes nine models with load capacities ranging from 1,500 kg to
4,500 kg. The company has also developed the EcoBallast water treatment system for ships, which protects
the marine environment from the transfer of foreign species via ballast water. These advancements are
expected to increase the company‘s market shares across the industries in which it operates.
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Opportunity - Diversifying Business and Exploring Markets
The company is diversifying into the photovoltaic and wind power generation plant businesses. HHI has
initiated a US$0.3 billion (KRW300 billion) investment program to increase its cell manufacturing capacity
almost eleven-fold to 330 MW from 2007–2010. The company also aims to enter the high-voltage transformer
and gas-insulated switchgear markets in India, and is on the verge of entering the US and Middle Eastern
high-voltage transformer markets. In the solar power systems field, the company is exploring new business
opportunities across Italy, Greece, France, the Czech Republic and other regional markets. This strategy is
being carried out to reduce the risk of its business portfolio.
12.5.4 Hyundai Heavy Industries Co., Ltd. – Threats
Threat - Rising Raw Material Prices
The company‘s operations are significantly affected by the high volatility in raw material prices. Steel is a key
raw material used in various company activities, and the prices of raw materials account for a significant share
of the company's total costs. The price of steel has been highly volatile in the recent years; the price of cold
rolled steel coils increased from US$603 (KRW695,584) per ton in August 2007 to US$1,093 (1,260,819) per
ton in August 2008, representing an increase of 81.2%, before falling to US$637 (KRW734,805) per ton in
February 2009. This level of volatility makes it difficult for the company to adjust the price increments in its
project cost management, and there may be significant deviation in the expected and achieved profit margins
for larger long-term projects.
Threat - Declining Shipping Industry
The declining shipping industry could pose a challenge for the company. According to World Shipping Council
(WSC), the shipping industry was still facing hard times in 2010. Christopher Koch, the President and Chief
Executive Officer of WSC, announced that shipping industry continued to face the most difficult times since
containerization was invented in 1956. He also stated that in 2008, total containership capacity increased by
13.2%, with 9.9% forecast to be added in 2010, 10% in 2011, and 5.3% in 2012. This scenario could have a
negative effect on the shipbuilding division, which generates a large proportion of the company‘s revenues.
12.6 Hyundai Heavy Industries Co., Ltd. – Company Information
12.6.1 Hyundai Heavy Industries Co., Ltd. - Key Competitors
The following companies are HHI‘s main competitors:
STX Offshore & Shipbuilding
Aker Solutions ASA
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12.6.2 Hyundai Heavy Industries Co., Ltd. - Key Employees
Table 177: Hyundai Heavy Industries Co., Ltd.,, Key Employees
Name Job Title Board Level
Min Keh-sik Chairman, Chief Executive Officer Executive Board
Lee Jai-seong Chief Executive Officer, President Senior Management
Oh Byung-wook President Senior Management
Park Young-june Director Non-Executive Board
Lee Man-woo Director Non-Executive Board
Lee Jae-kyu Director Non-Executive Board
Song Jung-hoon Director Non-Executive Board
Kim Oi-hyun Senior Executive Vice President – Shipbuilding Division, Chief Operating Officer – Shipbuilding Division
Senior Management
Chun In-soo Vice President – Industrial Plant and Engineering Division, Chief Operating Officer – Industrial Plant and Engineering Division
Senior Management
Yoo Seung-nam Vice President – Engine and Machinery Division, Chief Operating Officer – Engine and Machinery Division
Senior Management
Kim Kweon-tae Executive Vice President – Electro Electric systems Division, Chief Operating Officer – Electro Electric Systems Division
Senior Management
Choe Byeong-ku Vice President – Constrcution Equipment Division, Chief Operating Officer – Constrcution Equipment Division
Senior Management
Lee Choong-dong Executive Vice President – R&D Division, Chief Operating Officer – R&D Division
Senior Management
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
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13 Company Profile: Komatsu Ltd.
13.1 Komatsu Ltd. – Company Overview
Komatsu Ltd. (Komatsu) is an equipment manufacturer involved in the development, manufacture, marketing
and sale of industrial products and services. The company‘s product portfolio includes excavating equipment,
loading equipment, grading and roadbed preparation equipment, hauling equipment, forestry equipment,
tunneling machines, recycling equipment, engines and components. These products are marketed to the
construction, mining, utility and industrial sectors under the Komatsu brand name. In addition to this the
company holds business interests in industrial machinery and vehicles, logistics and electronics. The company
operates globally with plants located in Japan, the US, Germany, the UK, Sweden, Canada, Indonesia, Brazil,
Italy, China and Thailand. Komatsu is headquartered in Tokyo, Japan.
Table 178: Komatsu Ltd., Key Facts
Corporate Address 2-3-6 Akasaka, Minato-ku, 107-8414, Japan
Telephone +81 3 5561 2616
Fax +81 3 3505 9662
URL www.komatsu.com
Industry Construction
Ticker Symbol, Exchange 6301 (The Tokyo Stock Exchange)
No. of Employees 38,518
Fiscal Year End March
Revenue (US$ Million) 19,304.33
Revenue (in JPY Million) 1,431,564.00
Locations China, India, Indonesia, Japan, Thailand, Czech Republic, Germany, Italy, Norway, Russian Federation, Sweden, UK, Canada, USA, Brazil
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
13.2 Komatsu Ltd. – Business Description
Komatsu is a manufacturer of equipment for the construction, mining and utilities and forestry industries. It also
manufactures and distributes industrial machinery and vehicles. The company operates through 143
consolidated subsidiaries, owned either directly and indirectly under its two business divisions and the
management division.
The company‘s operating divisions are the Construction, Mining and Utility Equipment division and the
Industrial Machinery and Others division. The Construction, Mining and Utility Equipment division offers a
range of products used for excavation, loading, grading and roadbed preparation, hauling, tunneling, forestry
and recycling. The product portfolio includes hydraulic excavators, mini excavators, backhoe loaders, wheel
loaders, mini-wheel loaders, skid-steer loaders, bulldozers, motor graders, vibratory rollers and off-highway
dump trucks.It offers harvesters, forwarders and feller-bunchers for forestry purposes. The company also
supplies industrial vehicles, engines and components, casting products and products for logistics services.
These product lines comprise railroad maintenance equipment, diesel engines, diesel generator sets, hydraulic
equipment, steel castings and iron castings products. The operating subsidiaries in the division include
Komatsu Utility Co., Ltd. and Komatsu America Corp. This division accounted for 89% of total company
revenues in FY2010.
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In the Industrial Machinery and Others division, the company offers metal forging and stamping presses, sheet
metal machines, machine tools, defense systems and temperature-control equipment. This division accounted
for 11% of total company revenues in FY2010.
Geographically the company operates in six regions: Japan, the Americas, Europe and CIS, China, Asia
(excluding Japan and China) and Oceania, and Middle East and Africa. In FY2010, Japan accounted for 18%
of total company revenues, with the Americas accounting for 24.12%, Europe and CIS 9.6%, China 19.27%,
Asia and Oceania 22.22% and Middle East and Africa 6.74%.
In June 2010, Komatsu completed the construction of a new Komatsu Manufacturing Rus, LLC assembly
plant, Komatsu's first construction and mining equipment assembly plant in Russia. In 2010, the company
developed diesel engine technology which is compliant with new emission regulations in Japan, North America
and Europe. Komatsu also established a joint venture with Bangkok Motor Works Co., Ltd. in Thailand.
Komatsu planned to acquire a 40% share of Bangkok Komatsu Sales Co., Ltd. through its wholly owned
subsidiary, Komatsu Asia & Pacific Pte Ltd.
13.3 Komatsu Ltd. – Main Products and Brands
The company‘s key products and brands include:
Table 179: Komatsu Ltd., Main Products & Brands
Products Brands
Articulated dump trucks Komatsu
Backhoe loaders Galeo
Bulldozers Linde
Casting products Zenoah
Crankshaft millers
Diesel engines
Dump trucks
Excimer lasers
Feller-bunchers
Fine plasma cutting machines
Forklift trucks
Forwarders
Harvesters
Hydraulic equipment
Hydraulic excavators
Laser cutting machines
Machining centers
Metal forging and stamping presses
Mini hydraulic excavators
Mini wheel loaders
Mobile crushers
Mobile screens
Mobile soil stabilizers
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Table 179: Komatsu Ltd., Main Products & Brands
Mobile tub grinders
Motor graders
Packing and transport
Prefabricated commercial-use structures
Press brakes
Shears
Shield machines
Skid-steer loaders
Slag handling
Small-diameter pipe jacking machines
Temperature-control equipment
Thermoelectric modules
Transfer machines
Tunnel boring machines
Wheel loaders
Wire saws
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
13.4 Komatsu Ltd. – History
Table 180: Komatsu Ltd., History
Year Event type Description
2009 Others Komatsu decided to shut down its Mooka plant in the Construction, Mining and Utility Equipment division, and the Komatsu plant in the Industrial Machinery and Others division, both located in Japan, and transfer their production capacity to other plants.
2009 New Products/Services The company introduced high-performance thermoelectric generation modules, and also developed convex dot formation methods for its chip manufacturing unit.
2009 Acquisitions/Mergers/Takeovers The company established a joint venture with Bangkok Motor Works Co., Ltd. in Thailand. It acquired 40% of the shares of Bangkok Komatsu Sales Co., Ltd through its wholly owned subsidiary, Komatsu Asia & Pacific Pte Ltd.
2009 Acquisitions/Mergers/Takeovers Komatsu acquired Red Australia Equipment Pty Ltd., a distributor of forklift trucks in Australia.
2008 Corporate Changes/Expansions Komatsu restructured the Japanese operations of subsidiary Komatsu Utility Co., Ltd.
2008 New Products/Services The company introduced the world's first hydraulic excavator for the construction sector.
2007 Incorporation/Establishment The company founded Komatsu Undercarriage China Corp. in China.
2007 Corporate Changes/Expansions The construction of three new plants at Ibaraki and Kanazawa in Japan and Chennai in India was completed.
2006 Acquisitions/Mergers/Takeovers The company sold 51% of Komatsu Electronic Metal's stock to Sumco Corp.
2004 Incorporation/Establishment The company founded Komatsu Industries (Shanghai) Ltd. in China as a sales company for industrial machineries.
2002 Acquisitions/Mergers/Takeovers The company founded Komatsu Italy SpA.
2000 Incorporation/Establishment The company founded Gigaphoton Inc., a joint venture with Ushio Inc.
1999 Incorporation/Establishment The company established Komatsu Cummins Chile Ltda., a holding company for construction and mining equipment sales distributors in Chile, as a joint venture with Cummins Engine.
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Table 180: Komatsu Ltd., History
1996 Incorporation/Establishment The company established Komatsu Asia & Pacific Pte. Ltd. in Singapore as a supervisory company for the Asia Pacific region.
1995 Incorporation/Establishment The company established Komatsu Shantui Construction Machinery Co., Ltd. in China.
1995 New Products/Services The company began the shipment of D41 medium-sized bulldozers manufactured by Komatsu do Brasil Ltda.
1991 Incorporation/Establishment The company launched its new corporate brand logotype. It also established NS Komatsu Pty. Ltd., in Australia.
1988 Incorporation/Establishment The company established the Komatsu Dresser Company in the US.
1986 Incorporation/Establishment The company established Komatsu Industries Europe GmbH. in Germany.
1985 Incorporation/Establishment The company established Komatsu UK Ltd. in the UK.
1985 Incorporation/Establishment The company established Komatsu America Manufacturing Corp. and Komatsu America Industries LLC in the US.
1979 Incorporation/Establishment The company launched Komatsu Australia Pty Ltd. in Australia.
1971 Incorporation/Establishment The company launched Komatsu Singapore Pte. Ltd. in Singapore.
1970 Incorporation/Establishment The company launched Komatsu America Corp. in the US.
1951 Others The company moved its head office from Ishikawa to Tokyo.
1941 New Products/Services The company began production of large hydraulic presses.
1921 Incorporation/Establishment Komatsu Iron Works was separated from Takeuchi Mining Co. and was established as Komatsu Ltd.
1917 Incorporation/Establishment Takeuchi Mining Industry established Komatsu Iron to manufacture machine tools and mining equipment.
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
13.5 Komatsu Ltd. – SWOT Analysis
Komatsu develops, manufactures, markets and sells industrial products and services. The company has a
diversified portfolio of equipment and machines catering to the construction, mining, utilities and industrial
sectors. Komatsu has presence across the value chain in the construction equipment sector, and has a strong
research focus and presence in developing economies in the Asia-Pacific region. The company faces
challenges from increased regulatory requirements and volatile input prices which could hamper performance
and profitability.
13.5.1 Komatsu Ltd. – Strengths
Strength - Strong R&D Initiatives
Komatsu has a strong R&D program, which covers areas including information technology, management
technology, control technology, artificial intelligence and environmentally friendly and energy-efficient
equipment. In 2009, the company developed the world‘s first hydraulic excavator, with 25% lower fuel
consumption than previous models. It has achieved reductions in NOx and CO2 emission across its product
range, and in 2010 it developed a new diesel engine technology compliant with Euro 5 and Euro 6 regulations.
Komatsu spent US$529.5 million (JPY46,449 million) in FY2010 and US$612.6 million (JPY53,736 million) in
FY2009 on R&D. This strong R&D focus enables the company to offer innovative products and maintain a
leading competitive position.
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Strength - Market Leading Position
The company holds a leading position in the construction, mining and utilities machinery sectors worldwide. As
of June 2010, the company had 205 distributors in 148 countries, principally operating through sales
subsidiaries and affiliates located in the US, Brazil, Chile, Belgium, Germany, France, Italy, Sweden, Russia,
China, Singapore, Indonesia, India, Australia, the United Arab Emirates and South Africa. In FY2010, Japan
accounted for 18% of total company revenues, with the Americas accounting for 24.12%, Europe and CIS
9.6%, China 19.27%, Asia and Oceania 22.22% and Middle East and Africa 6.74%. To increase its presence
in Asia, the company established a joint venture with Bangkok Motor Works Co., Ltd. in Thailand, acquiring
40% of the shares of Bangkok Komatsu Sales Co., Ltd. through its wholly owned subsidiary, Komatsu Asia &
Pacific Pte Ltd. In 2010, Komatsu constructed its first construction and mining equipment assembly plant in
Russia. These expansion initiatives increase the company‘s market access and growth prospects.
Strength - Presence across Equipment Industry Value Chain
Komatsu is a global manufacturer and distributor of a range of equipment and machinery for the construction,
mining and industrial sectors. The company produces several major equipment components internally,
reducing its dependency on third parties for the delivery of important components. Komatsu‘s domestic and
international sales and distribution network consists of sales subsidiaries, affiliates, independent distributors
and sales partners, and the company principally provides support services to customers through its distributors
and dealers. Diversified modes of distribution enable the company to access end customers effectively and
mitigates the risks associated with dependence on few means of distribution. This presence across the value
chain gives the company a competitive edge.
13.5.2 Komatsu Ltd. – Weaknesses
Weakness - Declining Market Share in Sector
The company's revenue declined at a CARC of -2.93% during 2006–2010. This was below the construction
equipment sector average of 17.17%. The company's underperformance could be attributed to a weak
competitive position or inferior products and services.
Weakness - Declining Operating Margin and Low ROE
The company's operating margin decreased from 7.51% in FY2009 to 4.68% in FY2010. This was below the
construction equipment sector average of 8.44%. A below-average operating margin may indicate issues with
the company‘s cost management or pricing strategy. The company‘s operating margin fell 284 basis points
over 2009, which may suggest that the management has a low focus on profitability. The company's return on
equity (ROE) was 4.0% at the end of FY2010, below the construction equipment sector average of 11.7%. A
below-average ROE may indicate that the company is not using its shareholders' money as efficiently as other
companies in the sector, and that it is generating relatively low returns.
Weakness - Limited Liquidity Position
The company's current ratio was 1.62 at the end of FY2010. This was below the construction equipment sector
average of 1.92. A below-average current ratio indicates that the company is in a weaker financial position
than other companies in the sector.
Weakness - Underutilization of Resources
In FY2010, the company recorded a decrease in its turnover ratios, implying underutilization of resources
compared to the previous year. The inventory ratio and declined from 2.97 in FY2009 to 2.77 in FY2010, while
working capital turnover declined from 5.45 to 3.59. The capital employed turnover ratio declined to 1.71 in
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FY2010 from 2.48 in FY2009. This underutilization of resources could lead to an increase in opportunity costs,
and affect the company‘s growth prospects and profitability.
13.5.3 Komatsu Ltd. – Opportunities
Opportunity - Global Infrastructure Spending
Increasing global infrastructure spending provides substantial opportunities for the company to expand
revenue. Several governments have initiated investment programs to boost their economies following periods
of low and negative growth, with infrastructure spending a focal point of these programs. This long-term
expenditure in infrastructure development could create increasing demand for company's products and
services in all its operations markets.
Opportunity - Increasing demand for hybrid hydraulic excavators
During 2004–2009, worldwide excavator sales grew by around 250%, and the development of infrastructure in
developing regions is expected to drive demand further. Anticipating future market growth for hybrid hydraulic
excavators in Japan and overseas, Komatsu expanded its production capacity of electric motors and other key
components for hybrid hydraulic excavators at its Shonan Plant in Kanagawa Prefecture, Japan. Sales of
crawler cranes are also expected to grow, for use in construction of the expanding energy market.
Opportunity - Sustainable Products
Increasing environmental concern has led to changes in standards governing emissions and waste disposal.
Pressure groups and government bodies have increased pressure on construction companies to reduce
pollution and conform to environmental regulations, and the EU has agreed to reduce its emission levels by
20% by 2020. Similar initiatives have been taken by governments worldwide. These developments will create
demand for equipment and machines that comply with and the new standards and regulations, and the
company has already initiated several developments and technological advancements to decrease the
environmental impact of its products. For instance, in 2010 the company developed diesel engine technology
which is compliant with new emission regulations in Japan, North America and Europe. The technology will
reduce emissions of nitrogen oxides and particulate matter, and improve fuel economy. Technological
advancements such as these could put the company in a position to take advantage of the growing green
market.
13.5.4 Komatsu Ltd. – Threats
Threat - Stringent Environmental Regulations
The company‘s operations are subject to various international, federal, state and local environmental laws and
regulations which are subject to change and stringent implementation. European emission standards such as
the Euro 4 and Euro 5 regulations define the acceptable limits for exhaust emissions of new vehicles sold in
EU member states. European regulations consist of phases of increasingly stringent standards, and in 2005,
China started enacting phased emissions regulations similar to those in Europe. In the US market, the
California Zero Emissions Vehicle (ZEV) regulations have been in place since 2005, and ZEV regulations have
also been implemented in the states of Maine, Massachusetts, New Jersey, New York and Vermont. Stricter
emissions standards could force the company to redesign its vehicles, increasing its operating costs, and non-
compliance could result in fines and penalties.
Threat - Downturn in the Japanese economy
A downturn in the Japanese economy has decreased the revenues of most of the company‘s divisions, and
any further slowdown in the economy could have a serious negative effect on the company‘s operations. This
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may lead to financial constraints and hinder the company‘s growth. According to the International Monetary
Fund, Japanese economic growth is forecast to decline from 2.4% in 2010 to 1.8% in 2011. The Japanese
economy is also forecast to be affected by decreasing falling working-age population. These factors could
pose serious challenges for the company.
Threat - Currency Fluctuation Risk
The company‘s revenue is affected by currency fluctuations. The Japanese yen has appreciated against major
currencies, which is a key factor in an annual decline of the company‘s consolidated net sales of 29.2% to
US$16,319.8 million (JPY1,431,564 million). Currency fluctuations caused profits in the construction, mining
and utility equipment division to register an annual decline of US$0.4 billion (JPY34.9 billion) in FY2010.
Threat - Volatile Raw Material Prices
The company recorded an increase in operating costs for FY2009, resulting in reduced profit margins. The
increase in operational costs is primarily due to highly volatile input costs, especially in parts, raw materials
and material components such as steel. Steel prices are largely affected by the price of oil, which has been
highly volatile for several years, particularly from 2008 when it set record highs during the early part of the year
before reaching a high of over US$147 (JPY12,909.5) per barrel in July. It then fell to around US$90 per barrel
in early September, 2008, and dropped lower still to US$74 (JPY6,498.7) at end of August, 2010. This volatility
was reflected in steel prices across the globe; the London Metal Exchange registered steel billet prices in the
Mediterranean region of over US$1,000 (JPY87,820) per tonne in June 2008, before falling by the end of the
year as demand from the construction industry fell, along with fuel prices. It is difficult for the company to pass
the effect of volatile input costs on to customers on real-time basis, and high input cost volatility makes pricing
difficult; if company absorbs any cost increases costs, its margins could be affected.
13.6 Komatsu Ltd. – Company Information
13.6.1 Komatsu Ltd. – Key Competitors
The following companies are Komatsu‘s main competitors:
Tadano Ltd.
Nikko Co., Ltd.
Carrier Corporation
Johnson Controls, Inc.
13.6.2 Komatsu Ltd. – Key Employees
Table 181: Komatsu Ltd.,, Key Employees
Name Job Title Board Level
Masahiro Sakane Chairman Executive Board
Kunio Noji Chief Executive Officer, President, Director Executive Board
Yoshinori Komamura Director, Executive Vice President Executive Board
Yasuo Suzuki President – Industrial Machinery General Head Quarters
Executive Board
Kenji Kinoshita Chief Financial Officer Executive Board
Masao Fuchigami President – Research Division Executive Board
Masao Fuchigami President – Research Division Senior Management
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Taizo Kayata President – Overseas Marketing, Construction & Mining
Senior Management
Nobukazu Kotake President – Development Division Senior Management
Susumu Yamanaka President – Defense Systems Division Senior Management
Masakatsu Hioki Senior Executive Officer Senior Management
Tetsuji Ohashi President – Production Division Executive Board
Kouichi Ikeda Director Non-Executive Board
Hiroyuki Horii Vice President – Industrial Machinery Division Senior Management
Shinichiro Komiya President – Japanese Domestic Marketing Senior Management
Fusao Seki General Manager – CSR Senior Management
Kazuhiko Iwata President – Global Mining Business Division Senior Management
Mikio Fujitsuka General Manager – Corporate Planning Senior Management
Fujitoshi Takamura President – Development Division Senior Management
Noriyuki Sudo President – Rental and Used Equipment Business Senior Management
Yoshisada Takahashi Vice President – Production Division Senior Management
Tadashi Okada Vice President – Industrial Machinery Division Senior Management
Masahiro Uegaki President – Procurement Division Senior Management
Kazunori Kuromoto President – ICT Business Division Senior Management
Mitsuru Ueno President – Engines Business Division Senior Management
Kikuo Ejima President – Research Division Senior Management
Hidetaka Kita President – Product Support Division Senior Management
Noboru Sato President – Overseas Marketing Division Senior Management
Kensuke Hotta Executive Board
Noriaki Kano Director – Professor Emeritus Executive Board
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
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14 Company Profile: Hitachi Construction Machinery Co., Ltd.
14.1 Hitachi Construction Machinery Co., Ltd. - Company Overview
Hitachi Construction Machinery Co., Ltd. (HCM) is a leading construction equipment manufacturer and
supplier. It develops, manufactures and supplies excavators, wheel loaders, off-road dump trucks, tunnel
boring machines and other products. Operative along with its subsidiaries and other affiliates, HCM has
manufacturing facilities in Europe, the US and Asia. The company‘s products are marketed worldwide. It is
headquartered in Tokyo, Japan.
Table 182: Hitachi Construction Machinery Co., Ltd., Key Facts
Corporate Address 2-5-1 Koraku, Bunkyo-ku, , 112-8563, Japan
Telephone + 81 3 38308064
Fax N/A
URL www.hitachi-c-m.com
Industry Construction, Power
Ticker Symbol, Exchange 6305 (The Tokyo Stock Exchange)
No. of Employees 19,528
Fiscal Year End March
Revenue (US$ Million) 7,105.58
Revenue (in JPY Million) 605,788.00
Locations Australia, China, India, Indonesia, Japan, Malaysia, Mongolia, New Zealand, Republic of Korea, Singapore, Taiwan, Thailand, Vietnam, France, Germany, Italy, Netherlands, Russian Federation, Spain, Turkey, United Kingdom, Egypt, Ethiopia, Israel, Republic of the Congo, South Africa, Sudan, United Arab Emirates, Canada, United States, Mexico
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
14.2 Hitachi Construction Machinery Co., Ltd. - Business Description
HCM develops, manufactures and supplies excavators, wheel loaders, off-road dump trucks, tunnel boring
machines and other products. It is the holding company of the Hitachi group, which consists of 62 subsidiaries
and 20 affiliates. The company has manufacturing facilities located across China, India, Indonesia, the US,
Canada, the Netherlands and France. The company has segregated its operations into two reportable
segments. These include Construction Machinery and Industrial Vehicles.
In the Construction Machinery segment, the company manufactures and supplies a range of excavators. The
products range from medium-sized and mini excavators to the 780-ton ultra-large excavators. The firm has
manufacturing facilities in Europe, the US and Asia. HCM also manufactures and supplies wheel loaders, off-
road dump trucks and tunnel boring machines. These products are used for digging, loading, carrying,
breaking, grabbing, cutting, crushing and screening. HCM also provides certified used equipment and
attachments through its network of 150 dealers worldwide. In addition, it provides spare parts such as
hydraulic oils, hydraulic filters, high pressure hoses, ground engaging tools and remanufacturing components.
HCM also provides after sales service and diagnostic tools and technical training in this segment. Recently,
HCM launched the ZX U-3 mini-excavator with an ultra-short tail swing and expanded the EX-6 series of ultra-
large hydraulic excavators. In 2009 the company launched the ZAXIS-3G series of 30t class hydraulic
excavators in China. Demand for the company‘s products is increasing particularly rapidly in emerging
economies. For FY2010, the segment accounted for 91.14% of the total company‘s revenues.
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In the Industrial Vehicles segment, the company operates in association with TCM Corporation (TCM). It
provides a range of compact wheel loaders and wheel loaders, rigid dump trucks, articulated dump trucks,
truck mounted screen and truck mounted recycle equipment. The company manufactures vehicles such as
electric-drive forklifts in Japan. To meet emission control regulations and to build business in emerging
markets the company has launched the ‗C-1‘ Series vehicle in China. The segment accounted for 8.85% of the
total revenues generated for FY2010.
In terms of geography, the company has segregated its operations across five segments: Japan, Asia, Europe,
the Americas and Other. In FY2010, Japan accounted for 40% of the company‘s total revenues, Asia for
30.99%, Europe for 12.57%, the Americas for 3.72% and Other for 12.60%.
In June 2010 KCM Corporation and HCM reached an agreement under which HCM will acquire an equity
stake in KCM through a third-party capital. KHI will hold a 66% share in KCM and HCM a 34% share. Further
in March 2010 Hitachi Construction Machinery acquired 20% more shares of Telcon, to bring its total control to
60%, to make Telcon into a subsidiary and to take a strong lead in the rapidly growing Indian market.
14.3 Hitachi Construction Machinery Co., Ltd. - Main Products and Services
The main products and services for the company include:
Table 183: Hitachi Construction Machinery Co., Ltd., Main Products and Services
Products Services
Excavators Spare parts
Wheel loaders After sales service
Off-road dump trucks Diagnostic tools
Tunnel boring machines Technical training
In-vehicle semiconductors
Flat panel television displays
Ultrasonic imaging devices
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
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14.4 Hitachi Construction Machinery Co., Ltd. - History
Table 184: Hitachi Construction Machinery Co., Ltd., History
Year Event type Description
2009 Acquisitions/Mergers/Takeovers HCM acquired interest in Wenco International Mining Systems, Ltd (Wenco). Wenco provides fleet management systems for the mining sector.
2008 Corporate Awards Japan Industrial Design Promotion Organization awarded HCM with 2008 'Good Design Awards' for its Zero Tail Swing hydraulic excavator and mini wheel loaders.
2007 Corporate Changes/Expansions The company planned an investment of US$0.2 billion (JPY 14 billion), excluding land cost, in a manufacturing facility near Hitachi-Naka port, Japan. The production is scheduled to begin by April 2008.
2007 Corporate Awards HCM‘s medium-sized ZAXIS-3 hydraulic excavators received the iF Design Award. Earlier, the same models won Good Design Award 2006 in Japan.
2006 Corporate Changes/Expansions Hitachi Construction Machinery (Singapore) Pte Ltd was renamed Hitachi Construction Machinery Asia and Pacific Pte. Ltd. (HMAP).
2006 Contracts/Agreements Zhejiang University and HCM announced the establishment of a common laboratory for construction machineries in China.
2006 New Products/Services HCM launched new dump trucks models, the EH750-3 and EH1100-3.
2005 Corporate Changes/Expansions The company announced the expansion of its current facility in Amsterdam, the Netherlands, to increase annual production of midsize excavators to 5000 machines in 2009.
2004 New Products/Services
The ZAXIS380HH model was launched into market in February and by December, the company sold 27 excavators to domestic market. Moreover, HCM along with ELLE Construction Machinery (Tianjin) International Trade Co., Ltd (ELLE) introduced the ZAXIS850H, a heavy-duty excavator. ELLE is the HCM‘s prime distributor in China.
2003 Corporate Awards The company received ‗Miles Prize‘ and the ‗Miles Company Award, Main Prize‘ from Society of Japanese Value Engineering.
2002 Incorporation/Establishment The company established Hitachi Sumitomo Heavy Industries Construction Crane Co., Ltd. and Hitachi-Furukawa Loaders Europe S.A.S in France
2001 Contracts/Agreements HCM entered into a business tie-up with Sumitomo Heavy Industries, Ltd. and TADANO Ltd. in the crane market.
2001 New Products/Services The company, in association with TCM Corporation and Furukawa Co., Ltd, jointly released seven new models of the wheel loader series.
1999 Contracts/Agreements HCM entered into a business agreement with TCM Corporation in the area of wheel loaders.
1999 Corporate Changes/Expansions HCM's FA Division, which manufactures and sells ultrasonic imaging devices, was established independently as Hitachi Kenki Fine Tech Co., Ltd.
1998 Acquisitions/Mergers/Takeovers The company acquired Euclid-Hitachi Heavy Equipment, Inc. from Volvo Construction Equipment N.V.
1997 New Products/Services The company developed the EX5500, a super-size hydraulic excavator in the 515-ton class, the largest class in the world. It was awarded ISO 14001 certification, for environmental management systems.
1997 Corporate Awards The company was awarded the Ichimura Prize for the EX3500.
1995 Incorporation/Establishment HCM established Hefei Hitachi Excavators Co., Ltd. in the city of Hefei, China to enter the off-road dump truck market.
1994 Incorporation/Establishment The company established Euclid-Hitachi Heavy Equipment Inc. in the US
1993 Contracts/Agreements HCM formed a technical collaboration agreement with Samsung Heavy Industries Co., Ltd. in Korea for crawler cranes.
1991 Incorporation/Establishment The company entered the Indonesian market through the establishment of PT. Hitachi Construction Machinery.
1990 New Products/Services The company entered the bulldozer and road construction machinery markets. It also established Siam-Hitachi Construction Machinery Co., Ltd. in Thailand in October, 1990.
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Table 184: Hitachi Construction Machinery Co., Ltd., History
1990 Stock Listings/IPO The company was listed on the first section of the Osaka Securities Exchange.
1989 Others HCM completed construction for the Dejima Plant base for mass production of reduction gears and other products near the Tsuchiura plant in Japan.
1988 Contracts/Agreements The company entered into a joint venture agreement with Deere-Hitachi Construction Machinery Corp., for the local production of hydraulic excavators in the US.
1987 New Products/Services The company launched the EX3500, one of the largest classes of super-size hydraulic excavators.
1986 New Products/Services Hitachi Construction released four models of the new-generation excavators under the EX series.
1986 Contracts/Agreements HC entered into a joint venture agreement with Fiat-Hitachi Excavators S.p.A. in Italy for local production of hydraulic excavators.
1985 Financing Agreements The company was involved in capital participation in a construction machinery sales company in France (Fiat-Hitachi Excavators France S.A.).
1985 Incorporation/Establishment HCM established Oriental Hitachi Construction Machinery Sdn. Bhd. in Malaysia and Hitachi Construction Machinery (America) Corp in the US.
1984 Incorporation/Establishment The company established Hitachi Construction Machinery (Singapore) Pte. Ltd.
1983 Contracts/Agreements HCM entered into a business agreement with Deere & Company for the supply of hydraulic excavators.
1981 Stock Listings/IPO The company was listed on the second edition of the Tokyo Stock Exchange. In the same year, it formed a business partnership with Tadano Ltd. in the area of track cranes and crawler cranes.
1979 Incorporation/Establishment The company established Yamagata Hitachi Construction Machinery Co., Ltd.
1976 Contracts/Agreements The company formed a business tie-up with Kubota, Ltd. in the area of hydraulic excavators.
1976 Corporate Awards HCM developed an earth pressure balance shield machine, which was awarded the Japan Society for The Promotion of Machinery Industry Prize.
1974 Corporate Changes/Expansions HCM incorporated the Adachi Plant into Tsuchiura Works, under plant relocation and production consolidation measures.
1972 Incorporation/Establishment The company Hitachi Construction Machinery (Europe) B.V. was established.
1970 Incorporation/Establishment Hitachi Construction Machinery Co., Ltd. was established through the amalgamation of Hitachi Construction Machinery Co., Ltd. (manufacturing company) and the former Hitachi Construction Machinery Co., Ltd.
2009 Acquisitions/Mergers/Takeovers HCM acquired interest in Wenco International Mining Systems, Ltd (Wenco). Wenco provides fleet management systems for mining sector.
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
14.5 Hitachi Construction Machinery Co., Ltd. - SWOT Analysis
HCM is a leading manufacturer and supplier of excavators, wheel loaders, off-road dump trucks and tunnel
boring machines. Its global operations are its main strength of the company. In addition, strategic partnerships
and corporate restructurings across the world have enabled the company to expand its product portfolio.
However, the weak global economic environment, declining demand and intense competition pose significant
threats for the company.
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14.5.1 Hitachi Construction Machinery Co., Ltd. – Strengths
Strength - Diversified Geographic Presence
The company plots its operational activity globally, mitigating its business risk. HCM maintains manufacturing
facilities across China, India, Indonesia, the US, Canada, the Netherlands and France. In addition, the firm
operates through 62 subsidiaries and 20 affiliates, which provide a strong global platform for the company. The
network of 150 dealers worldwide further adds to the competitive strength of the company. The company
further increased its stake in Telco by 20% to total 60%, making it a subsidiary and increasing its presence in
emerging markets such as India. Global operations mitigate the uncertainties in performance in few regions.
For example, operations in China recorded the substantial annual increase of 33% for FY2010, limiting the
decrease in overall revenues to 18.6% for FY2010 caused by underperformance in other markets.
Strength - Strategic Partnerships and Corporate Restructuring
In addition to organic growth, the company emphasizes an inorganic growth strategy through joint ventures,
strategic alliances and restructuring programs. Recently, HCM restructured its FA Division to form Hitachi
Kenki Fine Tech Co., Ltd. Furthermore, it formed a business tie-up with TCM Corporation to enter into the
wheel loaders market. In 2001, it jointly released seven new models of the wheel loader series in association
with TCM Corporation and Furukawa Co. In addition, the company restructured the hydraulic plant in the
Tsuchiura Works and the Kasumigaura Works in order to stream line operations to build a structure capable of
supplying key components for 61,000 hydraulic excavators annually by 2011. Meanwhile, the production lines
operated by the Tsuchiura Works have been relocated and expanded through setting up a new facility for
increasing hydraulic excavator production capacity from 18,000–23,000 units annually. As an example of
inorganic growth, in June 2010, KCM Corporation and HCM reached an agreement under which HCM will
acquire an equity stake in KCM. KHI will hold 66% share in KCM and HCM a 34% share.
Strength - Improvement in Liquidity Position
HCM‘s current ratio has improved from 1.30 in FY2009 to 1.61 at the end of FY2010. Moreover the quick ratio
has increased from 0.653 at the end of FY2009 to 1.006 at the end of FY2010. This shows that the company is
in a strong financial position and is more capable of meeting its short term obligations.
14.5.2 Hitachi Construction Machinery Co., Ltd. – Weaknesses
Weakness - Declining Market Share in Sector
HCM‘s sales growth decreased in 2010 and 2009, by 18.59% and 20.87% respectively. As a result the
company‘s revenue CARC was -0.84% during 2006–2010. This was far below the Construction Equipment
sector average* of 17.17%. A lower than sector average* revenue CAGR may indicate that the company has
lost market share over the last four years. Such underperformance can be attributed to a weak competitive
position or inferior products and services.
Weakness - Underutilization of Resources
In FY2010, the company recorded a decrease in its turnover ratios, implying underutilization of resources
compared to FY2009. The fixed asset turnover and working capital turnover declined to 2.60 and 2.91,
respectively in FY2010 from 3.27 and 5.98 in FY2009. Furthermore, the capital employed turnover declined to
1.98 in FY2009, as compared to 2.53 for 2008. This indicates that the company has not utilized its resources
as efficiently as in the previous year, resulting in lower performance. Lower utilization of resources mitigates
the efforts for optimum results and leads to an increase in opportunity costs.
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Weakness - Declining Operating Margin and ROE
HCM‘s operating margin has drastically fallen from 6% in FY2009 to 2.94% in FY2010. This was below the
Construction Equipment sector average* of 8.44%. A lower than sector average* operating margin may
indicate inefficient cost management or a weak pricing strategy by the company. The operating margin has
decreased 313 basis points over 2009 which may indicate management's low focus on profitability. The
company's return on equity (ROE) was 1.3% at the end of FY2010. This was below the Construction
Equipment sector average* of 11.7%. A lower than sector average* ROE may indicate that the company is not
using shareholders' money as efficiently as other companies in the sector and that it is generating low returns
for its shareholders compared to other companies in the sector.
14.5.3 Hitachi Construction Machinery Co., Ltd. – Opportunities
Opportunity - Demand for Hydraulic Excavators and Crawler Cranes
HCM‘s hydraulic excavator‘s sales are expected to increase, especially in nations with developing economies.
Over the last six years, global excavator sales have grown by 2.5 times and this trend is expected to continue.
Infrastructure demand in developing nations and regions such as China, other Asian countries, Australia,
Russia-CIS and the Middle East are considered key drivers of the demand. According to a survey by the
Association of Equipment Manufacturers, global construction machinery sales — except the US and Canada
— are expected to grow by 13% over 2011–2012. In addition, HCM claims that demand for hydraulic
excavators could rise by more than 20% in 2011 in its operating markets, principally developing nations. The
company already has initiated several measures to seize such opportunities. For examples, the company has
launched new products such as the ZAXIS-3G series of 30t class hydraulic excavators and increased
promotion activates in China. This has resulted in an increase in net sales in China by 33% from the previous
year to US$1,809 million (JPY 158,681 million). Furthermore, the company is making efforts to expand sales of
new products such as the EX-6 Series, ultra-large hydraulic excavators equipped with environmentally friendly
engines. In addition to hydraulic excavators, demand for crawler cranes is also increasing rapidly in emerging
economies. The accelerating demand for energy globally could increase demand for lifting solutions,
principally crawler cranes which find applications in oil and gas, power, wind farms and other industrial
markets.
Opportunity - Indian Construction Equipment Market
The Indian construction equipment industry is expected to grow with sustained investment in infrastructure,
including roads, irrigation and urban infrastructure, and the likely recovery in residential real estate and
increasing industrial investments from 2010–2011 onwards. The construction equipment industry in India is
estimated to be worth US$4.4 billion (INR200 billion) in 2008–2009 with earthmoving equipment constituting
over half of the entire industry. Construction accounts for 70% of demand for earthmoving equipment and the
mining sector accounts for the remaining 30%.
Opportunity - Global Infrastructure Spending
Increasing global infrastructure spending provides significant opportunities for HCM‘s company to capitalize
upon. To stimulate the economies out of downturn and recession several governments globally have initiated
investment programs. Infrastructure investments are expected to total US$33 trillion (JPY2,898.1 trillion) over
the next 20 years. The company is also planning to double production in 2010 to meet demand from China and
Indonesia. This long term expenditure in infrastructure development could create increasing demand for the
company's products and services in all its markets.
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14.5.4 Hitachi Construction Machinery Co., Ltd. – Threats
Threat - Stricter Emission Standards
HCM‘s operations are subject to various international, national and local laws and regulations. Non-compliance
with such norms and regulation could lead to penalties and fines. For example, the European Union has
implemented its EURO 5 emissions standards in September 2009 and plans to introduce more stringent
emissions standards, EURO 6 standards, by 2015. In China too, phased regulations similar to the EURO
series of emissions regulations have been implemented since 2005. Stricter emissions standards could force
the company to redesign its vehicles, in turn increasing its compliance costs.
Threat - Intense Competition
HCM operates across markets characterized by intense competition due to the presence of large and
established companies and have considerable price pressures. The company faces intense competition from
companies such as Caterpillar Inc., Komatsu Ltd., Kubota Corp., Kobelco Construction Machinery Co. Further,
low entry barriers have further increased competition.
14.6 Hitachi Construction Machinery Co., Ltd. – Company Information
14.6.1 Hitachi Construction Machinery Co., Ltd. - Key Competitors
The following companies are HMC‘s main competitors:
Tadano Ltd.
KATO WORKS CO., LTD.
Kobelco Construction Machinery Co., Ltd.
OKADA AIYON CORPORATION
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14.6.2 Hitachi Construction Machinery Co., Ltd. - Key Employees
Table 185: Hitachi Construction Machinery Co., Ltd.,, Key Employees
Name Job Title Board Level
Michijiro Kikawa President, Chief Executive Officer, Director Executive Board
Yoshio Kubo Director Non-Executive Board
Minoru Tsukada Director Non-Executive Board
Mitsuji Yamada Executive Vice President Executive Board
Toru Sakai Senior Vice President Executive Board
Shinichi Mihara Senior Vice President Executive Board
Kiichi Uchibayashi Director Executive Board
Takayoshi Honma Vice President, Executive Officer Senior Management
Terumasa Otsuka President and Representative Director of Senior Management
Tsutomu Mizutani Executive Officer, Vice President Senior Management
Makoto Sato Executive Officer, Vice President Senior Management
Hiroshi Tokushige Vice President Executive Board
Yukio Arima Vice President Senior Management
Kiyomitsu Yamanaka Vice President Senior Management
Yoshimi Iwase President of Hitachi Construction Machinery Tierra Co.
Senior Management
Mitsuhiro Tabei Executive Officer Senior Management
Yuichi Tsujimoto Executive Officer Senior Management
Masaki Kanahara Executive Officer Senior Management
Shigeru Murasugi Executive Officer Senior Management
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
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15 Company Profile: Doosan Infracore Co., Ltd
15.1 Doosan Infracore Co. Ltd - Company Overview
Doosan Infracore Co. Ltd (Doosan) is a construction equipment manufacturer and supplier of excavators,
wheel loaders, tower cranes and concrete pump trucks used for construction. It also manufactures engines,
transmissions systems, hydraulic systems, electric generators and equipment parts. In the defense segment,
the company produces IFVs, anti-air and guided weapons and precision equipment. The company‘s product
portfolio includes a wide range of machine tools such as turning centers, machining centers, computer
numerical control (CNC) boring machines, electric discharge machines, aspheric turning centers and
automation systems. Doosan products are used in variety of industries, including agriculture, automotive,
construction, engines and power generation. The company‘s operations are spread worldwide. Doosan is
headquartered in Incheon, South Korea.
Table 186: Doosan Infracore Co., Ltd, Key Facts
Corporate Address 7-11 Hwasoo-Dong, Incheon, , 401-020, Republic of Korea
Telephone + 82 32 2111114
Fax + 82 2 33988339
URL www.doosaninfracore.com
Industry Construction , Industrial Goods and Machinery
Ticker Symbol, Exchange 042670 (Korea Stock Exchange(KOSE))
No. of Employees 4,529
Fiscal Year End December
Revenue (US$ Million) 4,329.84
Revenue (in KRW Million) 5,538,209.94
Locations China, India, Republic of Korea, Singapore, Belgium, France, Germany, Italy, United Kingdom, South Africa, United States, Brazil, Colombia, China, India, Republic of Korea, Singapore, Belgium, France, Germany, Italy, United Kingdom, South Africa, United States, Brazil, Colombia
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
15.2 Doosan Infracore Co., Ltd - Business Description
Doosan is a construction equipment manufacturer and supplier of excavators, wheel loaders, tower cranes and
concrete pump trucks used in construction. The company also manufactures engines, transmissions systems,
hydraulic systems, electric generators and other equipment parts, which find applications from agriculture and
automotive to construction, engines and power generation industries. Doosan has presence in Asia, Africa,
Europe, North America and South America. The company has classified its operations under six business
groups: Construction Equipment, Machine Tools, Engines and Materials, Forklifts, Parts, and Compact
Equipment.
Through its Engines and Materials segment, the company manufactures generator diesel engines, marine
diesel engines, automotive diesel engines, industrial diesel engines, generator natural gas engines and
automotive natural gas engines. The company also manufactures related materials such as iron cast and
aluminum cast. During FY2009, the Engines and Materials segment accounted for 9.6% of the company‘s total
revenues.
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The company‘s Construction Equipment business manufactures crawler excavators, compact equipment,
wheel loaders, wheeled excavators, articulated dump trucks, air compressors generators, lighting systems and
light compaction equipment. During FY2009, the Construction Equipment business accounted for 41.1% of the
company‘s total revenues.
Doosan‘s Compact Equipment business is operated through Bobcat Company. Bobcat designs, manufactures,
and distributes compact equipment for the global construction, industrial, landscaping and agriculture markets.
Its key products include skid-steer loaders, compact excavators, compact track loaders, telehandlers, compact
attachments, compact tractors and utility vehicles. During FY2009, the Compact Equipment business
accounted for 30.4% of the company‘s total revenues.
Doosan‘s Machine Tools group provides turning centers, machining centers, double column machining centers
and horizontal boring mills. During FY2009, the Machine Tools business accounted for 9.4% of the company‘s
total revenues.
Under the Forklifts business, the company manufactures engine forklift trucks, electric forklift trucks, electric
reach trucks and warehouse equipment. During FY2009, the Forklifts business accounted for 6.3% of the
company‘s total revenues.
Other key components are manufactured through the company‘s Parts segment. This includes construction
equipment parts, forklift parts, engine parts and machining tool parts. In addition, the company provides forklift
training and construction equipment training. During FY2009, the Parts business accounted for 3.2% of the
company‘s total revenues.
Recently, the company announced investment of US$54.1 million (KRW60,100 million) on building a new
factory to expand its machine business. Also, the company sold its 10,148,899 shares to Doosan Heavy
Industry and Construction Co. With this acquisition, Doosan Heavy Industry holds a 44.83% stake in Doosan
Infracore Co. Ltd.
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15.3 Doosan Infracore Co. Ltd - Major Products
Table 187: Doosan Infracore Co. Ltd, Major Products
Products
Engines
Transmissions systems
Hydraulic systems
Electric generators
Turning centers
Machining centers
CNC boring machines
Electric discharge machines
Aspheric turning centers
Automation systems
Excavators
Wheel loaders
Skid Steer loaders
Tower cranes
Concrete pump trucks
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
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15.4 Doosan Infracore Co., Ltd - History
Table 188: Doosan Infracore Co., Ltd, History
Year Event type Description
2010 Contracts/Agreements Doosan Infracore Portable Power, a business unit of the company appointed Air Compressor as an authorized dealer.
2010 Corporate Changes/Expansions The company completed a construction plant in Gunsan, Republic of Korea.
2009 Acquisitions/Mergers/Takeovers The company increased its stake in Ireland-based Doosan Holdings Europe Limited to 53.9%.
2009 Corporate Awards Doosan Infracore was awarded the Best of the Best Award at '2009 Reddot Design Award' for the futuristic concept excavator.
2009 Divestiture The company sold its entire shares of Doosan Dst Co. Ltd, a manufacturer of defense equipment.
2009 Acquisitions/Mergers/Takeovers Doosan acquired 4,874 shares of Doosan Infracore International, Inc.
2009 Divestiture Doosan sold its stake in Korea Aerospace Industries, Ltd.
2009 Corporate Changes/Expansions The company‘s Engines and Materials segment opened a Service Training Center at the Incheon plant in the Republic of Korea.
2008 Acquisitions/Mergers/Takeovers Doosan acquired Moxy, a Norwegian large size dump truck company.
2007 Acquisitions/Mergers/Takeovers The company acquired the compact construction equipment unit, along with two other units of Ingersoll-Rand.
2007 Corporate Changes/Expansions The company established Doosan Infracore (Suzhou) Co., Ltd.and Doosan Infracore India Private Ltd.
2007 Corporate Changes/Expansions The company established Doosan Holdings Europe Ltd and Doosan Holdings International Ltd.
2006 Corporate Changes/Expansions Doosan formed Doosan Infracore (China) investment Co., Ltd. as a holding company in China.
2005 Corporate Changes/Expansions Doosan established Doosan Infracore Co. Ltd. (rep. office) in Dubai, UAE.
2005 Corporate Changes/Expansions DHIL was renamed as Doosan Infracore Co. Ltd.
2003 Corporate Changes/Expansions DHIL formed Doosan Infracore Machine Tools Yantai Co, Ltd. in Shandong, China.
1998 Corporate Changes/Expansions DHIL established Doosan Infracore Germany GmbH in Germany and Doosan Infracore America Corp in the US.
1998 New Products/Services DHIL constructed a forklift factory in Shandong, China.
1994 Corporate Changes/Expansions The company entered into the UK and the Chinese markets through Doosan Infracore UK., Ltd and Doosan Infracore China Co., Ltd. in Shandong, China, respectively.
1990 Corporate Changes/Expansions DHIL established Doosan Infracore Europe S.A. in Belgium.
1986 Commercial Operation DHIL started mass production of the excavator model developed in-house.
1984 Corporate Changes/Expansions DHIL completed the construction of Changwon Defense Equipment Factory in the Republic of Korea.
1981 Corporate Changes/Expansions DHIL established its Central RandD Center.
1977 New Products/Services DHIL completed the construction of Changwon Machine Tools Factory and Incheon Excavator and Forklift Factory in the Republic of Korea.
1976 Corporate Changes/Expansions The company was renamed Daewoo Heavy Industries Ltd (DHIL).
1966 Stock Listings/IPO The company was listed on the Korea Stock Exchange.
1963 Corporate Changes/Expansions The company was reorganized as a state-run enterprise and renamed Korea Machinery Industries Corp.
1942 Corporate Changes/Expansions The company founded its first large-scale machinery factory at Incheon, Republic of Korea.
1937 Incorporation/Establishment Doosan was formed as Chosun Machine Works.
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
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15.5 Doosan Infracore Co., Ltd - SWOT Analysis
Doosan is a leading construction equipment manufacturer and supplier of excavators, wheel loaders, tower
cranes and concrete pump trucks used for construction. International certifications, wide geographic presence
and strong product portfolio are the key strengths of the company, even as a high debt to equity ratio and
weak operational performance remain major concern areas. Going forward, the company is at risk from
currency fluctuations, the volatility of raw material prices and gray market heavy equipment sales may affect its
business operations. However, its focus on emerging markets, expansion of facilities and construction and
mining machinery market will provide growth opportunities for the company.
15.5.1 Doosan Infracore Co., Ltd – Strengths
Strength - International Certifications
The international certifications and accreditations gained by the company resulted in strong brand recognition.
Doosan‘s portfolio of different forklift truck models comprising diesel, gasoline, LPG, and electric engines has
been awarded with international certifications including UL, CE, EMC, and EC Noise Directive as well as ISO
9001 and 14001 certifications in the Forklifts segment. Furthermore, the CNC boring machines, electric
discharge machines, laser-cutting machines, aspheric turning centers, and automation systems manufactured
under the Machine Tools division has been accredited with ISO 9001, ISO 14001, CE, UL, EMI, and EMC
certifications. These certifications received are a result of established quality standards and processes.
Strength - Wide Geographic Presence
Wide geographic presence enables the company to reach a diverse customer base across diverse
geographies. Doosan has sales facilities located in Europe and in China and maintains local sales
corporations in the US, the UK, Germany and South Africa and branch offices in France, Brazil and Colombia.
Furthermore, it maintains an extensive global dealer network. In the Forklifts segment, the company maintains
its distributors and parts supply bases in the US, Germany, France, Italy, the UK, Belgium, Brazil and
Singapore and a dealer networks in 90 countries. In addition, in the Engines and Materials segment, it
operates 146 parts agents in Korea and parts depots all over the world including in the US, Belgium, the UK,
China, South Africa and Brazil. Diverse geographic presence also acts as strength for the company by
enabling it to diversify its operational risk.
Strength - Strong Product Portfolio
The company‘s strong product portfolio helps it to meet diverse needs of its customers. Doosan has
maintained a strong product portfolio over the years. The company manufactures and supplies excavators,
wheel loaders, tower cranes and concrete pump trucks. In addition, Doosan manufactures and supplies a line
of machine tools including turning centers, machining centers, CNC boring machines, electric discharge
machines, laser-cutting machines, and aspheric turning centers along with automation systems. Furthermore,
the company provides 90 different lift truck models featuring diesel, gasoline, LPG and electric engines. In
addition, the company manufactures ultra-low-pollution CNG and low-pressure natural gas (LPNG) engines. Its
product portfolio also includes conventional models of diesel engines ranging from 24 to 1000HP. This diverse
product portfolio enables the company to cater to a wide range of customers, which in turn mitigates the risk
associated with dependence on a limited product range.
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15.5.2 Doosan Infracore Co., Ltd – Weaknesses
Weakness - Weak Operational Performance
The company reported weak financial performance in FY2008 and FY2009, which may limit its expansion and
future growth plans. Despite revenue growth in FY2009, the company recorded operating and net losses in
FY2008 and FY2009. In FY2009, the company‘s operating loss stood at US$0.4 billion (KRW395.3 billion)
compared with an operating profit of US$0.1 billion (KRW115.5 billion) in FY2008. In addition, the company
demonstrated a net loss of US$0.3 billion (KRW313.5 billion) in FY2009 compared with a net loss of US$0.1
billion (KRW123.1 billion) in the previous year. This was due to increased operating expenses, which as a
percentage of sales increased from 98.4% in FY2008 to 107.1% in FY2009. The poor operational performance
presents a challenge for the company in managing and controlling costs, which may further affect its margins.
Weakness - High Debt to Equity Ratio
Doosan has witnessed a high debt to equity ratio over the past five years, which might place the company at
risk as a result of paying the high interest. The company‘s debt to equity ratio increased from 0.8 in FY2005 to
4.4 in FY2009. This is much higher than Doosans nearest competitor, Hitachi Construction Machinery Co. Ltd,
who reported a ratio of 1.02 in FY2009. The relatively high debt to equity ratio may affect company‘s ability to
meet its obligations, which in turn may affect its business operations.
15.5.3 Doosan Infracore Co. Ltd – Opportunities
Opportunity - Construction and Mining Machinery Market
The company is anticipated to benefit from the growth in the construction and mining machinery and
equipment market. According to industry estimates, the global construction and mining equipment market will
reach 822,000 units by 2015. Major drivers for this growth include an increase in residential and commercial
building construction spending. Furthermore, the demand for construction equipment is expected to be high in
developing and emerging countries as a result of an increase in the construction of highways, oil refineries,
power plants, office buildings and other infrastructure projects. Developing markets in Asia-Pacific, Latin
America, and the Middle East are expected to drive this market growth. China is expected to emerge as the
fastest growing market for construction and mining machinery worldwide. As a result, Doosan could capitalize
on the growing market to enhance its top-line performance.
Opportunity - Expansion of Facilities
The company is focused on expanding its facilities and plants to enhance its presence in North America and
the emerging markets of Central and South America. In this direction, in March 2, 2011, the company
announced the investment of US$54.1 million (KRW60,100 million) to build a new factory which will be
operational by December 31, 2018. Also, in October 2010, the company announced the investment of US$0.1
billion (KRW116.9 billion) in a new engine factory to be operational by January 31, 2015. Prior to this, the
company began construction work at its joint venture facility located in Xuzhou, China in 2010. This facility is
an equally-owned joint venture with the XCMG Group, based in China. Both companies planned to jointly
invest CNY680 million for next four years to produce up to 50,000 diesel engine units with displacements of six
and eight liters by 2013. Also, through this facility, the companies will manufacture diesel engines and expect
to have an annual production capacity of 100,000 diesel engine units. These initiatives made by the company
will further enhance its production base and meet the growing diverse needs of its customers.
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Opportunity - Focus on Emerging Markets
The company‘s focus on emerging markets will provide growth opportunities for the company. With various
massive stimulus packages announced by respective governments to bring their economies back on track,
global output is expected to expand by 3.2% in 2011. The Euro zone, Japan and the US are expected to grow
by 1.7%, 1.8% and 2.7% in 2011, respectively. China is expected to report GDP growth of 9% during 2011
while India, Russia and Brazil are expected to grow at a GDP of 8%, 3% and 3.9% in 2011, respectively.
Despite GDP growth below 2007 levels, the recovering global economy offers ample growth opportunities for
the company, as companies across different sectors are pursuing their growth plans, more aggressively, than
before. In order to capitalize on emerging markets, the company is focused on expanding its operation to these
regions. For example, in 2010, the company announced plans to establish 20,000 units of production systems
annually to 2015. This is to target customers in mature North American markets and customers in emerging
South and Central American markets. These initiatives are anticipated to further enhance the company‘s top-
line performance.
15.5.4 Doosan Infracore Co. Ltd – Threats
Threat - Foreign Currency Fluctuations
Fluctuations in foreign currency exchange rates might affect the company‘s business as Doosan has
operations across North America, Europe and Asia-Pacific. The company operates in many parts of the world
and generates revenues in several currencies. A major portion of its revenues are generated from the British
pound, Korean won, the Euro and the US dollar. In addition, the company faces risks from emerging market
currencies. Any adverse movements in currency exchange rates may adversely affect its cash flow and results
of operations. The company translates the financial statements of its international operations in Korean Won
using month-end rates of exchange for assets and liabilities, and average rates of exchange for revenues,
costs, and expenses. During FY2009, due to fluctuations in foreign currency exchange rates, the company
recorded currency translation loss of US$0.02 billion (KRW24 billion). Any further fluctuations in currency
exchange rates may enable the company to incur losses in the future, which may affect its results of
operations.
Threat - Volatility of Raw Material Prices
Price volatility in raw materials may affect the company‘s business and result of operations. The company uses
various raw materials such as steel, copper and aluminum in manufacturing of products. The prices of these
raw materials account for a significant share of the company's total cost of goods sold. According to the US
Bureau of Labor Statics, producer price indexes for core raw material inputs such as rolled steel, and primary
aluminum, increased by 95.8%, and 90%, respectively in the last decade. Also, worldwide composite steel
price was US$642 (KRW740,572.7) per ton in September 2009, rising to US$748 (KRW862,847.9) per ton in
September 2010. Worldwide composite steel price increased by 10.5% in January 2011 compared with
December 2010. Due to the increase in the commodity price, the cost of raw materials and energy may also
increase drastically. The company may witness loss in sales volume to the extent price increases are taken
into account. In addition, the continuous supply of raw materials may be affected by weather conditions,
national emergencies, strikes, governmental controls, natural disasters or supply shortages. These pricing
fluctuations and non-availability of these raw materials may have an adverse effect on the product cost and
further operations of the company.
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Threat - Grey Market Heavy Equipment Sales
Parallel imports or grey market sales may have a negative impact on the company‘s performance. Grey
market heavy equipment sales were a more serious problem in the 1990s, when the US construction market
was growing. The issue may become more prominent again with the recovery of the US construction industry
from the current global economic downturn whilst other markets remain depressed. For instance, Chris
Johnson Equipment Inc., Michigan, illegally imported 29 Hyundai-branded wheel loaders and excavators and
sold them to US customers violating federal fair competition and other laws. Gray market importers pose a
problem for the company and other legitimate dealers by offering equipment manufactured for other markets,
which may adversely affect the company‘s customer base.
15.6 Doosan Infracore Co., Ltd – Company Information
15.6.1 Doosan Infracore Co. Ltd - Key Competitors
The following companies are the main competitors of Doosan Infracore Co. Ltd:
Hyundai Heavy Industries Co., Ltd.
Caterpillar Inc.
Hitachi Construction Machinery Co.,Ltd.
Sumitomo Heavy Industries, Ltd.
15.6.2 Doosan Infracore Co. Ltd - Key Employees
Table 189: Doosan Infracore Co. Ltd., Key Employees
Name Job Title Board Level
Yongsung Kim President, Director, Co-Chief Executive Officer Executive Board
Sungchul Choe Co-Chief Executive Officer, Vice Chairman Executive Board
Ogyoo Lee Director, Vice President Executive Board
Keysun Han President Senior Management
Anthony Helsham President Senior Management
Yongmaan Park Chief Executive Officer - Doosan Corporation, Chairman
Executive Board
Jeongwon Park Director, Chairman - Doosan Engineering and Construction Co., Ltd
Executive Board
Jaekyung Lee Vice Chairman, Vice Chairman - Doosan Corporation
Executive Board
Sunghee Lee Director Executive Board
MyungJae Lee Director Non Executive Board
Yang Ho Director Non Executive Board
Gilwon Kim Director Non Executive Board
Youngtak Lee Director Non Executive Board
Jonghyun Yoon Director Non Executive Board
Yongseok Yoon Director Non Executive Board
Jongseok Kim Director Non Executive Board
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
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16 Company Profile: BEML Limited
16.1 BEML Limited - Company Overview BEML Limited (BEML) is a leading manufacturer of heavy earthmoving equipments. It is a public sector
undertaking under the Indian Ministry of Defense. The company also manufactures rail coaches and metro
coaches, diesel engines and generator sets, hydraulic pumps and valves, powerline aggregates, defense
transport vehicles and heavy duty multi-utility trucks. These products find application across coal, mining,
steel, limestone, power, irrigation, construction, road building, aviation, defense, metro and railway segments.
BEML exports its products to 52 countries worldwide and has manufacturing facilities in India, China and
Indonesia. The company also operates through a joint venture and is headquartered in Bangalore, India.
Table 190: BEML Limited, Key Facts
Corporate Address Beml Soudha, Bangalore, , 560027, India
Telephone + 91 80 22963240
Fax + 91 80 22963278
URL www.bemlindia.com
Industry Construction
Ticker Symbol, Exchange 500048 (Bombay Stock Exchange)
No. of Employees 12,052
Fiscal Year End March
Revenue (INR) 29,662.21
Revenue (US$ Million) 607.21
Locations India, Indonesia
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
16.2 BEML Limited - Business Description BEML Limited (BEML) is a leading manufacturer and supplier of heavy earthmoving equipments, defense
transport vehicles, generator sets, powerline and hydraulic accessories. It is operative under the administrative
control of Ministry of Defense and is conferred with Mini-Ratna Category-1 Status. BEML is into design and
development, testing, manufacturing, and supplying a range of products for the defense, metro rail, and
mining and construction sectors.
Its operations are segregated across Mining and Construction, Rail and Metro, Defense, International
Business, Technology and trading division.
In the Mining and Construction division, the company offers a wide range of mining machinery applicable
across opencast and underground mines. Its product portfolio includes electric rope shovels, hydraulic
excavators, bulldozers, wheel loaders, wheel dozers, dump trucks, motor graders, pipe layers, tire handlers,
water sprinklers and backhoe loaders. In addition, the company also manufactures walking draglines for
operations in the opencast mines. BEML has ventured into underground mining with products such as side
discharge loader, load haul dumper, winch, winder, granby car and skips. In India, the company maintains a
marketing network for sales and service of construction equipments across 22 states in India, the National
Capital Region (NCR) and two Union Territories.
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In this division, the company has formed a joint venture with Midwest Granite Limited and Pt. Sumber Mitra
Jaya in Indonesia to form BEML-Midwest Ltd. This subsidiary would concentrate on bidding for contract mining
projects across India and overseas.
In the Rail and Metro division, BEML supplies products for the Indian Railways such as overhead electric
inspection cars, postal vans, integral rail coaches, AC and DC electric multiple units, broad-gauge rail bus, D-
Emus, utility track vehicles, track laying equipment, spoil disposal units and treasury vans. Currently, it has
also forayed into production of high-tech Metro Trains deployed for intra-city commuting. The company is also
expanding its manufacturing capabilities to meet the greater needs of metro projects coming up in the country.
The company through its Defense division operates as the leading defense equipment manufacturer and
supplier in India. It is engaged in the manufacturing and supply of state-of-the-art military equipments to the
Indian Army and other defense forces. BEML manufactures a wide range of vehicles used for all-terrain
operations including bridge layer, field artillery tractor, medium and heavy recovery vehicle, pontoon
mainstream bridge systems, crash fire tenders and mobile mast vehicles. These vehicles are marketed under
the brand name, Tatra.
BEML also supplies engineering mine ploughs, tank transportation trailers, weapon loading equipment,
armored recovery vehicle, aircraft weapon loading trolley and aircraft towing tractors and milrail coaches and
wagons. BEML also supplies ground support vehicles for Integrated Guided Missile Development Project in
India. The company has also created a world class test track at its KGF Complex facility to test defense
equipment and vehicles.
BEML‘s International division is engaged in distributing its products worldwide. The company has ‗Star
Exporter‘ status in this segment and has its operations in 52 countries worldwide. BEML maintains an
international office and warehouse in Malaysia and an international procurement office in China. In addition,
the company has its marketing network in Middle East, Africa and Far East countries, and dealers and
distributors operating from Syria, Tunisia, Sri Lanka and UAE along with representatives in Morocco and
Suriname. It also has plans to set up assembly operations in partnership with local players across Morocco,
Suriname and Indonesia.
BEML under Technology division offers services and solutions in areas of CAD, CAE, Testing and Technical
Documentation. The company has been accredited with Centre for Military Airworthiness and Certification
(CEMILAC) and ISO 9001-2000. Furthermore, presence of a National Accreditation Board for Testing and
Calibration Laboratories (NABL) certified test facility and strategic alliances with global partners have enabled
the company to become a global player in this segment. The company operates in four sectors namely,
aerospace, automotive and mining, defense, and rail and metro.
Its Trading division deals with products and commodities such as in iron ore, coal, steel billets for both captive
in-house requirements and also for customers within the country and abroad. This division has been awarded
the status of ‗Two Star Export House‘.
In June 2010, the company signed a MOU with Karnataka Government for the establishment of a
Manufacturing Complex in Bangalore. This Manufacturing Complex will be used for designing and
manufacturing aircraft components, sub-assemblies and MRO activities pertaining to aerospace applications
for the company‘s newly established Aerospace division.
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16.3 BEML Limited - Major Products Services and Brands
The company‘s main products, services and brands include the following:
Table 191: BEML Limited , Major Products Services and Brands
Products Services Brands
Crawler dozers CAD Tatra
Wheel dozers CAE
Excavators Testing
Dump trucks Technical Documentation
Loaders
Backhoe loaders
Pipe layers
Walking dragline
Rope shovel
Sprinklers
Graders
Tyre handler
C-crane
Rail and Metro
Stainless steel metro cars
Passenger coaches
AC electric multiple units
Stainless steel AC Emus
DC electric multiple units
Rail bus
8-wheeler OHE
4-wheeler OHE
Treasury Vans
Spoil disposal units
Track laying equipment
Sky bus
Utility track vehicle (UTV)
Defense:
MODELS OF BEML – TATRA VEHICLES WITH NON EURO VERSION
BEML - TATRA T815 VVNC 8x8 VEHICLE
BEML - TATRA T815 VVL 8x8 VEHICLE
BEML - TATRA T815 VTI 8x8 - TANK TRANSPORTER
30 M TELESCOPIC MOBILE MAST ON BEML TATRA T815 VVNC 8X8 CHASSIS
BEML - TATRA T815 VVNC 8X8 CHASSIS FOR 15 M BRIDGE LAYING
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Table 191: BEML Limited , Major Products Services and Brands
ROLE
BEML - TATRA T815 VVNC 6x6 HIGH MOBILITY VEHICLE
BEML - TATRA T815 VVNC 6x6 FIELD ARTILLERY TRACTOR
BEML - TATRA T815 VI 4x4 HIGH MOBILITY VEHICLE
BEML - TATRA CRASH FIRE TENDER
Prithvi missile launcher
Oxidiser carrier
Warhead carrier
Fuel carrier vehicle
Missile transporter
10t mobile crane
Ammunition loader
Backhoe loader transporter
Pontoon bridge set
Pontoon truck
Midstream pontoon
Shore pontoon
Truck mounted crane
Pavement laying truck
Dolly
Motor tug launch (boat)
Beml truck 4x2 for mounting rapiscan scanner unit
Hrv av 15 - heavy recovery vehicle
Medium recovery vehicle
Light recovery vehicle
Models OF BEML – TATRA VEHICLES WITH BHARAT STAGE – II (EURO – II) Version
BEML - TATRA T816 6MWR 8T 10x10 VEHICLE
BEML - TATRA T815 27ET96 28 300 8x8.1R / 50T - TANK TRANSPORTER
BEML - TATRA T815 27ER96 28 300 8x8.1R / 50T VEHICLE
BEML - TATRA T815 27ER96 30 300 8x8.1R / 50T - 4150 VEHICLE
BEML - TATRA T815 26RR36 22 255 6x6.1R / 50T HIGH MOBILITY VEHICLE (RHD)
BEML - TATRA T815 25RR45 17 230 4x4.1 HIGH MOBILITY VEHICLE
PINAKA PROJECT (MULTI BARREL ROCKET LAUNCHER)
Engineering mine plough
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Table 191: BEML Limited , Major Products Services and Brands
Mine protected vehicle
Other Defense Products:
BS42 SNOW CUTTER
Armoured recovery vehicle wzt – 3
Aircraft towing tractor
Self-propelled 155 mm gun – bhim t6
50 tonne trailer - for tank transportation
65 ton trailer
20 tonne low deck full trailer
Wagons
BFAT
BOMN
BRSTN
BWTB
MILRAIL Coach
Hydraulic Aggregates
Hydraulic pump
Hydraulic cylinder
Hydro-pneumatic suspension
Control valve
Powerline Aggregates:
Transmission
Axle
Bevel gear
Aggregates for BMP:
Transmission
Ejector and air cleaner assembly
Final drive
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
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16.4 BEML Limited - History
Table 192: BEML Limited , History
Year Event type Description
2009 Contracts/Agreements The company won an order of US$ 387.41 million (INR 1672.50 crores) from Bangalore Metro Rail Corporation Limited (BMRCL) for the supply of 150 Metro Coaches. BEML is also expected to get an additional order for 63 Metro coaches.
2009
Contracts/Agreements
BEML and Servo Controls formed a MoU to jointly design, develop and manufacture Gear pumps, Servo Actuators, Servo Valves and other hydraulic aggregates for Indian as well as global markets.
2009
Contracts/Agreements
The company entered into an agreement with Sumber Mitra Jaya (SMJ) of Indonesia to bid for upcoming Contract Mining businesses in India.
2009
Contracts/Agreements
BEML signed a Memorandum of Agreement with M/s. NFM Technologies, France for the manufacturing of Tunnel Boring Machines (TBMs) in India. BEML will be the only Indian company to manufacture Tunnel Boring Machines.
2009
Corporate Awards
The company was awarded the prestigious 'BEST PSU' award instituted by the Indian Institute of Planning and Management.
2009
Corporate Changes/Expansions
BEML established its Assembly Unit ―BEML BRASIL INDUSTRIAL LTDA‖ at Rio De Janeiro, Brazil.
2009
Incorporation/Establishment
The company forayed in Indonesia by establishing its subsidiary PT. BEML Indonesia in August 2009. The company was established to provide 24hour 7 days a week 7 support and after sales services, spares and repair support and to expand its market base.
2008
Contracts/Agreements
The company signed a MoU partnership with SAP India to market the SAP-ERP products and involve in its implementations in Defense, Rail and Metro and Mining and Construction sectors within the Indian Territory.
2008
Contracts/Agreements
BEML Limited signed a Memorandum of Understanding (MoU) with Eurocopter, France for its Aerospace business.
2007
New Products/Services
BEML constructed two new Hangers namely Under Frame Hanger and Shell Hanger in October 2007.
2007
Corporate Awards
The company was acknowledged as the ―The Largest and Most Profitable Construction Equipment Company‖ by Construction World - NICMAR, 2007.
1991 Incorporation/Establishment BEML established its engine division in the year 1991 in Mysore.
1987
Corporate Changes/Expansions
The company established its Hydraulics and Powerline (HandP) Division across an area covering 14.5 acres.
1986
Corporate Changes/Expansions
The company established its Truck Division at Mysore, in 1986 with a total area of 600 acres.
1964
Incorporation/Establishment
BEML Limited (formerly Bharat Earth Movers Limited) was established in May 1964 as a Public Sector Undertaking.
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
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16.5 BEML Limited - SWOT Analysis BEML Limited (BEML) is a leading manufacturer and supplier of heavy earthmoving equipments. It also
manufactures rail coaches and metro coaches and heavy duty multi-utility trucks. Strong product support
initiatives, presence in Middle East, Africa and Far East countries, wide range of construction equipment and
presence across the niche business segments are the strengths for the company. BEML could use strategic
alliances with foreign partners to capitalize on the growing construction sector in India. On the other hand,
volatile raw material prices coupled with stringent environmental norms could be challenging for the company.
16.5.1 BEML Limited – Strengths
Strength – Niche Business Segments
BEML has diversified its products and services portfolio to cater to niche segments. The Mining and
Construction division offers a wide range of mining machineries which are applicable across opencast and
underground mines. The product portfolio includes electric rope shovels, hydraulic excavators, bulldozers,
wheel loaders, wheel dozers, dump trucks, motor graders, pipe layers, tire handlers, water sprinklers and
backhoe loaders. In addition, the company also manufactures Walking Draglines for operations in the
opencast mines. BEML products such as side discharge loader, load haul dumper, winch, winder, granby car,
and skips are used in underground mining applications.
Moreover, the company provides overhead electric inspection cars, postal vans, integral rail coaches, AC and
DC electric multiple units, broad-gauge rail bus, D-Emus, utility track vehicles, track laying equipment, spoil
disposal units and treasury vans for the Indian Railways. BEML also manufactures wide range of vehicles
used for all terrain operations including bridge layer, field artillery tractor, medium and heavy recovery vehicle,
pontoon mainstream bridge systems, crash fire tenders, and mobile mast vehicles in the defense segment.
This strong product portfolio has enabled the company to cater to niche business segments creating a
competitive edge over its peers.
Strength - Strong Product Support Facilities
The strong product portfolio offered by BEML is complemented by the company‘s research and development
(RandD) initiatives and testing facilities. BEML is a Public Sector Undertaking (PSU) company (Mini Ratna
Category-1) under the Indian Ministry of Defense. Being an undertaking of the Indian government has enabled
the company to operate across industries where the entry barriers are very high. It operates as the leading
defense equipment manufacturer and supplier in India. BEML supplies engineering mine ploughs, tank
transportation trailers, weapon loading equipments, armored recovery vehicle, aircraft weapon loading trolley
and aircraft towing tractors, rail coaches and wagons. The company also plays a pivotal role in the country‘s
Integrated Guided Missile Development Project by supplying ground support vehicles for defense purposes.
BEML has also created a world class test track at its KGF Complex to test defense equipment and vehicles. In
the aerospace segment, the company has completed several projects for HAL and Defense Research and
Development Organization (DRDO) DRDO establishments recently. The aerospace division is also registered
with Base Repair Depot of the India Air Force to offer total solutions on customized design and development of
Ground Support Equipment (GSE) and Ground Handling Equipment (GHE). For instance, BEML‘s Technology
Division CEMILAC is ISO 9001-2000 certified and offers end-to-end services and solutions in areas of CAD,
CAE, Testing and Technical Documentation.
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Strength - Wide Distribution Network
The company has diversified geographic presence through joint ventures, partnerships and distributor
networks that has enabled the company to create awareness about its service and product offerings worldwide
and create a strong market position. BEML distributes its products worldwide through its International division.
It operates as an export House with ‗Star Exporter‘ status and has operations in 52 countries worldwide. The
company also maintains an international office and warehouse in Malaysia and an international procurement
office in China. Furthermore, BEML has its marketing network in Middle East, Africa and Far East countries
and dealers and distributors operating from Syria, Tunisia, Sri Lanka and UAE along with representatives in
Morocco and Suriname. The company has plans to set up assembly operations plans plants in partnership
with local players across Morocco, Suriname and Indonesia. Through its Technology Division, BEML has also
expanded its business in Engineering Services Outsourcing (ESO) of non-BEML products. Being a Two-Star
Export House through the Indian Ministry of Commerce, it also deals with products and commodities such as in
iron ore, coal, steel billets for both captive in-house requirements and also for customers within the country and
abroad.
16.5.2 BEML Limited – Weaknesses
Weakness - Declining Market Share in Sector
Between 2006 and 2010, the company recorded an increase in revenue at a CAGR of 8.75%. This was below
the construction equipment sector average of 17.17%, which indicates that the company has underperformed
in relation to the average growth in the sector and has lost market share during the period. The company's
underperformance could be attributed to a weak competitive position or inferior products and services offering
or lack of innovative products and services. However the company‘s revenue increased by 2.31% between
2009 and 2010, indicating the company is improving its market share
Weakness - Declining Operating Margins
In FY2010, the company maintained low margins compared with FY2009, affecting BEML‘s profitability and
performance. The operating margin for FY2010 was 10.87% compared with operating margin of 113.46%
compared with the previous year. This was principally due to operating costs which increased to 89.13% of
total sales in 2010, compared with 86.54% of total sales in 2009. In addition, the net margins have also
declined to 7.57% in 2010 from 9.32% in 2010. Declining margins have affected the profitability of the
company decreasing its return on equity (ROE) of shareholders. The ROE of the company decreased to
10.99% in FY2010 compared with 14.07% in FY2009.
16.5.3 BEML Limited – Opportunities
Opportunity - Strategic Alliances
The strategic alliances made by the company provide opportunities to increase its geographic presence as well
as products and services portfolio. In 2010, the company signed a Memorandum of Agreement (MOA) with
Kamaz Vectra Motors Ltd., a subsidiary of Russian Federation company manufacturing commercial and heavy
vehicles for on road application. Through this strategic alliance the company will develop 4x4 Stallion Type of
Vehicles for on-road application catering to the needs of defense forces, paramilitary and police forces. BEML
is working with Kamaz Vectra to source chassis and vehicle to market BEML Tippers. Such alliances and
partnerships would contribute to growth in product offering and market presence. Earlier, it also signed a
Memorandum of Agreement with M/s. NFM Technologies, France (the second largest manufacturer of Tunnel
Boring Machines in the World) for the manufacture of Tunnel Boring Machines (TBMs) in India. This
establishment could lead to contracts for supplying TBMs to various projects in India and ASEAN countries.
The Bangalore Metro and the upcoming Metro projects of Chennai, Kolkata, and Mumbai would provide a
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promising market for the TBMs markets. In addition, it could also be applicable across Irrigation and
hydroelectric projects.
BEML has signed a MoU with Servo Controls to jointly design, develop and manufacture Gear pumps, Servo
Actuators, Servo Valves and other hydraulic aggregates for Indian as well as global markets. In April 2009,
BEML established its assembly unit ―BEML BRASIL INDUSTRIAL LTD‖ at Rio De Janeiro, Brazil to assemble
its products related to Mining and Construction, Rail and Metro, and Defense segments. This could allow the
company to have a local presence in Latin American countries.
Opportunity - Railway Expansion Initiatives in China
The company could capitalize on the railway expansion initiatives in China. The Chinese government has
plans to increase national spending on railway construction by investing EUR78 billion each year between
2010 and 2012 for expanding the country‘s railway network. Total Investments worth US$17 billion
(RNB116.52 billion) has been planned in the Jiangxi province of china. This will include building of new railway
lines over the next three years, according to state news agency Xinhua. On the other hand, almost 14 projects
are to be completed by 2012, as a part of a longer term project identified by the state officials. This will expand
the railway network across provinces and major tourist and industrial areas in China by 2020. The company‘s
Rail and Metro division supplies various products for the railway sector. It also has presence in China along
with its international procurement office in China. The company can take leverage on its experience in
supplying railway equipments to railway projects in China to enhance its revenue generating capacity and
increase market presence.
Opportunity - Construction Boom in India
The development of the infrastructure and real estate market in India could provide opportunity to the
company. According to the Planning Commission, the road freight industry in India is expected to grow at a
compounded annual growth rate (CAGR) of 9.9 % between 2007 and 2012. Furthermore, according to the
annual review of the roads and highways sector report published by Crisil Research in August 2009, around
US$107 billion investment is expected in the sector between 2009 and 2014. The Government of India has
also launched various programs and projects including National Highway Development Programme (NHDP)
and Bharat Nirman Programme for the development of road infrastructure in India. Increasing construction
activities in domestic market might increase the demand for construction equipments, which in turn might
increase demand for the company‘s products.
Opportunity - Global Demand for Construction Equipment
Aside from the Indian market, increasing global demand for construction equipment provides an opportunity for
the company. According to a survey by Association for Equipment Manufacturers (AEM), the global
construction equipment industry is expected to grow during 2010-12. Construction equipment market in the US
is projected to grow at 5%, 15% and 14% in 2010, 2011 and 2012, respectively. The global demand for
construction equipment is expected to grow at 7% in 2010 and 13% in 2011 and 2012. Major factors driving
such demand include growth in economies worldwide after the recession supported by favorable consumer
confidence level, economic interest rates and availability of credit facilities. Such conditions coupled with public
spending in infrastructure facilities could create favorable conditions for the sector to grow. The company has
presence in 52 countries in the world. Growth in this sector could benefit the company to increase its
performance and market presence.
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16.5.4 BEML Limited – Threats
Threat - Volatile Raw Material Prices
The company has recorded an increase in operational costs for the FY 2009 and this resulted in reduction of
profit margins of the company. The increase in operational costs is primarily due to increase in volatility in input
costs, especially in parts, raw materials and material components such as steel materials. Steel prices in turn
are largely affected by the oil price, which are highly volatile. The global steel prices have increased by about
US$80 to US$100 per ton during the first quarter of 2010. In tune with international market, the prices in India
have also increased by about US$76 (INR 3,500) per ton to US$100.3 (INR4,600) per ton. India steel
producers like SAIL, JSW Steel and Tata Steel are also expected to increase prices owing to increasing input
prices in recent quarters. It would be difficult for the company to pass off the effect of volatile input costs to the
customers on a real time basis as competition makes this difficult. High input cost volatility hinders effective
pricing strategies to secure and retain business.
Threat - Intense Competition
The major geographic markets across which the company operates are highly competitive. In recent years,
competition has intensified considerably due to highly maturing and saturating markets. India‘s excavator
market is projected to continue to expand during the forecast period leading to the influx of new competitors
such as Kobelco entering the sector. BEML currently competes with major global players such as Caterpillar
Inc., Terex Corporation, and Volvo Construction Equipment NV, and local competitors like Telcon for several
products in its portfolio operating in similar markets. As some of the competitors are market leaders in their
respective home countries, the company needs to focus on select industry sectors. Competition is based
largely on price, product and service quality, brand reputation, customer service and product features. In
addition, competition has further increased during the economic downturn worldwide.
Threat - Stringent Environmental Norms
The company's facilities and operations are impacted by environmental laws and regulations governing
emissions, discharges into water and air, and the generation, transportation, storage, handling, treatment and
disposal of non-hazardous and hazardous waste materials. With engines subject to extensive regulations, the
company needs to improve product technology and has to make substantial investments in R&D. Furthermore,
the company has to comply with the emission and noise related regulations of various regulatory agencies in
the countries of current or future operation. Revamping products or certain manufacturing processes to comply
with the regulations could pose a challenge for the company. Currently, the company provides tier II compliant
engines in its equipments.
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16.6 BEML Limited – Company Information
16.6.1 BEML Limited - Key Competitors
The following companies are the major competitors of BEML Limited:
Texmaco Limited
Telco Construction Equipment Company Limited
16.6.2 BEML Limited - Key Employees
Table 193: BEML Limited., Key Employees
Name Job Title Board Level
V. R. S. Natrajan Chairman, Managing Director Executive Board
V. Mohan Director - Defense Executive Board
M. Poongavanam Director - Mining and Construction Executive Board
P. Dwarakanath Director - Metro and Railway Executive Board
M. Pitchiah Director - Finance Executive Board
M. Nellaiappan Director - Human Resources Executive Board
M B N Rao Director Non Executive Board
J P Batra Director - Independent Non Executive Board
J P Singh Director - Independent Non Executive Board
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
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17 Company Profile: Escorts Limited
17.1 Escorts Limited Company Overview
Escorts Limited (Escorts) is a leading engineering conglomerate operative across the agri-machinery,
construction and material handling equipment, railway equipment and auto components segment. Escorts‘ is
engaged in manufacturing of hydraulic mobile cranes, tractors, loaders, vibratory rollers and forklifts. In
addition, it also manufactures and supplies auto suspension products including shock absorbers and
telescopic front forks. The railway equipment portfolio comprises brakes, couplers, shock absorbers, rail
fastening systems, composite brake blocks and vulcanized rubber parts. Escorts has service outlets across 40
countries worldwide.
Escorts Construction Equipment Limited (ECEL), a manufacturing arm of Escorts Limited launched its backhoe
loader, DIG MAX, a 76HP, 8 ton operating weight backhoe loader in January 2010.
Table 194: Escorts Limited, Key Facts
Corporate Address 15/5 Mathura Road, Faridabad, , 121 003, India
Telephone + 91 129 2250222
Fax + 91 129 2250033
URL www.escortsgroup.com
Industry Construction
Ticker Symbol, Exchange 500495 (Bombay Stock Exchange)
No. of Employees 7,464
Fiscal Year End September
Revenue (US$ Million) 545.32
Revenue (INR Million) 26,639.09
Locations India, Poland
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
17.2 Escorts Limited - Major Products
The company‘s key products include the following
Table 195: Escorts Limited, Major Products
Products
Tractors:
Farmtrac
Dozers
Powertrac
Escort
Engines
Trailers
Lubricants
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Table 195: Escorts Limited, Major Products
ECEL
Hydraulic Mobile Cranes
Slew Cranes
Compactors
Forklifts
Articulated Boom Cranes
Railway Equipment
Auto Components
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
17.3 Escorts Limited – Company Information
17.3.1 Escorts Limited - Key Competitors
The following companies are the major competitors of Escorts Limited:
First Tractor Company Limited
Telco Construction Equipment Company Limited
BEML Limited
17.3.2 Escorts Limited - Key Employees
Table 196: Escorts Limited,, Key Employees
Name Job Title Board Level
Rajan Nanda Chairman, Managing Director Executive Board
Nikhil Nanda Joint Managing Director, Executive Director Executive Board
G B Mathur Senior Vice President Senior Management
Partha Dasgupta Group Head Human Resources and Employee Relations
Senior Management
O K Balraj Chief Financial Officer Senior Management
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
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18 Company Profile: Telco Construction Equipment Company Limited
18.1 Telco Construction Equipment Company Limited Company Overview
Telco Construction Equipment Company (Telcon) is India's leading provider of equipment and services in the
construction and earth-moving industries. It was set up in 1961 as a division of Tata Motors; and now has a
joint venture between Tata Motors and Hitachi Construction Machinery Co of Japan. The company
manufactures a range of equipment like excavators, loaders, compactors, cranes, dump trucks, and concrete
mixers and pumps for the construction, agriculture, infrastructure, and mining sectors. The company also
manufactures equipment spares and offers refurbishment and reconditioning services along with full
maintenance contracts to clients. The company has manufacturing facilities in countries such as India, Spain,
and China and operates through subsiadiaries, joint ventures, associates, and a network of distributors and
dealers across countries. Telcon is headquartered in Bangalore, India.
Table 197: Telco Construction Equipment Company Limited, Key Facts
Corporate Address Jubilee Building, Bangalore, , 560025, India
Telephone + 91 80 66953301
Fax + 91 80 66953309
URL www.telcon.co.in
Industry Construction
Ticker Symbol, Exchange N/A
No. of Employees N/A
Fiscal Year End March
Revenue (US$ Million) 496.52
Revenue (Local Currency) 21,430.00
Locations China, India, Thailand, Spain, Egypt
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
18.2 Telco Construction Equipment Company Limited - Business Description
Telco Construction Equipment Company Limited (Telcon) designs, manufactures and supply‘s construction
equipment. The products include hydraulic excavators, crawler cranes, wheel loaders, backhoe loaders, off-
highway dumpers, wheeled equipments, road making equipments, motor graders, skid steer loaders, cane
loaders, and truck loader cranes. Telcon products are used for agriculture, construction, infrastructure, and
mining applications. The equipments are sold in India, as well as in Asia, Africa, and the Middle East. The
company was established in 1961. As of March 30, 2010, Telco Construction Equipment Company Limited
operates as a subsidiary of Hitachi Construction Machinery Co. Ltd.
The company manufactures a range of construction equipment in India and has two manufacturing plants in
Jamshedpur in Jharkhand and in Dharwad in Karnataka. The Dharwad facility is the younger of the two
facilities and was established in 1999. The facility is spread over 118 acres and rolls out more than a thousand
machines with less than 50 workers. The facility in Jamshedpur is in operation since 1961 and is spread over
121,000 square meters.
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Another plant is being set up in Kharagpur spread over 60 hectares. The Kharagpur plant will produce
backhoe loaders, mini excavators, off-highway dump trucks, wheel loaders and large mining shovels. It will
also have a RandD centre in collaboration with HCM.
Telcon manufactures concrete pumps and concrete mixers through the Spanish company Serviplem S.A.,
acquired in 2008. It ranks first among truck-mounted concrete mixers in Spain with a 70% market share and is
the sixth largest company in the segment globally. Serviplem S.A. has presence in 40 countries, exporting
40% of the production. The subsidiary manufactures truck-mounted concrete mixers (since 1968) and tanks
for transporting bulk cement and powders (since 1990). It also sells ‗THEAM‘ conveyors mounted on
BARYVAL truck concrete-mixers in Spain. Serviplem S.A.has joint ventures and several technology transfer
agreements for concrete mixers of capacities between 3 and 15m3 mounted on trucks or semi-trailers. The
company has two manufacturing facilities in Zaragoza to manufacture truck-mounted concrete mixers and
tanks for transporting cement with 29 m3 capacity made of steel and 30-32 m3 capacity made of aluminum. It
also has a facility in Madrid, for mounting and after-sales center and a production center for the assembly and
manufacture of truck-mounted concrete mixers in Baotou, China.
The other subsidiary, COMOPLESA LEBRERO S.A (LEBRERO) is a leading manufacturer of vibratory
compactors for road construction since 1954. In addition, LEBRERO manufactures bitumen tanks and
auxiliary machinery for public works with production facilities in an area of more than 31 000 square meters.
Telcon acquired a controlling stake of 60% in the company in 2008. LEBRERO has a network of dealers
across four continents and has a centralized inventory center in Zaragoza that stocks 26000 spare parts.
In March 2010 Telco has sold 20% stake in Telco Construction Equipment Company Ltd to Hitachi
Construction Machinery Co. Ltd resulting in the company‘s shareholding being reduced to 40%.
18.3 Telco Construction Equipment Company Limited - Major Products, Services and Brands
The company‘s main products, services and brands include the following:
Table 198: Telco Construction Equipment Company Limited, Major Products Services and Brands
Products Services and Brands
Hydraulic Excavators Full Maintenance Contracts
Mini Excavator Specialized Reconditioning and Refurbishing Services
Dump Trucks
Crawler Cranes Baryval
Tire Mounted Cranes - Vehicles Lebrero
Rough Terrain TATA
Cargo Cranes
Pavers
Vibratory Compactors
Rammers
Backhoe Loader
Multi Utility Loader
Wheel Loaders
Hydraulic Filters
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Table 198: Telco Construction Equipment Company Limited, Major Products Services and Brands
Ground Engaging Tools
Hydraulic Pumps And Motors
Pins And Bushes
Transmission Components
Undercarriage Parts
Bulk Dry Tanks
Concrete Pumps,
Concrete residue Recyclers
Conveyor belts mounted on concrete mixers
Gravel spreaders
Bitumen spraying tanks
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
18.4 Telco Construction Equipment Company Limited - History
Table 199: Telco Construction Equipment Company Limited, History
Year Event type Description
2009
New Products/Services
Telcon sold its 5,000th TATA HITACHI EX70 machine in March 2009. Telcon also launched a number of new models which includes the TATA TWL 3034, India‘s first hydrostatic wheel loader; TATA-HITACHI ZAXIS 370MTH hydraulic excavator; and Telcon Serviplem transit mixer.
2008 Others Telcon sold its 10,000th EX 200LC hydraulic excavator.
2008
Contracts/Agreements
Telcon won an order for 16 TATA 315V backhoe loaders from Kolkata Metropolitan Development Authority (KMDA).
2008 Acquisitions/Mergers/Takeovers Telcon acquired a controlling stake of 60% in Comoplesa Lebrero S.A, Spain.
2008 Acquisitions/Mergers/Takeovers In March 2008, Telcon acquired a 79% stake in Serviplem S.A., Spain.
2007
New Products/Services
In June 2007, Telcon introduced the Hitachi's ZAXIS 50U, a 5 ton mini excavator, India's first zero tail swing excavator.
2007
Corporate Awards
In December SERVIPLEM, S.A. was awarded the international Swedish Steel Prize 2007 for design of new truck-mounted concrete mixer and its new semi-trailer mixer.
2007
Contracts/Agreements
SERVIPLEM, S.A. - BARYVAL signed a contract with its new official dealer TD AUTOBAN in Russia for dry bulk tanks.
2004
Contracts/Agreements
Telcon Eco Resurfaces Pvt Ltd (TERPL), a joint venture between Telcon, IVRCL Infrastructures and Projects Ltd and two Japan-based companies, GreenArm and Hitachi, was established.
2003
New Products/Services
The company started manufacturing the Euclid-Hitachi 35-tonne capacity dump-trucks ( EH-600 model).
2001
Contracts/Agreements
SERVIPLEM, S.A. signed a joint venture agreement with a Chinese firm for the assembly and manufacture of truck-mounted concrete mixers in Baotou, China.
1984 Contracts/Agreements The company entered into a technical collaboration with Hitachi Construction Machinery, Japan for manufacturing hydraulic excavators.
1962
Incorporation/Establishment
SERVIPLEM, S.A. was formed on April 1962 as Industrias LEBRERO S.R.C., in Milagro, Spain.
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
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18.5 Telco Construction Equipment Company Limited - SWOT Analysis
The company is a market leader in specific equipment markets in India and Spain. Telcon also has support
services and a strong focus on product innovation and development. The company could expand presence in
under-penetrated markets and increase its association with Hitachi in RandD and exports. The Indian
construction equipment industry, especially the ready-mix concrete business also offers opportunities for the
company. Compliance to environmental norms, volatility in raw material prices and increasing entry of foreign
players in India could pose challenges for Telcon.
18.5.1 Telco Construction Equipment Company Limited – Strengths
Strength – Market Leadership
Telcon has a strong presence in India and is a leading manufacturer of construction equipment. The company
has been a pioneer in hydraulic excavators and has sold excavators and construction equipment to both the
government and private sector. Telcon has established itself as the leader since 2004 in excavators and
crawler cranes and has captured over 66% market share in India. In 2008, the company sold its 10,000th EX
200LC hydraulic excavator and in 2009 sold its 5,000th TATA HITACHI EX70 machine in the month of March
and has a strong network of dealers across India. The company has also established a strong presence in
Spain after the acquisition of the Spanish company Serviplem S.A., in 2008. In Spain, Telcon is a leader
among truck-mounted concrete mixers in Spain, with a 70% market share and is the sixth largest company in
the segment globally. The other subsidiary, LEBRERO is a leading manufacturer of vibratory compactors for
road construction and helps complement the existing product line of the Telcon. Besides, Telcon has the
technology support of Hitachi, a global player in the equipment market.
Strength - Support Services
Telcon has made efforts to cater to the needs of customers. It offers new customized attachments to
agriculture and construction sector like the cane grab, clamshell, orange peel grab, rock breaker and crusher.
The company also has improved the quality of after-sales service to clients through in-house training of
mechanics of dealers. The company is setting up four operators‘ training schools at Dharwad (southern India),
Jamshedpur, Kharagpur (eastern India) and Chandigarh in northern India. Telcon also offers value added
service offerings such as Full Maintenance Contracts (FMC) and specialized reconditioning and refurbishing
services. It also facilitates sale and rental of used construction machinery improving goodwill. The company
also has realigned its Dealer Management System (DMS) with Channel Partners. It also plans to enhance the
customer support network through channel partners by locating customer touch points at every 100km (62.13
miles) across the country. These efforts have helped improve the company‘s relationships with clients and
created a competitive advantage.
Strength - Expansion of product portfolio
Regular expansion of product portfolio through overseas acquisitions launch of new products has helped
Telcon maintain its market leadership in India. Recently Telco has acquired 79% stake in SERVIPLEM S.A, a
European Construction Equipment Company based in Zaragoza, Spain Further Telcon has signed another
deal to acquire 60% stake in COMOPLESA LEBRERO S.A., a European Construction Equipment Company
based in Zaragoza, Spain. The company pioneered the development of hydraulic excavators in India. The
company‘s multi-utility loader has great utility in the agriculture sector. Telco indigenously developed the Motor
Grader TG14 that has applications in road construction and mine haul road maintenance. In 2009, the
company launched a number of new models which includes the TATA TWL 3034,Excon 2009, and TATA
315E, TATA-HITACHI ZAXIS 370MTH hydraulic excavator; and Telcon Serviplem transit mixer at the 9th
International Mining and Machinery Exhibition. The company also plans to set up a RandD center in
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collaboration with Hitachi at its new manufacturing facility in Kharagpur. The company also won the 2008 JRD
QV Award. It assembles 100% of products and manufactures more than 40% of components and aggregates
in-house. These efforts have helped the company retain customers and stave off competition from other major
players like JCB and BEML.
Strength - Hitachi provides strong technological support
Hitachi plays a very significant role in Telcon‘s operations. Telcon‘s operating strengthens from its capabilities
in indigenizing imported designs and its ability to introduce new models owing to its continuing access to new
products/ technology from Hitachi. Moreover, Hitachi remained a major raw material provider for Telcon,
supplying it with critical hydraulic components. Taking the relationship further, Hitachi now proposes to source
some components from Telcon‘s new manufacturing facility being set up at Kharagpur. Besides, Hitachi is also
planning to set up an R&D centre jointly with Telcon at Kharagpur to develop new products and also use the
centre as a global R&D hub. Hitachi holds a 60% of the share in Telco which will help to develop new
technology.
18.5.2 Telco Construction Equipment Company Limited – Weaknesses
Weakness - Product Range
Telcon has a limited range of products as compared to many other players in the market. This limits its ability
to become a global top 25 construction equipment player by 2012 as envisioned by the top management. The
company has significant presence only in select product lines in select markets in excavators, loaders,
compactors, and concrete mixers, primarily in the construction and earthmoving sectors. It is necessary for
Telcon to expand the product range and become a full line equipment manufacturer to become a global player.
Weakness - Corporate Administration
The company has a network of over 100 offices across India that manages sales for individual, private and
public customers. This requires the need to develop and operate an efficient information system to handle
orders, payments, financing and credit facilities. In 2009, a case was filed for fraud and deficiency of service
wherein the Secuderabad office of Telcon is alleged to have colluded with Magma Fincorp Ltd. and another
individual to collect post dated checks for the entire sale consideration amount without delivering the excavator
to the complainant. An efficient management system is necessary, especially with the company expanding its
product range and entering new markets.
18.5.3 Telco Construction Equipment Company Limited – Opportunities
Opportunity - Expand Presence in Under-Penetrated Markets
Telcon has the opportunity to expand into under penetrated markets. Currently the company exports
construction equipment to African, Asian and Middle Eastern countries. It could continue to pursue inorganic
growth strategy to achieve this objective. The company already has acquired couple of companies in Spain
and has various joint ventures and associates to support this objective. Some of them are Telcon Eco Road
Resurfaces (a joint venture with IVRCL, India, and Hitachi and Green Arm, Japan); Hitachi Construction, Japan
(hydraulic excavators and cranes); Lebrero, Spain (compactors); CESAN, Turkey (asphalt plants); Hitachi
Truck Manufacturing, USA (dumpers); Tadano, Japan (tyre-mounted cranes); Hitachi-Sumitomo, Japan
(crawler cranes); Berco (undercarriages); and Serviplem, Spain (concrete mixers and dry bulk tanks). The
acquisition of Serviplem gave Telcon the access to superior technology, a manufacturing base in Europe and
China, and a distribution network in Europe, the Middle East and China. The acquisition of Lebrero enables the
company to compensate the absence of Hitachi‘s presence in compaction equipment and leverage Lebrero‘s
technology and manufacturing base to provide compactors for distribution through Hitachi‘s network in Europe,
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the Middle East, Africa, CIS countries and South East Asia. Similar inorganic growth could help expand global
presence and increase its product range.
Opportunity - Ready-mix Concrete Business in India
The construction sector in India offers growth opportunities especially in the ready-mix concrete business.
According to today‘s concrete technology Global ready mix concrete market is estimated to reach US$105.2
billion by 2015 .This business is expected to drive demand for transit mixers and concrete pumps by about
30% by 2015 in India. Telcon, has the ability to introduce concrete mixers from Serviplem and tap this
opportunity. Global demand is also expected to grow with countries like China banning on-site concrete mixing
due to environmental pollution.
Opportunity - Product Innovation with Hitachi
The company can increase its relationship with Hitachi to produce newer equipment models, attachments and
undertake R&D for the global market. Telcon is currently planning to increase the export of components to
Hitachi‘s global manufacturing plants and has set up a joint development team. The two companies have
already agreed to make Telcon the sourcing base for 35-ton to 100-ton off-highway rigid dump trucks for global
markets. Telcon introduced the Hitachi's ZAXIS 50U, a 5 Tonne Mini Excavator which is India's first zero tail
swing Excavator. The company also plans to set up the RandD center at Kharagpur plant. This could help
launch new models with latest technology for global markets. Currently, BEML and Caterpillar lead in dumpers
and dozers, JCB India in backhoe loaders while LandT-Komatsu and Telcon lead in excavators.
Opportunity - Indian Construction Equipment Market
The Indian construction equipment industry is expected to grow with sustained investments in infrastructure
including roads, irrigation and urban infrastructure; and likely recovery in residential real estate and increasing
industrial investments from 2010-11 onwards. Construction accounts for 70% of demand for earthmoving
equipments and mining sector the rest.
18.5.4 Telco Construction Equipment Company Limited – Threats
Threat - Compliance to Environmental Norms
The company's facilities and operations are impacted by environmental laws and regulations governing
emissions, discharges into water and air, and the generation, transportation, storage, handling, treatment and
disposal of non-hazardous and hazardous waste materials. With engines subject to extensive regulations, the
company is faced with the challenge of improving product technology and has to make substantial investments
for research and development. Furthermore, the company has to comply with the emission and noise related
regulations of various regulatory agencies in the countries of current or future operation. Revamping products
or certain manufacturing processes to comply with the regulations could pose a challenge for the company.
Currently the company provides tier II compliant engines in equipment.
Threat - Volatile Raw Material Prices
In FY2009, the company has recorded an increase in operational costs which resulted in a reduction of profit
margins of the company. The increase in operational costs is primarily due to increase in volatility in input
costs, especially in parts, raw materials and material components such as steel materials. Steel prices in turn
are largely affected by the oil price, which are highly volatile reaching a high of US$145 per barrel in June 2008
to a low of US$30 per barrel. It would be difficult for the company to pass off the effect of volatile input costs to
the customers on real time basis as competition makes it difficult. High input cost volatility hinders effective
pricing strategies to secure and retain business.
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Threat - Competition from Foreign Players
The major geographic markets in which the company operates are highly competitive and in recent years,
competition has intensified considerably due to highly maturing and saturating markets. The construction
equipment industry is reported to produce volumes of 40,000-45,000 units per annum and has an estimated
turnover of US$2.6 billion to USD$3.1 billion (INR118.9-141.7 billion). The Indian market is relatively small as
compared to the global market that is estimated at US$75 billion (INR3428.5 billion). With an annual growth
rate of 37%, India‘s excavator market is projected to continue expanding for the foreseeable future leading to
more new players like Kobelco entering the sector. Telcon currently competes with major global players such
as Caterpillar Inc., Terex Corporation, Volvo Construction Equipment NV, and local players like Bharat Earth
Movers Ltd for several products in its portfolio operating in similar markets. As some of the players are market
leaders in their respective home countries, the company needs to focus on select industry sectors. Competition
is based largely on price, product and service quality, brand reputation, customer service and product features.
In addition, decreasing barriers to entry has further intensified competition. With the incremental capacities and
new entrants, the industry is expected to become more competitive and fragmented.
18.6 Telco Construction Equipment Company Limited – Company Information
18.6.1 Telco Construction Equipment Company Limited - Key Competitors
The following companies are the major competitors of Telco Construction Equipment Company Limited:
J C Bamford Excavators Ltd
BEML Limited
HERCULES HOISTS LIMITED
18.6.2 Telco Construction Equipment Company Limited - Key Employees
Table 200: Telco Construction Equipment Company Limited., Key Employees
Name Job Title Board Level
Ranaveer Sinha Managing Director Executive Board
K. C. Naveen Kumar Senior Management
P Ravishankar General Manager - Sales and Marketing
K Kimura Director - Operations Senior Management
A Krishnakumar General Manager - Sales Senior Management
M. Vijaykumar Chief Marketing Officer Senior Management
Source: Annual Report, Company Website, Primary and Secondary Research / © ICD Research
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19 Annual Review
Below is an extract of the most interesting and important activity in the global earthmoving equipment market
during the last 12 months. This includes details of major construction projects, contract tenders and awards,
financial deals and major company and industry events:
July 22, 2011: Hidromek, John Deere and ZF to develop drivetrain for backhoe loaders
Hidromek, a Turkish manufacturer of construction equipment, has partnered with John Deere and ZF to
develop a new drivetrain for its HMK 102B backhoe loaders. Hidromek has announced that the drivetrain
provides 5% efficiency gains compared to its previous backhoe loader. The drivetrain combines a heavy-duty
ZF electro hydraulic autoshift transmission with a 4.5 litre, 74kW JD4045HF280 engine from John Deere.
The engine complies with Stage IIIA/Tier 3 exhaust emission requirements, making the backhoe loader
suitable for sale in Turkey, Africa, Latin America and Asia. Hidromek plans to develop a Stage IIIB/Interim Tier
4 version to address forthcoming emissions requirements in Europe and the US.
July 11, 2011: Komatsu unveils new D65-17 crawler dozer
Komatsu America Corporation, a manufacturer of construction equipment, launched its new line of D65-17
crawler dozers. The new D65-17 is powered with the fuel efficient and larger displacement, 8.9 Liter, EPA Tier
4 Interim and EU Stage 3B emission certified Komatsu SAA6D114E-5 engines. The dozers are featured with a
standard (EX), low ground pressure (PX) and a wide (WX) track model, which will provide customers flotation
and weight distribution options that best match their applications.
The new line of equipment is available with an operating weight ranging from 44,355 pounds to 49,315
pounds, depending on the version. The dozer is primarily developed for heavy dozing and finishing operations
and combines the revolutionary SIGMADOZER blade with a new highly efficient automatic transmission with
torque converter lock-up to achieve exceptional productivity and fuel economy. The equipment is also fitted
with new Komatsu 6-way Power Angle Tilt (PAT) blade, creating a balanced and agile tractor for light and
medium dozing operations. The blade also provides precise grade cutting required for site prep, golf course or
house pad applications.
July 7, 2011: Volvo Construction Equipment unveils new EC250D and EC300D excavators
Volvo Construction Equipment launched new EC250D and EC300D heavy duty excavators, which offer
improved cycle times and greater fuel efficiency. The new EC250D excavator weighs 54,230 to 61,730
pounds and has a maximum power of 202hp, while EC300D excavator weighs 66,140 to 73,630 pounds and
includes a maximum power 227hp. The two excavators are equipped with Tier 4i certified Volvo D8H engines,
delivering lower emissions and high fuel efficiency.
The engines feature a waste-gate turbo, externally cooled exhaust gas re-circulation (EGR) and diesel
particulate filters (DPF) with partial fuel burner and active regeneration. The machines are installed with the
latest generation care cab and offer operators enhanced visibility, ideally placed controls and monitors, and a
quieter, safer and more comfortably spacious place to spend their days. Operators also are in for less of a
shock with these new machines, due to the cab being ROPS protected and mounted on dampened cab
mounts that iron out vibrations.
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June 20, 2011: LiuGong unveils new 766A backhoe loader
China-based construction equipment manufacturer LiuGong has launched a new model midsize backhoe
loader 766A, which features a Tier III Perkins engine that delivers 93 net hp to the Italian-manufactured 4-
wheel drive. The new LiuGong machine features a four-speed power shuttle Carraro transmission and
provides travel speeds up to 23.6 miles per hour. The backhoe has a rear axle differential lock system and
multiple wet-disc brakes and the four-wheel drive automatically engages when the service brake is applied.
The equipment also features a maximum dig depth of 14 feet six inches and a bucket digging force of 13,083
pounds. The 766A backhoe also exhibits capabilities for utility and commercial construction applications. The
766A backhoe‘s loading height is 11 feet six inches and comes equipped with a 24 inches wide, 0.27 cubic
yard bucket.
June 9, 2011: Terex unveils new twin drive excavator
Terex showcased its new TC16 Twin Drive mini excavator at the International Rental Exhibition (IRE) in
Amsterdam. The twin drive machine is powered by both a diesel and an electric engine. The diesel engine
produces 13.1KW and can drive the excavator from trailer to project site. The electrical system can be
switched on at the site to produce 11KW for a safe and quiet working environment on jobs such as renovation
on buildings, demolition works and green houses with no emissions.
Terex also launched a prototype of the dual engine crawler excavator, which weighs 1.9 tonnes and can dig to
2.2m, at Bauma exhibition held in 2010 in China.
June 9, 2011: Bobcat unveils new rotary grinder attachments for loaders, excavators
Bobcat, manufacturer of compact construction and utility equipments, launched a new range of rotary grinder
attachments, RG20, RG40 and RG60, for its compact loader and excavator range. All the new rotary grinders
feature a double drum driven by an integrated high-torque hydraulic motor.
The RG20 grinder has a standard cutting width of 565mm and is suitable for use on Bobcat E32, E35, E45,
E50, E55W and E60 mini-excavators. The RG40 grinder has a standard cutting width of 625mm and is used
for the E80 excavator and on the Bobcat S205H, S630, S630H, S650, S650H, T190H, T650 and T650H
compact loaders. The largest model, the RG60 grinder, cuts to a width of 850mm and can be used on the
Bobcat S770H, S850H, T770H, T870H and A770H compact loaders.
Bobcat states that the design of new grinding attachments allows them to be used for applications requiring
precise removal of material, without damaging adjacent structures. They can also be used for less precise
work such as the demolition of walls and other structures; for digging trenches in hard and rocky ground; and
for preparing asphalt or concrete surfaces for repair.
June 6, 2011: JCB introduces new TM180 wheeled loader
JCB launched TM180, a new telescopic boom wheeled loader, which will be available in the market from
September 2011. The TM180 model has a lifting capacity of 1.8 tonnes with pallet forks. The loader has a
maximum pallet loading height of 4534 mm, and maximum forward reach of 3674mm. The machine weighs
5.6 tonnes and is powered by a Tier IIIB compliant Deutz D2011 engine. The equipment produces 46kW of
power and 190Nm of torque.
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June 3, 2011: JCB Caterpillar unveils new Cat 966K and 972K wheel loaders
US-based construction equipment manufacturer Caterpillar has unveiled new 966K and 972K wheel loaders,
which feature new designs and engines certified to meet Tier 4 Interim emissions standards and Stage IIIB
regulations. The new 966K and 972K wheel loaders are equipped with a new operator station, new electro-
hydraulic steering with either joystick or steering wheel control, Performance Series Buckets and a more
efficient drive train. The new loaders will also offer high productivity and better fuel efficiency.
The new wheel loaders are powered by a new Cat C9.3 ACERT engine and at 1,800 rpm, deliver peak net
power of 267hp on the 966K and 288 horsepower on the 972K. The machine is designed to accommodate
buckets ranging in size from 3.25 to 13 cubic yards, the loaders work productively and economically in high-
hour, high-volume applications. The machines are also equipped with a Cat Fusion coupler and a variety of
work tools, making them ideal for construction, aggregates, forestry, industrial and other material-handling
applications.
May 31, 2011: Bobcat unveils new T750 compact track loader
Bobcat, a US-based manufacturer of construction equipment, added the T750 compact track loader to its M-
series loader line that includes the T630, T650, T770 and T870 compact track loaders. The new T750
compact track loaders have an operating weight of 10,327 pounds, a rated operating capacity of 3,325
pounds, and are powered by an 85hp turbo-diesel engine. An additional feature on the optional deluxe
instrumentation panel is its ability to monitor key loader functions, and the keyless start helps prevent theft.
The loader is also installed with a new five-inch, full-colour LCD screen that offers better readability and
interaction, easy to read virtual sweep gauges allow the operator to quickly read and understand the
machine‘s performance.
May 30, 2011: Gehl adds two new RT Series compact track loaders to its fleet
Gehl Company, a US-based construction equipment manufacturer, expanded its RT Series compact track
loaders range by adding two new models, RT175 and RT210. The RT Series compact track loaders comprise
powerful turbo-diesel engines which feature increased torque. The model RT175 engine produces up to 179
feet lbs of torque resulting in 11,840 pounds of tractive effort. The model RT210 engine produces 206 feet
pounds of torque resulting in up to 12,359 pounds of tractive effort.
In new RT Series track, an extra large operator‘s station is designed for optimal operator comfort resulting in
more productivity. The joystick controls are mounted directly to the suspension seat frame, allowing them to
move with the operator as the machine travels.
May 26, 2011: Volvo unveils new wheeled loaders, excavators and articulated haulers
Volvo Construction Equipment unveiled new wheeled loaders, excavators and articulated haulers compliant
with Europe's Stage IIIB and US Tier 4 Interim emissions regulations. Equipped with Volvo's new V-ACT
(Volvo Advanced Combustion Technology) diesel engines, the new machines are exhibited at the company's
Eskilstuna facility in Sweden. The technology has produced fuel savings of -15% on some machines, notably
the company's first 35 tonne wheeled loader, the L250G.
The company also displayed Volvo's new high lift wheeled loader - the L180G. The new wheeled loader is
fitted with a 246 kW Tier 4 Interim/Stage IIIB compliant engine that is married to drive train, hydraulics and the
lifting arm systems and has also demonstrated fuel efficiency savings of up to 15%.
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Further, the company exhibited two new models for its new generation of D-Series excavators - the Stage IIIB
/ Tier IV Interim-compliant EC380D and EC480D tracked excavators. The new machines weigh between 38
tons to 50,5 tons and have been designed for heavy digging and lifting operations.
May 16, 2011: Case Construction unveils new 1021F and 1121F wheel loaders
Case Construction Equipment expanded its new F Series wheel loader product line with the launch of 1021F
and 1121F wheel loaders. The new wheel loaders are specifically engineered for quarry, aggregate and truck-
loading applications.
The 1021F wheel loader features a 296hp engine, a 5.5 cubic yard bucket, dump height of 121 inches and an
operating weight of 53,500 pounds. The1121F is provided with a 320hp engine, a 6.25 cubic yard bucket,
dump height of 126 inches and an operating weight of 60,800 pounds.
Case introduced selective catalytic reduction (SCR) technology for wheel loaders to increase productivity and
meet Tier IV Interim emissions standards.
April 20, 2011: Galadari introduces green JCB backhoe loaders in Abu Dhabi
Galadari Trucks and Heavy Equipment, the official dealer of JCB equipment in UAE, launched JCB‘s latest
generation of green backhoe loaders in Abu Dhabi. The 3CX and 4CX backhoes feature a three pump
hydraulic system that allows for the same high output hydraulic flow and pressure at reduced engine
revolutions, cutting fuel consumption by 15%. The ecoDIG system of the loaders is controlled by a two-
position rocker switch on the main console in the cab. The control offers choices of an eco mode, maximum
efficiency and digging potential mode or an ultimate machine control mode to facilitate fine grading and
delicate groundwork profiling applications.
April 15, 2011: Kobelco opens excavator manufacturing plant in India
Kobelco Construction Machinery, a subsidiary of Japan-based Kobe Steel Limited, has inaugurated an
excavator manufacturing plant near Chennai city in Tamil Nadu, India. The plant has been established with an
estimated investment of US$15.7 million (INR700 million) and has an initial capacity of 1200 units per year.
Kobelco will begin manufacturing 20 tonne excavators and will later manufacture 14 and 35 tonne excavators.
The first phase of the plant development is expected to require a total investment of INR1 billion ($22.5 million)
with the plant expected to reach full capacity by 2013-14. The excavators will be produced using 50% local
parts. Critical systems and components including the engine and electronics will be imported from Japan and
Thailand. Excavators from the new plant will primarily be sold in the local market.
April 14, 2011: D Wardle Plant acquires two new Volvo G series wheeled loaders
D Wardle (Plant), a UK-based earthmoving company, has received two new Volvo G series wheeled loaders
in the UK. The L220G wheel loaders is part of Volvo‘s new G-series range with 20% increased lifting force,
10% improved breakout force and stronger hydraulics. The L220Gs feature new engines and driveline
systems designed for improved productivity, lower emissions, greater smoothness, serviceability and operator
comfort. The Volvos were selected for their slew of energy saving features including optishift transmission with
its reverse by braking feature, the simple but effective eco pedal and engine auto shut off.
March 23, 2011: JCB announces US$130 million investment for new production facilities
JCB is constructing a new factory with an investment of US$100 million in Brazil and will also invest US$30
million for an engine plant in Ballabgarh, Delhi, India. The new factory in Brazil will be a 350,000 square feet
facility constructed on a 50 acre site in Sorocoba. Complete production will be relocated to the new facility.
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The facility is scheduled to be opened by 2012, with a production capacity of 5,000 backhoes and 2,500
excavators a year.
The Indian facility will be the first JCB facility outside Derbyshire, UK, to produce the firm's Dieselmax engines.
The engines will be used in JCB products manufactured in India. Plans call for every backhoe manufactured in
India to be fitted with an engine manufactured in India from April 2011. The move is aimed at meeting new
local emissions legislation.
March 22, 2011: JCB launches new skid steer and compact track loader
JCB, a manufacturer of construction equipment, launched a new range of skid steers and compact track
loaders with rated operating capacities of 2,250 pounds. The new 225 wheeled skid steer and the 225T
compact track loader come with all the features introduced with the seven other New Generation skid steer
and track loader models. The new 225 wheeled skid steer and the 225T compact track loader feature tilting
cab with increased service access, multifunction joysticks, and hydraulic quick hitch. An isolated cab is also
included in the machines, which is sealed and pressurised with reduced noise levels. The cab also features
heated air-suspension seat with adjustable armrests and O-ring face seals for all hydraulic connections.
March 11, 2011: Doosan unveils new DX235NLC narrow width crawler excavator
South Korean conglomerate, Doosan Group unveiled a slim version of its DX235NLC excavator which comes
with mono boom. The DX235NLC comes with a 4.7 ton counterweight in the mono boom and five ton
counterweight in the articulated boom version. The crane also includes reinforced 12.5mm shoe plates and an
over-dimensioned front body section.
The new equipment, with a width of 2.54m, meets the transport width standards of the road regulations in
certain countries. The reduced width of the new machine enables operators to work in confined spaces on
inner-city projects or housing developments. The oversized boom and counterweight in the 22.5 ton
DX235NLC provide higher lifting performances than other excavators in the 21-24 ton category.
February 17, 2011: New Holland to unveil two wheeled loaders and crawler excavator at Samoter 2011
New Holland Construction has announced that it will unveil the E305C crawler excavator and the two wheeled
loader models, the W170C and W190C at Samoter 2011, which will be held from 2 to 6 March 2011. The new
models are powered by the new stage IIIB engine. The B115B and B110BTC backhoe loaders are equipped
with new features which will reportedly increase fuel efficiency, operator comfort, productivity and durability.
The company will also exhibit the new W170C and W190C wheel loaders which feature high-pressure
common rail engines that claim best in class power and torque.
February 16, 2011: Gehl unveils new V330 vertical lift skid loader
Gehl, a manufacturer of compact equipment for agriculture and construction markets, has unveiled the new
V330 vertical lift skid loader with more than 131 inches of near-vertical lift height. The V330 skid loader comes
with an 84hp turbo-diesel engine and a rated operating capacity of 3,300 pounds. The new loader features a
powerful Yanmar turbocharged diesel engine with 215lbf-ft peak torque. The horsepower and torque of the
loader are enhanced with a high-performance drive train.
The V330 skid loader is also featured with the Hydraglide Ride Control System as standard equipment. The
entire ROPS/FOPS assembly on the V330 skid loader tips rearward on a hydraulic lift for easy internal service
access.
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January 31, 2011: Mota-Engil signs deal for more than 40 Caterpillar’s earthmoving equipment
Portuguese contractor Mota-Engil Group has inked a deal with local Caterpillar dealer Barloworld STET for
more than 40 machines for Douro Interior Highways project in the north east of Portugal. Pursuant to the deal,
Barloworld STET has provided three Cat 323D L and two 336D LME medium size hydraulic excavators, and
three 345D LME and one 365C LME large hydraulic excavators. The dealer has also supplied five CS76 XT
soil compactors, four D6T and one D5K track-type tractors are also included in the package, along with six
730 articulated trucks, two 772 off-highway trucks and others. The order also includes seven used 740
articulated trucks and two pre-owned D8T track-type tractors. All of these machines are Cat Certified Used
products, and as such carry a full Cat warranty.
January 28, 2011: Case launches F Series wheel loaders
Case Construction Equipment has unveiled three new 721F, 821F and 921F F series wheel loaders, which
provide quick acceleration, quicker cycle times and higher travel speeds. The new Case 721F, 821F and 921F
wheel loaders evolved from the company‘s E Series product line. The Case F Series wheel loaders use
proven selective catalytic reduction (SCR) technology to meet Tier 4 Interim emissions standards while also
delivering increased power and improved fuel efficiency.
The Case 721F, 821F and 921F wheel loaders feature a 6.7-litre Tier 4 Interim-certified engine, rated at 179,
211 and 242hp (133, 158 and 180 kW), respectively. The new range of loaders has four programmable power
modes to save fuel and increase available power, Economy, Standard, Auto and Max, gives operators
flexibility in matching engine power to their jobs. The Case F Series wheel loaders can perform in a wide
range of applications, from construction sites and landfills to quarry and aggregate operations.
January 19, 2011: Case Construction unveils C Series excavators
Case Construction Equipment has expanded its C Series full-sized excavator line with three new models,
Case CX250C, CX300C and CX350C. The new line of excavators replaces models in the company‘s B Series
product line.
The excavators feature Tier 4 Interim-certified cooled exhaust gas recirculation (CEGR) technology that burns
cleaner while delivering superior horsepower. These three new models deliver 177, 207 and 266 net
horsepower (132, 154 and 198 kW), respectively. The new excavators are equipped with Case Intelligent
Hydraulic System technology, which reduces total fuel consumption and improves performance. The Boom
Economy Control of the machines reduces engine RPMs during the boom down and swing operation, while
the Auto Economy Control lowers RPMs when the joysticks are inactive. The new excavators are also
equipped with Swing Relief Control technology, which manages the hydraulic power allotted at the start of the
swing operation, and Spool Stroke Control creates an automatic pressure adjustment during digging
operations.
December 20, 2011: Komatsu unveils new 5.2 ton class PC55MR-3 midi excavator
Global construction equipment maker Komatsu Europe International has expanded its MR-3 range of
excavators with the addition of the 5.2 ton class PC55MR-3 midi excavator. The new midi excavator, which
replaces the earlier model PC50, is equipped with a Stage IIIA engine (28.5kW Komatsu 4D88E-6),
proportional controls, and offers auto-idling as an option.
The MR-3 range includes 1.4 ton to 5.5 ton models and is now almost complete, with just a two-ton unit to be
unveiled in early 2011. All the models were built in Italy. The PC55 has an operating weight of 5,280kg to
5,350 kg, and has a "tight" tail design making it suitable for working in restricted spaces. The excavator has a
bucket capacity of 0.07 cubic metres to 0.175 cubic metres and is available with either long or short arm, cab
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or canopy, and rubber, steel or road liner shoes. The new excavator is equipped with Komatsu's KOMTRAX
remote satellite monitoring system.
December 17, 2011: Case adds new four new T Series tractor loader backhoe models
Case Construction Equipment has added four new T Series tractor loader backhoe models to its Construction
King series, which include: Case 695ST, Case 590ST, Case 580ST and Case 580T. The company also said
that the new models offer improved productivity, lower running costs and faster operation. The company
provides the customers an option to choose between Powershift or Powershuttle transmission, pilot or
mechanical backhoe controls, and two- or four-wheel steering. All the four models come equipped with a 1.2
cubic metre front loader bucket as standard. The models are equipped with load sensing hydraulics, which will
ensure that power is available on demand, contributing to a 10% reduction in fuel consumption and lower
engine noise levels.
December 14, 2011: John Deere to build construction equipment factory in China
US-based construction equipment manufacturer John Deere announced plans for the construction of a US$50
million manufacturing facility in China. The new factory will produce four-wheel-drive loaders and excavators
and will be located in the Tianjin Economic-Technological Development Area. The new facility will be the sixth
manufacturing location in China for Deere. Construction is slated to begin immediately with completion
scheduled towards the end of 2011.
November 30, 2011: Liebherr supplies new equipment to Lancaster Earthmoving
Germany-based Liebherr supplied three excavators and a bulldozer to UK-based Lancaster Earthmoving,
which are currently being used at Abberton Reservoir, near Colchester in Essex. Two of the excavators are R
944 C Litronic models with the third being an R 934 C Litronic. All three have been supplied with long heavy
duty undercarriage with 750mm wide trackpads. CCTV rear-view cameras with in-cab colour monitors, screen
vandal guards, roof beacons, additional headlights, load diagrams with overload warning systems and a wide
selection of earthmoving and ditching buckets are included in the optional extras package.
November 30, 2011: Case Construction launches new range of angle brooms for wheel loaders
Italy-based Case Construction Equipment has introduced a new range of hydraulic angle broom attachments,
designed to increase the utility of its wheel loaders. Ranging in width from 96 to 120 inches, the new angle
brooms enable Case wheel loaders to sweep streets and parking lots, clean jobsites and remove snow from
jobsites. Angle broom models are available for Case 521D and E, 621D and E, 721D and E, and 821E wheel
loaders.
November 25, 2011: Liebherr announces plans to manufacture wheeled loaders in China
Liebherr Group, Germany-based manufacturer of construction equipment, announced plans to begin the
manufacturing of wheeled loaders in China. The 140 kW/ 3.5 cubic metre bucket capacity L 556 II is the first
model available. The machines will be manufactured at Liebherr's 19000 square meter excavator factory in
Dalian and are expected to be available from April 2011.
October 29, 2011: OZ Turners and Mulchers launches new excavator flail mulchers
Australia- based OZ Turners launched the new Oz Mulcher 50EX excavator flail mulchers, a line of heavy duty
flail mulchers designed for roadside, railway and property maintenance applications. The new Oz Mulcher
50EX excavator flail mulchers will weigh around 500kg. The heavy duty RockHound 50HD excavator flail
mulchers are suitable for use with 10T to 30T large excavators and backhoes in rough terrain. The
maneuverability of the excavator allows the user to mow and mulch in difficult terrain conditions effectively.
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The Oz Mulcher 50EX flail mulchers are designed to safely cut and mulch grass, scrub or small trees up to
100mm in diameter.
October 14, 2011: AAE Advanced Auxiliary Equipment introduces FlexMed Series hopper loaders
AAE Advanced Auxiliary Equipment Inc. introduced the new FlexMed Series hopper loaders with self-
contained electric motors. The new loaders include all of the FlexMed standard features. The standard PLC
control utilizes an industrial PLC to control the loading cycle, filter cleaning and material proportioning valves.
The Flexmed series hopper loaders are available for rates up to 1,000 pounds per hour. FlexMed Hopper
loaders come complete with flex hose and material wands for loading up to 12 feet and glass tube options for
just in time loading for small to large machines.
The loader can be controlled by a mercury free level switch or an adjustable switch reading through the glass
tube. The six inch glass tube is optimal for medium and large machines. A 3 inch glass tube will be available in
the first quarter of 2011 for small machines.
September 27, 2011: Sunward launches new SWE230S hybrid excavator
China-based Sunward launched the SWE230S hybrid excavator, which is now commercially available in
China. The SWE230S hybrid excavator is the first machine that actually rolled off the production line in
September, after five years of RandD by Sunward. Sunward‘s new machine uses 20% less energy than a
traditional excavator and is 50% quieter during slewing. It also meets Tier 3 exhaust emission requirements.
September 21, 2011: US DoD awards US$641.2 million equipment contract to Caterpillar
The US Department of Defense (DoD) awarded Caterpillar Inc. a US$641.2 million contract to manufacture
909 wheeled tractor scrapers. The wheeled tractor scrapers will be built at the Caterpillar's facility in Decatur,
Ill. It is the largest single contract Caterpillar has won through the defense department in terms of dollar value.
Work on the 621G wheeled tractors is expected to be completed by Aug. 14, 2020. The machines will be used
by the US Marine Corps and the US Army for construction and engineering projects.
August 19, 2011: JCB India to start manufacturing engines for backhoe loaders
Construction equipment manufacturing company JCB India has announced that it will soon begin
manufacturing its own ‗JCB 444‘ engine line specially suited for Backhoe Loaders. JCB had been outsourcing
JCB 444 engines from Kirloskar Engines and Cummins India, which are engine manufacturing companies
based in Pune, India. The proposed facility is slated to be operational by the end of 2010.
JCB has also launched the JCB 3DX Super and JCB 3DX XTRA backhoe loaders as part of the celebration for
manufacturing and selling 100,001st machines manufacturing and selling 100,001st machines in India.
August 17, 2011: Kobelco launches new 215SR and 235SR ACERA excavators
Kobelco Construction Machinery America has launched new 215SR and 235SR ACERA excavators in the
company's short-radius excavator line. The 215SR and 235SR are designed to offer higher performance with
lower noise and exhaust emissions. They are suitable for urban settings and tight areas. The excavators
feature the Kobelco Integrated Noise Dust Reduction system (INDR), a state-of-the-art technology to deliver
superior air filtration and a top-of-the-line engine and hydraulic cooling system. This also allows the INDR
system to lower noise levels by up to 5 dBA. The excavators are Tier III-certified engines with 6% higher fuel
efficiency than previous models for lowered total cost of operation. They feature quiet, in-line hydraulic pumps,
combined with the Kobelco Intelligent Total Control System (ITCS).
Their power-mode selection allows the operator to choose from four different modes, depending on the job.
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© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
While both use the same engine, the 235SR ACERA provides more breakout force than the 215SR and
features a heavy-duty boom, arm and undercarriage as standard. A high and wide undercarriage is also an
available option for special construction, demolition and forestry applications.
August 6, 2011: Bobcat launches new 324 compact excavators
Bobcat, the North Dakota-based construction equipment manufacturer, launched its new 324 compact
excavator with 1.5-ton capacity. The 324 excavator is a conventional tail swing unit in the 1.5-ton operating
class. The excavator also features a lighter yet durable boom fabrication with cast pivot joints.
The 324 offers a maximum dig depth of 8 feet 6 inches, reach at ground level of 14 feet and dump height
clearance of 8 feet 8 inches. The excavator is powered by a 13.9-horsepower, Tier 4 water-cooled diesel
engine and two travel speed ranges are standard. The engine is equipped with a hydraulic system similar to
the larger Bobcat excavators. Bobcat also claims that the system‘s torque-limiting piston pump is able to
sense and react to hydraulic loads, for better use of the engine‘s torque curve.
APPENDIX
Earthmoving Equipment – Market Opportunities and Business Environment, Analyses and
Forecasts to 2015 Page 299
© ICD Research. This product is licensed and is not to be photocopied Published: August 2011
20 Appendix
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Notes
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Revenue is converted to US$ at average annual conversion rate as of fiscal year end.
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