1
Appendices
Appendix 1: Trends in CNC machining... 2
Appendix 2: Company profiles of competitors ... 3
Appendix 3: Wind Turbine market ... 5
Appendix 4: Forklift manufacturers... 8
Appendix 5: Construction and Farm equipment manufacturers ... 11
Appendix 6: Casting industry... 20
Appendix 7: Iron, Steel and Malleable castings... 23
Appendix 8: Graph Iron, Steel and Malleable castings Production ... 24
Appendix 9: Average Production and Employment in 2004 ... 25
Appendix 10: Iron castings production for the vehicle industry in 2004... 28
Appendix 11: Annual Labour cost per Employee in Western- and Eastern Europe... 29
Appendix 12: Heavy truck and bus production... 30
Appendix 13: Press report of the strategic joint venture with Eurotech group ... 31
2
Appendix 1: Trends in CNC machining
A description of the new trends in machining is given below:
- Automatic pallet exchange and supply: Some machining companies have added automatic pallet exchanges 1 to their CNC machines. Other machining companies also have machinery for supplying the raw material automatically to the production line.
- Introduction of new machinery such as a rotary transfer 2 : These CNC Machines automatically feed multiple work stations from a rotating turret. This combines automated part feed with multiple simultaneous operations, streamlining the machining process significantly.
- Machining of magnesium parts: magnesium is becoming an important light weight alloy in the automotive industry. Euralcom is one of the few suppliers in the world that is able to deliver fully machined magnesium parts.
- Direct numerical control Software: Normally an operator has to walk around with a laptop in order to programme the machines. These machines also have a limited amount of memory installed. Direct Numerical Control- software enables companies to centrally programme these machines.
- Machining of complex product components: Traditionally the machining of high precision and complex parts is reserved for certain industries such as medical appliances, more often also in the automotive industry the parts have become more complex.
- Efficient manufacturing and tooling: More companies have become more flexible and in their production and are able to set up the machines more efficiently. They are for example capable of customizing the tools more efficiently and quickly.
- Additional services: more companies have become full service suppliers for their customers. They add services such as the assembly of parts into complete modules, independent purchasing of castings or forgings (from their own or outside foundries), surface (powder coating and cataforese electric coating) and heat treatments.
- Designing product components and tools in cooperation with the customers: by a better design of the product components and tools, considerable savings can be made in waste and machine hours. Tailor-made tools also allows for the machining of more complex product components.
- Implementation of quality and waste reduction programs 3 : Six Sigma (reduction in variation) and Lean Enterprise (elimination of waste). Six Sigma uses tools such as Control by Looking, Built in Quality, Green Belt and Black Belt projects, New Product Development, Design for Six Sigma, and APQP. Lean Enterprise has its own set of tools such as Flow and Theory of Constraints, TPM, Change-Over Reduction, and Pull Systems.
1
Source: FME-CWM, April 2006, Moderne verspaningstechniek, Efficiënte en betrouwbare
verspaningsmethoden voor draaien en frezen, Tech-Info-blad, nr TI.06.31, Available from: www.verspaning- online.nl
2
Source: Jobshop.com.
3
Source: website Metaalindustrie Bergen/MGG Group, www.mgg.nl
3
Appendix 2: Company profiles of competitors
Doesburg Components 4
Doesburg is a machining company in the Netherlands which is a subsidiary of Gietburg Holding. This holding includes a foundry in Gietburg, a lost-wax foundry in the Czech Republic (Cirex) and Moulding company in Hengelo. It also purchases product components from subcontractors. They are specialized in complex and ready-to-assemble castings. The machining factory has 32 CNC machines installed for the processing of cast-iron and aluminium components. The foundry uses simulation software and design by CAD-CAM software.
Metaalindustrie Bergen (MIB) 5
They are part of the MGG group which has three production facilities in the Netherlands and Belgium. The MGG group belongs to Hayes Lemmerz International Inc., which is a large American automotive supplier. The MGG group is specialized in aluminium components.
They are able to cast, machine and assemble these parts. Over 70 CNC and dedicated machines are located at their facilities. They have the ISO 9001:2000, TS 16949:2002 and ISO 14001 certification. Direct Numerical Control software is linked to their machine controls which make it possible for them to react quickly and efficiently to product changes.
They also have an in-house tool shop.
Smits Machine fabriek Valkenswaard 6
Smits is a medium sized machine company with 24 CNC machines installed at their facility in the Netherlands together with a 3D-measuring machine. Their subsidiary in Belgium produces hydraulic cylinder. Another subsidiary of Smits produces suspensions for cars. Around 70 employees are working at their factories. They claim to be able to co-design parts with their customers in order to work more efficiently.
Tim Hapert 7
Tim Hapert is part of the large Dutch automotive group VDL. This subsidiary of VDL machines parts for the group and customers outside the group. The group has its own tooling company and is able to design complex tools. Around 100 people are working at this company. They claim to deliver their products just-in-time and are able to purchase the raw materials independently.
Machine Fabriek Elburg 8
Elburg is a medium sized machining company with 80 people working at their facilities where 24 CNC machines are installed. Iron and non-Ferro components can be machined and assembled at their production sites. They are certified with ISO9002 and a 3D measuring machine is installed. Some of their customers are active in the truck industry.
4
www.gietburgholding.com
5
www.mib.nl
6
www.smits-nederland.com
7
www.vdl.nl
8
www.machinefabriekelburg.nl
4 Machinefabriek Goossens 9
At Goossens around 24 CNC machines are installed. One of their major customers is DAF and they are an A-status supplier of DAF. They are specialized in fine mechanical machining and are certified with ISO 9002. They claim to be able to purchase the raw materials themselves and to take care of the logistics to the customer. These materials can be iron, steel, aluminium or copper.
La Fonte Ardennaisse 10
This is a large foundry group from France. Their machining company SED in the city of La Fleche has 27 CNC installed at their production site. Their certifications include TS16949, ISO 9001 and ISO 14001.
Componenta Corporation from Finland 11
Componenta is a large Finnish machining company and is one of the most important competitors. The group includes the foundries in Pietarsaari (Sweden) and ‘De Globe’
(Holland). De Globe is one of the most important suppliers of castings for Cross-Line and their foundries are located very close to the city of Kerkrade. Cross-Line also machines the castings for ‘De Globe’. Componenta’s machining facilities are: Främmestad AB (Sweden, 170 people), Componenta Åmål AB (Sweden, 80 people), Componenta Mek Pietarsaari Ltd (Sweden, 80 people), Componenta Mek Por (Finland 14 people), Componenta Albin (Sweden, 130 people), and Componenta Nisamo Ltd (Finland, 50 people). These machining facilities include a full range of CNC machines and services such as heat treatments.
Certifications are ISO/TS 16949, ISO 9001 and ISO 14001.
Euralcom 12 :
Euralcom is a large foundry group from the Netherlands engaged in the production of light alloy components for the automotive industry. Other facilities are located in France, Italy, Portugal and Brazil. They develop and produce components of the light materials magnesium 13 and aluminium. There are 3800 people working for the group and it had a turnover of 520 million Euro in 2005. Activities include die casting, forging, special casting, machining and assembly. Their machine shops generate a turnover of 300 million Euro where a total 299 CNC machines are installed. The subsidiary Cideb SA (France) is able to offer prototyping and design services. Their customers also include truck manufacturers and producers of agricultural machinery. Their certifications are QS 9000, ISO 9002, TS 16949, ISO 14001 and ISO 9001
9
www.goossensbv.nl
10
www.la-fonte-ardennaise.com
11
www.componenta.com
12
www.euralcom.com and http://www.euralcomachining.com/
13
Magnesium is a very light alloy
5
Appendix 3: Wind Turbine market
3.1 General description
The world market for electricity generation from wind energy has grown rapidly in recent years. In 2005 the global wind energy capacity has grown with 24% to 58982 MW. (Source:
World Wind Energy Association) 14 . The largest manufacturer of wind turbines Vestas has increased its revenues in 2005 with 52 % 15 . In 2010 the World Wide Energy Association expects the global installed capacity of wind turbines to be 210.000 MW. Germany, Spain, United States of America, Denmark and India are the leading markets in wind energy. The share of these five countries in the overall installed global capacity is 64%. A geographical diversification of the market is taking place concerning the distribution of market share. New important markets are developing in China and Australia. Asian countries have shown a growth rate of 48% in 2005 and a further extensive growth is expected in the future.
Wind energy has caught considerable attention by governments for the reduction of Carbon Dioxide in the environment. Also strategic factors such as a reduction of the dependency on fossil fuels for generating electric energy, are important motives for governments to start new wind energy projects. Considerable grants can be gotten from the Dutch government and the European Union for the installation of new parks for wind turbines. However, in the Netherlands some questions have been raised about the effectiveness of wind energy and the considerable investments that are needed for the installation of a large amount of wind turbines. Off shore wind parks will play an important role in the coming years for the development of the wind energy market. Therefore the manufacturers are focusing more on wind turbines that are resistant to salt water. On shore wind farms are more often installed for the electrification of rural areas.
14
Source: World Wind Energy Association, 7 march 2006, Press Release
15
Source: Vestas Annual Report 2005
6
Global market share largest manufacturers of wind turbines in 2004 (source: BTM consult aps/annual report Gamesa 2005)
Vestas; 34,1%
Gamesa; 18,1%
Enercon; 15,8%
GE Wind; 11,3%
Siemens; 6,2%
Suzlon; 3,9%
Repower Systems; 3,4%
Mitsubishi; 2,6%
Nordex; 2,3%
Other; 4,1%
Ecotécnia; 2,6%
Figure 3-1: Global market shares of Wind turbine manufacturers based on installed capacity
163.2 Competitive Landscape
The most important wind turbine manufacturers in Europe and globally are: Vestas (Denmark), General Electric Wind (United States), Enercon (Germany), Siemens (Germany) and Gamesa (Spain). These manufacturers are described below.
Vestas Windsystems a/s
Vestas is a Danish company and the largest manufacturer of wind turbines in the world. Their headquarters is located in the city of Ringkøbing. The company has grown substantially in recent years. In 2005 they increased their revenues with 52 % since 2004 with a operating revenue of 3,538 Million Euro 17 . However, they made a loss of 192 Million Euro in 2005.
Their global market share is around 21 % and they have over 10000 employees. In 2004 the company merged with NEG Micon, their Danish competitor. Their most important markets are in Western Europe. They sell most of their wind turbines to customers in Germany, Spain and Italy. The United States and Canada have also become important markets for their wind turbines. New production facilities are set up in China, Australia and Spain.
Enercon Gmbh
The German manufacturer Enercon Gmbh is the third largest manufacturer of wind turbines in the world. In 2004 it had a global market share of 15.8 % (source: www.enercon.de) 18 . Enercon is not listed on the stock exchange. Their production facilities in Germany are located in Aurich, Emden and Magdeburg. Also in Sweden, Brasil, India and Turkey are facilities located for production. They have sales offices in 17 countries.
16
Source: BTM consult/Gamesa annual report 2005
17
Vestas Annual Report 2005
18
Enercon Gmbh, 2006, www.enercon.de
7 Gamesa
Gamesa Corporación Technológica, S.A. is the second largest manufacturer of wind turbines in the world with a market share of 18.1 %. They are based in the Spanish town Vitoria- Gasteiz. The company operates in two differentiated areas of activities: aeronautics and renewable energy sources. Their activities in renewable energy, concentrate primarily on wind energy. Gamesa Eólica is the division that manufacturers the wind turbines. They also have a division for the generation of renewable energy and for the provision of specialist services (installation and maintenance). They manufacture, sell and install the wind turbines.
According to their management report in 2006 the Gamesa group is trying to spin off their Aeronautical division. In 2004 the turnover was 1.745 billion Euros 19 , an increase of 9% since 2003. The net profit was 221 million Euros, up to 10% since last year.
International sales have grown to 27 percent in 2004 from 19% in 2003. New exports are developing to emerging countries such as India, China and Vietnam.
Almost all manufacturing plants are based in Spain. Only one manufacturing plant for the blades and the nacelles is located in Pennsylvania, USA. New facilities for components and assembly will be set up in China and Portugal (Source: Gamesa Management Report 2006) 20 . The wind turbines are almost fully designed and manufactured in-house. Gamesa Eólica has 17 plants distributed throughout Spain for the production of components. Their main suppliers for the housings are Arcelor and Thyssenkrupp. The flanges that are used on the towers are supplied by Euskal forging, Industrial Barranquera and Forjas Ireata. The gearboxes are delivered largely by Echesa SA, EGT and Flender. More pressure on prices is expected for the suppliers since cost is become more important.
GE Wind
General Electric (GE) is a large conglomerate from the United States. Their subsidiary GE Energy is involved in the supply of energy solutions. The wind turbines are manufactured and sold under the name of GE Wind. GE Wind is based in Atlanta, Georgia (USA). They have installed over 8500 turbines all over the world. 21 The market share for wind turbines was 11.3
% in 2004. The revenue for the subsidiary GE Wind was 2 billion dollars in 2005 22 and they delivered 1,346 wind turbines worldwide. Their revenue for wind energy operations was 200 % higher than in 2004 and has increased by 400 % since 2002. In the American market 75 % of their sales were generated by installing 1005 wind turbines. Facilities for the design, manufacturing and assembly of wind turbines are located in Germany, Spain, China and the United States. India and Spain are also growing markets for GE Wind.
19
Gamesa Corporación Technológica, S.A, Annual report 2004
20
Gamesa management report 2006: year end estimate 2005 and economic outlook 2006
21
GE Energy Fact Sheet 2005
22
GE energy, press release February 27, 2006, Athens Greece
8
Appendix 4: Forklift manufacturers
4.1 Definition of the forklift industry
A forklift truck is an industrial truck which is used to lift transport materials by a fork that is inserted under the load (source: Wikipedia). They are powered by an electric motor or an internal combustion engine. They need to be counterbalanced by a heavy iron mass to the rear of the truck in order to compensate for the load. Sometimes the weight of the battery at an electrically powered truck provides the necessary weight. Smaller forklifts are hand pallet trucks and low lifters. Hand pallet trucks lift their weight by a hydraulic system which is pumped by hand. Besides counterbalanced trucks there is also a large group of lift trucks which are specifically designed for the use in warehouses. They are designed for working in the small aisles of warehouses. An example is the reach truck which is able to lift the material very high up in the air.
4.2 Global market 23
The global demand for material handling equipment has grown considerable in 2005 due to the improved economic conditions. That year around 749,000 of units were sold globally, an increase of 6 percent since 2005. European demand for material handling equipment advanced 4 percent to 304,000 forklift units sold. Amount of units sold in Eastern Europe increased by 21 percent during that year. The market for material handling equipment is divided between counter-balanced trucks and equipment for warehousing. Furthermore, the market is very dependent on global economic conditions and are therefore very sensitive to cyclical fluctuations.
4.3 Competitive landscape
Competition between lift truck manufacturers is very intense. New manufacturers from Eastern Europe and Asia are entering the market rapidly. The rising material cost and intense competition forces the manufacturers to source their components from suppliers in low labour cost countries. The high growth rates of sales in Asia and Eastern Europe provides the forklift manufacturers new opportunities and they have therefore opened new production facilities in these markets.
An overview is given of the twenty largest manufacturers of material handling equipment in terms of global sales in 2004. The following companies are outlined in more detail because of their high amount of sales and their many European manufacturing locations: Toyota, Linde, Jungheinrich, Mitsubishi-Caterpillar, Atlet and Roca.
23
Source: Annual Report Jungheinrich AG 2005
9
Rank Company 2004 Worldwide
Sales Revenue in $ Brands World Headquarters
1 Toyota 4.89 billion Toyota, Raymond, BT
Pirme mover Aichi, Japan
2 Linde 4.49 billion Linde, Still, Om
Pimespo Wiesbaden, Germany
3 Jungheinrich 2.07 billion Jungheinrich,
Multition Hamburg, Germany 4 Nacco Industries 1.9 billion Hyster, Yale Portland, Oregon, USA 5 Mitsubishi/Caterpillar 1.3 billion Mitsubishi-Caterpillar Sagamihara, Japan
6 Crown 1.23 billion Crown New Bremen, Ohio, USA
7 Komatsu 1.03 billion Komatsu, Kalmar AC Tokyo Japan
8 Nissan 828 million Nissan, Barrrett Tokyo Japan
9 TCM 759 million TCM Tokyo Japan
10 Nichiyu 357 million Nichiyu Kyoto, Japan
11 Daewoo 321 million Daewoo Seoul, South Korea
12 Manitou 300 million K-D Manitou Ancenis, France
13 Atlet 250 million Atlet Molnlycke, Sweden
14 Clark 237 million Clark Lexington, Kentucky, USA
15 Rocla 108 million Rocla & Caterpillar Jarenpaa, Finland
16 Taillift 65 million Taillift Taichung Hsien, Taiawan
17 Hoist Lifttruck 55 million Hoist, Shreck, Autolift,
Elwell parker Bedfork Park, Illinois, USA
18 Hyundai 46 million Hyundai Emsung , South Korea
19 Landoll 25 million Bendi, PivotMaster,
Drexel Marysville, USA
20 Anhui Heli 22 million Heli Hefei, Anhui, China
Table 4-1: The twenty largest suppliers of lift trucks in the world (source: Modern Materials Handling, August 2005)
24Toyota Material Handling
The Toyota Material Handling Company is a division of Toyota Industries Corporation.
Toyota is the largest manufacturer of material handling equipment in the world with a total revenue of 4.89 billion dollars in 2004. Their world headquarters is located in the city of Aichi, Japan. Their forklift trucks have a capacity ranging from 0.5 to over 40 tons and incorporate international combustion or electricity engines. Their manufacturing facilities are located in North-America, Japan, China and France. The Japanese plant is their largest production facility where they produce 44,300 units annually (year 2001) 25 . Their French facility produces 9,200 units annually and is located in Ancenis Cedex.
Linde AG
The German company Linde AG is the second largest manufacturer of industrial trucks in the world. Their material handling segment had a turnover 4.49 billion dollars in 2004. The Linde group has two main business segments: Gas and Engineering and Material Handling.
The corporate center of the group is based in the city of Wiesbaden, Germany. Their other forklift brands are Still and OM Pimespo in Italy. They also have a strategic partnership with the Japanese forklift manufacturer Komatsu. The plants of the Linde brand are produced in
24
O’Neill, Jeff, August 2005, The Top 20 Lift Truck Suppliers, Modern Material Handling, Vol. 60 Issue 8, p43-45, 3p, 1 chart, 1c
25
Toyota Industrial Equipment, March 2006: www.global-toyotaforklifts.com
10 the in Germany (Aschaffenburg-Schweinheim, Aschaffenburg-Nilkheim, Kahl), Great Britain (Basingstoke, Merthyr Tydfil), France (St. Quentin en Yvelines, Châtellerault), U.S.A.
(France Summerville, South Carolina) and China (Xiamen). The main office of the division OM Pimespo is in the city of Lainate (province Milan) and it has plants in Luzzara (province of Reggio Emilia) and in Bari. The Still brand is manufactured in Germany (Hamburg and Reutlingen), France (Meaux Cedex) and Brasil (Rio de Janeiro).
Jungheinrich 26
Jungheinrich is the third largest manufacturing of material handling equipment in the world with sales revenue of 2.07 billion dollars in 2004. Almost half of their sales are generated in Germany. The company is based in Hamburg, Germany. Their production sites are located in the German cities Norderstedt, Lüneburg and Moosburg. In Moosburg the counterbalanced trucks are produced. The battery-powered low-platform and high-lift trucks are manufactured in Norderstedt. Whereas in Lüneburg the small-series and customized trucks are made. The company closed down its plants in the UK, France and Spain recently. Hand pallet trucks are now procured from Ningbo Ruyi Joint Stock Co Ltd in China in which it has a 25 percent stake.
Mitsubishi-Caterpillar
Mitsubishi Heavy Industries Ltd. and Caterpillar Industrial Inc. have formed a joint venture in 1992 for the production of forklifts. For the European market all forklifts are manufactured in Almere, the Netherlands, with a capacity of 18,000 units a year.
Manitou
Manitou is a French company based in the city of Ancenis. They produce forklifts for rough- terrains and with long telescopic arms. Their consolidated turnover was 985 million Euros in 2005. Their turnover is distributed between their activities in the sectors of construction (45%), agriculture (28%) and other industries (27%). Around 40% of their turnover is generated in France.
Atlet
Atlet is a Swedisch company that is based in the city of Mölnlycke. Most of their sales are genereated in Europe. Their production sites are located in Oberhausen (Germany) and Mölnlycke (Sweden). They also have subcontractors for parts in Eastern-Europe and China.
They cooperate with Nissan in the production of warehouse trucks.
26
Jungheinrich AG Annual Report, 2004
11
Appendix 5: Construction and Farm equipment manufacturers
5.1 European Market
The European 27 market of construction and farm machinery reached a value of $28.8 billion in 2004 (source: Datamonitor) 28 . It is forecasted to reach a value of $30.4 billion in 2009, an increase of 5.5% since 2004. This includes manufacturers of rolling machinery, earth-moving and construction equipment and heavy farm machinery. The share of agricultural machinery by value in the European market is about 53.4% for 2004 whereas construction equipment amounted to 46.6%. Europe accounts to 27.1% of the global construction and farm machinery market. Key countries for the construction equipment in terms of sales and production are Germany, France, Italy, UK, and Sweden. Spain and Central Eastern Europe are also important in terms of sales because of their large infrastructural projects.
Trends:
• Rising exports to Central and Eastern European countries due to large infrastructural investments.
• In Western Europe the market for agricultural equipment is declining 29 .
• As can be seen above, the construction equipment is expected to grow slightly.
• Better fuel efficiency is need in the construction equipment due to rising fuel cost.
• Push for tighter emission regulation for diesel engines 30 .
• Pressure on suppliers on prices and thus lower manufacturing cost: due to rising raw material cost because of a shortage in commodities, consolidation and strong Euro 31 .
• Medium sized manufacturers will be merged with or purchased by global brands.
5.2 Competitive landscape
The key players in the European construction and farm machinery industry are Caterpillar, Johh Deere, Case New Holland, JC Bamford (JCB) and the Agco Corporation. On a global scale also the companies Komatsu, Terex, Hitachi, Volvo, Liebherr, and Ingersoll Rand play a significant role in the construction equipment industry. An oversight of the largest global manufacturers in sales and their activities are shown in the figures below.
27
In this figure Europe consists of Belgium, Czech Republic, Denmark, France, Germany, Hungary, Italy, Netherlands, Norway, Poland, Russia, Spain, Sweden and the UK.
28
Datamonitor, July 2005, Construction & Farm Machinery in Europe, Industry Profile
29
Source: Case New Holland, annual report 2005
30
Source: Datamonitor.
31
Source: Datamonitor
12
20
9,9
5,4 4,6 4,2 4 3,6 3,5 3,1 2,5
0 5 10 15 20 25
C at er pi lla r K om at su Te re x Jo hn D ee re H ita ch i C on st ru ct io n M ac hi ne ry V ol vo C as e N ew H ol la nd Li eb he rr In ge rs ol l- R an d JC B
S al es in b ill io ns o f d ol la rs
Figure 5-1: Largest global manufacturers of construction and farm equipment in 2005 (source:
Presentation Terex European Roadshow
3213
thJune 2005)
3332
Downloaded from Forbes.com
33
Based on their estimated Construction Equipment Sales in 2005. Total sales of Caterpillar before Power
Products, Financing and Insurance. Approximate last twelve months of net sales by Terex ended on March 31,
2005. Represents the Construction segments of Komatsu, John Deere, Volvo and Case New Holland. Sales of
Liebherr and JCB are estimated.
13
Crushing
&
Screening
Compact Construction Equipment
Heavy CE &
Mining Equipment
Aerial Work
Platforms Cranes Utility Equipment The Majors
Caterpillar x x
Komatsu x x
Case New Holland x x
Hitachi Construction Machinery x x
John Deere x x
Terex x x x x x x
The Industrial Conglomerates:
Ingersoll-Rand (Blaw-
Know/Bobcat) x
Volvo Construction Equipment x x
Metso (Svedata/Dynapac) x x
Sumitomo (Link-Belt) x
The Niche Players
Liebherr x x
JCB x
Manitowoc (Cranes-Business) x
JLG
Tadano x x
Astec x x
Altec x
Figure 5-2: An overview of the activities of the largest manufacturers in construction equipment
34Figure 5-3: Amount of tractor registrations in each Western European Country during 2005
34
Source: Terex, June 2005, Presentation Terex European Roadshow
35
Source: CEMA (European Committee of associations of manufacturers of Agricultural Machinery), Yearly
report 2005, Tractor Registrations in Western European Union - Years 2004 & 2005
14
Figure 5-5: European Construction Equipment Industry split by turnover generated in each country, with a total turnover of 17.5 billion Euros in 2004 (source: Yearly report published by CECE)
3636
Source: CECE (Committee for the European Construction Equipment Industry), April 2005, Economic report 2005, Facts and Figures about the European Construction Equipment Industry
Germany 28%
Italy 18%
Spain 3%
Sweden 7%
UK 18%
Netherlands 3%
Poland + Czech Republic
1%
Belgium 5%
Finland 5%
France 12%
Crushing &
Screening 9%
Tower Cranes 3%
Concrete Equipment
11%
Road Equipment
14%
Earthmoving Equipment
63%
Figure 5-4: European Construction Equipment Industry split by product categories, with a total
turnover of 17.5 billion Euros in 2004 (source: Yearly report published by CECE)
3615 Caterpillar inc.
Caterpillar is a manufacturer of earthmoving machinery, construction and mining equipment. 37 They also produce diesel and natural gas engines. Caterpillar is headquartered in Peoria, U.S.A. They generated $30.3 billion of revenue in the year 2004. Their revenue in construction equipment was 20 billion dollars in 2005. In Europe they generated $8.86 million of sales in 2005 38 .
Production Locations in Europe:
Caterpillar has established many production locations around the world. The following productions sites are located in Europe (source: Caterpillar, 2004) 39 :
• Belgium: Gosselies
• England: Leicester, Peterborough, Peterlee, Shrewsbury, Skinningrove, Stafford, Stockton, Wimbourne, Wolverhampton
• France: Arras, Grenoble, Paris.
• Germany: Bremen, Kiel, Rostock, Wackersdorf
• Hungary: Godollo
• Ireland: Dublin
• Italy: Anagni, Bazzano, Frosinono, Josi, Milan, Marignano, Minerbio
• The Netherlands: ‘s-Hertogenbosch
• Russia: Nosno
The Belgian factory in the city of Gosselies in Belgium is probably the most important production facility of machines and engines in Europe.
Terex 40
The American company Terex is a diversified global manufacturer and is based in the city Westport. In 2004 their net sales was approximately $5 billion. In terms of sales they are the third largest manufacturer of construction equipment in the world. Their products range from construction, mining, cranes to road building equipment. Some of their trucks are also built for the military industry. Terex operates in five business segments (percentage of total turnover): Terex Construction 32%, cranes 20%, Aerial work platform 20%, Materials Processing & Mining 13%, Roadbuilding/Utility Products and other 15%.
Main Production locations in Europe:
Terex construction:
• Germany: Delmenhorst, Ganderkasee, Vechta, Bad Schoenbom, Langenburg, Gerabron, Rothenburg, Crailsheim, Clausnit.
• England: Coalville, Coventry.
• Northern Ireland: Omagh, Dungannon.
• Scotland: Moetherwell.
• Italy: Perugio Terex Cranes:
37
Datamonitor, July 2005, Construction & Farm Machinery in Europe, Industry Profile
38
Source: Document published by Caterpillar, 2005, Caterpillar At a Glance
39
Source: Document published by Caterpillar, 2004, Caterpillar 2004 Global Network. Including remanufacturing sites and overhaul. The facilities of affiliated companies and subsidiaries are also included.
40
Sources: Presentation Terex European Roadshow 13
thJune 2005 and www.terex.com
16
• Italy: Fontanafredda, Milan, Crespellano.
• France: Montceau-les-Mines.
• Germany: Zweibrucken, Wallerscheid, Bierbach.
• Hungary: Pecs
Terex Materials Processing & Mining:
• Germany: Dortmund.
Terex Roadbuilding, utility products and other:
• Czech Republic; Koprivnice Case New Holland 41
Case New Holland is one of the largest manufacturers of construction and agricultural equipment in the world (source: Datamonitor). They are the second largest producer of agricultural equipment after John Deere. The company is also the third largest producer of construction equipment after Caterpillar and Komatsu. Their European headquarters is located in Amsterdam, the Netherlands. CNH Global N.V. is officially incorporated under Dutch law.
The Italian automobile company Fiat owns 85% of the company. Their brands include Case, New Holland, Steyr and Kobelco. CNH has a 75% equity share in a joint venture with Kobelco Construction Machinery SA that encompasses the operations and distribution networks of the two partners. Globally CNH employs over 26,000 people. In 2005 they recorded an revenue of $12.6 billion with a net profit of $163 million.
Production locations in Europe 42 :
• Austria
St. Valentin – Tractors
• Belgium
Antwerp - Components
Zedelgem - Combines, Forage Harvesters, Large Rectangular Balers
• France
Coex - Grape Harvesters Croix - Components
Tracy-Le-Mont – Components
• Germany
Berlin - Wheeled Excavators, Wheel Loaders, Graders
• Italy
Imola - Tractor Loader Backhoes, Mini-Excavators Jesi - Tractors
Lecce - Midi-Wheeled Excavators, Telehandlers, Dozers, Wheel Loaders Modena – Components
San Mauro - Crawler Excavators, Wheeled Excavators
• Poland
Plock - Combines, Balers
41
Sources: Datamonitor, July 2005, Construction & Farm Machinery in Europe, Industry Profile, Annual Report CNH 2005 and www.cnh.com
42
Source: Case New Holland, Available form: www.cnh.com [Accessed May 2006]
17
• United Kingdom
Basildon - Tractors, Engines (2) Deere & Company
Deere & Company is better known as John Deere. The company manufacturers a wide range of agricultural, commercial and consumer equipment and a wide range of equipment for construction and forestry (source: Datamonitor). Their headquarters is situated in the USA at the city of Moline, Illinois. The city of Mannheim, Germany, is the location of their European headquarters. In 2005 they reported a net income of $1.5 billion at a total revenue of $19,4 billion 43 . Around 63% of the company’s revenue is generated in the USA, while Europe takes up around 21% of the revenue.
Main European production locations: 44
• France
Fleury-les-Aubrais Cedex – Diesel engines
Gray Cedex - Balers, Forage Equipment, Material-Handling Equipment
• Germany
Bruchsal - Tractor and combine cabs & ROPS Mannheim - 6000 Series Tractors
Stadtlohn - (Kemper GmbH) Headers For Self Propelled Forage Harvesters
Zweibruecken - Combines, Self-Propelled Forage Harvesters, and Telescopic Loaders
• The Netherlands
Horst – (Machinefabriek Douven B.V.) Spraying equipment
• Spain
Madrid -Components Liebherr
Liebherr is a family owned group of companies that manufacturers a wide range of products.
They mainly produce cranes for several industries and the company is the 8 th largest manufacturer of construction equipment in the world. The European market is their most important market where they generate 66 percent of their turnover. In 2004 their turnover was around 4.6 billion with a workforce of 22,245 people. Most of their production is performed by factories in the countries of Germany, France and Austria. The holding company is headquartered in Bulle, Switzerland.
Main European production locations 45 :
• Austria
Bischofshofen - Wheel loaders
Korneuburg - Equipment for rail vehicles
Nenzing - ship-, offshore- and harbour mobile cranes, hydraulic duty cycle crawler cranes and lift cranes.
Telfs - crawler tractors and loaders
• France
Colmar – Crawler excavators, from 20 to 670 metric tons Toulouse – air systems for aircraft
43
Source: Annual Report Deere & Company, 2005
44
Source: http://www.deere.com/en_US/deerecom/johndeere_worldwide/index.html
45
Source: www.liebherr.com
18
• Germany
Bad Schussenried - wide range of mixing plant and truck mixers.
Biberach - Tower cranes, technical driveline components Ehingen - mobile cranes
Friedrichshafen
Kempten - CNC gear-cutting machines and automation systems.
Kirchdorf - Mobile excavators, hydraulic components Lindau - Electronic Control Units
Lindenberg – Undercarriages, aircraft control systems and aircraft electronics Rostock – Maritime cranes
• Great Britain
Sunderland - Ship-, offshore- and special purpose crane
• Ireland
Killarney - Container cranes
• Spain
Pamplona - Tower cranes, truck mixers
• Switzerland
Bulle - Diesel engines for construction machinery, driveline components Komatsu 46
The Japanese company Komatu is the second largest manufacturer of construction and mining equipment in the world after Caterpillar. They also produce industrial vehicles such as forklifts and are active in the electronics market. The global headquarters is located in Tokyo, Japan. Komatsu Europe International is located in Vilvoorde, Belgium. From this centre the import of the Komatsu machines, that are built outside the EU, is coordinated. This subsidiary also takes care of the parts distribution for Europe, Middle East and Africa. Komatsu has started a global cooperation in 2005 with the Germany Company Linde in the manufacture and sales of lift trucks. The company generated a revenue of $13.6 billion in the fiscal year 2005 with a net income (after tax) of $551 million. Around 15% of their turnover is generated on the European continent. The construction and mining equipment represent around 66% of the total sales.
Main European production locations:
• Belgium
Vilvoorde – Imports of Komatsu machines built outside the EU and parts distribution
• Czech Republic
Mnichovo Hradiste - Sheet metal products for construction equipment
• Germany
Dusseldorf - Super-large hydraulic excavators
Hannover - compact and medium-size wheel loaders and waste compactors
• Great Britain
Birtley - Large and medium-sized hydraulic excavators
Newcastle – medium-sized crawler and wheeled excavators and remanufactures major Komatsu components such as engines and transmissions.
46
Source: Komatsu Fact book 2005
19
• Italy
Este - rigid and articulated backhoe loaders, skid-steer loaders, mini and midi excavators
• Netherlands
Amsterdam – agricultural and forestry-related equipment.
• Norway
Kverneland - Teeth, Edges
• Sweden
Umeo - Forestry machinery (wheel type) JCB 47
The JC Bamford Excevators (JCB) Corporation produces industrial and farming equipment.
The company is headquartered in Rochester, UK. The company is privately owned by the family of the founder Joseph Cyril Bamford. JCB has workforce of over 5000 people around the world. Their most important factories for the European market are in the UK.
Volvo 48
The subsidiary Volvo Construction Equipment is part of the large Swedish Volvo group. The Volvo group produces trucks, buses and construction equipment, marine and industrial power systems and aircraft engine components. Construction equipment generates 15% of the net sales from the group. In 2005 the net profit of the construction equipment was around $387 million with a turnover of $4.8 billion. Almost half of their sales is generated on the European continent. The European manufacturing facilities are located in the countries Sweden (Articulated Haulers in Växjö and Wheel loaders in Eskilstuna), Germany, France and Poland.
Other manufacturers:
• Ingersoll Rand/Bobcat: An American manufacturer of construction equipment. Their subsidiary Bobcat has a manufacturing facility in Dobri, Czech Republic.
• Bumar – Polish manufacturer of construction equipment and military vehicles
• Agco cooperation – large manufacturer of agricultural equipment that incorporates many brands such as Fend.
European manufacturing locations:
Beavais France
Beaumenheim – germany Marktoberdorf
Kempten
Randers – Denmark Linnavuori – Finland Suolahti
Jyvaskyla
• Manitowoc - French producer of cranes
• Atlas Weyhausen – This German manufacturer of mainly wheel loaders is headquartered in Wildeshausen (Bremen) and it has a subsidiary in Hungary.
• HSW (Huta Stalowa Wola S.A.) – a Polish manufacturer of construction equipment
47
Source: Datamonitor, July 2005, Construction & Farm Machinery in Europe, Industry Profile
48
Source: Volvo group annual report 2005
20
Appendix 6: Casting industry
This Appendix will describe the European foundry industry in general. In section 6.1, the different casting processes and materials are described. The second section will give a short description of several important European countries for the foundry industry. Other data about the European foundry industry can be found in the appendices 7,8,9 and 10.
6.1 Product characteristics
Casting process
Casting is a technique to produce ferrous or non-ferrous product components. These components are most often used in vehicles. Since this casting process offers enormous freedom in terms of the shape of the product, this technique is also used for manufacturing product components in various types of machinery. Cranes, wind turbines, airplanes, boats etcetera all need parts that are casted. There are three types of processes in casting (source:
CBI) 49 : First, casting with sand (further subdivided into hand-moulding, mechanical moulding and shell moulding). Second, the low-wax model method, and third the casting in permanent shapes. Cross-Line only buys castings that are sand casted. This technique does not have the high volumes in permanent shapes but still enough quantities that is needed for the truck business. Sand castings also need a lot of machining treatment as the shape of the casting are not formed with the detail of the lost-wax method. The sand casting technique is further elaborated below.
Sand Casting
The sand casting method is a method for producing rough metal castings. These castings need to be further refined by hammering, polishing, machine grinding, or machining. During the sand casting process, a melt fluid is poured into a mould. When the fluid is cooled down the component is ejected to make a fabricated part or casing (source: Wikipedia) 50 . There are four main elements that are needed during the process of casting: flasks, pattern, mold, and the cores. Flasks are boxes made out of metal or wood that contains the moulding sand. Patterns are used to create a fitting cavity in the casting material in order to prepare the mold. Cores are used to produce the internal features of the parts such as holes or tunnels. These cores are placed into the cavity in order to produce these holes.
The type of sand defines the precision of the casted part is and how many times the sand can be reused. Casting with sand can be done by hand, mechanical, or automatic moulding.
Moulding by hand is done when parts are needed in very small quantities or to manufacture large and complex items. Higher volumes are fabricated by mechanical or automatic moulding, in which automatic moulding can produce even higher quantities.
Forging
This type of technique generates large quantities of identical parts. A block of metal is deformed under impact or pressure and reformed to the desired shape (source: CBI). For the manufacturing of automobile parts, this technique is often used because of its large production volumes. The forging of metal results in a stronger metal than cast or machined parts because also the internal structure changes. The most common processes in forging are:
49
CBI, Centre for the Promotion of Imports from developing countries, EU Market Survey Castings and Forgings, 2005
50
Wikipedia, 2006, http://en.wikipedia.org/wiki/Casting#Casting_in_manufacturing
21 drop/press/upset forging, cold forging, open-die forging and closed-die forging for non- ferrous metal.
Drop forging is performed by hammering down on the parts. This hammering process is powered by compressed air or steam (source: Wikipedia) 51 . Most often, the drop forging is performed by machine presses, which automatically form the metal into a desired shape.
Softer materials can be cold forged but iron and its alloys have to be forged hot. The reason for this is that hard materials such as iron and steel will become even harder and as a result very difficult to work with. Secondly, most steel alloys are hardened by heat treatments. Heat treatment is a group of techniques that hardens materials by heat.
Casting process Moulding
alloy Size Complexity Minimum
quantity a) casting with sand
- hand moulding - mechanical moulding - automatic moulding
steel, cast iron,
non-ferrous small to big simple to high moderate moderate
1 50 100
b) lost-wax model method
All metal alloys Small very high 500
c) permanent shapes Cast iron, non-
ferrous alloys Small to
average Moderate 10000
d) pressure die casting
Zinc, aluminium,
magnesium Small Simple to high high
e) lost foam Iron, steel, alloys high Used for large parts, 1 time use Table 6-1: Casting processes (source: CBI, 2005, EU Market Survey Castings and Forgings)
Cast iron: Cast iron is a group of iron-based alloys that contain more than 2 % carbon (source: Wikipedia, the free encyclopedia) 52 . This type of iron is made from melting pig iron and by removing unwanted elements such as sulfur and phosphorus. The most common used alloys are: grey, malleable and ductile iron and are further explained below:
Grey iron: This material is relatively easy and inexpensive to produce. Grey cast iron is different from white cast iron because of its higher content of silicon. This makes the iron less brittle. The name is derived from the colour of the fracture. The graphite flakes (irregularly shaped particle of graphite) redirect a passing crack and starts numerous new cracks as the material brakes, which as a result becomes a rough surface that appears grey. This type of iron has a lower tensile strength and ductility than alloys of a higher grade. The material will therefore fail more easier and will break suddenly in stead of bending. For that reason, this type of iron is used in parts where tensile strength is not critical such as engine blocks and valves.
Malleable iron: Malleable iron is formed from white iron that is heat-treated, which gives it a graphite free structure. This type of iron has a good tensile strength and is able to flex without breaking (ductility). Because of these characteristics, it is used for the smaller castings.
51
http://en.wikipedia.org/wiki/Forging
52
Wikipedia, The free encyclopedia, March 2006, http://en.wikipedia.org/wiki/Cast_iron
22 Nodular or ductile cast iron: This type of iron has the same excellent tensile strength and ductile properties as malleable iron. The only difference is that this type of iron also can be used for casting larger parts. Small amounts of magnesium or cerium are added to the iron in its liquid state. This allows the carbon to separate as particles with a spheroidal shape as the iron solidifies. This is also referred to as particles with a nodular shape. Components that are prepared from ductile iron are used in many industries. Examples are the automotive industry, wind turbines, construction machinery etcetera.
A new development is Austempered Ductile Iron (ADI). This type of iron is even stronger and wear resistant than ductile iron. It is formed by a heat treatment of the ductile iron.
Lighter alloys:
Aluminium castings 53
Aluminium castings have become more important for the automotive industry because of its lightweight properties, at the same time it still is a strong material. The casting processes of aluminium are often the same as in iron castings. Processes include die casting (high pressure and low pressure), gravity, vacuum and sand casting.
Magnesium castings 54
Traditionally magnesium parts are used in the aircraft and aerospace industry due to its light weight properties. A dramatic growth of magnesium alloy castings is caused by the automotive companies. They are forced to reduce the mass of the vehicles because of the sharp rise in fuel cost in recent years. The magnesium alloys also have certain advantages in physical and mechanical properties 55 : it is an abundant available metal, easier to machine than aluminium and can be (dry) machined much faster than aluminium.
6.2 European Foundry Industry
The iron, steel and malleable foundries in Europe had a total output of 12.3 million tons in 2004 (source: CAEF) 56 . Germany, France, Italy, Spain and Great Britain take account for 80% of the output in ferrous-metal castings and are therefore the five most important countries for casting components. The Spanish foundry industry expanded the fastest of these five countries in 2004 with a growth rate of 14.7%. Germany, Great Britain and Italy have shown growth rates of 6.0%, 5.2%, and 4.5%, while the foundry industry in France declined with 3.2%. Among the smaller producers, the Netherlands at 17.4% and Austria at 10.4% had the largest output gains. The total production volumes of the foundries in France, Belgium,
Czech Republic, and Portugal shrank in 2004.
53
http://www.azom.com/details.asp?ArticleID=1392
54
www.azom.com
55
http://www.key-to-metals.com/Article78.htm
56
Total of the CEAF (the European Foundry Association) member states : Austria, Belgium, Czech Republic,
Denmark, Finland, France, Germany, Great Britain, Hungary, Italy, Lithuania, Netherlands, Norway, Poland,
Portugal, Slovenia, Spain, Sweden, Switzerland.
23
Appendix 7: Iron, Steel and Malleable castings
Country Total Production in
1000 tons (2004) Number of foundries
(2004) Employment
(2004)
Austria 194.1 35 2853
Belgium 127.3 21 b 2110 b
Czech Republic 443.4 138 13246
Denmark 90.6 10 1219
Finland 120.3 19 2045
France 2058.6 161 21377
Germany 4088.4 265 42000
Great Britain 1046 280 17000
Hungary 84.8 45 2800
Italy 1507.5 237 17690
Lithuania 18.6 9 881
Netherlands 148 28 b 1819
Norway 60.5 10 1662
Poland 620.3 185 19250
Portugal 93.2 47 2255
Romania 400.0 a
Slovakia 100 a
Slovenia 126.4 18 2277
Spain 1141.8 101 12601
Sweden 256.7 49 3700
Switzerland 81.6 c 20 1822
a
In 2002
b
In 2003
c
without malleable iron castings
Table 7-1: Total production in metric tons, number of foundries and employment in the foundry industry for each European country in 2004
5757
Source: CAEF – The European Foundry Association, The European Foundry Industry 2004, Table 1, 3, 4, 8,
13, 15, p. 69-70, 76, 82-83, 124-125, 127
24
Appendix 8: Graph Iron, Steel and Malleable castings Production
Figure 8-1: Production of Iron, Ductile Iron and Steel castings in the European Foundry Industry in the year 1991 and 2004
5858
Source: CAEF – The European Foundry Association, 2004, The European Foundry Industry 2004, p. 122
25
Appendix 9: Average Production and Employment in 2004
59
Calculated from data in Table 7-1
Table 9-1: Average production and employment per 1000 Metric tons production and per Foundry in the year 2004
59Country Average production per
foundry in 1000 tons Total production
/# Foundries
Average employee per 1000 tons
production Employment/Total Iron
Average employee per foundry Employment/ #
foundries
Average production per employee in tons
Total production/#Employees
Austria 5.55 14.70 82 68
Belgium 6.06 16.58 100 60
Czech Republic 3.21 29.87 96 33
Denmark 9.06 13.45 122 74
Finland 6.33 17.00 108 59
France 12.79 10.38 133 96
Germany 15.43 10.27 158 97
Great Britain 3.74 16.25 61 62
Hungary 1.88 33.02 62 30
Italy 6.36 11.73 75 85
Lithuania 2.07 47.37 98 21
Netherlands 5.29 12.29 65 81
Norway 6.05 27.47 166 36
Poland 3.35 31.03 104 32
Portugal 1.98 24.20 48 41
Romania
Slovakia
Slovenia 7.02 18.01 127 56
Spain 11.30 11.04 125 91
Sweden 5.24 14.41 76 69
Switzerland 4.08 22.33 91 45
Turkey
Ukraine
26
0,00 5,00 10,00 15,00 20,00
Hungary Portugal Lithuania Czech Republic Poland Great Britain Switzerland Sweden Netherlands Austria Norway Belgium Finland Italy Slovenia Denmark Spain France Germany
Production in 1000 tons
Figure 9-1: Average production per Foundry in 1000 tons by European country in 2004
6060
Based on calculations shown in Table 9-1
27
0 20 40 60 80 100 120
Lithuania Hungary Poland Czech Republic Norway Portugal Switzerland Slovenia Finland Belgium Great Britain Austria Sweden Denmark Netherlands Italy Spain France Germany
Production in tons
Figure 9-2: Average production per employee in tons by European country in 2004
6161
Based on the calculations shown in Table 9-1
28
Appendix 10: Iron castings production for the vehicle industry in 2004
Country Year Iron Nodular
iron Share of total iron production
Czech Republic 2004 51.4 8.7 14
Finland 2004 1.5 21.6 19
France 2004 495.1 306.0 39
Germany 2004 212.7 769.9 24
Great Britain 2004 222.0 80.0 29
Hungary 2003 24.7 25.3 59
Italy 2004 328.3 145.2 31
Lithuania 2004 1.3 0.02 7
Netherlands 2004 40.4 33.6 50
Poland 2004 126.0 44.8 28
Portugal 2004 9.8 41.6 55
Spain 62 2002 53
Table 10-1: Production of iron and nodular iron castings for the vehicle industry in 1000 tons 63
Iron (incl. nodular) Castings for Vehicle Industry National Production Share Percentage 2004
0 10 20 30 40 50 60 70
Lit hu an ia Cz ec h R ep ub lic
Fin lan d Ge rm an y
Po lan d Gr ea t B rita in
Ita ly Fr an ce
Ne the rla nd s Sp ain 20 02
Po rtu ga l Hu ng ar y 2 00 3
Figure 10-1: National share percentage of Iron (incl Nodular) Castings for the vehicle industry in 2004
6462 According to an industry report by Subcontract Solutions, the Spanish automotive sector represents 53 percent of the iron production in 2002.
Source: Subcontract Solutions, October 2003,
http://www.subcontractsolutions.com/Newsletter/7/SpainFoundry_en.htm
63
Source: CAEF – The European Foundry Association, 2004, The European Foundry Industry 2004, table 8 and 15: p. 76, 83
64
Based on the data in Table 10-1
29
Appendix 11: Annual Labour cost per Employee in Western- and Eastern Europe
65 InfoBase, march 2005, Europe Fact sheet, http://www.ibeurope.com/Factfile/75labcost.htm
66
