CHINESE TECHNOLOGY
made in a facility expansion and new machinery.
“ We have a great product portfolio in China, but with the weak demand in the mining market we must ensure that we utilise our capacity the most efficient way,” said Johan Halling, President for the Mining and Rock Excavation Technique business area.“ Consolidating the operations will help us stay strong for the future. We will support the affected employees in this difficult situation.” Both operations primarily serve the domestic Chinese market.
Volvo and SDLG
In an announcement timed to conincide with Bauma 2016 in April, Volvo majority-owned Shandong Lingong Construction Machinery( SDLG) stated on the export market: " SDLG has set up distribution networks in over 80 countries since the formal establishment of the overseas distribution network system in 2004, and SDLG has been the synonym of‘ Made in China’ construction machinery in many countries … SDLG has won recognition in some high end markets. In North America, SDLG ' s brand has expanded from seven dealers and 12 agencies to 29 dealers and 53 agencies covering the US and Canada in only two years. Today, the Asian, African and Middle Eastern markets are still areas where SDLG shows the strongest momentum of growth. In 2014, SDLG became the first Chinese construction company brand to have set up a parts storage centre in Southeast Asia, located in Singapore, greatly shortening the parts supply time in the region; and in 2015 SDLG entered new markets in Myanmar, Nepal and East Timor, introducing wheel loaders, backhoe loaders and graders.” In Africa, SDLG launched a new product exhibition area in Morocco in July 2015 and a new parts and service centre in Sudan in June 2015. It also launched the B877 excavator at Bauma Africa.
While still a construction focussed company, like most of the major China-based companies,
SDLG is a good example of a value brand owned by a global player, in this case Volvo, which has its own separate but premium brand
SDLG has ambitions in mining.“ Besides the success in the field of energy-saving products, SDLG has also made extraordinary progress in the R & D of high tonnage products. SDLG now has four product lines, respectively, for loaders, excavators, road machinery and wide body mining vehicles, which can provide comprehensive mining solutions and are ideal for rapid overburden removal, loading, unloading, transit and transportation of mining materials.”
SDLG owner Volvo Group, through its ownership of Terex Trucks, also has a 25.2 % stake in Inner Mongolia North Hauler Joint Stock Co( NHL), the leading mining truck player in China, with the Baotou operation also supplied with engine / differential / transmission kits for its smaller Terex-branded trucks( name used under licence for sale in China) from Terex Trucks in Scotland. NHL’ s market share in the mining truck market in China has been estimated to be as high as 75-80 %.
Engine relationship deepens
LiuGong and Cummins have officially announced an expansion on their joint venture investment in the manufacturing of non-road engines at Guangxi Cummins Industrial Power Co Ltd( GCIC). LiuGong, a global leader in manufacturing a full line of extreme duty equipment for mining and quarrying, has contributed to a cash injection of RMB240 million, an investment equally shared by LiuGong and Cummins. This will go towards key capability building as well as product and technology enhancements.
As a result of investment expansion, GCIC can now“ further utilise its production capacities and key advantages, optimise manufacturing efficiency, and lower operational cost by strengthening the cooperation on the supply chain with partner enterprises.”
More enhancements will also be made to the whole value chain system, including research
and development, manufacturing, quality assurance and marketing after-sales services.“ This enhancement will further build GCIC’ s competitive edge, and create better value for customers.”
LiuGong’ s Vice President Huang Haibo commented on the investment expansion:“ The increase of investment fully embodies both sides’ confidence in the healthy development and bright future of GCIC. As new capital input is coming, GCIC will further exert its win-win advantages.”
The partnership between LiuGong and Cummins was first forged in 2013 to bring GCIC top-level engine technologies to a world-leading machinery plant. This combination has brought many third-generation products to the Chinese market, including the L9.3, QSB7 and QSL9.3, with both brand and products receiving a good reception from customers.
As Euro-III non-road engine standards are being applied nationwide in China, and its advantages on products and technologies are becoming more obvious, GCIC has also looked at further conquering the assembly market.
Wang Ning, Cummins’ Vice President and General Manager of China Engine Division JV Business Operation, added:“ By utilising Cummins’ manufacturing capacities, technical reserve and scale advantages, GCIC will provide more competitive products and technologies to LiuGong and other customers, helping them make more breakthroughs in domestic and overseas markets.”
View from established global player
IM spoke to Rajiv Kalra, CEO of CITIC HIC, which has been one of the most successful mining equipment companies to make an impact globally, about how Chinese companies are building their influence, helped by growth in Chinese owned mines and assets. He comments:“ Access to global markets by Chinese companies is now fully accepted worldwide. This is due to a combination of increased Chinese investment in the sector, China being the largest consumer of mined products and the large installed base of Chinese equipment operating successfully throughout the industry. Chinese equipment has been supplied successfully to the industry worldwide for decades. It started by major international OEMs and engineering companies procuring equipment through China with companies like CITIC HIC and has now progressed in the last decade to direct marketing by Chinese companies to major mining and engineering, such as EPCM companies.”
There have also been a number of major buyouts by Chinese players of Western companies, such as PALFINGER and Putzmeister by SANY, CIFA by Zoomlion and DRESSTA by
152 International Mining | SEPTEMBER 2016