Spotlight Feature Articles LIUGONG MACHINERY | Page 2

HIGH PROFILE LiuGong at 62 – reaching new heights Paul Moore had the opportunity to visit one of China's largest mining and construction OEMs, LiuGong, at its HQ in the city of Liuzhou, and focuses here in on the company's unique background, breadth of offering and specifically its place in the mining market Around that time, company President Guang’an Zeng took over the overseas businesses. He led a group to North Africa and hired the company’s first ever overseas agent in Morocco. The company upgraded its export trade to full international marketing, which enabled targeted support from R&D, manufacturing systems, and distribution channels. In 2003, LiuGong started to establish overseas marketing networks. In 2009, its first overseas plant was put into operation in India. The company’s influence globally increased rapidly to the point where it soon became the most recognisable Chinese brand in construction and quarrying, in the 1990s and early 2000s. Since then SANY and XCMG in particular have also become giants in the world market, but LiuGong was the first and retains its importance and loyal brand following. LiuGong's largest wheel loader, the 8128H, working hard at an iron ore mine in Mongolia, where it has to endure extreme temperatures. It is part of a fleet of more than 10 large-tonnage LiuGong machines at the mine LiuGong is one of the most famous names in construction equipment, not just in China but around the world, with a strong heritage going back to 1958 when a 500 strong team was assembled from Shanghai and other parts of China in Longtengbei, then a remote corner of Liuzhou in Guangxi Zhuang Autonomous Region. The company established its reputation in China first for quality, premium technology and service. Its ZL50C loader for example, became a legend in the industry back in the 1990s, and has now sold over 200,000 units. In 1993 it was the first construction machinery company to be listed in an IPO on the Shenzhen Stock Exchange. In 2012 it was one of the first Chinese companies in this market to make a major acquisition overseas when it bought leading Poland based crawler dozer company Dressta, while it has founded important JV companies with Cummins and Metso (now Metso Outotec) in 2011 and 2014, building on a strategy that started with the founding of a JV with ZF for the production of axles and transmissions back in 1995. The company also showed vision when it employed American David Beatenbough as VP of R&D in 2006, managing those activities across five global sites including Liuzhou where he is based, as well as India, Poland, the US and the UK. He was the first senior western executive in the industry to be employed by a Chinese OEM and more importantly is based in China. This was a shrewd move in helping the company understand what global equipment users expect in design, quality and technology as well as service. Today, LiuGong employs over 10,000 people and produces well over 32 product lines. The Liuzhou R&D facility alone has a 100,000 m 2 footprint with a prototype centre, 12 labs and an outdoor testing area. It has the capacity to house up to 1,200 engineers. It includes a cutting edge semi-anechoic noise testing chamber. This facility has helped produce industry firsts such as the VL80A, the industry’s first vertical lift wheel loader with self-levelling Z-bar bucket launched in 2016 and the 4180D motor grader, which won the Red- Dot Award in 2019. More recent advances include the new F-series excavator lines as well as intelligent equipment. A timeline to global success LiuGong’s globalisation started with the export business back in 1993 when it was granted an import and export licence. Over the first 10 years, it only sold around a dozen sets of equipment annually to foreign buyers and failed to seek out the target clients in the global market. In 2003, the company adopted a new strategy of going global. An evolving domestic market IM met with Dave Beatenbough in Liuzhou who had some interesting comments on the Chinese market: “There is no doubt that the domestic market is challenging and competitive. The excavator market was traditionally not as price driven as wheel loaders as the market developed differently – it started with imports of Japanese brands into China which introduced premium products, technology and prices. So relatively speaking, excavators have retained price levels. In recent years, however, this has come under pressure as competition has increased. The technology of Chinese made wheel loaders has increased significantly at the same time though prices have failed to keep pace – the relative price of a wheel loader in China is still significantly lower than outside China though the products are now On the production line for LiuGong mid range wheel loaders in Liuzhou, China International Mining | SEPTEMBER 2020