Why are high machine Oems changing their production plans?

With the increasingly severe international situation, localized production has become the key to the plans of aerial work equipment manufacturers. Providing local services to customers is not a new concept, but it is increasingly being reflected in the production layout of Oems. For example, Sin Bang Heavy Industries plans to assemble aerial work platforms at its production plant in Poland to supply the European market, which dovetails with tariffs on Chinese-made equipment entering the EU. However, Sinbang Heavy Industries has been planning to manufacture products for the European market at the Polish plant since 2021. Changsha, China-based Sinbang Heavy is pursuing a "Made in Europe for Europe" strategy, which means that its Poznan plant will be fully responsible for the assembly of shear and arm aerial work platforms exclusively for the EU market. Although there were already plans to produce products for the European market at the Poznan plant as early as 2021, the announcement of this strategy was made at a dealer Open Day in July, aimed at assuring Simbon Heavy's European dealers and customer base that the temporary tariffs would not have a long-term impact on their business. The provisional tariffs, which came into effect on July 13, imposed a 56.1 per cent duty on the company, which is appealing, with the Commission due to make a final ruling in December.

Richard Butler, chief executive Officer for Europe of SSCI, the Polish plant of SSCI, said: "Our strategy is clear; We are here today, we will be here tomorrow, and we will be here in the future. It couldn't be clearer." According to the ongoing investigation by the European Commission, 60% of the components of each aerial work platform must be produced outside China, and there must be clear traceability. The plan is that 75% of the components of the equipment assembled at the Polish plant will be sourced from countries other than China. Currently, the Polish plant produces shear and arm aerial work platforms for the North American market until its new plant in Mexico opens this year. The factory in Poland, covering 19,000 square meters, was established in 2021 and currently employs 120 people. Due to the challenge of hiring local skilled workers, more than 50% of the production staff at the plant come from countries outside Poland, including China, Ukraine, Southeast Asia and Colombia. To date, the plant has received an investment of 10 million euros and will have an annual capacity of 5,000 shear aerial work platforms and 3,750 arm aerial work platforms at full capacity. The company's strategy is to gradually launch European-localized products in Poland and continue to invest €60 million in the supply chain outside China over the next three years. In addition, a European R&D team will be established in Poznan, responsible for the development of localized products and the final certification of CE certified equipment. The company has sourced components from several countries, including drive motors and counterweights from India, batteries from Vietnam, blue frame components and chassis from Poland, Deutz batteries from Germany, tire components from Belgium, and various valves from Italy, among others. The Poznan facility complements Simbang's 12,000-square-meter European headquarters in Ridderkerk, the Netherlands, and its global headquarters in Changsha, China. In addition, the company has eight other offices worldwide with a total of 1,500 employees. To further expand its presence in Europe, Starbang will also set up a base in the UK, possibly in Derby.

Zoomlion shares the view that having physical production bases in key markets is the key to success. "If you really want to capture the overseas market, setting up a production facility is the only way," says Ren Huili, general manager of Zoomlion's intelligent aerial work equipment. In the future, Zoomlion aerial work Equipment will have three main production sites: a headquarters in Changsha, an existing Mexican plant in the US market, and a yet-to-be-built European plant. "We will also set up corresponding supply chains in these regions to meet production needs." Mr Ren added: "When I say globalisation, I don't just mean manufacturing in other countries, but also the globalisation of supply chains, logistics and transport systems. Globalization and localization will be our overseas strategy." What if tariffs are imposed on aerial work platforms made in Mexico? "We will set up a factory in Europe and possibly a production facility in the US," Mr Ren said. International perspective Liugong aerial work equipment general manager Li Ying also holds a similar view. The company's internationalization plan is divided into three main target markets: first, tariff-free mature markets such as the United Kingdom and Australia; Second are emerging markets, such as South America and Southeast Asia; Finally, there are mature markets with tariffs, mainly the European Union and the United States. "We started our overseas business in 2023 and one thing we won't do is compete on price - that would destroy trust and revenue," Mr Lee said. The advantage of Liugong aerial work equipment is that the parent company has a global business network and can easily store parts, which allows Liugong International to handle parts of aerial work equipment. In addition, Liugong has existing production facilities both domestically and globally, which means it can enter the market without making large-scale infrastructure investments. "We have been in business for a long time and our fixed assets are fully owned, so our costs are very low and we can make a profit even with a small volume of sales."

Earlier this year, Karel Huyser, general manager and vice president of Europe, Middle East and Africa (EAME) at JLG, said that JLG's production layout is becoming increasingly local and targeted, especially when it comes to collaboration. "Since joining in 2012, JLG has invested in small manufacturing plants in the UK (producing low-altitude working equipment) and a plant in Tonneins, France, for the production of Toucan lifts. These small plants are part of a larger strategic plan to meet region-specific needs and requirements. Both locations serve large markets for JLG devices. Having small, localised facilities means we can produce equipment more quickly and respond to changing customer needs."

Power Towers adds to JLG's product line and localization program

JLG, through its parent company Oshkosh, acquired Ausa, a Spanish manufacturer of compact devices, further expanding its scale. Ausa joins JLG in Oshkosh's Aerial Work Equipment division. Mahesh Narang, Executive Vice President, Oshkosh, said: "Combining our advanced technical capabilities with our strong training, support and service infrastructure, we will be able to better serve our customers and enable targeted growth." Since 2010, JLG has worked with Hinowa to produce four compact tracked aerial work platforms, which JLG sells outside the European Union under its own brand. The partnership has expanded to include six compact crawler-mounted aerial work platforms and two electric EC series second generation arm aerial work platforms - the EC450AJ and EC520AJ. "The launch of the second generation of the EC series is a great example of how collaboration based on the same values and a shared passion for product design and development can work successfully." Genie is hoping its new manufacturing facility in Monterrey, Mexico, will ease the company's backlog. Earlier this year, Genie President Josh Gross said: "The Monterey plant is gradually increasing capacity, and more production facilities will come online." Currently, Genie's plant in Italy supplies regions such as Europe and North America, and Gross said Genie is looking to increase production capacity for its telescopic arm forkloads. Of the China plant, Mr Gross said: "Operations there have been very successful." He added: "We are always thinking about how to produce the right model and configuration for export or for domestic demand. Therefore, we try to respond flexibly, constantly adjusting and optimizing the production layout. There is no significant surge in demand in any of the markets and we are ramping up all our lines as much as we can."