Covid crisis puts damper on crawler sales

Time. That is what it is going to take for the lattice boom crawler market to recover from the Covid-19 pandemic.

“The market dropped significantly from March 15th through May 30th due to the combination of low oil prices and the Covid-19 forced shutdowns,” said Kobelco’s Jack Fendrick. “The crawler crane business is very resilient and beginning in June, we are seeing contractors go back to work.”

The Covid crisis put a damper on sales at ConExpo, where crawler crane manufacturers had high hopes.

“The timing of the crisis plus the drop in oil prices had a negative impact on the traditional ConExpo Bump,” Fendrick said. “It is very understandable, way too many unknowns during the show and the 60 days after, for a customer to make large investment decisions. Kobelco will be here when the sky’s clear and ready to support our customers lifting needs.”

Fendrick anticipates that the crawler market will tilt more towards rental during the second and third quarters and a strong “retail” fourth quarter. He said if everything lines up and an infrastructure bill is passed by the U.S. Congress, the 2021 crane market could rival that of 2008 before the financial crisis.

Wind market interest

“We are starting to see more interest in crawlers 660 to 750-ton capacity due to wind energy projects moving forward,” said Tadano America’s Dan Melnyk. “We are seeing additional large crawlers migrating from Europe due to the economic slowdown.”

He said wind projects in the Midwest, South and West Coast regions have generated interest in the Demag 3800. The Covid-19 crisis has definitely had an impact on sales, as well as project delays and materials shortages.

“It has been felt throughout the supply chain in our industry,” said Melnyk. “The activity and opportunity level were very robust heading into ConExpo. Our customers have been hurt by project delays and an uncertain work condition environment with different states governing or mandating different rules. With most of the states reopening in early June, the activity level has started to trend positively with more cranes starting to move back out on rental contracts.”

He said Tadano Demag is cautiously optimistic that the economy will bounce back as state and local economies open up. All the OEMS are excited about the prospect of an infrastructure bill.

“This should push higher utilization of crawler cranes in the 110 to 300-ton capacity class,” Melnyk said.

Monitoring the market

Liebherr-Werk Ehingen’s Wolfgang Beringer says that while North America has always been known as a dominant market for crawler cranes, the market today is stable. Up until ConExpo, the market was solid, he said.

“The overall mood/spirit as well as the sales activity of the fair was very good,” he said of ConExpo. “Only the last days (Friday and Saturday) were slower. But overall, ConExpo was a successful event for Liebherr.”

Liebherr is monitoring global demand for crawler cranes very closely and will adjust its production accordingly.

Liebherr-Werk Nenzing’s Wolfgang Pfister said “the U.S. market has always been – by tradition – an important lattice boom crawler crane market. Looking at year 2019 and first months 2020, it is still strong and steady with constant sales.”

As for the balance of 2020, he said Liebherr customers are monitoring their investments closely.

“As governments worldwide are trying to keep investments in construction projects running, jobsites are lively and contractors are still in need of crawler cranes,” he said. “What we observe is a shift towards rental machines.”

While he thinks an infrastructure package from Congress would be a positive for the market, he said Liebherr expects that sales will be close to recent years.

“We do not expect significant growth,” he said.

Covid and energy

Over in Lexington, KY, Link-Belt’s Pat Collins characterizes the North American lattice crawler market as “a bit down,” due to the Covid-19 challenges.

“But the global oil situation is also responsible for some of the market being down,” he said. “Drilling activity in particular can have a significant impact on the small to mid-range crawler market.”

The market retreated just after ConExpo.

“ConExpo had its own strong momentum leading into the show and I think carried through to the conclusion with a strong attendance of crane buyers and with that orders,” he said. “Keeping our workforce healthy and protected now and in the future is our number one priority.”

As for the balance of 2020, Link-Belt is staying in close contact with market activity.

“We react up or down by communication with our manufacturing/purchasing team, allowing timely adjustments to our build and purchasing activities,” he said. “This ultimately provides a responsible inventory level for our distributor network and their customers without creating a backyard full of unsold cranes.”

On edge

The North American market has been strong with a considerable amount of construction ongoing across various industries, according to Brennan Seeliger with Manitowoc Cranes.

“The atmosphere has obviously been more on edge since Covid-19,” he said. “As economies are opening up, undoubtedly more construction will be ongoing. We are paying close attention to the market and together with our dealer network we will be ready to address the needs of the market.”

‘Still demand’

Olga Dubinok said Zoomlion recently commissioned a new 110-ton ZCC1100 crawler into the Southwestern U.S.

“There is still demand within North America and should react positively to the growth in infrastructure projects and energy sectors for specific crawler cranes,” she said. “The efficiency that crawler cranes can provide for these types of projects allow for overall growth in these classes of machines and provide a sturdy market despite uncertainties.”

Continued uncertainty has influenced timelines for projects and planned fleet updates.

“Zoomlion has observed interested parties that have incurred delays in commencing projects that may be pushed out, but still on the schedule to start within the next 6 to 12 months,” she said. “We are anticipating continuing discussions with interested parties that have upcoming projects that require equipment that Zoomlion can provide. Zoomlion continues to manufacture mobile cranes while evaluating the current situation and adjusting to the market needs.”

Modest plan

Sany America is also looking to expand its presence in North America, according to Nichole Greco.

“During ConExpo 2020 Sany introduced the all new SCA1000A and SCA2600A, 110 ton and 286-ton crawler cranes,” she said. “We are just entering the market with these new cranes. The traffic in our booth at ConExpo was very heavy all week with particular interest in the cranes. Everyone we spoke with said they were busy and currently have a strong backlog of work. We believe the market for lattice boom crawler cranes in North America is healthy. While the largest part of the market remains in the 100 ton to 150-ton class we are seeing the larger capacity segments growing.”

She said the pandemic did not put a damper on sales or orders taken at ConExpo.

“We talked with several people in the industry late last year and early this year in developing our strategic plan for 2020,” she said. “We have a modest plan for 2020 as we initially enter the market with these new products, ramping up to something more reflective of our true capabilities in 2021 but, regarding how we are positioned for the balance of 2020, our strategic plan has not changed.”