Making Its Mark

With an enhanced product strategy, mature Middle East dealer network and new finance offerings, Zoomlion is growing its market share across key segments, representatives from its Dubai office tell Plant & Equipment magazine.

Zoomlion Heavy Industry Science and Technology Co, Ltd traces its roots to 1956, when it was founded as a government research institute. It became a for-profit company in 1992, and began international sales in 2000. Now, 20 years on, the company has forged a notable presence in several key segments in the Middle East, including tower cranes, mobile cranes and concrete equipment. Its product range extends across earth-moving machinery, aerial work platforms and forklifts. Revenue in 2019 was reported at 43.31bn yuan ($6.1bn), a 50.9% increase over the previous year, while profitability was up 116.4%.

Zoomlion is known for its 2008 acquisition of CIFA, an Italian manufacturer of concrete equipment, though the CIFA brand has remained relatively independent, with a separate sales structure in the Middle East. The acquisition has strengthened Zoomlion’s own range of concrete equipment, via the flow of technology and know-how into the Zoomlion design and manufacturing processes. CIFA was the first to use carbon fibre for its concrete pump booms – an advantage since the lighter material makes it possible to produce longer boom lengths while reducing stress on components, meaning a longer operation life. Today Zoomlion uses carbon fibre boom sections for some of its own products.

At the same time, the influx of capital into CIFA and a technical and cultural fusion helped generate new competitive advantages, with CIFA expanding its product line say Zoomlion executives, who characterise the partnership between the two companies as a ‘win-win’.

In 2018, the company acquired WILBERT TowerCranes GmbH, a German manufacturer of top-slewing tower cranes. Zoomlion followed a similar strategy, retaining the existing management and business focus while expanding the capital-intensive core business in Germany and international markets.

Flander Fan, Zoomlion Gulf General Manager.

In the Gulf Cooperation Council, the company has seen rapid success in recent years, with a mature dealer network and after-market support, says Zoomlion Gulf General Manager, Flander Fan. Improvements in product quality have helped win production recognition, he says. Notably, in 2014 Zoomlion embarked on a new product strategy, revolving around an Industry 4.0 concept, comprising improved production processes, European-quality components, apps to connect construction equipment to the Internet of Things (IoT), big data analysis and artificial intelligence. Today, its machines and vehicles have more onboard chips and sensors; making the machines smarter and safer. “We can use big data analysis to identify and enhance many quality issues,” explains Fan.

(from left)1. Mark Yang, Zoomlion Middle East Regional Director for Concrete Machinery. 2. Gavin Zen, Zoomlion Middle East Regional Director for Mobile Cranes. 3. Jet Ren, Zoomlion Middle East Regional Director for Tower Cranes.

In mobile cranes, the company began focusing on the GCC markets in earnest in 2013, says Gavin Zen, Zoomlion Middle East Regional Director for Mobile Cranes. Currently its most popular models are rough terrain cranes, all-terrain cranes, crawlers and truck cranes. It has sold more than 100 rough terrain cranes that are in use on Saudi Aramco sites.

When it comes to tower cranes, the firm has had success in Kuwait, Saudi Arabia and the UAE, including largecapacity cranes on notable projects such as the new Kuwait International Airport terminal. There are more than 500 Zoomlion tower cranes in the Saudi market, says Jet Ren, the Middle East Regional Director for Tower Cranes.

The company also sells a full range of concrete equipment – batching plants, transit mixers, truck pumps, trailer pumps and placing booms. On the ground, the team includes a number of Chinese engineers to provide product support. Headline projects include Dubai Creek, where truck pumps with booms of 43m, 49m, 52m and 60m are in use been sold, as well as stationary pumps and truck mixers. “In total there are around 100 Zoomlion units working in Dubai Creek,” says Mark Yang, Regional Director for Concrete Machinery – Middle East.

Fan says market share has been growing in key segments and countries, such as rough-terrain cranes and tower cranes. Market acceptance of its equipment is demonstrated by the fact that the machines are in use on mega projects, by topflight rental companies and by specialist oil & gas operators. He explains that Zoomlion sales teams will always target benchmark projects, since having their machines working for major contractors or on sites known for stringent standards, such as Saudi Aramco, accelerates market acceptance.

After-market support has also steadily improved since 2013, when the firm established one of its biggest global spare parts hubs in Dubai, covering the Middle East and Africa. “We want to guarantee that if any spare part is urgently needed, it can be supplied from this regional hub, one of six globally,” says Fan. Dealers themselves also need to have a significant level of spare parts on hand in their own workshop, and parts are available in short order from China.

Zoomlion’s intelligent factory for tower cranes in Changde, China. The factory, opened in 2019, has 12 automatic production lines and over 10,000 sensors and 100 industrial robots.

A further change is that the company has rationalised its product line to limit complexity, reducing the total number of models offered. In the rough-terrain crane segment, there were once something like 50 different models for the international market; now there are just seven. Spare parts commonality within the major product segments has also been increased, making spare part stocking more efficient for customers and dealers. Across the 25-tonne, 30-tonne and 55-tonne mobile cranes for example, as many as 60% of the spare parts can be exchanged between the three models, improving efficiency and lowering costs for customers, says Fan.

Overall, he sees Zoomlion as having made big strides, in a time when Chinese manufacturing in many industries has improved, shifting from a model of mimicking Western manufacturing to aiming to be innovators in their fields. “There is a big difference in our machines compared with 10 years ago – today they are smarter, safer and more efficient,” says Fan. Zoomlion has almost closed the gap with its European and Japanese competitors when it comes to technology, he believes, and it still enjoys a price advantage thanks to lower manufacturing costs. “Still we have areas to focus on and room to improve, but technology-wise I don’t believe there is a big difference between Chinese and the European or Japanese brands.”

The company also has a stand-alone finance house. Fan says Zoomlion is diversifying away from just selling directly and now offers purchasing support, including financing, rentals and lease-to-buy. “Now the Middle East is a strategic market, so finance-wise we will provide more options for our customers.” With a difficult outlook for GCC markets as long as oil prices remain low, Zoomlion and other Chinese manufacturers are well positioned to seize the opportunity during a difficult time, as margin compression makes customers even more price-conscious, says Fan. “Our price is very competitive, but also the perception of Zoomlion products is higher. We have improved the quality of our machines and we are ready for this challenge. We will be here both for the good times and the hard times.”