Korean manufacturer Hyundai Heavy Industries (HHI) is spinning off its construction equipment division, with a new firm officially established under the name Hyundai Construction Equipment Co Ltd.
However, this newly-created company will change its name later this year to Hyundai Construction Equipment Europe.
All activities of HHI’s European construction equipment division are moving to the new company, which began on 1 April. Hyundai Construction Equipment Europe is to replace Hyundai Heavy Industries Europe and will report to Hyundai Construction Equipment.
Hyundai Construction Equipment is a separate, independent company now and no longer one of the business divisions of Hyundai Heavy Industries.
The spinoff is based on a restructuring plan which was started last year when the HHI board decided to break up the company into six separate companies. It said the new HHI would contain its shipbuilding arm, along with the Offshore & Engineering and Engine & Machinery divisions.
The company said that for the construction equipment division, the spinoff offered “great possibilities and an improved agility”. It said the newly-established mother company would be able to make independent decisions in the interest of the industries and markets worldwide.
Despite the fact the new firm is named Hyundai Construction Equipment, forklifts and construction equipment are to be manged equally, “with the same goal – to grow the market share”, according to the company.
Later this year, the European headquarters will move a few miles to Tessenderlo, Belgium, where a €30 million investment project is designed to help Hyundai Construction Equipment increase its sales in Europe. The 81,000m2 site will be home to new headquarters and a warehouse, as well as a training facility, an event hall and a showroom, which are now under construction.
The company said that for 2017, the European strategy was to focus on the mini excavator market and wheeled loaders for the recycling and related industries. In the forklift business division priority will be given to the heavy diesel forklift market and the warehousing range.
Both divisions will focus more on parts sales, said Hyundai. The European company will expand its dealer network, widen the product range and focus on key customers, it said.
Spinoff companies will be set up under the Hyundai Construction Equipment name in other areas such as the Americas, India and Africa.