View from the east

15 April 2008

In many ways the Bauma China 2006 exhibition in Shanghai from 21 to 24 November was an eye-opening experience. As one of 1,088 exhibitors In many ways the Bauma China 2006 exhibition in Shanghai from 21 tofrom 30 nations, SC&RA shared booth space with KHL, which publishes this magazine and American Cranes & other Transport. The number of exhibitors increased 47% compared to the previous event in 2004.

These exhibitors attracted more than 80,000 visitors from all over the world, about 60% more than two years ago. This exhibition provided considerable positive exposure for our association. We anticipate converting several of our visitors from China and other countries into SC&RA members this year.

The event also gave us an excellent opportunity to visit representatives from many of our current member companies. Particularly well represented were SC&RA Allied Industry Group members, including Kobelco, Liebherr, Manitowoc, Terex and others.

When we stepped away from our own exhibit, we were pleased to see the strong presence of our member companies in the four halls covering 46,000 m2 and an open-air site spanning 104,000 m2. Although the space increased by 50% compared to the last Bauma China exhibits were fully booked months in advance.

The majority of the companies exhibiting were domestic. Of the 732 domestic exhibitors, 505 were local Chinese companies and 227 were Foreign Invested Enterprises. Germany, Italy and the US were the three foreign countries with the most exhibitors represented at the trade fair.

Overall, it appeared that Chinese equipment manufacturers, while working on technological advancements, still lagged behind their counterparts in North America, Europe and Japan. A number of buyers and manufacturers domiciled in other nations expressed some concern about the current quality of Chinese equipment, particularly cranes.

We heard enough comments about the reliability, availability of parts, and service capabilities outside of China to believe this was more than speculation. This concern should in no way be construed as a derogatory commentary on Chinese manufacturing. The Chinese increasingly are showing they can produce world-class products to compete in a global marketplace.

The challenge facing them in our industry, however, is that they are trying to catch up at a time when manufacturers elsewhere are making remarkable advancements. Unfortunately, a few aggressive Chinese manufacturers have decided to take some evident shortcuts. Rather than undertake their own research and development, they are doing an incredible job of replicating products from their overseas competitors. To put it bluntly, some of the equipment manufactured by our members is being copied.

Feedback from a few top SC&RA member manufacturers suggests that the Chinese may not face infringement suits as long as the equipment remains in China. However, once they market and export their equipment to the global marketplace, they may likely face significant legal challenges.

Based on the advertising plans of some of these manufacturers, it seems clear they plan to operate in other countries. After Bauma China, we travelled to meet with the Crane Rental Association and the Crane Industry Council of Australia in Sydney and the Heavy Haulage Association of New Zealand in Wellington. These groups verified that the Chinese were testing their markets in Australia and New Zealand.

We will continue to monitor developments in this area and, if necessary, take appropriate steps to help protect our Allied Industries members from unfair competition. If you are in the market for products and services for the specialized carriers and rigging industry, we encourage you to support companies listed in the SC&RA Membership Directory.

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