The past year has been a mixed bag for materials handling, with demand for equipment soaring, but supply chains under extreme strain. Allan Leibowitz summarises the year’s highs and lows.
A common theme in the financial reports of the major manufacturers has been rising demand – almost across the board.
This trend is confirmed by Tim Waples, CEO of the UK Material Handling Association: “Rising confidence as business looked for a swift recovery from a succession of pandemic-induced lockdowns helped to generate unprecedented demand for new (forklifts) across nearly all sectors of the market during 2021 and underlined why it has been such a strong year for the UK materials handling sector”.
He adds that keeping pace with such a volume of orders has brought significant challenges, and with demand expected to remain strong well into 2022, the materials handling sector is likely to be stress-tested once more.
The big challenge, he observes, is the ongoing shortage of critical components, preventing manufacturers from meeting the strong demand. “Dealers are also having to temper expectations on deliveries when taking orders for new machines.
“With restrictions on the supply of new machines, end-users have been trying to source good quality used equipment, to the point where this also is in short supply.
While this is a challenge not unique to the materials handling sector, it is nevertheless frustrating,” he explains.
Across the Atlantic, John Paxton, CEO of the major United States industry group MHI, characterises 2021 as a year of disruption and shortages.
“The pandemic was unique in that it dramatically impacted both supply and demand. With millions staying at home during the pandemic, demand changed dramatically - first down, and then quickly rising. Supply chains that were operating as just in time had difficulties to meet this rising demand, especially when faced with pandemic-related plant closures, material shortages and ongoing worker shortages.
“Nearly two years into the pandemic, many manufacturers still aren't operating at pre-pandemic capacity. For example, a shortage of semiconductor chips led to a dramatic shortage of products that require these, including consumer electronics, cars and appliances, as well as some toys.”
As long as the shortages continue, Paxton predicts higher prices, inflation and fewer available products.
But he stresses that even amid this disruption, materials handling equipment manufacturers had a record year in 2021 with strong new orders and shipments in most equipment categories. “Companies are continuing to invest in equipment for their facilities to help them handle the increased demand,” he notes.
In similar vein, Liz Richards, CEO of MHEDA (Material Handling Equipment Distributors Association), highlights the supply challenges.
“The difficulty obtaining products due to supply chain disruptions and other factors has been a major source of frustration.”
She points out that rental fleets and used equipment inventories have been depleted and lead times for new equipment are well into 2022. This has also created challenges in trying to satisfy customer demands.
Another challenge is inflation, and MHEDA members have had to closely monitor and adjust their pricing strategies as a result.
Richards adds that another obstacle has been the availability of talent. “The talent challenges include replacing those who are retiring, on-boarding new employees in these robust times, training, retaining and dealing with wage pressures across all wage segments. Most MHEDA members are trying to hire for positions across the board, not just skilled labour which has been the primary shortage in previous years. LinkedIn is filled with job postings seeking new hires.
“Many companies are trying to balance their employees’ demands to remain in a remote, work-from-home or hybrid environment. It is often difficult to maintain a healthy company culture while also providing the flexibility employees are seeking. Improving culture is a primary focus for most of our members as it covers both recruitment and retention of good employees.”
In the UK, there is cause for cautious optimism about the skills shortage, according to peak body Logistics UK.
The recent Logistics UK Skills Report 2021 reveals that significant steps have been taken to help address the recruitment issues which have plagued the sector for years, with government and industry working together to increase capacity to test new operators, provide new training schemes and commit to improving facilities available to those working across the roads network. But as Elizabeth de Jong, policy director at Logistics UK, explains, while there has been progress, there is still much work to do.
“There needs to be continued focus from government to ensure (improvements) are delivered, so business and industry can take full advantage and continue to raise awareness of logistics and the opportunities it offers,” she says.
The Association of Industrial Truck Trainers (AITT) notes disruptions to training activities which have impacted the UK talent pool.
AITT managing director Adam Smith explains that many training courses had to be cancelled or postponed last year, and social distancing requirements meant those courses that did continue had to do so with fewer delegates.
“This situation carried over into early 2021. As more companies began to return to normal service throughout this year, the renewed need for operator training resulted in a slight backlog in the availability of accredited training providers,” he says, adding that wait times for training courses became longer than normal, as many instructors were busy catching up.
“However, it is essential that anyone working with workplace transport equipment has the necessary skills and competence to work safely, which is why we urged businesses to prioritise novice training and consider delaying refresher training by a few months. This advice was backed by the HSE. It was important that employers continued to use only accredited training providers, so as not to compromise on the quality of training they received.”
On a positive note, Smith notes that the backlog thinned out somewhat as the year went on, and he believes normal service is resuming within the training sector.
For the crane sector, COVID and its associated ongoing restrictions was undoubtedly the biggest trend globally over the past 12 months, according to Ross Moloney, CEO of the Lifting Equipment Engineers Association (LEEA). “UK members have also been contending with Brexit. They need LEEA’s support in terms of explaining how relevant standards are being changed and tweaked,” he says. “The association’s technical team has put a great deal of effort into ensuring they are visible and accessible to members and are looking at these issues with a LEEA and UK perspective.”
Looking more broadly, Moloney says policy makers around the world need to recognise and support the role lifting plays across numerous key industries and in improving health and safety at work. “We want to remind end-users how important it is to use high quality suppliers who utilise experience and high-quality training, and who routinely develop innovative solutions,” he says.
Linde Material Handling had two significant milestones in 2021. In April, Linde completed its millionth counterbalance truck on its Aschaffenburg assembly line and then presented the vehicle to customer Colorobbia España. Coincidentally, the Spanish customer celebrated its centenary in 2021.
Linde has been manufacturing counterbalance trucks at its Aschaffenburg production site since 1959.
The company also marked the 50th anniversary of its move to electric forklifts in May, noting that the line made its debut at an industrial trade fair in Hanover in March 1971.
"Looking back, it was a decision that set the course for the future," said Stefan Prokosch, senior vice president - brand management at Linde. "Today, we not only offer our customers a huge portfolio of electrically powered industrial trucks with a variety of energy storage systems, but we also use our expertise to electrify vehicles of all kinds - from hackney carriages to trolley cars."
Toyota Material Handling (TMH) recently reached a manufacturing milestone with the production of the 750,000th forklift to roll off the line at the company's factory located in Columbus, Indiana in June. The 750,000th forklift was an electric model launched by TMH last year, and the first to be completely designed and developed by TMH's engineering team in Columbus.
Kalmar completed its 75,000th Ottawa terminal tractor early in the year, delivering the milestone truck to long-standing customer Lazer Spot Yard Management. The manufacturer also produced its 3,000th Kalmar reachstacker in China in July. Destined for a long-standing customer, Ningbo Meidong Container Terminal CO. Ltd., the machine was completed at Kalmar's manufacturing facility located in Lingang, Shanghai, with employees and guests gathering at the plant to celebrate the achievement.
Liebherr Rostock shipped its 1,300th maritime crane from Rostock, Germany to Ghana in July. Since the start of production in 2005, Liebherr-MCCtec Rostock GmbH has manufactured and delivered maritime cranes to over 100 countries on all continents. The milestone crane, an LHM 550, was one of two Liebherr mobile harbour cranes that will begin the 5,500 km journey to Ghana, where they will service the West African Port of Tema.
In July, Irish manufacturer Combilift produced its 60,000th unit, a Combi-CB3000 shipped to a site in Toowoomba, Australia.
Yale marked 40 years of manufacturing at Craigavon in Northern Ireland in November. Since the plant opened in April 1981, thousands of forklifts have been manufactured and exported to locations throughout Europe, the Middle East and Africa.
Konecranes delivered its 10,000th lift truck, a Flow Drive reachstacker, to Absolut Vodka in Åhus in the southern Swedish province of Skån in November. The 10,000th truck was a Konecranes SMV 4632 TC5 reachstacker, a sturdy 46 T machine able to stack up to five containers high.
In December, the 750,000th engine came off the line at JCB Power Systems in Derbyshire, where production first began in 2004.
Mergers and acquisitions
One of the industry’s biggest mergers which dominated the news during the year, the union of Cargotec and Konecranes, has hit some serious hurdles.
Just this month, the UK Competition and Markets Authority (CMA) raised concerns about “a significant reduction in competition in the supply of a range of container handling equipment products”.
The merger partners responded that they disagree with the CMA’s provisional conclusions, noting that they are in discussions with other relevant competition authorities, including the European Commission and the US Department of Justice, and are considering ways to mitigate some of the concerns raised by the different competition authorities.
The deal is also under fire in Australia, where the competition watchdog has expressed concerns and called for submissions from interested parties before making a final determination in February 2022.
To address the concerns of competition authorities, the two companies ended the year with a compromise suggestion – offering to divest Konecranes’ Lift Truck business and Cargotec's Kalmar Automation Solutions. The proposed divestitures would eliminate overlaps between the parties’ container handling equipment businesses but allow the combined company to combine with others and continue to be a strong player in all aspects of container handling equipment, according to a joint statement.
Cargotec, meanwhile, completed the sale of its Navis business to the US technology investment firm Accel-KKR for an enterprise value of EUR380 million (USD450 million). Cargotec’s Hiab subsidiary subsequently acquired the US demountables manufacturer Galfab, which makes roll-off hoists and related equipment for the domestic waste industry.
In March, Japan-based Mitsubishi Logisnext took 100% ownership of Mitsubishi Logisnext Americas. Subsidiary Mitsubishi Caterpillar Forklift America Inc. (MCFA) acquired the MCFA shares held by its minority stockholder, Caterpillar Industrial Inc., a subsidiary of Caterpillar Inc.
Caterpillar Inc. and the Mitsubishi Logisnext Americas group continue their long-term strategic relationship, working together to deliver new products and solutions for their customers. The Cat lift trucks brand will continue to be used globally by the Mitsubishi Logisnext group.
On similar lines, an intermediary holding company, Hyundai Genuine, was established in November, following the purchase in August of Doosan Infracore by Hyundai Heavy Industries Group. Doosan Infracore has since been renamed Hyundai-Doosan Infracore.
Hyundai Construction Equipment and Hyundai-Doosan Infracore will continue to operate under their own management systems, competing as sister companies within the global equipment market.Hyundai Genuine would provide support to both businesses, while maximising the available synergies between the two.
Belgian parts giant TVH, regularly featured in Forkliftaction News for its acquisitions, made the headlines in March with an ownership reshuffle.
The Vanhalst family took full control of the Mateco machinery division, in which it previously held a 50% stake, while the Thermote family took control of the TVH Parts division, with a 60% stake. Both families retained their interests in TVH Equipment nv, the Belgian branch of Mateco, the business "where it all started 50 years ago”.
In July, TVH sold the 40% stake previously held by the Vanhalst family to D'Ieteren Group, a listed company comprising four activities: D'Ieteren Automotive, Belron (Carglass), Moleskine and D'Ieteren Immo.
The ownership reshuffle didn’t halt the acquisition efforts, with TVH Parts Holding buying Dutch parts dealer Van Gent Forkliftparts. TVH also acquired the shares of Battery Supplies in Deerlijk, Belgium and its subsidiaries in Meyzieu, France (Battery Supplies France) and Erftstadt, Germany (BATTEC Batterie Vertrieb).
In other acquisitions, Palfinger took over TSK Kran und Wechselsysteme which produces a wide variety of tipper, crane and platform bodies and other special vehicle components and had worked with Palfinger for more than 20 years. Early in the year, Palfinger acquired its Iberian dealer, Equipdraulic, in Barcelona. This acquisition strengthened Palfinger Iberica's position in the Spanish market, especially in Catalonia, a strong industrial region.
Another dealer acquisition saw Hubtex acquiring a 50% stake in its North American distributor, Design Storage & Handling (DSH).
In October, attachment maker Cascade Corporation successfully completed the acquisition of mast manufacturer Lift Technologies, Inc. (USA) and Lift-Tek Elecar S.p.A. (Italy) from Calvi Holding S.p.A as wholly owned subsidiaries.
In the UK, Briggs Equipment had a busy year, completing the acquisition of JB Plant Hire, one of Northern Ireland's leading plant hire companies. Earlier Irish acquisitions saw Briggs take control of Laois Hire in Portlaoise and Balloo Hire Ltd in Dublin. In December, Briggs Equipment completed the acquisition of materials handling dealer Forkway Group. The company, which has been a sub-dealer of Briggs for 10 years, has three UK sites in Amersham, Dewsbury and Southampton.
In the biggest shake-up of the auction market, Ritchie Bros acquired Euro Auctions group for an enterprise value of GBP775 million (USD1.08 billion).
As the battery market heated up, fuel cell specialist Ballard Power Systems acquired Arcola Energy, a UK-based systems engineering company specialising in hydrogen fuel cell powertrain and vehicle systems integration. Meanwhile, Concentric bought All Battery Sales and Service, a leader in DC power for forklifts as well as automotive and specialty power products. This acquisition extended Concentric's footprint into north-western US, including Washington, Oregon and Idaho.
Separately, Exponential Power, a leading provider of stored power solutions, announced its strategic acquisition of Maryland-based Static Power. Headquartered in Columbia, MD, Static expands Exponential Power's service offerings to the Mid-Atlantic corridor and supports its mission of delivering reliability and advancing technology.
In November, Pyroban acquired one of its partners, specialist work platform manufacturer Euro Access in Cork, Ireland. Euro Access manufactures ground support equipment specifically used for the maintenance of military aircraft. Pyroban was involved in the equipment’s original design process and certification in the 1990s with Euro Access’ founders Paul McHugh and Michael Buckley.
There was plenty of movement on the dealer front in 2021, especially in the United States. It was a particularly busy year for Clark Material Handling Company, starting with the appointment of Duke Equipment Company, a subsidiary of Ogden Forklifts Inc., as an authorised distributor of Clark products in the Orlando and Jacksonville, Florida markets.
This was followed in June by the appointment of Reliable Forklift Sales as an authorised distributor of Clark products for the Arizona market and, in August, Clark appointed Conger Industries as an authorised distributor of its products for the Wisconsin and Upper Michigan market.
Clark Europe also extended its market presence in the Benelux countries with the appointment of Europieces Luxembourg S.A. as its new sales partner.
Wolter Group rebranded the company and its eight sub-brands as Wolter, an industrial solutions provider focused on accelerating productivity for its customers.
In November, Wolter acquired Advantage Materials Handling Group, with locations in South Bend and Goshen, Indiana. This marked Wolter’s 12th acquisition in over 10 years, as well as becoming the company’s 16th location.
In November, Shoppa’s Material Handling added Dematic equipment to its product range across North America. A few months earlier, Shoppa's opened a new Amarillo, Texas location.
In April, Toyota Material Handling North America (TMHNA) launched a two-brand, one-channel distribution trial program with the dealer networks of its two main group companies - Toyota Material Handling and The Raymond Corporation - in an effort to address the evolving needs of customers.
KION North America dealer HTX Material Handling opened a new location in Carrollton, Texas (HTX Material Handling Dallas). This augmented HTX’s operations in Houston and surrounding areas. Meanwhile, KION dealer Carson Material Handling added two locations to better serve its customers in Charlotte and Morrisville (Raleigh-Durham area) in North Carolina. In another dealer expansion, Lift Parts Service, L.L.C. added an additional location to better serve its customers in Garden City, Kansas with Linde and Baoli products.
Equipment Depot started the year with the purchase of Capital Equipment & Handling (CEH) and its four Wisconsin locations. Equipment Depot was later appointed as a dealer for the Cat lift truck, Mitsubishi forklift and Jungheinrich brands across Wisconsin and Northern Michigan, enabling the chain to represent the brands across 23 states and 50+ locations.
In January, Tri-Lift purchased Vantage Equipment's materials handling group, a Cat Lift Trucks and Jungheinrich forklift dealer covering 18 counties in central New York. The acquisition expanded Tri-Lift's Cat and Jungheinrich service territory from the prior footprint consisting of Connecticut, Western Massachusetts, Vermont, Eastern New York from Long Island, and New York City in the south all the way to the Canadian border in the north.
In one of the biggest European dealer shake-ups, the UniCarriers brand began to "gradually disappear" from France as Logisnext France integrated its UniCarriers operations with those of the subsidiary Mitsubishi Forklift Trucks France in Lyon. This was part of the integration of the European companies Mitsubishi Caterpillar Forklift Europe (MCFE) and UniCarriers Europe (UCE) into Mitsubishi Logisnext Europe which began in April 2020. Later, Berner Oy sold the Berner's Machinery business to Logisnext Finland, shifting representation of the Mitsubishi Forklift Trucks, Combilift and Dulevo sweepers brands to Logisnext Finland.
In July, Brubakken AS in Norway and Brubakken AB in Sweden were appointed as distributors of Hyster equipment, while Medley Material Handling Company acquired all Hyster assets from Briggs Equipment Arkansas. Medley took over operations in all previously serviced Briggs territories including Little Rock and Springdale.
In September, Yale Europe Materials Handling increased its footprint in the Middle East with the appointment of a new dealer in the Kingdom of Bahrain, Banz Trading & Contracting WLL.
Chinese brands increased their dealer footprints in the US in 2021, with BYD adding
Forklift Systems, Big River Equipment Inc and LiftTruck Parts and Service Inc to its network, while Ogden Forklifts was added to expand its reach in the American south-east.
LiuGong continued its North American dealer push, adding Industrial Repair Service Inc. as its forklift dealer in Wisconsin.
In Canadian developments, Baumann appointed MacFarlands Industrial as its distributor in Nova Scotia, New Brunswick, Newfoundland and Prince Edward Island. Close by, Leavitt Machinery from Surrey, British Columbia acquired Provincial Lift Truck serving the Kitchener area.
The year started with the loss of an “industry legend”. Hyundai Construction Equipment Americas executive vice president and COO Chuck Leone died of complications due to COVID-19.
Leone's career spanned over 50 years. Starting out in national account sales at Clark, he then moved on to greater achievements and responsibilities as branch manager for a Yale factory store. He was VP of sales and marketing at Nissan Forklift and then VP of sales at both GNB Battery and Jungheinrich, before arriving at Hyundai, where he significantly grew Hyundai Forklift's distribution network and overall business in North America.
His career achievements reflected his great love and respect for his family, employees, dealers and customers. He lived by the motto "always do the right thing and you'll win in the long run", which he applied in business and proved successful throughout his career. His hard work and dedication earned him the Hyundai Global Employee of the Year Award in 2019, an award he received with great honour.
In July, the Lifting Equipment Engineers Association (LEEA) expressed its sadness at the loss of "a dear colleague and friend", Craig Morelli, who sadly passed away after a short illness.
Morelli joined LEEA in 2011 as a training officer, directly from his successful career in the British Army in which he served for 24 years. His last role was as LEEA's compliance and quality manager, overseeing the association's Accredited Training Scheme and training operations.
Another significant industry leader lost in 2021 was Professor Daryll Hull, a fellow of the Chartered Institute of Logistics and Transport (CILT), a fellow of the Australian Institute of Company Directors (AICD), and a fellow of the Global Labour Organization (GLO).
With an illustrious career spanning 40 years, Hull had a tangible impact across the realms of industry, business, government and academia. Through his commitment and dedication, he left lasting impressions on many and will be remembered for his brilliant mind, generous spirit and steadfast belief in the form and meaning of decent work, cooperative management and common ownership as the underpinnings of a new global social and economic paradigm.