ENTANGLEMENTS SPOTLIGHT MID-SOUTH REGION

Feature Article
- 11 Sep 2003 ( #124 ) - MEMPHIS, TN, United States
2 min read
Forklift industry legal and business developments in Memphis have highlighted the Mid-South region's dealerships and their distribution and manufacturing relationships.

Unsettling changes in some relationships are taking place, but a full understanding of how the players will eventually align awaits the outcome of litigation pending in a federal court.

One-time region-wide dealer CTK Inc, which represented Toyota Material Handling USA Inc (TMHU) until an August 1 termination, is highly unlikely to participate. And separate dealerships - the Lilly Co and newly formed sister company Mid-South Lift Trucks Inc (MLTI) - are in the unenviable position of serving different masters from the same premises. Lilly represents Yale Materials Handling Co (YMHC) and MLTI represents TMHU.

The pending litigation has revealed multiple issues and led to confusion among customers. Forkliftaction.com News has been covering the unfolding situation in recent weeks.

Meanwhile, several other dealers - and numerous influential outsiders - also compete to sell, rent and service forklifts in overlapping areas of the vigorous Mid-South region.

Dealers with local stakes include the Memphis branch of Johannesburg, South Africa-based Barloworld Handling, primarily dealing Hyster products; Delta Materials Handling Inc, representing four lines, including Mitsubishi and Clark; Grady W Jones Co, dealing in numerous brands, including Caterpillar and Komatsu; and Shaw Material Handling Systems Inc, which focuses on the Raymond line.

Delta, Jones and Shaw are locally owned, and each is based in Memphis.

YMHC and Hyster are operating units in the materials handling group of Nacco Industries Inc, of Mayfield Heights, Ohio. The Nacco ownership has meant Lilly, with the YMHC line, is in direct competition in the region with acquisitive Barloworld, representing the Hyster line.

For forklift vendors, it is an energised region housing major operations of Memphis-based global delivery giant FedEx Corp, close to barge traffic on the Mississippi River, and with distribution sites ideally located near the country's centre.

Increases in the distribution business have led to market demand for more forklifts. Distributors have found increases in per-square-foot costs for warehouse space require higher pallet stacking, and narrower aisles. They are obtaining forklifts to match those needs.

Historically, sit-down class 1-4-5 forklifts have dominated sales, but economic pressures have spurred business for providers of class 2-3 narrow aisle and walkie units. The market has "gone from 80% in classes 1-4-5 to 50%", says Barloworld Memphis branch manager Tim Lee.

While the dot-com expansion and bust stressed the Mid-South, some distributors in the region have bounced back and provided a strong base for economic growth and forklift demand, Mr Lee said.

Meanwhile, the legal entanglements keep market participants and observers watchful for the next forklift industry developments.

- Contact Roger Renstrom - www.forkliftaction.com
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