Review by Geographical Area
Overseas
In the overseas markets, Kobelco Cranes undertook the following activities to further expand its global reach.
Mega projects, such as the construction of railways, airports and LNG refining facilities, are underway in the Middle East, supported by the abundant capital gained from high oil prices. In this region, Kobelco Cranes reinforced its marketing by increasing sales personnel and new dealers, which resulted in successfully increasing the number of machines sold. Customer service system was also improved by starting a project to keep a large stock of parts for customers in the Middle East.
In the U.S. market where investment in residential construction has slowed down, environmental and energy-related investments, such as wind-power generation and highway maintenance, continues to be strong, supporting the high demand for cranes. Owing to the strong market, Kobelco Cranes, by expanding the number of dealers and service distribution outlets, was able to increase the sales volume.
In Europe, active marketing and strengthening relations with major contractors, rental companies and energy-related industries also led to increasing demand for the Kobelco Cranes’ products both inside and outside the European market, resulting in continued strong performance in the region.
In Southeast Asia, where development of infrastructure and the establishment of an industrial base bolstered demand for new machines, Kobelco Cranes South East Asia Pte. Ltd., the sales subsidiary established in June 2007, showed a profit in its first fiscal year. The number of machines sold greatly increased by expanding the number of sales and service distribution outlets to meet the demand in this region.
Kobelco Cranes was also able to maintain strong sales of new machines in most of the major world markets including South Korea, India and Australia, except China.
Strong sales of the 550-metric-ton large sized crawler cranes, launched in March 2007, resulted in steadily increasing the sales volume and profitability.
In anticipation of recession, Kobelco Cranes Trading Co., Ltd. is established in April 2008, to deal with used machines which are expected to be available in quantity in the future market of Middle East, etc.
Japan
In the Japanese market, overall demand for new crawler cranes increased 25% over the previous year. In meeting this demand, Kobelco Cranes was able to increase the number of units sold, thus maintaining the top market share in Japan.
Domestic demand for rough terrain cranes was also strong, increasing 23% over the previous year. In order to reinforce the wheel crane business, Kobelco Cranes is promoting the development of a new, city-conscious model wheel crane to meet the current needs of customers. This new machine will be released on June 1st, 2008.
To meet growing orders in the Japanese and overseas markets, Kobelco Cranes strengthened its procurement capabilities with the cooperation of its suppliers. On the production side, Kobelco Cranes began implementing just-in-time manufacturing, shortening the lead time and improving overall production efficiency, resulting in boosting production capacity. These steps contributed greatly to the higher number of units sold.
In terms of service, Kobelco Cranes developed Kobelco Crane Remote Observation System. This system has been in service for domestic market since April 2008 and it has contributed to increased customer satisfaction. In addition, the service operations were reorganized with this system.
In order to increase product-customizing capabilities, specialized subsidiary KC Technoservice Co., Ltd. was established in April.
Alliance with Tadano
For rough terrain cranes, Tadano supplies complete small models and the carrier portion of large models on an OEM basis. With demand continuing to be robust in Japan and overseas, Kobelco Cranes has maintained a favorable relationship with Tadano.
Outlook for Fiscal 2008
In the fiscal 2008, the domestic market is anticipated to continue its expansionary trend. Construction investment in mega projects in the Middle East is expected to be firm. As a result, although there are some uncertainties, the world crane demand is forecast to continue being strong. However, factors which curtail profits—the rising cost of materials due to high steel and oil prices, the difficulty in procurement caused by booming worldwide economy and unstable currency market conditions—are areas of concern.
With these business conditions, large sales growth is expected by increasing the number of machine sold in the fiscal 2008.
With the major activities shown below, Kobelco Cranes will establish a strong business structure to accomplish the objectives of its Medium-Term Management Plan "rebuilding the crane business".
Major Activities |
