Backhoe loaders: Gearing up for growth
A perennial volume churner in the Middle East’s construction equipment sector, the backhoe loader is expected to continue to go strong as manufacturers make improvements ready for tomorrow’s construction landscape
The backhoe loader is a curious case in the world of construction equipment. It is at once both an indicator of the state of sophistication of the construction sector in a market and a marker of its economic health – and in a paradoxical way. Backhoes are not typically favoured in the advanced developed markets like Western ones, while they are the equipment of choice in developing markets such as the Middle East, Africa and India.
That the Middle East is fascinated with this versatile piece of machinery is well known. And from the way the machine is selling, as well as what the major manufacturers plan to do, it seems the days of the backhoe will continue for quite a while longer in this region.
As Gaby Rhayem, Bobcat’s regional director for the Middle East and Africa, puts it: “The backhoe today is a very, very good and important business in the region. Even though there is a slowdown, this category is still selling well. For Bobcat, it’s a very promising field and we believe this product will be developed a lot more in the future.”
Development of the product is what will be key to its future sales. This is because, typically, a backhoe, being a general machine, can be said to be substituted by two important pieces of specialist kit – the skid-steer or compact track loader (CTL) and the mini excavator. While the Middle East has hitherto seen only a trickle in compact equipment, the times are changing. The sales of both have registered substantial rises. Many contractors have made CTLs and compact excavators their go-to machines while their backhoes sit idle or are sold. Many contractors are using the two compact machines to replace a single backhoe, and are getting productivity gains with this strategy.
In this, the Middle East is now starting to mirror many advanced western markets, where the popularity of the backhoe is a thing of the past and the compacts have fully taken over. So, is this the beginning of the end for the immensely popular backhoe in the region?
Hardly, says Case Construction Equipment’s construction product specialist Zane Barnard. “While backhoes come in a wide range of sizes, on average they are bigger and more powerful than compact machines. As a machine with a larger size, reach and height, coupled with more power, a backhoe is capable of heavier work than compacts or skid steers.
“A backhoe’s bucket is also bigger than compact loaders and its horsepower and more powerful hydraulics allow for lifting heavier loads. It also has stabilisers, which enhance its capacity to tackle the heavier stuff.”
Typical applications that backhoes are used for are stockpiling, loading trucks, trenching and lifting, which is not within the capability of compact machines. Also, compact equipment cannot easily replace the larger backhoes.
“Whatever their size, backhoes offer more versatility than compact track loaders, excavators and even skid steers in certain applications,” says Bobcat’s Rhayem. He should know. Despite being known the world over as a compact machinery specialist – and especially in the Middle East as a skid steer maker – Bobcat jumped onto the backhoe bandwagon in May last year, introducing its first backhoe ever globally in the Middle East. The timing was just right for growth, Rhayem says, and he has not been disappointed.
When launching the backhoe last year, Rhayem had stated his company’s goal as capturing around 10% of market share in the segment and entering the top-three backhoe brands. In an exclusive interview with CMME earlier this year after a year of selling backhoes in the region, he revealed: “We’ve done both with room to spare.”
Pulling up figures from the Association of European Manufacturers (AEM), to cite Bobcat’s performance, Rhayem, made his case: “We sold about 78 units of backhoe loaders last year, giving us a 4.7% market share, according to figures published by AEM. And this is for six months, after we started selling the backhoes in June to the end of the year. It took us only six months from a standing start to reach that level, which is no mean feat”
Coming from the leading compact machinery brand, this success in the backhoe segment speaks not only for the quality of Bobcat’s machine, but also – and more importantly – the abiding popularity and indispensability of the backhoe in the region.
Bobcat may be a recent addition, but first off the block in the backhoe segment was JCB, the global king of the machine. Almost 50% of all backhoes sold globally are JCB and the manufacturer has five main models in the market, from the 1CX up to the supersize 5CX, but the 3CX has been its biggest volume seller around the region, a representative from the company told CMME earlier.
While JCB has a full range of backhoes, the British manufacturer has put emphasis on the smaller models, such as the 3CX Compact. JCB says the 6t model is about 35% smaller than a standard backhoe and has two-wheel and four-wheel steering. Its small size and four-wheel steering mode bring backhoe productivity to worksites once thought to require compact-machine manoeuvrability.
Meanwhile, Case’s model range starts from the baby in the family – the 570T. Then there is the slightly heavier spec version of the same in the 570ST. The 580T and ST, and the 695T and ST complete the line-up.
“At the moment we have only launched the 570T in the Middle East, but the ST version is headed here in the near future,” says Case’s Barnard. The difference between the two versions is that the ST has more power and higher flow hydraulics, even though the basic machine remains the same.
“The backhoe market is seeing a lot of competition in the region for a while now. And Case is doing quite well. In terms of numbers, we are currently in the fourth spot in the total Middle East market, but in the UAE we are at the third spot,” Barnard says.
Interestingly the 570 is made at the company’s plant in India, while the other models are all made in Italy. When asked about the difference this might make, Barnard explains: “All our plants, in India, Italy or elsewhere, are up to the same Case standards and are WCM certified. Quality-wise there is nothing to choose between the products of our plants from separate geographies, as they are built to the same exacting standards that Case sets worldwide. However, manufacturing the 570 in India does give us certain advantages in terms of cost savings on labour and other overheads, which we can pass on to our customers here.”
The made-in-India machine has become Case’s best seller in the region and not just on price point alone.
“The 570T is designed to suit the demands and conditions of the Indian market, which the Middle East shares somewhat. For example, we designed a larger cab for the 570, capable of transporting two more people besides the operator in air-conditioned comfort. This is one popular in the Indian market, where backhoes often transport technicians and other personnel to and within job sites. And since a lot of the construction industry in the Middle East employs people from India, this is a habit that they bring with them here.”
Case also has a marketing project on at this time, which it calls its ‘Demo Truck Programme’. Under this, Case is taking a 570T around on the back of a flat-bed truck to various job-sites and showing off the machine to customers or prospective customers.
“If the customer is interested after the demo, then we drop off another 570T at his job site for them to use at their leisure for a couple of days. This is of course free of charge and it allows them to preview the machine in a very comprehensive way. The response has been overwhelmingly positive so far and has encouraged us to soon go very large with this promotion,” Barnard adds.
Another tough competitor, Caterpillar, has an entrenched market position in the GCC through the strength of its dealers. Caterpillar recently updated its backhoe line with the new 426F2, aimed at markets in the Middle East and Africa. Offering a highly configurable design, it has a Side Shift frame and provides customers with additional choices, allowing the selection of a more base-specification model or a highly configured machine to match budget and operating needs. Some of the options are two-wheel or four-wheel drive, backhoe loader or excavator control pattern, cab climate control packages, and specified Product Link technology levels.
“The continuous efforts from Cat and the recommendations of its dealers and partners has resulted in the introduction of the new 426F2 model,” says Samer Ismail, product manager, Earthmoving & Excavation at Caterpillar’s regional dealer Al-Bahar.
“The durability and versatility of Cat’s backhoe loader enables it to be the suitable machine for various applications to meet different project requirements and demand.”
Speaking about the backhoe sector as a whole, he says new uses and applications are constantly being found for the machine, making it more profitable and cost-effective for a customer to own one.
“The backhoe loader industry has been witnessing a flat growth over the past two years. With the diversity we have in our products, we succeeded in penetrating various market segments and applications. Looking to the future, the construction industry forecast till 2020 seems promising, and we are expecting a steady increase in demand for the backhoe in the coming years,” Ismail says.
“The Cat 426F2 has many new improvements that fit in our territory and meet our customers’ demands and project requirements – such as a greater bucket capacity compared to the 422, better break-out force and digging force, and a higher lifting capacity – all while maintaining the Cat backhoe DNA of visibility and serviceability. Factoring in Cat’s features such as differential lock and load sensing hydraulics, we have a winner on our hands.”
With five models in Cat’s F-Series – including the 426, 428 and 434 – each can be ordered with one of two engine options. The smallest 422F is offered with a naturally aspirated diesel engine that puts out 56.5kW gross power, or a direct injection turbo (DIT) engine outputting 68.5kW gross, with air-conditioning only available with the DIT engine.
“Attributes like performance, features and on-going research for product enhancement, along with the competitive advantage Cat machines have in terms of parts availability sets them apart from the competition,” says Ismail. “In addition to these, Cat backhoe loaders come with a range of support and services, like customer support agreements (CSA), extended warranty, fleet management solutions, and equipment protection plan – all of which add to the strong market history we have, giving us the edge against our competitors.”
That history stretches a long way for the Al-Bahar-Caterpillar combine, as Ismail says: “Caterpillar introduced the first backhoe loader in the early 80s. The ability of Caterpillar to meet demands in different markets and for different applications by providing a wide variety of products has been the corner stone of our partnership. Al-Bahar has a very strong distributional channel in the UAE, Oman, Kuwait, Bahrain and Qatar, as well as very quick machine repair and service abilities.”
Chinese maker SDLG is another player in the region’s backhoe market. Owned by Volvo CE and represented in the region by Volvo dealer Famco, SDLG is keen to take the fight to the market leaders.
Jackie Sun, region manager MENA, at SDLG, says that despite the oil price blip affecting the region’s economy and its construction sector, SDLG has confidence in the Middle East.
“SDLG’s backhoe loaders have been in the Middle East for several years and we have received total acceptance from customers. Our forecast is that the backhoe loader business will continue to have a very important role in the Middle East market in future, and, together with our local dealer Famco, we are well-positioned to benefit from it,” he says.
“We started our partnership with Famco in 2012 and they have helped SDLG to build its competitiveness in the region with their resources, expertise, well-trained staff and multiple branches across the region. SDLG also provides a complete product line to improve Famco’s product offering, so our dealer can offer the best solution packages.
“SDLG’s B877 delivers a power output of 93.9hp, digging force of 56kN and breakout force of 60kN, assuring powerful operation. Its cost-effective operation makes the company believe that the B877 is the right match for most of our customers’ needs.”
Bobcat’s backhoe loader range comprises four models – the B700, B730, B750 and the top-of-the-line B780.
While the B700 is an entry-level model, the top-of-the-range B780 is a highly-manoeuvrable machine with four equal sized wheels and is steered by three steering modes: 2-wheel steer, 4-wheel steer and crab steer.
“The main sellers in the range, though, are the B730 and B750. In Saudi Arabia, the B750 is leading around 40% of the sales. Some customers who bought one machine from us have come back to place 2-3 repeat orders, which means they are very happy with their purchase,” says Rhayem.
Powered by a 100hp turbocharged engine, driven through a standard powershift transmission, and controlled by mechanical levers, the B730 model is equipped with 18-inch front tyres and two-wheel steer. Double loader bucket cylinders provide superior breakout force and reduce maintenance cost with bolt type cylinder head design.
Apart from all the features of the B730, the B750 adds 20-inch front tyres and a hydraulic joystick control system. The standard 4.4l, four-cylinder, 100hp turbocharged diesel engine delivers adequate power for demanding applications, while reducing operating costs. It also features a high-quality filtration system for longer life, and its single-side service components make maintenance easy.
“Because we are new to the category we were expecting some issues with the machines, but we haven’t recorded a single major issue so far. Also, our engineering team is constantly monitoring the performance of the machines in the field with our customers, visiting them often, asking questions and observing the machines in action to know how they’re doing.
Offering a highly configurable design, the new Cat 426F2 Backhoe Loader with Side Shift frame provides customers with additional choices, allowing the selection of a more base-specification model or a highly-configured machine to match budget and operating needs.
Customers can choose between 2-wheel or 4-wheel drive, backhoe loader or excavator control pattern, cab climate control packages, and specified Product Linktechnology levels, among other options, to get the machine matched to their requirements.
The new 426F2’s high pump oil flow delivers excellent hydraulic performance, and load-sensing hydraulics enable this new Cat machine to tackle a variety of applications, ranging from loading and carrying to full-depth trenching.
Delivering the power and productivity needed for high performance jobs, the new 426F2 backhoe loader can be equipped with up to a 1.05 m3 loader bucket offering a 7 012-kg tipping load at breakout point. Its standard 4.3-m-long standard excavator-style stick delivers a 4.7-m maximum digging depth and 4.03-m loading height.
The machine is powered by the 68.5 kW Cat 3054C 4-cylinder diesel engine with advanced cooling system designed for efficient and reliable operation in ambient temperature reaching 50-degrees Celsius. An externally mounted engine pre-cleaner offers quick filter servicing for customers working in dusty operating conditions.
Its Cat four-speed Power-Shuttle transmission delivers effortless gear changes, up to 40 km/h road speeds and matched gear ratios for optimum performance in all applications. Whether equipped with standard 2-wheel or optional 4-wheel drive, the new 426F2 backhoe loader features standard 100% differential lock, in the rear axle, to provide maximum traction in poor ground conditions.
The machine’s parallel lift loader arms provide the operator with excellent forward visibility, exceptional breakout forces reaching 60.4 kN and class-leading lift capacity of 3 610 kg at full height. General Purpose (GP) or Multipurpose (MP) buckets are available to precisely match the customer’s needs.
Among Case Construction Equipment’s three main models of backhoes on the market, its most important one is both its lowest spec and latest – the 570T. Recognising several peculiarities of the Middle East market, the manufacturer went to a territory that shares most of them – India – and had its latest offering for the Middle East backhoe market manufactured there.
Zane Barnard, construction product specialist, Middle East and Africa, told CMME earlier that while the backhoe is in demand in all construction segments, they see particular demand coming from smaller and medium contractors.
“However, as the rental segment is expected to grow across the region, there will be considerable demand from the rental companies, which are by definition fleet owners.”
Speaking about the 570T Barnard says that the machine is able to play an “effective and main role” on construction sites, especially road projects, due to its high productivity, economical fuel consumption and durability, as well as its being equipped with ergonomic features which contribute to an improved working environment for the operator.
“Customers looking for a simple, reliable and cost-effective tool will find that this machine matches their needs to the maximum.”
Key features of the Case T-Series range include an overall lower height, achieved by the use of overlapping cylinders, so that the backhoe needs a lower height clearance. The units are built with CNH/Fiat tier 3 engines, with Case CE claiming a 10% power advantage over competitors.
