Chinese competitors will provide stiff competition to European construction machinery manufacturers over the next few years, the managing director of Germany’s machinery giant, Bauer, has warned.
With competition in the foundation engineering market growing, Dieter H K Stetter said that European manufacturers needed start taking Chinese manufacturers very seriously.
“I wouldn’t say that it (the Chinese supply line) has reached our standards yet, but the Chinese people are working very hard and I think sometimes they have an advantage to us European manufacturers, in that they listen when a customer says something, whereas we tend to respond and tell the customer where he’s wrong,” Stetter explained.
He added that Chinese manufacturers were currently focusing on mass production of construction equipment, which gave European companies the opportunity to produce specialised equipment, targeted at specific sections of the market.
“If you look at our range of products, if you look at our catalogues, I would say there is a lot of equipment that is not produced in China yet. There’s a lot of specialised equipment,” he said.
“In Bauer’s case we have a lot of special equipment which may not be worth Chinese companies producing. We can produce three units in ten years, but this is certainly not something a Chinese manufacturer would be interested in looking into.”
“They want to produce a minimum quantity of a 100 units annually, to a maximum of 10,000. Figures like that are in their range of operation.”
As a result, Bauer decided to spilt their product range into two parts, so as to both compete and take advantage of, the priorities of the Chinese market.
“In response to the Chinese market, three years ago, we started to divide our products into a ‘value line’ and a ‘premium line’. Our traditional line is the premium line while the value line basically corresponds with a single operational method, which is the most used method,” he explained.
Furthermore, he added that the company opened facilities in China in 1998 so as to compete on the ground with Chinese companies, using the same equipment and manpower, thereby allow them to offer the same value to customers.
“I would say that the most important thing is that you have a presence in China as a manufacturer. Because you have to fight this ‘house-to-house’ fight every day to know what it means. If you just experience the Chinese competition from Europe, then you don’t know what you’re doing.”