How to go global

Nabil Al Zahlawi, the Middle East’s undisputed king of cranes, talks to CMME about taking the company global

Nabil al Zahlawi has expanded NFT to markets in South East Asia and North America

Nabil al Zahlawi has expanded NFT to markets in South East Asia and North America

Nabil Al Zahlawi, the Middle East’s undisputed king of cranes, talks to CMME about taking the company global

Sitting for dinner in Northern Europe at the end of the summer, CMME is at an event looking at the future of earthmoving but we’re talking about cranes. The conversation centres around one company. One person.
“Do you know Nabil al Zahlawi? How is NFT doing?”

In terms of construction machinery suppliers in the Middle East, you can’t get much higher than, NFT Cranes (NFT stands for Nouman Fouad Trading). A growth spurt which saw it amass hundreds of towers at the end of the last decade took the once Saudi and now Abu Dhabi-based dealer to the top of the tree during the boom. Half a decade later and its synomonous partner Potain’s cranes still line the roads leading into the UAE capital.

Like the islands of Saadiyat and Al Reem, the industry climate has changed vastly since the heady days of 2008. NFT was once at the centre of a spending spree on towers that captured the imagination of the world’s media. In the aftermath of the global economic downturn, the cranes became a key statistic for those wanting to use the UAE and Dubai, in particular, as an example of how untenable ambition leads to inevitable decline.

While many of his peers within the Middle East were burdened with their inventories, he has instead embarked on a deliberate global programme to distribute his cranes as far and as wide as possible. As the old saying goes, out of necessity comes change.

“I decided to, rather than diversify in equipment, diversify georgraphically,” he begins. “Singapore was the first place I went to three years ago, and today we have close to 150 cranes in operation, in rental.”

As NFT’s managing partner Nabil Al Zahlawi remains inarguably one of the most recognisable figures in the industry and is frequently asked for his views on the market. Pausing on the point of running a rental operation in the Far East he refers to a recent interview.

“A very smart lady asked me, where have the cranes gone out of Dubai? I said do you want to know a secret? Ok, 150 in Singapore, 50 in Hong Kong, another 50 in Taiwan, maybe 100 in Korea.”

Moving cranes internationally via the rental channel requires identifying local partners that can be entrusted with NFT’s sizeable fleet. He explains that he has looked for partners that have an effective service set-up. In return he offers part-ownership of the operation. Al Zahlawi says the experience of the Far East has been a good one.

“We have better rates and better quality of customer,” he says. “I get impressed that the people don’t go for cheap price. We’ve never had one day delay with any of the customers…they pay ahead.”

He contrasts the customer/dealer relationship with his experience closer to home.

“This reminds me of the situation in Dubai when all the contractors needed you. I remember one of the big names (here) paying cash to me, $10 million in advance just to secure the proper delivery,” he says referring to the city’s mid-2000s decade boom.

He adds: “(It was like that) starting from 2005 but the best year for us was 2008 – not only for us but for everybody. We reached a big numbers. I was supposed to buy 550 cranes the next year.”

He recalls the signing meeting for the deal at the Kempinski Hotel in Dubai with members of the Potain/Manitowoc executive in 2007.

“All the management came here. The CEO, chairman, some of the shareholders,” he stops to point at a picture on the side of the boardroom. “And we took this photo.”

The smiles form a snapshot of those heady days, the market in the region has moved on he muses.

“Today we have two markets that will boom. We have Saudi Arabia, the new markets like Iraq and in the future Syria, Egypt, Libya when they are stable.”

He adds: “What’s happening in Egypt is not good for business but let’s hope that situation will be better. There is a shortage of everything: housing, infrastructure, hotel accommodation.”

As an example of the potential of these markets, he mentions that NFT has signed up to supply 100 cranes to the first phase of a government-funded $15 billion, 200,000 housing project in Iraq.

“The contract has been signed and we are working with contractors. 100,000 flats will be delivered in five years. They have started erecting five precast factories. Starting from the end of the year the cranes will arrive. We will work day, night and fast.”

The Gulf market has seen a shift to using mobile cranes on housing projects but as Al Zahlawi explains, they are not well-suited to projects of this type: “The precast factories are quite far away. The trucks move the precast to the site and we have to lift ten or 14 floors high. Mobile cranes are costly and you need a radius.”

NFT has now set-up its own office in Iraq, a country still far behind Saudi Arabia in terms of volumes. On the day we meet, the company is erecting two cranes for Samsung in Riyadh.

“On the Princess Noura University project we had 200 cranes,” he recounts. “We had the King Abdullah Financial District where we started with 100 cranes and today we have new contractors and are close to 180 cranes.”

Currently standing at almost 1,000 cranes, NFT’s fleet continues to expand. Gross income rose by 9% in the second quarter of 2013 jumping business up to 270 million AED. However its newest towers are not expected to head towards the region: “This year we have purchased close to 100 cranes but for different markets. Our strategy is not to buy for every market (from) here. If I need a crane for the Far East I buy from Potain but unfortunately not from David (Semple, the MEA sales director for the manufacturer). Anything for the Far East we buy from (Potain in Asia).”

NFT is currently working on the third 1.5km Bosphorus bridge project in Turkey with the first of six cranes for Hyundai. The cranes will be expected to work at a height of 320m. A team is heading to Turkey to erect a third crane when we meet. The job will be demanding, he says, with the cranes expected to rise by 2m per day. Global expansion means global reach and NFT employs 20 teams to oversee crane erections. Each team is coordinated onsite by a construction manager who liaises with the NFT team and the contractor. “We send teams to Africa, to India; we have no limitations,” he says.

“(There is) no border with business. You have to catch the opportunity when you can. We are fast with everything we do, we negotiate the price right away and most importantly we have a good network.”

Illustrating the point he refers to the King Abdullah University for Science and University close to Jeddah. “Saudi Oger said we need 58 cranes, quickly. The next day we started putting in the cranes; we used whatever we had. Princess Noura was a different story. We knew the project was coming and I took the decision to buy the cranes before signing the contract. This is something nobody (else) can do. We sold 40 cranes to the customer and erected about 150 from our side. In the first day after we had been awarded the job we delivered 35 trucks.

“On a daily basis there were between 25 and 35 trucks being delivered. Imagine the logistics,” he asks, “but this is a project where you make money. You either do it (make the investment) or somebody will take your place. I was not impressed by the size of Princess Noura but to build a university like that in 20 months, from nothing, is impressive.”

Sitting in the boardroom of the NFT offices, he grabs a nearby magazine to illustrate where the company stands today in a list of the world’s biggest crane companies. Second in terms of the number of cranes, NFT reigns over its US and European counterparts in terms of tonnage and capacity. Thriving post-downturn in South East Asia, Africa and even North America, NFT is finally at the top of the tree but al Zahlawi is not prepared to ease up.

“I don’t where my next destination is,” he jokes. “But I hope to get a few days off.”

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