GLOBAL AMBITIONS

With Chinese OEMs increasingly looking to expand into developed markets such as Europe and North America Andy Brown welcomed the chance to speak to Mr. Fan Zhide, assistant general manager of Zoomlion Overseas Company

Earthmoving equipment sales are performing strongly for the company

There are several megatrends in construction, such as sustainability, new technologies and power solutions. Among these trends are Chinese-based OEMs increasingly looking outside of their home market for business and, not only that, but increasingly targeting developed markets such as North America and Europe.

Mr. Fan Zhide, assistant general manager of Zoomlion Overseas Company is responsible for three regions – Europe, Middle East and Africa. He confirms that Zoomlion is rapidly expanding its sales from overseas territories.

“For Zoomlion last year, the global revenue to Zoomlion group is around 37% from overseas market,” he reveals, adding that several years ago this was in the single figures and that they expect this figure to increase to 50% in the near future. “So, right now, we are not just depending on the Chinese domestic market.

For us, we are looking more for the global market. This is our strategy and is our group’s major focus.”

The biggest overseas markets for Zoomlion when it comes to revenue is currently Central Asia followed by Southeast Asia and the Middle East. Africa is also growing rapidly, and Zhide says he expects this market to produce approximately 10% of the overseas revenue of the company. While these markets are important there is, as the old saying goes, an elephant in the room, some very important markets that we haven’t mentioned.

“We didn’t talk about the advanced countries and regions, yet,” he says, with a ghost of a smile. “Another challenge is for the European market and North American market. This year we are going to open another three branches in Europe: Belgium, France, and Spain.

“Europe is definitely very challenging, but we are expecting we can have something, we can have some market share. This year I believe around 5-7% of the total group revenue we are expecting from Europe. We believe this year we are going to have something small, but we are expecting more in this region in the medium term.”

If Zoomlion want to achieve another level for Zoomlion overseas, then Europe is the market we can’t miss… North America is a market Zoomlion couldn’t miss

Product sales

This article started by talking about trends and here’s another one; access equipment sales have been (excuse the pun) going through the roof in both established and developing markets. Zhide says that the company expects to increase sales for this segment in 2024 from what was already a strong position last year.

The other construction sector that is performing well for the company is earthmoving equipment. Zhide confirms this, saying, “We are expecting big growth for earthmoving equipment. In the last three years it is one of the major focuses for Zoomlion overseas global market. This year we are expecting around 35% of the total [sales] outcome from earthmoving equipment.” He adds that the company currently has seven models of earthmoving equipment certified for the European market. Alternative power is an industry megatrend and Chinese companies are right at the forefront of electric powered construction equipment. Why does Zhide think this is? “I think there’s two aspects: the first is because of climate change and China making a commitment to the global community. China already became the number one electrical vehicle exporter, as well as being the biggest consumer in the world. Why did this happen? Because the Chinese government, due to the commitment to the global community, encourages the industry to manufacture something more green, more clean,” he says. “Zoomlion is part of this society, we have a responsibility, and the government gives encouragement. And due to the supply chain, like for the electric batteries, the availability of the batteries definitely gives us some plus points for this process.”

Zoomlion is based in China but is increasingly looking outside of its home market for sales

The company says it has already released more than 100 electric-powered pieces of equipment and Zhide says it is clear the trend of the market – he cites the rapid take up of electric cars around the world in the last few years. However, he also makes the point that government intervention is sometimes needed to give something new a push. “I was in Netherlands two months before; Netherlands is in the front line [for electric equipment] because the government encouraged the market to buy electrical excavators, they give motivation. If you buy diesel excavators, you are going to pay more. But if you buy electrical, you are going to get more from government subsidies.”

Turning back to the future and those markets of Europe and North America; it is clear that the company’s ambitions are not small.

“If Zoomlion want to achieve another level for Zoomlion overseas then Europe is the market we can’t miss. If we look further, North America is a market Zoomlion couldn’t miss. We need to take actions.

“Within three years, Zoomlion is going to cover all the countries in Europe. This is one of our targets. Europe’s contribution to Zoomlion overseas, for revenue, is around 5%. I wish after two to three years, we can give around 20% of Zoomlion overseas revenue.”

It will be interesting to return to Paris in the Spring at the next Intermat three years from now and to see to what extent Zoomlion and other Chinese OEMs have expanded their presence in the developed markets of both North America and Europe.