Two of the industry’s biggest shows took place in November, although there was only one place to be if you wanted to hear big contract news. And that wasn’t Big 5 PMV.
The fact that the dates of Big 5 PMV and the biennial Bauma China always clash in never really seemed to matter before. This year was different.
Putting them up against each other this time around only served to remind everyone how far back the Middle East has fallen relative to China in the attentions of the global companies.
The word to stress is relative. Big 5 was not the gut wrenchingly uncertain fright fest that last year’s was: when Dubai had to be bailed out as its financial system collapsed.
In fact as the on-going construction in the near-by financial district attested, and as Sheikh Mohammed stated on the first day, this was an opportunity for Dubai, the UAE and the rest of the GCC, to re-affirm its mission statement of being one of the most exciting places for the construction industry to be.
A shame then that it was marginalised by many of major players who chose to focus their attention on Bauma China instead.
From a neutral’s point of view the reasoning is understandable and it’s not just the fact that in terms of size and visitor numbers Bauma China is three times bigger than its Middle East peer.
China is the single most dominant construction market; its most buoyant and dynamic base for manufacturing and has become the number one destination for big names looking to expand their global manufacturing footprint. 150,000 people attended Bauma China and many of them headed to the giant machinery on show.
Big 5, with its 20,000 (11,000 pre-registered for the PMV section) visitors sounds small in comparison. At times during the event felt like it too.
It didn’t help that the Big 5 PMV pavilion which is housed at one end of the show seemed like one of the quieter areas, with through traffic slow compared to the hustle and bustle of the tightly packed show halls near the front of the exhibition.
However numbers only tell part of the story. At some events, when exhibitors tell you that it is about quantity and not quality and they’ve been pleased with the people they seen, it can seem like they are rehearsing that difficult report meeting when they go back and have to justify their expense claims on the back of a few contracts and pencilled IOUs.
For once, that would be doing the event, the exhibitors and those that were there spending, a massive disservice.
Of course there were a few grumblings from exhibitors displeased with their locations but you expect that as not everyone can place themselves right next to the front door. at a show this large.
However there were a number of companies that pitched up that will look back on this year’s event as the point they really gained traction in the region and blew away the cobwebs of the recession.
The companies with large showcases of equipment, in particular, came away with order books looking a lot fuller than the
previous week.
For instance the Doosan range was packed into the PMV Arena, leading to machine sales agent Bin Brook Motors celebrating the end show with forklift and wheeloader sales.
Senior Sales Engineer Samer Al Ali, told PMV that: “We put a lot of effort to put together an attractive stand with the biggest machines at the show and were hopeful we would be able to attract some good business.”
“I still had to put some good sales techniques to use,” he joked. “I told him it was a Daewoo engine, the best you could get, and offered free service, free insurance and free delivery!”
Al Ali also said that business for Bin Brook had been buoyant of late, including a long distance delivery to South America: “We have just completed the sale of 52 excavators to Venezuela. We seem to be getting interest from a lot of countries.”
Early orders
Likewise JCB took almost $2 million of business including selling several of its new Backhoes – which had only entered the market a few weeks before.
While its major global competitors chose to stay away, the gamble of paying for the privilege of bringing its Dancing Digger display again after their debut at the Big 5 last year seem to pay off.
Paul Murray, regional manager, Middle East explained that its return was a demonstration of how important the region has become to the company.
“This event is not just about selling,” he said.
“It’s about getting our brand out there. The Dancing Diggers, for example, had an audience of 4,000 people on the first day.
We had people from Singapore, Japan – it’s great for JCB as a brand.”
Considering the healthy looking balance sheets the machine makers have been publishing lately maybe $2 million (minus the cost of putting on a sizeable exhibition) isn’t justifiable especially with attention straying elsewhere, but you can’t escape the feeling they may have lost a little momentum in a market that is beginning to look a lot healthier.
Market progress
There were a lot of companies that were relatively new to the market returning this year that were happy to talk about their progress in the market.
As one exhibitor put it: “The Chinese market is not open to us, so why not come and set up here?”
If there is any market that understands branding it is the Middle East market and placing that branding front and centre in the major thoroughfare of the show was a statement of intent from JCB.
Are companies such as Caterpillar, Hyundai, et al, so established and so strong in the Middle East that they don’t see the value in showcasing their machines at Big 5?
This year’s Big 5 PMV could also be a turning point in the UAE’s move away from a market obsessed with machine ownership.
The consensus on the show floor was that buyers are looking to rent more and more. In itself that is not a revelation, especially in the post downturn climate, but the fact that a few of the new exhibitors were European
rental companies chose Big 5 to announce their arrival suggests this is going to be the trend in the next few years.
As it shakes itself down and picks it up after the downturn, Dubai is reinventing itelf as a trading up and staging point for any company looking to reach the wider GCC region. It is clear from this year’s show that its reach is even further than that with many companies revealing they were using the UAE to service business across Asia, Africa and even
South America.
When his Highness Sheikh Mohammed bin Rashid Al Maktoum opened this year’s Big 5 exhibition in Dubai’s World Trade
Centre, he said with confidence: “We are back.”
As the show concluded, it was hard not to muse on how the industry had changed over the past few years and how right he could be proven to be.
Nixon counting on rental surge
Nixon Hire, one of the largest independent construction equipment rental companies in the UK, confirmed at the Big 5 PMV that it has sustained a month-on-month growth of 10 per cent since its expansion into Qatar in November 2009. Now that the country has won the right to host the World Cup, its diecision to base itself there has been vindicated.
Nixon Hire is currently involved in supplying German construction giant, Bilfinger Berger with compaction equipment for their Barwa City Development project in Doha, Qatar.
Nixon has capitalised on market instability and the reluctance of companies willing to invest in their own plant machinery and vehicle fleets to grab a business foothold in the Gulf from a regional base in Doha.
Managing director Chris Nixon said the company is now formulating plans to ensure continued growth and sustainability of the business, and that the successful outcome for Qatar’s 2022 FIFA World Cup bid could accelerate expansion into other Middle East markets.
Nixon said: “We have seen an improvement in the construction industry in 2010 and things can only get better. The GDP in Qatar is double digit and we are ideally placed to expand further into the region.
“Obviously, we are not the only company which could benefit substantially from Qatar’s 2022 FIFA World Cup bid, in view of the business that would generate.”
Nixon believes that there is huge potential in the region for the continued growth of the construction equipment rental market. “In the UK, 80 per cent of contractors hire their machinery and we are seeing a trend emerging towards this culture in the Middle East,” he said.
According to Nixon, renting plant and machinery not only saves on the high initial outlay but also cuts out fleet management and maintenance costs. It also ensures fleet managers have the latest technology and targeted equipment for each project, and that expensive machinery does not lie around unused.
He added: “It is important for customers to realise the true cost of purchasing machinery, which includes the cost of storage space, minimising downtime, insurance and maintenance of the fleet and ensuring that the equipment is fully utilised to create value for money.
“Our fleet is constantly updated to keep up to date with the latest ever-changing safety features and customers have peace of mind in that we provide cover for all breakdowns and repairs, taking the hassle out of maintaining a fleet of machinery.”
“Last year brought the most challenging situation we had seen since the company was established in 1967,” said Nixon.
“The region was cash scarce, but this worked positively for us, since many construction companies that would not have previously considered renting equipment turned to us.
“We also experienced cases where companies offloaded their fleets onto us to manage while they concentrated on running their businesses. The advantage of hiring equipment is that it doesn’t sit on the customer’s day to day balance sheet.”
FIVE BIG NUMBERS AT BIG 5
- 37% – The rise in visitor numbers from 2009
- 2,500 – The number of exhibitors at the show
- 10 years – Kevin Davis, director of sales for Kryton estimates how far behind the GCC’s infrastructure is and suggests a positive outlook for contractors
- $1.68 million – In orders taken by JCB in the first two days of the event
- 30 – The number of times its Dancing Diggers performed during the show
