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CAPITAL EQUIPMENT NEWS
NOVEMBER 2016
23
Meanwhile, Griesel is also of the view that
the compact loader is economical to run in
terms of fuel consumption compared with
the skid steer, while it can also load more
material per run than the similarly sized skid
steer. However, he believes that, like any
other market segments, it is tough times for
the compact loader market, which he says is
down 53% on a monthly average between
2015 and 2016.
Elsewhere, through Avant South Africa,
Finnish articulated loader maker Avant Tecno
has made significant headway in growing
the population of its articulated loaders in
South Africa. With its headquarters in Cape
Town, Avant SA also has a branch in the
developmental hotspot of Johannesburg.
According to Jukka Vaattovaara, sales
manager – export at Avant Tecno, the local
dealer, in its six-year presence, is already
selling between 80 and 100 units per year
in the local market, but envisages that this
number can grow to between 400 and 500
units in the next few years. He believes space
is becoming a big factor on construction
sites, translating into a big need for compact
solutions such as the compact loader.
Competitive solution
Vaattovaara says the competitive edge of
the compact loader over the competitive
solutions, such as the skid steer, is its lower
price. This is because it is a simple concept
with very little extra “bells and whistles”
when it comes to componentry. “As a result,
its pricing is a lot cheaper than the skid
steer,” he says. He believes that simplicity
also translates into ease of maintenance.
Over and above the price, he believes that the
articulated loader’s versatility is a big plus. “It
can work with a wide range of attachments,
making it a boon for a range of sectors, such
as construction, mining, landscaping, fencing
contractors and property maintenance, to
mention but a few,” says Vaattovaara.
Meanwhile, Vaattovaara believes that
South Africa has gone down the compact
loader road than its sub-Saharan Africa
peers. But, he is upbeat about the uptake
prospects of this seemingly cost effective
solution on the whole continent moving for-
ward. Through Avant South Africa, Avant Tec-
no has also penetrated the Namibian market.
The focus is now on the rest of southern Afri-
ca in the immediate future, with Vaattovaara
saying the company is targeting to establish a
footprint in countries such as Botswana and
Mozambique. “The medium-term plan entails
growing our distributorship footprint in the
rest of sub-Saharan Africa. Countries includ-
ing Nigeria, Tanzania and Kenya are on the top
of the list of preferred destinations,” he says.
Looking ahead
While there are signs of growth for compact
gear in the local market, many agree that
there is still a long way before it becomes
the prime tool of choice. “In terms of unit
sales in Africa, 75-80% of machines sold are
still heavy ranges. The more developed the
continent will become, the more the growth
for compact equipment will be realised. In
Europe, 60% of construction machinery sales
are in the compact line, and only 40% are
heavy liners. I believe in the next few years
Africa will also move towards that direction,”
says Invernizzi.
Looking ahead to next year, Griesel be-
lieves the compact industry will remain a
challenge in 2017. But, it is not all doom and
gloom as he foresees growth opportunities in
the compact excavator segment for Wacker
Neuson in the 5 t class size.
Kemp is of the same view as he believes
that the market will still be under pressure
next year. “The total equipment market in
South Africa is anticipated to be approxi-
mately 4 200 units strong this year, excluding
drum rollers and ADTs. When considering
the rate at which the total industry volume
has regressed in the past three months, rel-
ative to the past 12 months, indications are
that the market will decline further, before it
starts improving in the latter part of 2017 /
2018,” says Kemp.
Nicoll says that the compact equipment
market is very price sensitive and if the ex-
change rates hold or improve, there should be
increased volumes. “Earlier this year things
slowed down significantly due to pricing that
rocketed alarmingly on account of exchange
rate woes,” reasons Nicoll. “But if this volatili-
ty is to settle, we should be seeing good move-
ment of orders.” Nicoll believes that organic
growth of the compact equipment market is
indeed a reality too as more and more clients
add compact machines to their fleets.
b
The CASE 570T backhoe loader and the SR175 skid steer
are key market drivers for CSE in South Africa.
Through its local dealer, Avant Tecno continues to grow the population
of its articulated loaders in South Africa.
“The most interesting growth prospect at this point is
the compact excavator. To date, we sell about 15 mini
excavators per year, but I believe in the next five years that
number will grow tenfold.”
COMPACT EQUIPMENT