Why is it that European wire rope hoist manufacturers are enjoying such success in the USA while many indigenous manufacturers are suffering? There are various possible explanations.
Several visitors to the Promat materials handling exhibition in Chicago in February earlier this year expressed surprise at the strong European presence at the show. The Europeans, said various Americans, seem to be taking over. The US hoist manufacturing industry is not in great shape at the moment and there has been a definite increase in recent years in sales of European lifting equipment in North America.
A parallel can be drawn with the US auto industry when the big three of Ford, Chrysler and General Motors were caught on their heels, failed to invest in continual improvement and were severely weakened by international competition.
The rise of the European hoist manufacturers in North America can be explained in part by exchange rates. The weakness of the euro and the strength of the dollar has improved the value of purchasing European goods. But it is also a technology issue. This next statement is sure to cause the blood to boil within many American readers, but quite simply the European products are widely regarded as better. The Europeans have continued to bring out new products while their American competitors have relied on products that in some cases are 20 or even 30 years old.
There has been a European presence in North America for years. Demag was in Canada in the 1950s and set up in the USA in 1967. Konecranes has been in the USA since the late 1970s.
But many of the other Europeans at that time saw the market as too difficult to break into. Americans rarely accept that their market is protectionist but there are barriers to trade, such as the dogged retention of imperial units of measurement, as well as the more subtle application of standards and technical regulations.
Some European manufacturers have also been concerned about the strict liability laws and the litigious culture.
But a remarkable penetration of the market has taken place in the last three to five years, to the extent that last year European manufacturers had about 40% of the wire rope hoist market in the USA, supplying 6,800 of the 15,800 sold, according to industry statistics. In contrast, the US share of the European market is negligible, bar a few special application products. Columbus McKinnon’s Lodestar remains a favourite of the entertainment industry, for example.
Demag of Germany leads the Europeans in the USA, followed by KCI Konecranes of Finland (which owns R&M) and then Stahl, also of Germany.
Stahl has grown its sales fourfold in the USA in the last five years and increased sales by 37% last year. Others making headway include Street Crane of the UK and GH of Spain. Abus has a presence through Cleveland-based crane builder EMH. Donati of Italy (a Demag subsidiary) has also now come onto the scene, having started supplying Harrington with wire rope hoists. Products from all of these companies, except Abus, were on show at Promat in February. Also prominent were pneumatic hoist manufacturer JD Neuhaus of Germany and lifting equipment manufacturer Pfaff-silberblau, also from Germany. In addition to these were a host of ancillary product manufacturers such as PAT and remote control systems companies like HBC-radiomatic.
The Americans still have a firm grip of the chain hoist market, however. Columbus McKinnon’s various brands together have 81% of the market, Harrington’s Japanese product has a 10% share and the Europeans (primarily Demag) have just 8% or 9%. The European share looks to be rising here too, though.
It could be that the Europeans have initially concentrated their focus on the wire rope hoist market because it is more of an engineered product, distributed through crane builders. Chain hoists, in contrast, are more of a standard, off-the-shelf commodity.
"In the USA cranes are in the Stone Age," says the president of a US service and supply company that offers both US and European hoists.
"American products are dinosaurs. They are huge," says a European manufacturer.
"A European hoist will be half the size of the equivalent American one, half the weight and make half the noise," says another European.
There are various explanations for why the Europeans have grown so strongly in North America. Firstly, the US manufacturers in general have failed to invest in new product development. Columbus McKinnon, the biggest name in the market, has concentrated investment in buying market share by acquiring rival manufacturers such as Yale and Coffing, but has not been noticeably active in improving and modernising its product offerings. European manufacturers are driven by prescriptive regulatory standards that have demanded technological evolution, while the US has opted for a regime of litigation rather than regulation. This might be crudely characterised as ‘you can do want you want, but you will be sued if you get it wrong’, rather than the European approach of ‘this is what you must do’. The backdrop of litigation rather than regulation possibly encourages conservatism and inhibits innovation.
Secondly, American companies tend to be led by those whose main focus is sales and efficient volume manufacturing. In Europe there is a stronger culture of engineering, and engineers are more likely to hold board level positions.
Thirdly, labour costs are higher in Europe and – it is tentatively suggested by one European manufacturer – labour is more skilled. Faster hoisting speeds are demanded in Europe, and while it is hard to prove that this is a direct result of higher labour costs, the correlation has a certain logic. European hoists lift at a minimum of 5m/min, in the main. German car manufacturer BMW specifies that the hoists it uses must lift at 15m/min (49ft/min), while Mercedes Benz in Germany specified 16m/min (52ft/min). Skilled European workers have few problems operating such hoists. In the USA, on the other hand, the usual speed is 2m/min or 3m/min (10ft/min).
This is a debatable point. European manufacturers tend to offer a wider variety of speeds, but a hoisting speed of 16ft/min – just about 5m/min – is not unusual in the USA. And just because a hoist is faster does not necessarily make it better. "Slow speed is desirable for certain applications and I think the Europeans are missing out on this market," suggests one American.
Apart from speeds, there are other technical differences between the traditional US hoist and the modern European models. A key philosophical difference is the American desire for a second load brake to be fitted. But gradually the market is being persuaded that this feature is not necessary.
The new M series produced by Morris, as a collaboration between the American and British operations before they split, is offered with a mechanical load brake as an option, rather than as standard. The availability of a mechanical load brake, however, is an important difference between this product and the hoists built by Morris in the UK which the M series replaces. Thus the M series is described as an ‘Americanised’ hoist. The fact that the mechanical load brake is not fitted as standard could be seen as indicative of progress in the US market.
Some European manufacturers hedge their bets and offer load brakes as an optional extra. Until about five years ago Demag actually put a load brake on the drum of its wire rope hoists for the American market but this is now an option. It still has a load halt in the gearbox of its chain hoists as standard.
Other key differences are that US hoists typically feature true vertical lift and deep grooves, with no rope guides.
In general European hoists come with more features as standard fitment and are designed for higher performance and high duty ratings. In Europe two speed motors, and to a lesser extent variable frequency drives (VFD), are common. This makes the European product more expensive than its simpler US counterpart, but as users learn the benefit of VFD, demand is increasing.
US manufacturers can offer inverter controls too, but they tend to be an engineered extra, so while this feature may make a European hoist 15% or 20% more expensive than a simple single-speed US hoist, variable frequency can double the price of a US hoist.
American manufacturers use an open loop system for inverter controls since the presence of a mechanical load brake allows the lowering speed to be controlled. European manufacturers used a closed loop system. Europeans have been able to achieve better value with inverter controls, though, simply by using them more widely, a European manufacturer argues.
Other features likely to be included as standard on European hoists include rope guides, overload guards, and upper/lower limit switches, all of which improve safety and reduce the likelihood of error.
As the European hoists have penetrated the market, end-users have come to appreciate the benefits of the various features, and for some the old US-style product is no longer good enough. General Motors, for example, now specifies overload guards on hoists.
American manufacturers have been slow to respond to the invasion, but some are now reacting. Witness for the defence is Detroit Hoist & Crane. "We at Detroit Hoist as a small player relative to Demag, Kone and Morris are actually pleased that we can provide technical leadership for the industry and we will continue to offer innovative solutions," says president Ulrich Vorpahl.
He explains that Detroit Hoist now uses photoelectric sensors (photoeye and reflector) for upper limit switches in place of the traditional mechanical limit switches. "The hoists will not start unless the limit switch is operational, contrary to other switches which if malfunctioning will lead to catastrophic failures," Vorpahl says. "We have additional features built into that switch to allow an operator to verify it’s functionality at the start of every shift as recommended here by OSHA (Occupational Safety & Health Administration) and other standards." He continues: "Another example is our rope guide design which is now a standard feature for us since we believe that a hoist should have a mechanism to guide the rope into its grooves. Since most of our hoist models are of ‘true vertical lift’ as a standard, the traditional European style rope guides were impractical from a technical, as well as from a commercial, aspect.
"Demag and all other European manufacturers sell a typical replacement rope guide for a 10t hoist for about $600," Vorpahl continues. "In addition the customer has to pay for a service call by a specialised service technician to install the unit. Our rope guide sheaves glide alongside the drum, cost $35 each and can be replaced instantly by unqualified personnel." Americans can also point to leading technology in intelligent assist devices. Gorbel, Zimmerman (Ingersoll-Rand) and Cobotics all showed leading edge products at Promat. These precision lifting assistance devices have grown out of research and development work sponsored by the automotive industry.
To date, at least, it all seems to be one way traffic though; European product moving into North America. The one attempt to reverse the trend, the acquisition by what used to be P&H of the UK’s Morris Mechanical Handling in 1994, has now ended in tears, with the Americans selling the overseas business and returning home with tails between legs.
This may all sound like bad news for American hoist manufacturing, but there is worse to come. There is a tide of competitively-priced chain hoists manufactured in such countries as Korea, Taiwan and China beginning to make headway in North America. There may be initial resistance from customers until the products have proved themselves, but it is quite likely that they will gain market share just as surely as the Europeans have done. The difference being that while the Europeans have captured the premium end of the market, these products could clean up at the price-led end.
