As they always do at the major international construction shows such as ConExpo and Bauma, JCB sent out its “Dancing Diggers” to perform. A sort of Cirque du Soleil for backhoes, the Diggers prance around in a choreographed routine, showing construction equipment’s amazing dexterity.
But JCB had a lot more on its mind and a more focused agenda to present to attendees at Bauma in April. The U.K.-based manufacturer set some aggressive goals for itself in recent years and is meeting them, according to information shared by top executives at the recent Bauma Trade Fair in Munich.
JCB CEO John Patterson told a Bauma press conference that the company’s strategic vision has been threefold.
“The first was to move JCB from being a strong European player to being a global company recognizing the American market, India and China,” Patterson said. “Second, to grow the company’s business by expanding our product range to satisfy a much wider customer base and gain strength though our dealer network. And thirdly, the past five years, to achieve a worldwide market share of 10 percent.”
Once viewed as too provincial to be a worldwide player, JCB has expanded its global manufacturing capability to 17 facilities, including India, China, Germany, the United Kingdom and the United States. JCB opened a new factory in India in August 2004, and has since doubled production, sending units outside of India as well as selling them to the exploding Indian market.
“In 2006 we built our third Indian plant, producing hydraulic excavators, field loading shovels and compaction equipment,” Patterson said. In October 2006, KCB started production of backhoes and mini-excavators to serve the Chinese market from its Shanghai plant.
JCB opened five new factories since 2004, investing 150 million Euros (about U.S. $201 million by current conversion rates), including a parts center in Paris in 2004, enabling it to send parts anywhere in Europe within 12 hours.
JCB now manufactures 208 different products, so it has certainly made strides in growing its equipment range. In the past three years, JCB has developed a new line of 48 mini-excavators ranging in capacity from 800 kilos to 8 tons, It has launched a new line of compact loaders to the United States market, and a compact loader introduced to the French and German markets has already captured 12 percent of the German market, Patterson said. It developed a new generation of 57 models of hydraulic excavators, and a range of dump trucks from 14 to 22 tones.
In the past, JCB was not particularly known as a compaction equipment player, but last year grew its sales in compaction equipment 67 percent, its acquisition of Vibromaxx in September 2005 being the primary driver of its compaction growth. It has also developed a new product range of compact tractors for the lawncare industry. The company has also become an engine manufacturer, having made more than 50,000 dieselmax engines since starting production in November 2004. JCB is now producing 150 engines a day, and meeting about 50 percent of its engine requirements on the automobiles it produces.
In reaching its third strategic goal, JCB claims a 10.4-percent market share in the product range it is in, up from about 7 percent in 2001 and trailing closely behind Komatsu’s 10.5 percent, with Caterpillar far ahead at 17.5 percent. “Our sales in 2003 were 30,200 machines,” said Patterson. “This increased in 2004 to 37,200, up to 45,000 in 2005 and 55,700 machines in 2006.”
JCB’s growth can be reflected in its sales volume, growing from EU 1.37 billion in 2003 to EU 1.67 billion in 2004, EU 2 million in 2005, to EU 2.55 billion in 2006.
JCB claims to have re-gained its previous status as No. 1 in sales of backhoe loaders with a 31.4-percent market share. JCB’s telescopic handler sales jumped 14 percent in 2006 and the company claims the No. 1 spot in the world telehandler market. Its new high-visibility telescopic handler got significant attention at the Bauma show.
JCB has also entered the generator market in 2006, introducing a range of generators from 17 to 3,000 kVas.
The company, founded by the Bamford family and still owned by it, doesn’t plan to stop but has aggressive plans for the future as well.
Patterson says more than half the company’s sales growth in 2006 came from new product introductions. JCB introduced 36 new products at the Bauma show, and has aggressive expansion plans in numerous markets. New products introduced at Bauma included two new Loadall telescopic handlers offering improved visibility; 15 new tracked and wheeled excavators; eight Series II Robot skid-steer and compact-tracked loaders; six new tandem vibratory rollers; two new Midi CX backhoe loaders; two new compact articulated wheeled loading shovels; and the new 8020 mini-excavator for the 1.9- to 2.3-tonne operating weight class.
While acknowledging that the strong international construction market fueled its growth spurt, JCB’s group chief operating officer Matthew Taylor notes that his company’s growth has outpaced the overall market. With a 14-percent international construction market jump, JCB’s volume in 2006 increased 23 percent. Its biggest single market growth was in India, where it claims an 80 percent share of the backhoe loader segment. In Russia, where construction growth zoomed 70 percent, JCB jumped 145 percent, and its sales volume broke 1,000 machines. “We saw significant growth in pretty much every market around the world,” Taylor said.
