‘Substantial growth’ planned for Hyundai

Hyundai Construction Equipment Europe (HCEE) plans to grow substantially in the next three years. They will release new and improved machines, play a leading role in the move to a zero-carbon future, and double their sales.

Hyundai Construction Equipment (HCE) is a company that should be considered a sleeping giant in the European machinery market. The company's parent, Hyundai Heavy Industries Group, acquired a controlling interest in fellow South Korean manufacturer Doosan Infracore last year.

Though the two companies will be separate, there will inevitably be some technology crossover and new product development, manufacturing and procurement synergies.

“We will extend the range, but not into all market sectors. We want to give our dealers more equipment and opportunities to grow their share of the wallet with us and extend their offer. With our current portfolio, we cover 80% of the European equipment market at present, but we want to grow. We want to double our 2021 figures in terms of machine volumes over the next three years,” said Dr Hubertus Muenster, Sales and Marketing Director of HCE’s European equipment business.

He believes that in order for the company to grow, it is not just important to increase the number of cars sold, but also to increase market share. This will be driven in part by the increasing awareness of the Hyundai brand.

The company's future growth plans will rely on its dealer network. The dealer network is important for two reasons: it helps the company sell more products, and it also helps dealers grow their businesses.

“We need to let the brand shine. This brand is fantastic. In some markets, a certain percentage of our target group doesn’t even know that we exist, yet we have dealers in Europe with market shares above 10%. The growth opportunity arising from that imbalance is huge,” said Dr Muenster. “We are not entirely happy with what we have in the dealer network. Some regions have a mature network, others have an incomplete or not fully focused network. Network development is one of our key objectives and represents another substantial growth opportunity for us.”

Supporting the growth of dealer networks

Hyundai Construction Equipment and Doosan Infracore will not share dealer locations. They will remain competitive, in much the same way that Hyundai and Kia, which are brands of Hyundai Motors, are competitors in the passenger car market.

Hyundai wants its dealers to know that they can have a much bigger business with Hyundai Construction Equipment. Hyundai is fully committed to its dealer businesses and wants to be much closer and more supportive to its dealers. Hyundai calls this the "Growing Closer Together" initiative. However, dealers need to focus and invest too in order for this to be successful. HCE's European organization has been working on developing a key accounts business. Whenever possible, the company does business with key accounts through its dealer network. This will give growth opportunities for the dealer network through those key account customers.

“We want to develop another revenue and profit stream with key accounts,” said Dr Muenster, “In future, key accounts can represent as much as 30% of our machine sales. We have taken some time to learn and to analyse the specific needs of key account customers together with our dealers and we are now getting ready to hit the market with our activities.”

Many key account customers have shown recent interest in HCE's products, especially the company's new A Series wheeled excavator range. These excavators are available in different sizes, and they are all designed to be easy and comfortable to operate. They also have increased lifting capacity and stability.

“We now have one of the most comprehensive wheeled excavator ranges on the market,” said Dr Muenster, “We’ve touched on all aspects of the machines, but operator comfort is a key element in the wheeled excavator sector. These machines are giving us access to customers that we had previously struggled to get in touch with. That in turn is opening doors for us with other products. The wheeled excavator forecast for next year from dealers is tripling and more.”

Hydrogen can have a big impact on construction

HCE is investing in new equipment and technologies for the future. This includes a concept machine powered by a hydrogen fuel cell. Next to the launch of two articulated dump trucks at the Hillhead show in June and an update to its mini excavator range at Bauma in Munich, HCE is continuing to invest in order to improve its product and routes to market. This drive to improve product and routes to market is being supported by Hyundai Heavy Industries in South Korea, which is making a €150m investment in the Ulsan production facility that produces much of the machinery sold in Europe.

The wheeled excavator will show how we can have a zero-carbon future for construction machinery. But it will also show how, through partnerships with other Hyundai businesses, we will be able to create a hydrogen infrastructure in the future.

“Hydrogen will really impact construction, materials handling, even shipping. We believe that the fuel cell is the best route for heavy equipment and our partner Hyundai Mobis is developing that technology,” said Dr Muenster, “We have ideas for setting up the infrastructure, in shipping and in renewable energy. We have our hands on all stages of the hydrogen chain. We will be a hydrogen-focused equipment supplier, offering the infrastructure too.”

The company has upgraded the activities of its customisation center near Antwerp. Dealers will be able to request customer-specific options for semi-knocked down stock European equipment. Many machines will be delivered without a specific boom, with the site fitting monobooms or two-piece articulating booms locally, to suit customer demand. Cab guards, Trimble weighing systems and machine guidance and control systems will also be added at the center, along with Engcon tilt-rotators.

When will demand for machinery return?

Hyundai has not been able to escape the component delays and pandemic restrictions that have held back machine sales for many manufacturers over the last two years. Dr Muenster is confident though that the future is looking brighter.

“I think 2023, towards the end of the year, I would expect more normalisation of demand. The boom of the last 18 months and for the next six months is being driven by fleet renewal and this will be reflected in future market demand. While 2023 will still be a good year, by 2025 the market should have stabilised and levelled off,” he said, “Many things are in place for us to take the next step in this journey, with new machines, new technologies and support from our parent company. For dealers and customers, we are one of the best options on the market today.”

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