This US crane building company opens a state-of-the-art factory in Brazil, creating equipment of international standards for the Latin American market. Reuben Ford talks investment and innovation with General Manager of Manitowoc Brasil, Mauro Nunes.
Founded in 1902, The Manitowoc Company Inc. is a multi-industry capital goods manufacturer with over 115 production, distribution and service facilities in 26 countries. Recognized as premier innovators and providers of cranes for the construction industry, Manitowoc is a world leader.
Manitowoc has 24 best-selling global brands of hot- and cold-focused equipment. In 2012 annual revenue totaled $3.9 billion, with more than half of these revenues generated outside the United States.
The company has been present in Brazil for over ten years and has consolidated its position to become the domestic market leader in rough terrain cranes. Its first Latin American factory, located in Brazil, celebrates its first anniversary this year.
“The entire South American market has responded very well to our operations. When companies see our factory, the installations and the quality of the cranes we produce here, they immediately compare the products with US made machines,” says Mauro Nunes, General Manager of Manitowoc Brasil.
Since the start of its activities in Brazil, Manitowoc has engrained itself more and more in the domestic market. Despite market presence for more than a decade, the company opened its first sales office for imported cranes in industrial capital São Paulo in 2006. Two years later it was buying and selling components and stock – catering for the aftermarket.
In April 2011, Manitowoc Brasil began construction of its factory in Passo Fundo, Rio Grande do Sul state. The site involved huge manpower efforts and considerable investment, importing machinery and materials for the company’s first Latin American assembly facility.
Now, a year on from the inauguration of the factory, which was celebrated by more than 400 people, Manitowoc is commemorating its unprecedented success. The first cranes assembled in Passo Fundo were delivered in June 2012 and according to Nunes “production hasn’t slowed for a second since.” In other words, the Latin American market is buying Manitowoc cranes as fast as the facility can make them.
“The overriding theme for the new plant is quality. South American companies who have already visited the company in its opening year, confirm that the cranes meet the standards that Manitowoc has set worldwide. We are proud to say that the Grove cranes made in Passo Fundo are the exact same quality as those built in Shady Grove, Pennsylvania,” he says.
In 2013, since the opening of the $75-million factory, the company has continually invested in improvements to increase production capacity. Upgrades, such as new tooling machinery, painting systems and soldering technology have been installed to raise quality standards higher still and maintain low manufacturing costs.
Manitowoc has also increased the amount of components purchased directly from Brazilian companies. “Using local suppliers helps keep costs down and allows a quick turnaround for customers,” Nunes comments. The locally produced parts have been tested at Manitowoc’s Product Verification Center in Shady Grove to ensure performance standards and are confirmed as adhering to the same international quality specifications.
This year, Enterprise Resource Planning was also introduced at the facility – increasing efficiency and lowering costs for customers.
Program Cost benefits for customers are an important focus of Manitowoc’s operations. One way the company is utilizing its extensive EMEA dealer network to the advantage of clients is through the EnCORE program. The program certifies dealers to refurbish and rebuild Manitowoc cranes, speeding up and reducing the costs of such projects.
In Brazil, the EnCORE contracts began in summer 2012. A 250-ton, all-terrain crane (GMK6250L) that had been badly damaged by seawater was fully restored, costing 40 percent less than a new crane.
The EnCORE program is part of Manitowoc’s after-sales service is called CraneCare. The department is divided into five areas: parts, services and technical support, technical publications, training and EnCORE. “Our clients have total support for the complete life cycle of their equipment,” says Marketing Manager, Leandro Nilo de Moura.
Manitowoc customers are also experiencing quality CraneCare service and support from a location much closer to their site locations than ever before. Parts are well stocked, delivery time is fast and CraneCare experts are always available for support.
“Our customers in Brazil have been very pleased with our commitment to the market through Manitowoc Crane Care service and EnCORE. Through Passo Fundo, we are able to ensure fast delivery times, expert advice and meticulous maintenance,” Nunes says.
Listening to clients is an integral part of services and product development. “We have an enormous database of requests and comments made by customers and innovations such as the Full Vision Cab and LMI (Load Moment Indicator) computer originated from feedback,” Moura adds.
Funding the Future
Operations in Brazil are such a success that the company has increased the number of models manufactured and plans to produce even more in the future. The factory began producing the 65-ton capacity (RT765E-2), the 80-ton capacity RT880E and the 90-ton RT890E rough terrain cranes. Today 35- and 40-ton capacity models have been added to the production range at Passo Fundo. In 2014 the Potain brand (incorporated by the Manitowoc Group in 2001) will also begin producing tower crane mast sections in the Passo Fundo factory.
Moura explains: “The Rough Terrain line (produced in Brazil) is the fruit of years of engineering and development of products, which today result in robust, secure and efficient models. All of our products adhere to market norms and regulations.”
The cranes built in Brazil are now eligible for BNDES (Brazilian Development Bank) financing, available from the Federal Government. The BNDES FINAME (Machinery and Equipment Financing Plan) offers low interest rates to companies looking to purchase Brazilian made products. “These operations will grant services much like DLL (De Lage Landen), the bank that finances Manitowoc purchases in North America and Europe,” adds Nunes.
Manitowoc plans to expand technology production in the future, particularly for the Rough Terrain and Potain cranes – two lines that have been named areas of investment for 2014.
Segments, requiring exclusive items such as mining, industrial, offshore and concrete among others, will also be the object of renewed technology. “We already supply accessories and parts, but our aim is to make items available locally,” Moura says.
As the Brazilian economy showed signs of recession in the second semester, the outlook for Manitowoc is contrastingly bright. Presidential elections, the 2014 World Cup and 2016 Olympic games all provide opportunity for the company’s growing, international standard technology.
“Brazil hasn’t reached economists’ expectations within the predicted time frame three years ago, but it is happening. Airport renovations and developments and infrastructure projects are underway. The improvements will happen in the long-term and not all at once,” Nunes concludes.
Needs are increasing not only in Brazil, but in Chile, Peru, Mexico and Colombia, and Manitowoc is prepared to meet demand.