Cranes and Construction: Factors to Consider & Tips of the Transport Trade
From Singapore to Seattle, a familiar site looms against the skyline—cranes poised to complete towering buildings, bridges, roads. They come in all shapes and sizes, and are essential to most any construction project.
The crane market is inextricably linked to the health of the construction industry—in this post, we take a look at international and domestic construction projections to get an idea of where the crane market is headed in the coming years, and offer tips to make sure your crane project is a success.
Crane Market Expands
The global cranes market is poised to grow during the forecast period of 2017 to 2024, according to the Global Crane Market Forecast 2017-2024. [http://www.inkwoodresearch.com/reports/global-crane-market-forecast-2017-2024/]
As emerging countries continue to industrialize, developed nations recover from the recession and construction advances in smart cities and mega cities thanks to technological innovations, the crane market will expand.
Energy efficient, lighter and compact cranes widely used in the marine sector, mining and excavation are in high demand, while the market for fixed cranes is expected to grow at a slower rate during the forecast period.
Positive Global Forecast
Worldwide, the construction industry continues to rebound from the Great Recession, and the overall picture is one of steady growth.
A benchmark global study from Global Construction Perspectives and Oxford Economics, titled “Global Construction 2030,” [http://www.globalconstruction2030.com/] forecasts that the volume of construction output will increase by 85 percent to $15.5 trillion worldwide by 2030, with three countries — China, the United States and India — accounting for 57 percent of all global growth.
“Construction is likely to be one of the most dynamic industrial sectors in the next 15 years and is utterly crucial to the evolution of prosperous societies around the world,” said Fernando A. González, chief executive of global building materials company CEMEX.
Europe is poised to reach pre-financial crisis levels approximately a decade from now, while the United Kingdom is expected to overtake Germany to become the largest market in Europe and the world’s sixth largest construction market by 2030.
In North America, high-rise residential projects comprise nearly 70 percent of construction activity, according to the North American Crane Index®.
[http://assets.rlb.com/production/2017/02/01000131/2017-01-Crane-Index.pdf] This constitutes a significant shift in the second half of 2016, with mixed-use construction declining by almost 25 percent. Simultaneously, commercial, healthcare and hospitality sectors all experienced significant growth.
“Our research indicates that new projects are scheduled to commence in most cities as existing projects are completed,” said Julian Anderson, president of Rider Levett Bucknall North America. “We therefore anticipate that cumulative activity in all sectors will remain consistent.”
Outlook in the United States
In the United States, infrastructure projects are of particular interest to citizens and lawmakers alike. Federal funding for repairs to existing bridges, roads and water supply systems is expected to increase in the near term, and planning for new infrastructure projects is underway. These projects largely will be carried out through public-private partnerships.
Plans have also progressed for federal transportation projects with the passage of the Fixing America’s Surface Transportation Act. The legislation established a multi-year spending framework for these projects, replacing a decade’s worth of temporary extensions to previous financing provisions.
Additional factors that could affect the construction industry include interest rate ‘normalization’ per the Federal Reserve, steady population growth in the United States resulting in more consumer spending, and speculation that millennial’s will help fuel single-family home-building as they bond or marry and start raising children. Shifts in the retail sector away from ‘bricks and mortar’ stores to online sales could also have an impact, but current growth trends in the sector remain positive.
Ensure Your Project’s Success
Crane projects are time critical, and late deliveries result in financial penalties and lost customers. The majority of the world’s largest crane companies are located in Europe and Asia, which adds a level of complexity to your logistics and transportation needs. Read on for some tips to ensure the success of your crane project.
Insurance:
First step — confirm that the product is in fact insured during transit, and determine a plan for replacement in the event of damage on arrival. It’s not uncommon for damage to a single piece to delay an entire installation. Develop a plan with the manufacturer in advance to replace damaged components, and mitigate your risk.
Manufacturing Lead Time:
Suppliers are rarely ahead in growing markets. It’s important to fully understand their ability to produce on time, as well as the scenarios that could prevent them from doing so. Initiate a conversation with the manufacturer early in the process.
Multi-Modal Consideration:
Rail and trucking options for transport will be available depending on the relative location of your manufacturer and your job-site to ports. There is a trade-off between each of these in terms of cost, transit time and predictability. Weigh those pros and cons before making a decision.
Direct vs. Transhipment:
Your manufacturer will likely offer both direct and transshipment vessels. Transshipment sailings are often less costly, but with higher probabilities of delay and mishandling. The timing of the project and the availability of the equipment may dictate which option you choose.
By working through these considerations with your strategic logistics provider in advance, you will reduce late arrivals and the possibility of penalties, and enhance customer satisfaction.
For more information on these and other considerations, contact:
Cami Meador, CLN at: cami@bagmakerblog.com | 704-526-9301
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