The KION Group has its eye firmly on the USA as a high-opportunity market. To make even greater inroads there, we need to do what the Americans do best: show determination and team spirit. Vincent Halma can count on the right products with Linde and STILL – and he can count on the right team as well.
When Vincent Halma talks about his new job location, you can’t help but notice his sense of enthusiasm. “We have tremendous opportunities that haven’t been taken advantage of,” says the Vice President Marketing of KION North America. “We have so much collective knowledge within the KION Group that can make us successful. The point now is to use it.” Halma is backed by the capable team of the global KION network.
The goals are clear: the market share in North America, the second largest individual market in the world for KION Group products, will grow substantially in the coming years. Every morning, when Halma gets out of his car in front of the KION plant in Summerville, South Carolina, he is reminded of the fact that North America is more than the USA alone. When he looks up, he sees the Canadian and Mexican flags fluttering alongside the Stars and Stripes.
US economy is bouncing back
After the heavy years of the crisis, the US economy has gained traction again and is overtaking Europe in terms of growth. Plus, after the service sector has been on the rise for years, the largest national economy in the world wants to regain a prominent position in the manufacturing sector. The buzzword is reindustraliziation. “Made in USA” is poised to become a globally recognized standard for quality again. Volkswagen and BMW are establishing US production facilities and Apple is starting to produce products in its home country once more. Motorola is looking to attract new customers for its high-end cell phone with the slogan “Made in USA.” And all of them need forklifts. Approximately 185.000 industrial trucks were sold in the US in 2013, an increase of 12 per cent compared to the previous year.
The key markets include the old “Rust Belt,” the industrial belt stretching across the Midwest and as far south as Texas. What is needed are new products. “In Europe, for instance, lorrys (tractor trailers) are loaded from the side, while in the USA forklifts enter the trailer from the back. The US market requires different equipment,” explains Vincent Halma. “In addition, the USA has totally different philosophies when it comes to warehouse optimization which requires a completely different product design and approach to the market.”
The vehicles tailored for the US market under the Linde and STILL brands are backed by KION technology from Europe and Asia. In terms of production capacity, on the other hand, Summerville is in the lead, with the ability to produce as many as 20,000 units a year. A central element of the strategy is to provide a comprehensive range of products and to leverage the dense retail network that the KION Group has access to in the USA.
»Within KION we have all ingredients to be successful in the North American market. This project is one of the biggest and most exciting ones in our history and I am proud to be a part of it.«
KION plant in Summerville: capacity for 20,000 trucks
“Plenty of knowledge there to be successful”
A strong team: achieving the objectives of the KION Group by pulling together as a team
Returning to an old passion
Vincent Halma is looking forward to the tasks ahead: helping to market newly developed products for the American market, expanding sales structures, and creating service offerings. The 43-year-old father of two sons has the right skills for the job. For nine years he was Managing Director of the STILL brand in the Netherlands and was later responsible for Western Europe.
For the native Dutchman, the move to South Carolina meant returning to an old passion: the USA. After studying business management in Leeuwarden, Holland, Halma wanted to get international experience with an internship and went to Columbus, Ohio, to do his MBA. He stayed for seven years gaining experience in product development and sales. “The very first job I had in my life was in the United States,” he says with pride. So he didn’t have to think twice when he got the offer to return to his favorite country in 2014.
The US South: a popular location for businesses
And it’s easy to feel at home in the town where Halma lives, 20 minutes from Summerville. Charleston’s historic buildings and cobblestone streets from the period before the Civil War give the town a historic flair. The streets are lined with palm trees, a promenade on the Atlantic invites for a stroll, and the spicy Southern food with its oysters and seafood is famous around the world.
What’s more, Charleston’s harbor offers a perfect logistics infrastructure. Others have discovered the area’s advantages as well. Charleston has attracted companies like Boeing and Bosch. “KION’s North American project is its most ambitious to date,” says Halma. “I’m very proud to be able to contribute.”
Attractive market with growth profile above GDP.
The KION Group operates in an attractive market that is growing faster than global economic output.
The worldwide market for industrial trucks grew at roughly 1.4 times the rate of the global economy between 1980 and 2013. Industry experts reckon that this pace is set to accelerate slightly over the period up to 2017.
This scenario is being driven by three global mega-trends:
- the industrialisation of the emerging markets,
- the advancing globalisation of world trade and, as a consequence, the increasing transportation of goods around the world,
- the growing fragmentation of supply chains and value chains: just-in-time logistics and purchases from online retailers create demand for the KION Group’s products and services.
A global leader– strong home base ...
Measured in terms of new trucks sold, the KION Group is currently number one in the European market and number two in the market worldwide. And with a presence in more than 100 countries, the company is the world’s biggest specialist provider of materials handling trucks and associated services.
Our strong position in western Europe, where we have a market share of 35 per cent (2013), is the basis for the global expansion of the KION Group. The foundation of our business is stable in this region because of replacement purchases and a strong service business.
After plunging into a deep crisis, Europe’s market for industrial trucks is now recovering. Since 2010 the KION Group has benefited from this trend with a double-digit percentage increase in revenue in Germany and the rest of Europe.
... and well positioned in growth markets.
The KION Group’s leading position in emerging markets such as India, China, South America and eastern Europe means that it is excellently placed to fully exploit the growth opportunities available there. In 2013 the KION Group’s brand companies sold 35 per cent of their new trucks in emerging markets – and this proportion is set to rise sharply.
A case in point is China, which is the world’s largest individual market for the KION Group’s products. The Company has been firmly established here with its offering of development, production and services for more than two decades and is the leading non-domestic supplier. The KION Group is the third-largest player in this market, where it employs some 3,200 people. China is now the Company’s second-biggest market in terms of unit sales (behind only Germany).
Technology leadership drives premium positioning ...
The KION Group is right in the vanguard when it comes to technology and innovation. By spending in excess of €114 million on research and development in 2013, the Company is a leader in its sector.
Over 900 people work at ten research centres in Europe, Asia and the Americas to devise forward-looking solutions; more than a quarter of them are based in China so that they are close to their market. This continuous R&D investment means that clients in all markets and segments can expect to have a fully customised range of trucks and services to choose from.
In 2013 the KION Group launched more than a dozen new trucks and truck families in the market, thereby providing added impetus for 2014, and a number of new products and services are set to be introduced this year as well.
... and customer value.
Customers of the KION Group particularly benefit from the industrial trucks’ good handling capacity and very low running costs throughout their lifecycle.
The cost benefits for customers mean that the KION Group can set prices at a level that enables it to achieve higher margins than its competitors. After all, personnel expenses and the cost of operating a truck over its lifecycle constitute a significant portion of the purchase price, especially in highly developed markets.
The proximity of the KION Group’s brand companies to their customers also ensures a high level of availability for the trucks. Around the world, around 12,900 inhouse and external service engineers work for the KION Group. This business offers considerable potential also outside of Europe: in China, revenue from services has risen substantially in recent years.
Robust integrated business model with high contribution from services.
This provides the basis for the KION Group’s lasting business success. Customer services, truck rentals, used trucks and spare parts together contribute more than 40 per cent of revenue. This business is very resilient to fluctuations in the economic cycle. Moreover, it generates particularly good margins for the KION Group.
There are around 1.2 million KION trucks in use around the globe, forming a broad basis for a strong and integrated service business.
A comprehensive network of more than 1,200 sales and/or service outlets worldwide ensures that the KION Group is never far from its customers. This creates strong customer loyalty, which in turn offers more potential for growth and provides a lasting competitive advantage.
Strong profitability – well prepared for future value creation.
Constantly improving efficiency and profitability is a clear objective for the KION Group. Size and synergies – a combination that makes the KION Group stand head and shoulders above other truck manufacturers.
This involves collaborating on research and development, improving plant structures and fully exploiting the economies of scale created by a worldwide production network. Other areas of focus are the optimal use of shared, cross-brand modules and platforms and the ongoing expansion of the service business.
Highly motivated and qualified employees with proven track record.
International, highly qualified and highly motivated: the KION Group’s more than 22,000 employees, who demonstrate dedication and creativity day in, day out, are both the heart and the backbone of the company.
Their hard work underpins the operational success of the company and ensures a strong financial performance. This was one of the key elements in the successful stock market flotation of the KION Group in June 2013.
The company’s growth strategy is reflected in the structure of the workforce. In 2013, the Group recruited extra staff for its service and sales operations and notably invested in new employees in the emerging markets and growth regions. The KION Group is increasingly hiring local management in all its markets in order to utilise their strong market knowledge and expertise.