Sectoral conditions

The global material handling market, which comprises industrial trucks and supply chain solutions, again grew at a much faster rate than the global economy in 2018. Despite the spiralling trade disputes, the high volume of goods traded worldwide led once again to growing demand for industrial trucks in all of the KION Group’s sales regions. At the same time, demand rose sharply for warehouse automation and for sorting and picking solutions, partly in connection with the creation of extra warehouse capacity for the expanding e-commerce market.

Industrial Trucks & Services

Measured in terms of the number of trucks ordered, the global market for industrial trucks registered strong growth of 10.3 per cent in 2018. Around 1.5 million industrial trucks were ordered in total worldwide, with significant increases in all product categories. Orders for new IC trucks were up by 6.4 per cent, although the rate of growth in China, the biggest individual IC market, was a lot slower than in 2017. Unit sales of electric forklift trucks rose by 9.3 per cent. For warehouse trucks, the increase was 14.0 per cent. One of the main reasons for this growth was that manual equipment was replaced by entry-level trucks in the lower price segment, particularly electric hand pallet trucks in the lower weight categories.

In the EMEA region (western Europe, eastern Europe, Middle East and Africa), which is still the KION Group’s most important region, order numbers were up by 10.8 per cent. This was on a par with the growth rate in 2017, thanks to contributions from both western and eastern Europe. At 4.1 per cent, the rate of increase in the Americas region (North, Central and South America) was lower than in 2017. While the rate of growth was down significantly in Central and South America, the US also registered markedly slower growth. Despite a noticeable flattening, the APAC region (Asia-Pacific) again generated the strongest rise, driven to a large extent by demand for electric-powered trucks. > TABLE 006

Supply Chain Solutions

The market for supply chain solutions again expanded rapidly in 2018. Burgeoning e-commerce is continuing to have a significant impact, as is the related refocusing of supply chains on multichannel approaches. A steadily growing number of companies are investing in the expansion and optimisation of their warehousing and logistics capacity in order to shorten lead times, improve the efficiency of the flow of goods and widen their product range. Automated warehouse systems include not only solutions for individual processes, such as picking and packing, but also fully integrated end-to-end solutions.

In the US market, the volume of e-commerce sales again rose sharply year on year and the proportion of retail business transacted online increased from 8.7 per cent to 9.6 per cent. This meant a greater flow of goods in warehousing and logistics, as shown by the Prologis Industrial Business Indicator. The resulting increase in logistics capacity utilisation is leading to investment in distribution centres located close to consumers, and the trend for large building units accelerated sharply. At the same time, there is growing demand for more efficient warehouses, especially as the majority are still managed manually. Capital expenditure on warehouse equipment and technology, including rising investment in warehouse management systems, was therefore again at a high level in 2018.

Procurement markets

On the whole, prices for the commodities used by the KION Group rose sharply over the course of 2018. Steel, the most important commodity, became more expensive during the year and was up by more than 5 per cent on the average price for 2017. The average price of copper (LME) also increased year on year, reaching its highest level since 2014. The average price of oil in 2018 was also well above the previous year’s average. The price of Brent crude maintained a clear uptrend until October and, for a time, exceeded the threshold of US$ 75 per barrel, but it subsequently fell sharply. By contrast, rubber became cheaper due to declining demand from the middle of the year onward, and the average price in 2018 was lower than the average in 2017.