Drastic changes in tower rental market

By Heinz-Gert Kessel04 January 2022

Following the collapse of the Asian market, the future of the tower crane industry is unclear. Ben Shaw takes a look at the global rental business while Heinz-Gert Kessel looks at new developments from the manufacturers.

There are interesting times in store for the tower crane rental market. The past five years have seen drastic changes in the industry with major European rental firms disappearing, the Asian market collapsing, and a saving grace appearing in the form of a growing US market. An already saturated tower crane market continues to grow as cranes from the depleted Asian market are offered at bargain prices, and manufacturers con­tinue to launch new models.

In Europe, the growth of tower crane rental firms can be traced back to times when contractors required an extra one or two cranes to fill gaps in their existing fleets. Many tower crane rental firms then blossomed in the wake of the construction boom, with most being tied in some way to one of the major manufacturers. However, a collapse in the market late in 1995 signalled the beginning of a new era.

One of the biggest names in crane rental, Breuer, was recently dis­solved and its mobile crane fleet was sold back to the original founders of the company. The tower crane section now operates under the name TDK, although with a reduced fleet. Another large German rental firm, Kammerlander, went out of business while Euromietkran, a consor­tium of small tower crane rental firms operating under one name, ceased to exist.

Klaudia Sachs of MAN Wolffkran, whose company is a manufacturer that also rents out its cranes, says that her firm has noticed a definite shift in the European market over the past ten years. Sachs says the majority of the firm’s business now comes from renting out its cranes rather than sales. “At present, most of our customers are contractors who will rent one or two cranes from us to upgrade their own fleets. We also receive a lot of business in the renting of parts or compo­nents.” 

Changing times

But as with most other rental firms, Wolff has had to adjust to the changing eco­nomic climate, and the firm has recently reduced the number of staff at its head office from 210 to 150 in an effort to cut costs. Indeed, re-struc­turing and adapting seem to be the keys to survival in the changing European tower crane rental mar­ket.

“The tower crane market will undergo dras­tic change in the coming years as sales decrease steadily and rental increases”, says Leo Theyskens, general manager of Belgian rental firm, Arcomet.

“Specialisation and economies of scale combined with geographical diversification will become key factors in this market.”

Arcomet has certainly practised this philosophy, by establishing company sub­sidiaries in Belgium, Holland and Germany, as well as regional partners in France, Cyprus, Norway, Sweden, Poland and the UK.

Theyskens says that the current demand from contractors in Europe is for the versatile, but small capac­ity self erecting tower cranes and also for large capacity top slewing models. 

Concrete trends

This trend for larger capacity units is also in evidence in the UK, where Tom Newell of Vertical Transportation says that con­tractors are demanding a crane that can lift and transport a 2.8 tonne bucket of con­crete to all lengths. For this reason, the firm has just taken delivery of a Comedil CTL 130 luffing jib tower, to complement the firm’s large fleet of mainly Tornborgs jack­nife cranes, which although ideal for work­ing in limited space, have a relatively low lifting capacity.

The first of Comansa’s new LCL 250 luffing jib towers has been delivered to Econ Machinery Pte Ltd of Singapore.

Elsewhere in the UK, the story of the tower crane rental market is the same as the rest of Europe. An over-supply of cranes has led to reduced rates, despite relatively high demand. The general rule that a week’s rental of a tower crane should equal ‘1 per cent’ of the purchase price, is proving difficult for many rental firms to attain. Trevor Vanson of Vanson Cranes blames this partly on an influx of cranes from the depressed German and Asian markets, but also says that the increasing age of many companies fleets is affecting national rates. In Asia itself, the situation is similar to Europe with too many cranes available to a market where demand is limited. However, in Asia, the problem is greatly magnified, with demand at a fraction of the level it was just a couple of years ago.

In Hong Kong, rental firms have continued to increase their fleet sizes, taking advantage of bar­gains that are too tempting to miss, yet the demand for cranes has failed to increase. This has led, predictably, to a price war.

“There is intense competition in Hong Kong and the price war lowers profit margins,” says Judy Chan of tower rental firm Proficiency Equipment.

“But this situ­ation will improve towards the end of 1998 with the start of the Northwest Rail and Tseung Kwan OMTRroute projects.”

China survives

The story is slightly different in China which seems to have emerged from the Asian crises without too much damage. Potain, together with its Chinese joint ven­ture Zhangjiagang, is currently preparing two specially adapted MD2200 towers in a deal worth around US$12 million, for work on the massive Three Gorges Dam. However, for Asia in general the future remains uncertain, with nobody able to say if demand will ever return to its previous levels.

However, if there has been a promising mar­ket for tower cranes in recent times, it would have to be the US. The biggest tower crane rental company in the world at the moment is Morrow Equipment based in Oregon, US. Vice chairman of the company and eo­founder, Rick Morrow, explains that saddle jib cranes are currently enjoying a period of popularity, with his firm adding eight Liebherr 630 EC-H cranes and 20 of the 316 EC-H towers to its fleet in the past 12 months.

Morrow explains that contractors are increasingly choosing to have tower cranes on site instead of a crawler with a tower attachment (as is traditional in the US) because towers are more economical. “They have lower operating costs because a tower needs only one operator whereas a crawler will need an operator and an oiler,” says Morrow, who also points out that it is cheaper to run a crane on electricity (tower) than it is to run on diesel (crawler). 

Lewis Equipment Co has provided its Comedil CTT 561 “topless” tower for work at Dallas airport. The crane has a free standing height of 92m and is rigged with an 85 metre jib.

Unlike Europe where tower rental firms developed to complement end-users own fleets, the US has always been primarily rental, with the vast majority of contractors preferring to rent rather than purchase out­right. However there are no other nation­wide rental firms in the US, with the majority of Morrow’s competition coming from local tower crane rental companies, or the larger mobile rental firms that oper­ate limited tower crane fleets.

One example is mobile rental giant, Anthony, which operates a fleet of 50 tower cranes. One of the latest additions to its fleet is an SK285 from Peiner which the manufacturer launched at Bauma, shown in Anthony’s colours.

Similarly, one of the first of Comedil’s new CTT561 cranes, which also debuted at Bauma, went to Lewis Equipment Co for construction work at Dallas Airport. The company has since ordered another CTT561 and two of the CTT431 cranes with 75 metre jib and a maximum capacity of 16 tonnes. The manu­facturer now has distributors in Washington State, Colorado and Texas. Yet in global terms, the market for tower cranes remains depressed and the availabil­ity of barely used equipment at knock­down prices makes competition between the manufacturers even fiercer.

New developments

Despite this, the manufacturers continue to develop new models as was in evidence at this year’s Bauma exhibition, where luffing jib and topless models dominated the manufacturers’ stands. Ironically, the demand for luffing jib cranes in Germany remains low - in sharp contrast to their presence at the show. However, the strong presence of these cranes, which are specifically designed for high-rise building projects, was obviously an effort by the manufacturers to find new markets for them, following the collapse of the Asian market where they had enjoyed a healthy demand. 

One of the manufacturers admitted to IC at Bauma, “The designs were well underway before the region’s sudden economic crash. This was, of course, followed by a sharp decline in tower crane application”.

Lots of luffers

Among the new models on display at the show was Peiner’s SN356 luffing unit which incorporates many design features of the well-known SN86, such as the trian­gular lightweight jib and the rope-guided sliding counterweights. The well-designed machinery deck and platform can be split down into economic sections and a maxi­mum load of 4.6 tonnes can be lifted at 60 metre jib length. The company also dis­played one of its SN 166 luffing units which was delivered immediately after the show to UK rental firm, Delta.

Liebherr, meanwhile, launched the 160HC-L which has just 7 metre slewing radius and a maximum capacity of 16 tonnes on the shortened 30 metre jib. With the 55 metre trian­gular jib it can lift 2 tonnes at maximum radius. In contrast to previous HC-L cranes, the machinery deck components can be split down into 5 tonne collis - a real benefit for derigging. Some of the compo­nents, such as the side-mounted cabin, have been adopted from the popular EC-series of Liebherr city cranes. 

Like the Liebherr machine, Comansa’s new LCL250 has a fixed ballast and fea­tures a quadrangular jib. The crane is based on a newly-developed square folding base and represents the first in a new line of luffers from the company. The first unit has been delivered to Econ Machinery in Singapore, demonstrating that despite the slump in demand, there is still some inter­est in Asia, especially for luffing jib cranes.

Raimondi, meanwhile, having focussed on the LR 60 for several years, has intro­duced a new larger luffing crane, the LR 120, which features a turning radius of just 7.5 metre and a jib with a maximum of 50 metre outreach where 2.3 tonnes can be lifted. 

And MAN Wolflkran, which is cele­brating 100 years since the delivery of its first tower crane, has extended the design features of its 100B into the 180 tonne-metre class. The new 180B, with a tail radius of 7.1 metre, provides a maximum capacity of 18 tonnes.

Bauma launches

At the smaller end of the luffer market, BKT has launched the BN75 which has 6.2 metre radius, a 40 metre jib and 6 tonnes maximum capacity. Because of its relatively small capacity, this crane comes equipped with fixed ballast instead of a moving coun­terweight with swinging mechanism, as is typical on other BKT models.

The other major presence at Bauma was the topless and low top models with almost all manufacturers displaying a model. Comedil introduced the CTT561 topless crane from its new range designed by Franc Jost. This crane is mounted on compact HD tower sections that provide a free­standing height of 92 metre. At its maximum jib length of 80 metre, it can lift 3.5 tonnes. One of the first of these new units is working, along with 10 other Comedil towers, for Italian contractor lmpregilo and Rizzani De Eccher on the construction of a Mosque in Abu Dhabi. 

In direct competition to Comedil’s new design is the large BK412 topless crane with a maximum jib length of 75 metre. The central crane component features a user-friendly fast rigging arrangement and the manufacturer says that these topless giants are finding a ready market in airport extension projects.

Liebherr, meanwhile, has extended its HC-B series with the 80HC-B, which has a maximum jib length of 45 metre where it can lift 1.5 tonnes. Many of the design features of this crane are similar to those of the larger cranes in the range, which were intro­duced last year. 

Not strictly a topless model but based on the same principle, Wolff has introduced the innovative changeable tower top system, whereby the new flat tower head or the classic tower head of its 5520 model can be changed depending on the applica­tion of the crane. The company has yet to sell any of these cranes, which it admits is “disappointing”, however, one of the units is currently out on a rental contract working at Frankfurt airport.

One of the more interesting developments in the tech­nology for tower cranes is Liebherr’s Litronic sys­tem that allows the opera­tor a choice of two load moment curves at the touch of a button. By closely controlling the speed of the hoist and trolley near the crane’s limits, an extra-20 per cent capacity can be made available. 

And yet with all these developments com­bined with an over-supply of used machin­ery, particularly in Europe, it is natural to ask, ‘What will become of the rental firms?’

Leo Theyskens, general manager of Arcomet, predicts, “Only the financially sound and the geographically diversified have a chance of survival.” There are defi­nitely interesting times ahead.

Starting from zero

A Jaso J56 crane, owned by Jaso’s Mexican dealer Expamex, working for contractor Isaac Abadi and Associates on the ‘Square Tower’ project.

Mexico’s economic crisis in 1994 had an enormous impact on the country’s small tower crane rental business. The devaluation of the peso and the construction market for new cranes led to oversupply in Mexico’s already small tower rental fleets.

Pingon, one of the most famous names in Mexican tower cranes, cut its fleet from around 35 cranes before the crash to the 15 it cur­rently operates, and although there are signs that the Mexican market is now recovering, the company still only managed to sell 2 new cranes in the whole of 1997. 

Still, the few Mexican companies which do specialise in tower crane rental are genuinely optimistic about an upturn. Speaking at the Expo Construccion exhibition in Mexico City earlier this year, Pedro Alonsa Palacios, director general of Espamex - which imports Jaso towers and runs a fleet of 30 rental cranes - said there are now the same tall buildings being built in Mexico City, and he also sees potential for using self-erect­ing cranes in the country’s massive house building programme. Mexico aims to build 1.5 million homes a year, many in the form of 4-storey blocks for which self-erectors would be ideal. The company represents Italy’s Cattanea and has five of its self erectors in its fleet.

Another Mexican company to spot this potential market is Grupo Alpet, which earlier this year became Mexican dealer for the Alfa range of tower cranes, including self-erectors. The company has taken delivery of one Super 27 Alfa self-erector, which, says AIpet director general Jose Rubio del Rio, will be offered for rent or for sale; “The best way to introduce the concept is to demonstrate it on site”, said Mr Rubio at Expo Construccion.

An Alfa self-erecting crane on display at the Expo Construccion 98 exhibit in Mexico City earlier this year. Alfa will be represented in Mexico by Grupo Alpet.

The Mexican market for towers remains small, however, with one tower crane salesman estimating the total tower crane population of Mexico at just 300 cranes, many old models owned by contractors. It will take a sus­tained economic recovery - and major public works spending programme - to change that.

Delivered directly to your inbox, World Crane Week Newsletter features the pick of the breaking news stories, product launches, show reports and more from KHL's world-class editorial team.
Long Reads
Top training practices for increased construction productivity
Zack Parnell discusses how top practices align with McKinsey & Company’s ‘Construction Productivity Imperative.’
What were the SCRA jobs of the year?
The Specialized Carriers & Rigging Association (SC&RA) announced the winners of the 2021 Rigging and Hauling Job of the Year Awards on 29 October, during the 2021 SC&RA Annual Conference in Texas, USA
Hardware and software: how the latest crane tech can boost safety and reliability
Hardware and software alike, the latest technology launched for the crane industry focuses on improving safety and reliability of operations. 
Alex Dahm Editor, International Cranes and Specialized Transport Tel: +44(0) 1892 786 206 E-mail: alex.dahm@khl.com
Mike Posener Sales Manager Tel: +353 860 431 219 E-mail: mike.posener@khl.com