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Fiat Group Pushes Client-Oriented Engineering As It Prepares To Spin Off Industrial Assets

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Case Construction Equipment is launching a new line of loader-backhoes that the Racine, Wis.-based manufacturer says will boost sales as the economy rebounds. Production of the new line was informed by a strategy of its parent firm, Fiat Group, which places a high priority on client involvement early in the design phase.

Case used Fiat’s product-development process to create a new line of loader-backhoes that has been designed with the customer’s needs in mind.
Photo: Courtesy of Case Construction Equipment
Case used Fiat’s product-development process to create a new line of loader-backhoes that has been designed with the customer’s needs in mind.
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While Case says it always has used customer feedback to guide product development, this higher level of interaction was initiated by Fiat’s top executive, CEO Sergio Marchionne, according to one company insider. Customers say the approach is a noticeable change from the past.

“Case, like other equipment manufacturers, used to ask what we customers thought of a new machine when it was already well into development,” says Dennis Zentner, owner of DRZ Backhoe, a contractor in Vancouver, B.C. “This time, they talked to us from the very beginning, so we could suggest ideas and improvements right from the start.” Zentner is one of five users who worked on the design and testing with Case for 18 months.

The four new models—580N, 580 Super N, 580SN Wide Track and 590SN, delivering 79 to 108 horsepower and starting at $82,000 retail—will be available starting in November. They replace Case’s M-Series-3 line. ENR previewed the new line last month at Case’s 500-acre customer center and proving grounds in Tomahawk, Wis.

Although Zentner lists a number of features he likes about the new loader-backhoes, he is especially happy that the cab’s rear-quarter windows can swing open 180 degrees and that the new push-button-activated PowerLift option can boost hydraulic pressure to give the backhoe up to 39% more lifting power while running the engine at idle.

“It will lift heavy concrete manholes, distribution boxes and pipe that you normally would have to bring in a 5-ton hydraulic excavator to handle,” says Zentner. “It also runs so quietly in PowerLift mode that you can talk to someone outside the cab. That makes operation safer.”

Marchionne
MARCHIONNE

Fiat, which owns a 20% stake in U.S. automaker Chrysler Corp., Auburn Hills, Mich., aims to please investors by separating Case and other industrial subsidiaries from its automotive business. However, analysts don’t expect much to change. “I do not think the restructuring will have any effect on Case’s operations at all, not at least in the short term,” says David C.A. Phillips, managing director of Off-Highway Research Ltd., London.

Case officials say they will continue to use the Fiat process and are in the midst of using it for its next generation of skid-steer loaders. Case chose to introduce the loader-backhoes now because market indicators “are aligned for a successful 2010 launch,” says Jim Hasler, vice president of Case’s parent, CNH Construction Equipment, Burr Ridge, Ill.

Hasler says the favorable market conditions include newly signed federal legislation that offers tax credits for fourth-quarter investments in industrial equipment, a defined customer need for more backhoe lift capacity than was available in the market, and a forecast from machinery analyst Yengst Associates, Wilton, Conn., that predicts the U.S. loader-backhoe market will grow 7% in 2011.

If sales follow as expected, the new machines designed under Fiat’s process could help Case boost its presence in a category it helped define in the 1950s. In 2009, Moline, Ill.-based Deere led the U.S. loader-backhoe market with a 36.6% share, according to Manfredi & Associates, Mundelein, Ill. Meanwhile, Caterpillar Inc., Peoria, Ill., held a 31.3% share, while Case trailed behind with 20.1%.

Case, Hasler adds, also wanted to get ahead of competitors, which are expected to unveil new machines next spring.

 

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