subscribe to ENR magazine subscribe
contact us
advertise
careers industry jobs
events events
FAQ
Dodge Data & Analytics
ENR Logo
SUBSCRIBE TODAY
& receive immediate web access
comment

Cautious Economic Optimism Pervades Big Equipment Show

Text size: A A

As an expected 120,000 visitors began packing into the Las Vegas Convention Center, this year’s CONEXPO-CON/AGG exhibition kicked off with a universal question in mind: Will the current economic recovery stick?

Caterpillar’s new truck model (far right) was unveiled at the opening of the 2011 CONEXPO in Las Vegas, where construction industry attendees expressed hope that the recession is fading.
Photo By Tom Sawyer
Construction industry attendees expressed hope that the recession is fading.
Photo Courtesy Of Tony Illia
Caterpillar’s new truck model was unveiled at the opening of the 2011 CONEXPO in Las Vegas
----- Advertising -----

“All the focus is on CONEXPO as investors look to see whether the pending recovery on the U.S. construction equipment is real,” said Credit Suisse analyst Jamie Cook in an investor note.

Machinery manufacturers were hit especially hard by the recession. The plummeting demand from 2006-10 was “from peak to trough about twice as severe as previous cycles,” said Mike Mack, president of Moline, Ill.-based Deere & Co.’s construction and forestry group, at a pre-show press conference March 21.

For some, the tide is turning. Switzerland’s Liebherr Group reported that overall sales grew last year to $10.1 billion, or roughly 9%, led largely by its earthmoving equipment line, which grew 16%. It expects to sell more foundation rigs this year in North America, a promising sign of planned new construction.

But the industry has much ground to regain. “We’re celebrating an increasing market that is approximately one-third of what it was at the peak,” said Duane Wilder, president of Liebherr Construction Equipment Co., Newport News, Va.

Tower cranes still remain depressed, with a 60% sales decline since 2007. Liebherr this year plans to build tower cranes to satisfy Brazil and India’s emerging markets. New-housing construction remains at low levels and Congress has yet to decide on a long-term transportation policy. But conventioneers said there is plenty of rehabilitation work to do.

“Most state transportation agencies won’t engineer a bridge or other multi-faceted projects until they know a six-year bill is in place,” said J. Don Brock, chairman and CEO of Astec Industries Inc. “But asphalt gets out there pretty quick. It is the top roof of a road, and the roof is leaking.”

Many manufacturers at the show introduced machines and services to cut costs, boost production and meet clients’ needs. Deere unveiled the “Chatterbox,” a mobile recording studio inside which clients can sound off about their likes and dislikes. It rolled out a 4-cu-yd and a 9-cu-yd wheel loader, both using diesel-electric hybrid powertrains, set to go on sale in 2012 and 2013, respectively.

The threat of inflation tempered some of the optimism. Machine prices are climbing as much as 10% to pay for federally mandated new clean-diesel engines, vendors say. And they will likely rise again in two years as another round of clean-air rules hit.

Vendors including Liebherr say they won’t introduce cleaner engines this year because they have banked enough credits—a federal provision for suppliers who beat earlier mandates—to delay passing costs to end-users.

Ultimately, CONEXPO is all about big iron, and Caterpillar’s eagerly anticipated CT660 vocational truck made its debut amid a fog and light show inside Caesars Palace. Five years in the making, the “premium priced” truck emphasizes serviceability, functionality and ruggedness, said George Taylor, director of Caterpillar’s on-highway truck group.

The CT660 was field-tested on Alaska’s ice road—the same one featured on the History Channel’s “Ice Road Truckers,” where temperatures drop to -35F.Caterpillar will begin taking orders in April, with production beginning in May and the first customer deliveries scheduled for July.

“It needed to look, smell and growl like a Cat,” Taylor says. “This truck is more than just a pretty face.”

For more news about the show, visit ENR.com/CONEXPO.

 

----- Advertising -----
  Blogs: ENR Staff   Blogs: Other Voices  
Critical Path: ENR's editors and bloggers deliver their insights, opinions, cool-headed analysis and hot-headed rantings
Project Leads/Pulse

Gives readers a glimpse of who is planning and constructing some of the largest projects throughout the U.S. Much information for pulse is derived from McGraw-Hill Construction Dodge.

For more information on a project in Pulse that has a DR#, or for general information on Dodge products and services, please visit our Website at www.dodge.construction.com.

Information is provided on construction projects in following stages in each issue of ENR: Planning, Contracts/Bids/Proposals and Bid/Proposal Dates.

View all Project Leads/Pulse »

 Reader Comments:

Sign in to Comment

To write a comment about this story, please sign in. If this is your first time commenting on this site, you will be required to fill out a brief registration form. Your public username will be the beginning of the email address that you enter into the form (everything before the @ symbol). Other than that, none of the information that you enter will be publically displayed.

We welcome comments from all points of view. Off-topic or abusive comments, however, will be removed at the editors’ discretion.