LiuGong has long been seen as one of the most important instrument manufacturers to emerge from China, especially in the last 20 years in which the brand has gone international, today having more than 30 subsidiaries abroad and more than twenty factories globally, with more than three hundred. distributors in 130 countries.
Zeng Guang’an, president and CEO of Liugong
This process works well. In 2022, revenue from overseas sales will exceed US$1.2 billion, 46% more than US$8 million in 2011.
Zeng Guang’an, president and CEO of the company, shared with Construcción Latinoamericana his business vision in the region and future plans.
According to Mr. Zeng, Latin America is the company’s largest market, where it has had a strong presence since 2008, starting in Brazil and expanding to other countries in the region. In fact, in addition to the assembly lines at the Mogi Guaçu (Sao Paulo) facility, the company has a facility in Argentina, where the forklifts are manufactured.
In the main markets and areas the company is engaged in, Mr. Zeng mentions some of its product lines.
“The first type of product is construction equipment, which is the core business of LiuGong. The company has a wide range of products, among which front loaders, excavators and motor motors stand out, which are our core business, earth moving.” In this sense, the executive promises the company’s high performance, excellent team to have qualities and to work to improve market share through support to distributors and customers, especially in the after-sales service. “Through these activities we can improve the awareness of our brand in the region.”
The second type of product is mining equipment, where LiuGong has made a lot of progress in recent years. The company has a strong product mix, including heavy-duty front-end loaders, excavators, and large haul trucks, among others. “This product segment is very important to LiuGong’s business in Latin America because of the large number of mining operations in the region,” he said.
Linjun Wang, president of LiuGong Latin America, Zeng Guang’an, president and CEO of LiuGong, together with Christian Peters, editor of Latin American Construction.
A third product segment is forklifts in the logistics industry. LiuGong read his strategy in this business and put a lot of resources in the past two years, changed the leader and strengthened domestic and foreign distributors. This industry is a great company and has good business potential.
Mr Zeng’s fourth product line refers to sugarcane harvesters, where LiuGong is quite successful in China, Asia and South Australia. Now, the company is focusing on regions such as Brazil and North America, where the demand for compounds is very strong. The agricultural industry is a large company and has great business potential.
LiuGong North America recently sold its first battery electric vehicle in the United States, the front-loaded 856H-E MAX. And while this is the first in that region, the company already operates more than 2,000 electric transport wheels operating in some of the harshest conditions in the world, and exponential growth is expected.
LiuGong North America recently sold its first battery electric vehicle in the United States, the front-loaded 856H-E MAX.
But are the Latin markets enough to mature this technology?
“The development of electric machines technology in the market has both advantages and disadvantages. One of the main disadvantages is the charging infrastructure, which is still a problem in many countries. Even in developed countries, such as North America and Europe, governments have not pushed enough to invest in this infrastructure,” says Mr. Zeng, comparing this situation to China, where the government and many companies have invested in infrastructure, and the government has pressure.
Another factor to consider is the higher cost of acquisition, although, as the executive points out, there will be a longer return on investment. “The total cost of ownership of these machines is much less compared to traditional machines, as they save a lot of money on operation and maintenance costs.”
“The electric car has been around for a long time, but the question remains whether the Latin American market is ready to adopt it.” The answer is yes. Electric engines have several advantages compared to internal combustion engines. Electric machines are quieter and have lower maintenance costs. In addition, they have fewer emissions and are easier to sustain. Electric technology is more environmentally friendly,” he adds.
So Mr. Zeng is ahead of LiuGong electric tools already on its way to Ecuador, its Grupo Mavesa distributor.
In order to achieve better brand recognition and strengthen LiuGong’s presence in the country (and the world), the executive has a clear strategy that considers the development of its distributors in target regions, especially for the manufacture of the product line. As explained by Mr. Zeng, the plan of the entire company is to transform the distributors to sell solutions for one or the other product, which means a full line of products for contractors, farmers and other industrial customers.
The company is willing to hire new distributors in countries where it is needed, especially for the mining industry, which is a difficult job and requires specialized parts and equipment.
The company has a meeting facility in Mogi Guaçu, Sao Paulo, Brazil.
The company has invested in the support of distributors and customers and has developed a training system, spare parts services and telematics service, which allows the inspection of the quality and efficiency of the machines.
Latin American importance
For Zeng, Latin America is one of LiuGong’s most important markets, and the company is committed to introducing more products in the region, in fact, this year should see the launch of 28 new company models. The company has a clear goal: to become the number one brand in key regions.
The executives emphasized the importance of maintaining continued investments in America for parts service and customer service, and emphasized the need to financially support distributors and customers in the region. To achieve this, LiuGong plans to recruit more local talent and work more closely with them on product development and growth.
In general, Mr. Zeng expressed his gratitude to the customers and distributors of his country, noting that the brand seeks long-term success and sustainable business growth. The company also plans to introduce new technologies to manage customer support, improve efficiency and safety, and make their operations more transparent and sustainable with growth.