NEWS/PRESS

July 01, 2002
Heavy Duty: Crane Companies find new opportunities in duty-cycle work

Although some crane businesses have been quite successful performing duty-cycle work, only recently have companies renting and selling cranes realized the strong potential in this market. This niche market is not for all companies; however, it is certainly worth considering. In recent years, companies active in duty-cycle applications are experiencing notable success. The reason: Few rental companies offer duty-cycle cranes, although the number of contractors in this type of work is sizable. Two companies actively engaged in this market are AmQuip, located in Bensalem, PA., and American State Equipment, Inc., in Milwaukee. Both companies are well-established crane rental/sales firms and leaders in the industry.

Besides its corporate headquarters, AmQuip has nine branches covering the northeastern states from Maine to Virginia. This past year, the company became a Liebherr Nenzing Crane Co. dealer. According to Frank Bardonaro, general manager of AmQuip, the company selected Liebherr “because we believe this company makes the best duty-cycle cranes offered in the United States.”

AmQuip has four HS-853-HD and LR-853 100-ton duty-cycle cranes in its fleet. Even though the LR-853 crane is considered a lift crane, it also can be fitted with some options and accessories for use as an efficient duty-cycle crane. The company is planning on adding two new HS-855-HD 100-ton cranes to the rental fleet later this year. This model has replaced the HS-853-HD in Liebherr’s line.

AmQuip’s customers perform a wide variety of duty-cycle work, including clamshell operations; dynamic compaction work; iron and steel scrap handling (with magnets); demolition work; pile driving; and slurry wall projects.

At American State Equipment, customers are performing two unusual duty-cycle crane applications: steel-slag pulverization and tunnel construction. Slag pulverization is accomplished by the crane free-falling a 15-ton drop ball onto the intact slag until it is well fragmented. Following fragmentation, the same crane loads the slag onto trucks with a clam bucket. The slag is then processed by other means into products, including aggregates.

American State Equipment has three HS-833-HD cranes in its rental fleet. It also will be adding more duty-cycle cranes. The company has already sold 40 Liebherr cranes, with 15 being various duty-cycle crane models.

Tunnel Construction

Most crane rental/sales companies know little about tunnel construction. Nevertheless, hundreds of millions of dollars are spent each year on new tunnel construction in the United States. The tunnel construction in Boston alone has exceeded $20 billion over the past seven years.

Where there is tunnel construction, there are cranes working, usually three shifts per day. Duty-cycle cranes are preferable for many tunnel construction applications because they are comparable to lift cranes, yet much more productive for duty-cycle work. At the access shafts found along the tunnel’s alignment, the cranes constantly lower construction materials and heavy construction equipment. Moreover, the crane is an integral part of the mucking-out system, bringing the excavated ground to the surface in large-capacity skips. Because access shafts can be 1,000 feet or deeper, fast single-line speed with strong line pull is important for satisfactory duty-cycle production.

American State Equipment recently has sold three duty-cycle cranes to Kenny Construction for tunnel work. The company bought two HS-853-HD cranes and one HS-895-HD crane. The model MS-895-HD is the largest duty-cycle crane currently available from Liebherr. It has a lift capacity of 220 tons, a single-line pull of 77,000 pounds, and an 810-hp engine. Liebherr Nenzing offers five basic crane models in North America. They range from 40- to 220-ton capacities. Among the cranes are nine engines and 16 line-pull options. They feature free-fall. In addition, there are 28 production-oriented accessories and numerous applications packages. With so many choices to make, crane renters or buyers need sound advice from their crane supplier before choosing the best crane for their specific applications.

“There is a growing market for the HS-895-HD and smaller duty-cycle cranes,” said Jim Drought, vice president of American state. “The reason for this demand is that most duty-cycle cranes used today are old and worn out. Most crane manufacturers that built true duty-cycle cranes are no longer in business, so contractors have been holding onto what they have. Liebherr Nenzing is the only manufacturer offering an extended line of true duty-cycle cranes in North America.”

Secret of success

According to Bardonaro and Drought, there are three parts to a successful duty-cycle crane rental/sales business. The first part is offering an extended line of duty-cycle cranes for sale. Today’s new duty-cycle cranes are more productive and built heavier than lift cranes, thus making them better for continuous, severe working conditions. Typically, a duty-cycle crane’s productivity is 30 to 100 percent greater in duty-cycle work than a lift crane’s. Like lift cranes, the size of the duty-cycle should match the application for optimum cost-effectiveness.

Drought explains the main differences between lift and duty-cycle cranes: “Contrast the Liebherr LR-1100 and the HS-855-HD cranes. The LR-1100 crane is an excellent lift crane in every way. It has good reach capabilities, and it is relatively compact for its 110-ton lifting capacity. The HS-855-HD crane has a similar lift capacity but has higher horsepower (550 hp or an optional 800 hp vs. 300 hp) and greater single-line pull (55,000 pounds vs. 32,000 pounds). Duty-cycle cranes simply require greater horsepower and higher single-line pull for realizing the high production cycles expected of them. Generally, lift cranes do not require these higher-capacity attributes to make efficient lifts.”

The second part to a successful business is having expertise in duty-cycle crane applications. Duty-cycle crane work contractors are knowledgeable about the applications but not necessarily about the different model cranes. Bill Pace, sales manager for AmQuip, believes it is important for an expert to deal with the contractor.

“The lack of expertise not only poorly serves the customer, it is doubtful the crane supplier would end up renting or selling a crane,” Pace said. “We have 25 company field reps calling on customers in our territory. Most of our customers rent lift cranes, and our people are experts about lift applications. Nevertheless, they are gaining experience concerning duty-cycle crane applications. Meanwhile, we can rely on the expertise of the Liebherr applications team for assisting us in dealing with duty-cycle work contractors.”

Drought believes that duty-cycle cranes must be sold on their superior productivity compared to lift cranes. “It is an educational process, including convincing the customer that first costs (rental/purchase prices) will not necessarily lead him to a more cost-effective crane,” he said. “A duty-cycle crane may cost more to rent or purchase, but it is potentially a more profitable investment for duty-cycle projects.”

The final part of a successful duty-cycle business is a principle shared with a successful lift crane rental/sales business. The company will need a rental fleet of duty-cycle cranes to meet customers’ demands in a timely fashion. Duty-cycle crane contractors have renting/buying patterns similar to most other crane users: They order the cranes as they need them and often give the crane supplier little advance notice. This is why both AmQuip and American State Equipment are adding more duty-cycle cranes to their fleets this year. They need them. AmQuip’s duty-cycle cranes, for example, have 100 percent utilization. As for contractors, a duty-cycle crane can be a sound investment, even if there is not year-round work, because it can serve both roles: a duty-cycle and lift crane. Drought says that all 15 duty-cycle cranes sold by American State Equipment are used between duty-cycle projects as lift cranes.

As with any new business venture, management must make a serious commitment in capital and trained personnel in order to succeed. Although the duty-cycle crane business can be profitable, Bardonaro and Drought believe profits are not guaranteed. Rather, it takes an effective marketing effort. Similar commitments by the contractor also are necessary in order to succeed in this largely untapped niche market.

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