Capital Equipment News April 2018

COVER STORY

JEWEL IN THE CONSTRUCTION CROWN In a market previously dominated by premium offerings, Powerstar, supplied locally by Ever Star Industries, has established itself as a dominant force in the construction vehicle segment. A key pillar of growth is the rugged nature of the competitively priced product that comes with no extra bells and whistles, complemented by a strong dealer and service network throughout southern Africa. By Munesu Shoko.

O ver the years, Powerstar has become a household name in the South African construction sector, and even beyond the country’s borders. Armed with a rugged, competitively priced product that is built to challenge the gruelling terrain com- monly found on local construction sites, Ever Star Industries (ESI) – the southern African distributor of the Powerstar truck range – has achieved continuous growth, even in the face of some serious challenges associated with Chinese automotive offerings and a relatively small business base. While Powerstar caters for many areas of the commercial vehicle market, it is in construction where the range has become the jewel in the crown, breaking the dominance of premium offerings in this market segment. To date, Powerstar holds the second-largest market share in the extra heavy construction vehicle segment. The South African extra heavy commercial vehicle segment is, on average, a 12 000-unit per year market, and construction vehicle sales constitute about 20% of that figure. “Since ESI took over the local distribution back in 2010, we have established Powerstar as the tipper king of the local market,” says Bob Wang, CEO of Ever Star Industries. “A strong R&D regime has informed the continued development of the range. We have continuously listened to our customers, which has led to the non-stop refinement of our product designs to meet the end users’ ever-changing requirements.” The Powerstar brand made its local debut as far back as 2006 under the distributorship of Super Group at the time. During the early days, completely built units were shipped into the country, before ESI started local assembly in 2007 at its state-of-the-art facility in Pietermaritzburg. In 2010, ESI

took over the sales and support duties of the brand in southern Africa, ushering in a period of continuos growth for the brand. Growth pillars Testimony to Powerstar’s success in the local market is a massive 5 200-unit population rolled out between 2006 and end 2017. Of that number, 4 700 units were locally manufactured. Rodney Selesnick, Senior Head of Sales at Ever Star Industries, says the major success factor is the tough nature of the product, which is backed up by a strong aftermarket infrastructure. “In Powerstar, we have a product that speaks directly to the specific needs of the African customer. It is a rugged truck built for the challenging African conditions,” he says. “Our range is not as sophisticated as some of the so-called premium offerings, it’s essentially a workhorse that comes with no extra bells and whistles, making it very easy to maintain for the customer,” adds Selesnick. Another factor that has propelled this range to the summit of the construction vehicle market is the competitive pricing, making Powerstar a good fit for emerging contractors and entry-level participants into the construction industry. Both Selesnick and Wang have seen a big surge in the small and medium construction contracting sector, where Powerstar is playing a major role in providing a strong, reliable construction vehicle solution that is competitively priced. To put this into context, Powerstar’s VX2628 tipper range comes in at just below R900 000, while a same-sized unit from some of the premium OEMs costs in the region of R1,3-million. “Add to that, premium offerings come with obligatory

A key success factor is the rugged nature of the truck, making it a good fit for challenging African conditions.

maintenance contracts that drive up the total cost of ownership beyond the reach of start-ups. The product is very simple and customers can do their own maintenance. Bear in mind we also have a very good support structure of 32 dealers and service centres, with a very good supply of competitively priced parts,” says Selesnick. Wang adds that this is further complemented by the tough nature of the Powerstar truck, which makes the life of the vehicle a bit longer than most of the competition’s offerings. “Some of our customers have run their Powerstar construction vehicles in excess of eight years, of which the first four years is the finance period, allowing them to rack in some much needed profits during the balance of ownership. The lifecycle cost of the product is also very competitive,” says Wang. For these reasons, ESI has seen a growing customer base in the upcoming contractor fraternity, with 65% of its total sales in 2017 going to this group of customers. Selesnick notes that this is largely due to the changing face of the construction market in South Africa.

CAPITAL EQUIPMENT NEWS APRIL 2018 4