Capital Equipment News May 2017

Paul Williamson, sales director for Africa at IronPlanet, says Caterpillar remains the most selling brand in the used equipment market in Africa.

is Caterpillar. The “yellow” is known wherever you go. Always Cat. Why? Because locals know how to fix the machines. And they know where to get spare parts. This preference is reinforced by a good dealer network, although Komatsu is also well-regarded. In contrast, parts from Chinese manufacturers are currently difficult to obtain despite their efforts to build up dealerships. Essential sales tips There are a number of tips to bear in mind to ensure a successful transaction. The equipment has to be suitable for the African environment. Computer systems and advanced electronics are classed as unacceptable. With newer equipment models there simply isn’t the expertise on the ground to keep them working. If a project is undertaken in the middle of the jungle and the machine breaks down the purchaser has got to be able to fix it. The dealer might be able to help eventually but the need for an immediate response is what is fuelling demand in older models. Emission levels also vary considerably from the strict compliance observed in

markets such as the United States. The desire to buy older technology is a fundamental characteristic of the African market. For those selling older equipment this is a great opportunity, as it is likely to keep prices solid for many years to come. Stability and opportunity IronPlanet anticipates a very strong future for the region, with “phenomenal opportunities” available in the used equipment marketplace. The optimism is based on a broad range of factors. With the population expected to double from 1,2 billion to 2,4 billion by 2050 – in a continent currently containing 650 million mobile phones – there are enough “raw materials” for developing IronPlanet’s success. Less tangible, but equally persuasive, is the identification of the spirit found from many visits. There is an energy about these guys in Africa – they get on with life; there is great drive and they want to get on. Where there is stable government, used equipment markets will grow, thrive and flourish. Mozambique, Botswana, Namibia and Kenya are prime examples. Ethiopia,

Tanzania and Uganda are also stable and investing countries where the outlook for purchasing equipment is strong. Nigeria has great potential if circumstances align, whereas the countries of French West Africa are viewed as better for finding equipment. In East Africa and certain parts of south- ern Africa, economies are more diversified. Those countries that add value will be in the best economic shape: those that go away from just shipping raw materials and convert these into products. And once the oil price goes up again, requirement for plant will be strong going forward. Kenya and Tanzania have a lot of construction projects coming up. There are major rail projects on stream in Mozambique and with the Djibouti to Addis Ababa rail link to the sea. Chinese investment is responsible for many of the infrastructure projects and the country’s influence in Africa is considerable. It is an influence that is driving opportunities but also shifting ways of doing business; often leaving European companies, with their adherence to strict compliance, less competitive. b