Germany China
Norderstedt Lüneburg Moosburg Degernpoint Landsberg Dresden Qingpu
Low-lift trucks • •
Stacker trucks • •
Battery-powered counterbalanced trucks • •
IC engine-powered counterbalanced trucks • Reach trucks • • Order pickers • • • High-rack stackers • Tow tractors •
Small-series and customized trucks •
Control units, batteries and chargers •
The net sales target underlying this corporate vision is of an order of magnitude which should exceed the 3 billion-euro mark in 2017. We aim to own a share of significantly more than 20 per cent of the European market (based on incoming orders in terms of units). Long-term earnings expectations are primarily oriented towards the EBIT return on sales, which is intended to be above the competition’s average. Jungheinrich pursues a single-brand strategy focussing on products and services in the premium segment of the global material handling equipment market and generally has its sights set on organic net sales growth. However, we do not rule out making strategic acquisitions to round off the product portfolio.
Jungheinrich is primarily taking the following measures with a view to achieving its long-term growth objective:
1. Expansion of the core business in Europe
Jungheinrich has long commanded leading positions on the European markets—above all in the warehouse tech- nology product segment. Although the European market grew by 9 per cent compared to the previous year, en- compassing 344,500 forklift trucks, it was still 16 per cent smaller than before the financial crisis in 2007. Therefore, this region still has some room for recovery. Moreover, current trends in intralogistics present new prospects for growth. Significant pressure on prices, consumer behav- iour characterized by the increasing diversity of variants and rising product customization, mounting consumer expectations regarding the reliability and quality of deliv- eries, the expansion of Internet commerce and the high volume of mail-order business require innovative solu- tions to manage increasingly complex logistic processes. Driven by the ever-stronger desire for process reliability with reduced human resources, the need for automated solutions is rising steadily. The largest markets in Western Europe are Germany, France, the United Kingdom and Italy. In Eastern Europe, Russia and Poland lead the way, followed by the Czech Republic.
Manpower was expanded significantly at our European sales companies in the period under review. Besides Germany, countries of focus were Russia, France, Poland, Spain and Turkey.
In sum, we succeeded in defending our position on the European market, commanding a share of just under 21 per cent against the backdrop of a persistently hotly contested market.
2. Expansion of the strategic position in the logistics systems business
With its logistics systems operations, which encompass the planning, project engineering and implementation of complete warehouses when their potential is fully tapped, the company pursues a strategy that sets it apart from the competition in the material handling equipment business. Jungheinrich expects global demand for logis- tics systems solutions to increase further in the years to come. Going beyond Europe, which is our current point of focus, centres of excellence have been planned in Asia and Russia in this field. At the beginning of the year being reviewed, the logistics systems business and the production of warehousing and system equipment were combined and placed under common management with a view to establishing an even stronger presence on the market as a provider of end-to-end intralogistic services. Furthermore, the sales force of the logistics systems business was increased by 40 employees to a total of 565 staff members. This includes the expansion of the labour force of Jungheinrich Systemlösungen GmbH, Graz (Austria) by 13 employees to a total of 89 staff members. The subsidiary’s offering encompasses soft- ware for integrated, holistic material flow and warehouse logistic solutions as well as the associated services ( project design, implementation, training and service). The warehouse and system equipment factory at Degernpoint (Bavaria), which took up operation in Sep- tember 2013, produced nearly 2,600 forklifts in 2014, its first full year of operation.
3. Increase in the share of the IC engine-powered counterbalanced truck market
At about 44 per cent, or some 486,700 trucks, the IC engine-powered truck product segment continued to account for the single-largest portion of the world market in 2014. In the year under review, Jungheinrich manufactured 5,200 IC engine-powered forklifts. Jungheinrich launched two new IC engine-powered counterbalanced truck model series featuring hydro- dynamic drives (converters) at CeMAT, the world-leading trade show for the intralogistics sector, in May of the year being reviewed. Manufactured in the Moosburg plant, these forklift trucks are both robust and reliable, suitable for universal use, and achieve above-average handling turnover rates for their class, while keeping energy consumption low. Some 1,500 units were produced in
2014. All in all, we increased our share of the European market in the IC engine-powered counterbalanced truck product segment from just under 6 per cent in 2013 to approximately 7 per cent in the year under review.
4. Expansion in Asia’s growth markets, focusing on China
Asia accounts for a 41 per cent share of the world material handling equipment market, with China alone owning 25 per cent. Jungheinrich is enlarging its sales footprint in Asia accordingly. In the year being reviewed, Jungheinrich had five sales companies in Asia. We al- ready run nine branch offices in China. Furthermore, the network of dealerships and sales agents was expanded in 2014 by three new dealers.
At the same time, the Asian sales force was increased by 54 employees, or 9 per cent, to a total of 646. More than 50 per cent the personnel works for the Chinese sales company. Seeking to strengthen our presence in Asia even further, the site maintained in
Malaysia, which had been run as a branch office of the sales company in Singapore, was transformed into an independent sales company in 2014. By December 31, 2014, the newly established company had 30 people on its payroll. In our quest to step up our activities in
Singapore, we purchased a new property for the sales company in the year being reviewed.
Production at the newly constructed plant in Qingpu, China, commenced in August 2013 and rose by 74 per cent to 3,700 units in 2014, the factory’s first full year of production. All three product categories—plat- form trucks, battery-powered counterbalanced trucks and reach trucks—contributed to this increase. This enabled Jungheinrich to partake of local market growth to an extent disproportionate to its size. The workshop for reconditioning used equipment was integrated into the plant in the year under review. Our Chinese short- term hire fleet was enlarged by 35 per cent in 2014. The average number of pieces of equipment for short-term hire thus totalled a good 1,300 forklifts.
5. Expansion and international growth of the mail-order business
Our mail-order operations posted further strong growth in 2014. In the year being reviewed, net sales were driven up by some 19 per cent to €50 million by expanding the range of offerings. Products in the stacking and hoisting, transportation, warehousing, operation, occupational safety and environment categories are offered via online stores and a factory equipment catalogue of more than 1,000 pages. So far, the business model has become established in Germany, Austria and the Netherlands and continues to harbour substantial potential for growth. In addition to the five aforementioned strategic points of focus, we also intend to expand the after-sales services and short-term hire and used equipment business areas. The future potential of after-sales services, which contributed 30 per cent of consolidated net sales in the financial year that just ended, depends on the strong
growth of new truck business. In 2014, the number of service en- gineers working for Jungheinrich rose to over 4,000, representing about 32 per cent of the workforce. Averaged for the year, in 2014 we maintained a short-term hire fleet of approximately 38,100 forklift trucks (prior year: about 33,600 units). A significant rise in demand for trucks for short-term hire was recorded in the year being reviewed in Eastern Europe, the Asia- Pacific region and on the core markets of Central Europe. Demand for used equipment in Eastern Europe, the Asia-Pacific region and on the core markets of Central Europe was much higher than in the previous year. In the period being reviewed, over 5,100 used pieces of mate- rial handling equipment from the whole of Europe were reconditioned at the Dresden Used Equipment Centre. Subsequent to reconditioning, the forklifts are sold the world over via the direct sales and dealer networks. Capacity was expanded significantly at the Dresden Used Equipment Centre in the year under review. Work on the shell has been completed. By the middle of 2015, we will have finished the internal conversion work, e.g. on the new surface technology as well as the new coating and
Chinese production up