Expert View – Solid growth: trends and opportunities in the Brazilian crane market

What are the trends you observe in the Brazilian Crane sector?

The Brazilian crane sector currently has a fleet of more than 2,500 machines, most of which are all-terrain cranes due to their versatility and service capacity.

This regional market is following the global sector’s trend of growth, with a certain upside and additional potential due to Brazil’s current shortage of equipment and the country’s large size and current needs, such as modernizing maritime ports (approximately 380), airports (almost 100), motorways, and increasing the renewable energy infrastructure (including wind turbines, hydroelectric plants, etc.), among others.

All projections indicate a growth of above 6% over the next 10 years, including numerous sectors of the economy and types of usage: industrial, construction, wind energy, and others.

Amongst the multiple sectors in which cranes operate in Brazil, the wind energy sector can be highlighted; it is currently growing massively, and Brazil is among the five largest wind energy markets in the world – and cranes are important for both the installation and maintenance of wind turbine towers. Additionally, although equipment over 400 tons is core for the main services of the turbines, smaller equipment is also needed as complementary support.

When we look at customer profiles, more than 90% are specialized service providers in a wide range of segments such as heavy industry, maritime ports, wind power, construction and specialized transport. The remaining 10% are companies using cranes for their own in-house services, which is very common in large companies such as engineering firms, construction companies and steel mills.

As in other sectors, the offer and interest for electric-powered equipment is growing in Brazil, although it is still quite limited for the moment. The current perspective mainly highlights growth in the hybrid equipment market, which is less disruptive, but we also see some alternatives being developed for 100% electric models.

What are the challenges faced by this industry?

One of the main challenges for the Brazilian crane market is related to the high cost of ownership, and the lack of new equipment. This is explained by the fact that almost all cranes are not manufactured in Brazil but imported, for example from Germany, USA, China, and Japan.

In addition to the strong global competition to acquire the limited number of available new equipment, Brazil also suffers from its geographical distance from the manufacturers’ countries, which naturally leads to long delivery times, and from the volatility of foreign exchange rates, which can negatively impact prices.

One solution to these limitations is the growing potential of the secondhand market (for example large cranes from Germany) which not only helps to meet local demand but also positively contributes to the ESG agenda through the extension of the life cycle of the equipment. This secondhand market is expected to grow at a similar rate as the new crane market; however, it remains dependent on the availability of such equipment.

What can BPCE Equipment Solutions bring to this sector?

Present in Brazil since 2008, we have built a strong level of experience and expertise as a one-stop shop, offering all kind of options to serve its clients, especially through customized structures and tailor-made solutions.

More specifically, regarding the crane market, BPCE Equipment Solutions Brazil is specialized in import leasing, which is a “door-to-door” solution from the purchase of the equipment abroad to the delivery at the client’s plant in Brazil, providing financing solutions for all the related costs.

Recently, the market has been showing stronger preference for operational lease transactions, which are asset-based financing structures, enabling the client to use the most up-to-date technology and brand-new equipment without the upfront expense of having to buy it first. This trend can be seen across the segments where the use of the equipment is prioritized against the standard ownership of the asset, which leads to more tailor-made and customized financing solutions to meet the specific needs of individual end-users.

These two examples are only a few illustrations of the broad range of services and added value that BPCE Equipment Solutions Brazil can bring to its clients and partners, always seeking to build long-term relationships and mutual confidence.