| |
Last year - despite
a broad downturn in large building project - sales of those tight-space
performance champs were up again, reports Pat Bright, excavation
products manager for Gehl in West Bend, WI. Residential work remains
the bright spot in an otherwise weak business, and the churning
of compact pieces working hard has become pervasive throughout it.
As Bobcat dealer Frank Garcia of Miramar Bobcat Inc. in San Diego,
CA, describes, "Here we're now building houses with only 4.5-foot
setbacks, and some even butt up against each other. Nothing else
but a compact machine can get in there. More and more we see bigger
equipment just dying on the vine because [it] can't get in to do
the job."
Access
to restricted spaces is one strong suit with compacts; another is
ease of portability. Virtually every user cites the huge convenience
of lighter weight and smaller size. You can haul a mini-excavator
or track loader almost anywhere on a small trailer pulled by a good
pickup truck, saving the cost of a tractor rig and a commercial
driver's license. "It's so much easier," relates Garcia, "to move
the small pieces around, get them to a job site quickly, and finish
in a fair time." In many urban and suburban settings, as J.R. Bowling
of Rayco Manufacturing in Wooster, OH, notes, "There are a lot of
places where, for various reasons, you just can't operate large
dozers and excavators anymore unless you're a demolition contractor."
All
of which is rather ironic, considering that a dozen years ago several
importers tried to launch compacts here and found only a feeble
reception. Several early players gave up and retreated. It took
nearly a decade before sales began to reach a critical mass, and
this largely coincided with the boom in home improvement in the
late 1990s, Bright points out. Hot sales figures for compacts have
spurred manufacturers to add even more power and capabilities to
their original lineups. For example, at a CONEXPO show in 1999,
Kobelco launched a new excavator line having extremely short (or
nearly zero) swing radius and a compact center of gravity - specifically
designed for tight spaces. With these machines, work that formerly
took days to do with very tiny equipment or pick-and-shovel could
be banged out in a few hours with much larger equipment, notes Kobelco
Product Manager Reece Norwood. In three-plus years since that launch,
Kobelco has more than doubled its compact-equipment market share,
he says. Competitors have redesigned their product lines accordingly.
Other manufacturers are adding muscle to engines, increasing the
bucket breakout force, and enhancing the hydraulic engineering while
still retaining the small footprint. All of this is feeding a virtual
cycle: More productive machines are luring buyers and spurring still
more innovations.
 |
Bob Taylor, equipment
manger for McLeod Land Services in Sarasota, FL, purchased his first
small, tight-radius excavator (a 310 Kobelco) in mid-2002 and reports
that only weeks later he was getting a lot of use for it, digging
small water lines and concrete footing for residential buildings.
Before the short-radius excavators came along, he recalls, McLeod
operators were occasionally hitting and knocking into things. McLeod's
land development business runs a gamut of projects - from the huge,
such as relocating whole lakes, to digging small backyard pools
and utility trenches. Its fleet numbers more than 100 pieces, predominantly
larger ones, including several mass excavators. Even so, to do the
increasing number of jobs in the small category, Taylor says, "We
go all the way down to little-bitty excavators and small Japanese
backhoes with rubber tracks for tight spots. Even the biggest companies
around here have been getting into these mini-excavators. They're
pretty powerful little machines. And of course they save us a lot
of shoveling."
Elimination
of hand labor "is frankly the real key to success of compact equipment,"
maintains Product Manager Keith Rohrbacker of Kubota's regional
office in Torrance, CA. The Japanese firm imports very small excavators
and tractor-loader backhoes - "nothing over a 1-yard-size machine
bucket," he says. Sales of minis often occur through a kind of domino
effect, Rohrbacker notes. One earthmoving contractor sees how his
competitor has replaced hand labor with a small machine, which does
the work in a third of the time. Soon that competitor buys one,
and so on. Rohrbacker cites another strong selling point: "The small
machine doesn't need workers' comp, it doesn't show up late, doesn't
take lunch breaks, and doesn't complain of a bad back."
Compact
equipment usage in California has been skyrocketing in residential
landscaping, for sprinkler systems, for digging tree holes, for
trenching for gas or other utility lines, and for extensive earthquake
retrofitting. The latter requires exposing foundations in limited
spaces. Before the advent of compact machines, "it was usually the
pick, shovel, and wheelbarrow," Rohrbacker recalls.
Snarling
Bobcats
Early designs of compacts were relatively limited, compared
to current models. "Basically they were just small buckets,
good for fine grading or for a plumber digging in tight spaces,"
notes Fred J. Willert, owner of F.J. Willert, a grading and excavation
contractor based in Chula Vista, CA. Willert owns about 60 large
pieces and mainly does grading and earthmoving on larger industrial
and commercial projects. He probably typifies the early skeptic
who then undergoes a conversion experience. Eyeballing his first
mini in the early 1990s, Willert remembers agreeing with the joke
that they looked just like toys. His doubts soon vanished, though,
when he took on a backfilling job for bleachers at a high school
stadium, where access by any standard equipment was impossible.
He phoned a friend who owned a Bobcat and invited him over. "When
I saw how good his operator was, and what he could do with [the
machine], we just got going from there," Willert recalls.
He
didn't buy immediately, however. Instead, he rented Bobcats as often
as 30 times a year for several years. Finally, in 2001 Willert purchased
a Bobcat 763, and a year later he sprung for another one capable
of carrying a relatively large 60-in. bucket. "They're both excellent
for fine grading and backfill in restricted spaces," he states.
His men typically utilize both Bobcats at least 30 hours a week
doing backfill on curbs and assorted finishing. Previously, whenever
he encountered tight spaces, he brought in the skid loaders. But
he likes the speed, quickness, and maneuverability of the mini machines
much better.
Bobcat
(now a division of Ingersoll-Rand) undoubtedly deserves the credit
for pioneering compacts of many kinds. Its product line now includes
skid-steer loaders, track loaders, all-wheel steer loaders, mini-excavators,
versa-handlers, telescopic reach machines, loader backhoes, and
even small walk-behind machines with a loader on the front - portable
power compaction, says Mike Fitzgerald, Bobcat product representative
in West Fargo, ND. In San Diego,
CA, estimates Bobcat's Garcia, the company held 95% of the local
market a half dozen years ago, which probably was representative.
Since then, surging competition has cut modestly into Bobcat's dominance.
"Swiss
Army Knife" of Construction Equipment
Early
Bobcats were indeed, as Willert notes, simply "small bucket machines"
until the company introduced a wildly popular quick-hitch system
for driving hydraulic attachments. Assorted tools for it have proliferated
since its inception: hammers, thumbs, tampers, blades, brooms, plows,
compactors, trenchers, pallet forks, rakes, grapple attachments,
augers, myriad buckets, and more. Currently, notes Garcia, you can
get 100 or so attachments, with about a dozen being popular and
well known. Other players in the attachment game include the Gehl
subsidiary ceattachmentsinc., Caterpillar, Komatsu, Kobelco, and
JCB, although Garcia estimates that Bobcat still makes or owns about
90% of the volume. Interchangeability of attachments with various
manufacturers' compact equipment is far from standardized yet, but
it seems to be working adequately.
The attachment craze has, in turn, spurred another revolution
of its own. Having these tools, a small contractor can often complete
an entire landscaping or other dirt job by himself, "thus eliminating
the need for many specialty subcontractors," notes George Chaney,
marketing manager for compact equipment-maker JCB in Pooler, GA,
and manufacturer of about 40 tools for its compacts and others.
Proliferation of tools also has meant that, as Rohrbacker points
out, "Equipment stays busy working all the time. You enhance
your investment by making your equipment far more versatile." And
high utilization is how any contractor
makes money.
High
utilization also has made compacts even more competitively attractive
compared to bigger equipment that doesn't allow add-ons. Dan Rafferty,
product manager of Takeuchi US in Buford, GA, offers an illustration
of the advantages: "Suppose I come to a job site with a TL 150 [a
Takeuchi mini-excavator], working beside a Caterpillar 953 dozer.
We dig out basements together." Of course, the dozer outperforms
the compact, but at the end of the digging, "The 953 pretty much
has to go back to the yard - or perhaps it can go do some fine-grading
somewhere if the operator's really good." By comparison, with the
more versatile mini-equipment, "I can drop off my tooth bucket,
attach a smooth bucket, and more easily do a good job of fine-grading,"
Rafferty maintains. "Or I can put on a trencher on the loader's
front end and trench down 4 inches to run the pipes. I can then
remove the trencher, put on a 36-inch bit augur, and drill holes
for planting trees. Or for smaller trees I can use an 18-inch bit.
There's tremendous versatility with a compact piece that the big
track loader just doesn't have," and utilization becomes far greater.
Some of Rafferty's customers have downsized from Cat 943s to smaller
TL 150s (a 10,700-lb. track loader) for excavating basements and
are happy they did, he reports.
Tag-Teaming
Another operational development assisted by compacts: More
machines readily complement each other, either in the big-and-small
combo or two small machines in tandem. McLeod's Taylor, speaking
from a work site in Palmetto, FL, boasts, "Now that the little excavators
come with blades on the front, we can drive them into a housing
subdivision [and team-up there with a Bobcat steer loader] for use
by cleanup crews or other quick jobs. Working together this way,
they're fast. They're small. They get you in and out. We get a lot
of use out of them." As for the mini-excavator equipped with a blade,
this particular fusion makes it the only digging machine needed
in most residential work, Taylor claims.
Garcia adds that a small,
rubber-track mini-excavator with a blade and a digging arm can go
360 degrees - "anywhere you want and on a two-to-one slope where
a backhoe can't go." Digging a backyard swimming pool, for instance,
it will first move the dirt behind it to a space where the bigger
loader can then haul it away. "A lot of contractors have been buying
this combination, calling it a 'system,' says Garcia. "With the
two pieces together, they can dig a good-size pool in 12 hours instead
of two days."
Another
illustration comes from Bobcat's Fitzgerald, who recounts how a
townhouse condominium project needed fill between structures and
in the rear - where regular-size pieces couldn't squeeze in. The solution?
"Trucks dumped the fill on the front side," he describes. "A larger
wheel loader brought buckets of material to the back, where all
of the material was distributed between homes and leveled by compact
equipment." He observes that, to an increasing degree, "owners of
big pieces need small equipment for filling and finishing work.
You don't take a large dozer in to level off two loads of material."
One
Small Caveat: Size Still Matters
All
that said, it might be too early to run out and liquidate your herd
of heavy graders just yet. Big machines still fill a critical niche,
as every user and vendor will attest. Compacts hardly were designed
for roadwork and bridgework, for example, nor for moving earth in
woods, fields, farms, and rural waterways. These jobs almost always
will be done more profitably with large equipment. Bigger is still
better when it helps you win bids and make more money.
Willert,
for one, still prefers to deploy the largest possible piece for
a job. He reports that he's currently digging more basements
with his big Cat 375 excavator, which sports an 8-yd. bucket, whereas,
by comparison, "not too many years back we were using small dozers
and rubber-tired loaders to dig them." Recently, too, he used the
bigger stuff to tunnel through California's coastal hills for a
new extension to San Diego's light-rail system. "We bought the big
375 especially for that job, and now we're very pleased," he remarks.
He is still keeping the excavator busy. At the tunneling job site,
he reports, the 375 was loading big trucks in less than two minutes.
Willert also did the earthmoving for San Diego's new baseball stadium - a
complex undertaking in which he utilized the full spectrum of machines,
from large dozers and excavators down to Bobcats and pick-and-shovel
crews.
Bigger
Buckets for Bigger Bucks
Typically,
large jobs are bid on cents-per-cubic-yard moved; hence, bucket
size is still the critical term in the profit equation, notes Mark
Sprouls, a Caterpillar spokesman. Small equipment, almost by definition,
can't compete. Even if you're using a D9 and scrapers, he says,
"The cents-per-cubic-yard, versus using articulated trucks and loaders,
comes in at half the cost. First you have to get the job by bidding competitively, then you have to
use the right tools to make a profit."
Fitzgerald
agrees: "If you're loading dirt into a line of trucks on an hourly
rate, you're more efficient with a large wheel loader than with
compact equipment." For that matter, adds Sprouls, "Three skid-steers
with three operators - versus one big bulldozer - will not be a moneymaker."
Besides,
developers who are paying you will feel much happier about forking
over their money while they watch huge dozers and scrapers at work
than little machines working shorter hours - even at a lower hourly
rate.
Even so - and arguing on the other side again - a D6R tractor
is going to set you back $250,000$300,000
perhaps. By comparison, you'll probably pay only a tenth of that sum for a durable midsize track- or skid-steer
loader, according to one professional. Thus, the big investment
demands the highest possible utilization rate.
Out
in the open country, at least, the decision to "buy big" is usually
clear-cut, observes Greg Jueneman, estimator for Orval Jueneman
Dozer Service in Hannover, KS, and co-manager of a fleet of 60-plus
earthmovers. Jueneman believes, "Generally you have to be thinking
of upgrading size to keep
ahead of the competition. Bigger size means we're able to do more
work faster - which greatly reduces the cost of the overall project
to us."
When Jueneman bids jobs,
he often shows clients the comparative hourly rates on a D8 or a
D7H (both at around $95). "And they say, 'Gosh that's a heck of
a lot more expensive than the D6H (at $70 to $75).' But I tell them,
'You've got to realize that they're doing one-and-a-half times the
work.'"
"Ever
bigger" has its practical limits though. Extremely large pieces
often require considerably more time and expense to prepare for
transport. You reach a point of diminishing returns. In jobs where
Jueneman foresees lots of equipment movement, he prefers to bid
only up to a D7H or D8H. "They're about as big as you'd want to
have" when your shifting them from site to site. Still, compared
with smaller D6Hs, they do the work in two-thirds the time. "Time.
That's the big factor," he points out. "You can do more work with
a big machine. The equipment costs a little more. But you have to
bid it that way."
Many of Jueneman's jobs
combine several elements, such as trenching and pond cleaning. For
these, he says, "Of course you want to buy a machine that will do
both." For his needs, a 20-ton excavator with interchangeable bucket
sizes and a large trenching arm has proven adequate. These two dimensions
are critical profit factors. "It's much faster and more cost-efficient
than using the (12-ton) trackhoe," which is what he used to do.
"It's sort of like using a bucket compared to a teaspoon," he describes.
"At least twice as fast."
The
urge for bigness is ever persistent. Jueneman now is looking to
upgrade his 20-ton trackhoe to a 30-ton for the gain in speed. His
firm also tears up old bridges and then regrades the banks for the
replacements. Hydraulic hammer attachments break the concrete. Forget
about using compact equipment here too: Once again, bigger is better
for the pounding leverage, at least in midsize equipment compared
to small.
Jueneman
sums it up: "Any way you can find to decrease the time and increase
the efficiency will make you more money." And his buying tip: "If
you upgrade to a machine with comparable or greater horsepower - but
don't get equal or greater weight - it'll just sit there and spin.
You've got to have the weight there to compensate for the power."
Watch
the Wear and Tear
Compact-equipment makers reportedly are aiming to lure
more and more buyers away from heavier pieces. They're beefing up
the hydraulic horsepower, enlarging bucket sizes, and packing more
punch into small packages or, as Kobelco's
Norwood puts it, "squeezing every little bit of residual
capacity out of a machine to make it as economic as possible to
own." Operators,
too, want small machines to do ever-bigger jobs - and, not infrequently,
push machines beyond their specified limits. Norwood believes that
operators often have the practice of digging light topsoil
using the largest bucket available on a compact, then keeping the
same bucket for digging rock or heavy clay - material of twice the
density. "Oversized buckets aren't
always bad if you know what
you're doing. You should refer to manufacturers' charts to tell
you what bucket to use for the application," he advises. Failing
to follow these guidelines, though - "don't expect the machine to
perform as well or last as long," he cautions.
Herein lies another drawback: Small machines, even
if solidly built, "have a considerably shorter life span than larger
machines," points out Sprouls. Durability
becomes even more critical in the purchase decision if you anticipate
high utilization, perhaps with multiple hydraulic tools. According
to one industry observer, "A skid-steer loader with 10,000 hours
on it is pretty well shot, while a D6R dozer with 10,000 hours is
only nearing engine replacement."
Virtually
all commentators agree that the current rage for compact equipment
doesn't really mean "competition" on the basis of size; rather,
compacts offer more choices to use the right machine for
the need, citing an oft-repeated theme. As Takeuchi's Rafferty observes,
"If you're going to drive finishing nails, you don't bring a 5-pound
sledge hammer." In other words, using a 13,000-lb. machine, for
example, you can indeed clear a modest tract of 10,000 ft.2
cost-effectively, but by the same token, for cutting out a hillside
for a strip mall, or for road building, or for most other industrial
and commercial work, you need the heavy stuff. Once the new building
is going up, or the curbs are in, "Nothing else but a compact will
fit," notes Fitzgerald. So the byword is to strike a balance, he
adds, "which is why big contractors love using compact equipment
to finish the job."
La Mesa, CA based
writer David Engle specializes in construction-related topics.
GEC
- March/April 2003
|
|
