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Construction and mining equipment sales rise

Sales of construction and mining equipment improved during the first quarter of 2018, with sales of new equipment reaching levels last seen in the first quarter of 2015.

According to figures released by the Construction and Mining Equipment Suppliers’ Association (CONMESA), a total of 1542 units were sold during the period, an improvement of nearly 100 machines during the same period last year.

CONMESA Chairman, Lawrence Peters, said the move was in line with the associations expectations and predictions at the beginning of the year.

He added that the second quarter should continue a similarly positive trend, but with the uncertainty of volatile exchange rates and rising fuel costs possibly weighing against a sharper increase in sales.

Low demand

“The recovery has been steady, but slow due to the underlying challenges faced on both the mining and construction sides of the industry. While low commodity prices have weighed heavily on the mining sector, the sluggish sales are also because of political uncertainty, as well as unease of the mining charter and its impact on mining investment in South Africa.

“On the construction front, we are still not seeing any significant infrastructural projects in the form of headline projects. This means that the large and medium construction companies are not buying new machines to the extent that they had previously. Their fleets are being employed elsewhere on smaller projects thereby hindering sales to second and third tier companies,” said Lawrence.

Cautiously optimistic

Fellow board member and representative from Bell Equipment, Dale Oldridge, added that the company’s figures were better than expected in all areas with mining equipment performing particularly well.

He said that internally the company was also optimistic that construction equipment sales would improve during the latter part of the year as infrastructure projects launched close to next year’s elections.

Barloworld Equipment’s Dr Samantha Swanepoel concure, reporting that sales were improving across all industries. She did however state that the industry’s improvement was off a relatively low base.

She added that factors such as the implementation of the Mining Charter, as well as negative mining news headlines were still depressing aftersales business and margins.

 

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