Stuttgart At the end of October, at the world’s largest meeting of construction machinery manufacturers, the Bauma trade fair in Munich, it was evident on every corner: Like the automotive industry, the sector is undergoing a far-reaching transformation process towards digitization and alternative drives.
“Four years ago we only had two battery-operated devices, today almost every division is dealing with the topics of batteries and electrification,” says Stephen Albrecht, Chief Technology Officer at Liebherr.
The traditional family company received the Bauma Innovation Award for its hydrogen excavator. And Liebherr is also significantly involved in the award-winning digital platform MiC 4.0, which was initiated by the mechanical engineering association VDMA and the main association of the German construction industry. It should one day ensure that all the different machines on a large construction site can be networked.
Much of this is still in the future. Liebherr, which produces in Germany but is managed by a holding company in Switzerland, is usually very reserved in public. Two leading managers are now giving the Handelsblatt an insight into the company’s current plans, which Hans Liebherr set up in the region between Ulm and Lake Constance after the Second World War.
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“For us, these are fascinating times in which we can contribute to technological progress,” says CFO Steffen Günther. Despite the pandemic, delivery bottlenecks and the Ukraine war, the signs point to growth.
“Incoming orders are solid at eight billion euros, eight percent above the strong previous year,” says the CFO. This is a record value. In the course of the 2022 financial year, the momentum slowed down, but there were no cancellations of orders in any division. However, due to the current framework conditions, the operating result will be “below the level of the previous year”.
The group can draw on electrical experience.
(Photo: Liebherr)
“The 2022 financial year ended on a positive note overall for the group of companies,” says a company statement. The balance sheet is burdened by the extensive withdrawal from Russia. Nevertheless, group sales are likely to have been higher than in the previous year.
In 2021, Liebherr had just reached the level it was before the corona crisis, with an increase in sales of 12.6 percent to 11.7 billion euros. The annual result was 545 million euros. The company will not give concrete figures for 2022 until April.
“We currently have no problem children, all eleven divisions are developing positively,” emphasizes Günther. In addition to construction and mining machines, Liebherr manufactures material handling technology as well as aircraft components and refrigerators, among other things. With a market share of around four percent, Liebherr is one of the ten largest construction machinery manufacturers in the world. However, the industry leader Caterpillar from the USA, which is three times as large, and Komatsu from Japan, which is more than twice as large, are still a long way off.
Liebherr intends to continue gaining ground this year. CFO Günther anticipates “a growth in sales of 15 percent”. According to the manager, whether these high goals can be achieved depends more than in previous years on the supply chain and thus the availability of material, personnel, energy and logistics.
The group is currently plagued by a luxury problem: “High order backlogs ensure delivery times that do not meet our customers’ expectations,” says Günther.
Construction machinery manufacturer relies on infrastructure projects worldwide
The attitude of the management is nevertheless optimistic. The boom in residential construction has meanwhile subsided in this country. “There are market opportunities for our construction machinery division in major global infrastructure projects, for example in energy supply, rail transport, larger buildings and road construction,” explains Günther.
The traditional group is primarily focused on the markets of Europe and the USA. “In terms of sales, China is of little importance to us,” says the chief financial officer. Liebherr uses the land primarily for production purposes at nine locations with 1,000 employees.
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However, the wide range makes the transformation more complicated, because Liebherr needs machines with a power range of 30 kilowatts (kW) to three megawatts. At 600 million euros, the cost of research and development is much higher than it used to be for the group, which for decades was primarily concerned with diesel and hydraulics.
“There is no ‘one size fits all’ solution,” emphasizes Chief Technology Officer Albrecht. That is why Liebherr remains open to technology when it comes to drive technology and is dealing with all possible approaches: hydrogenated vegetable oil, e-fuels, electric drives, hydrogen combustion engines, fuel cells, biodiesel from renewable raw materials or green ammonia.
Wheel loader with fuel cell
The effort for technology studies such as a wheel loader with a 50 kW fuel cell and hydrogen tanks that is now being presented is enormous. When this turns into sales does not only depend on Liebherr. The management does not yet dare to make a forecast for the hydrogen engine. “But we believe in it, and there was great interest among customers at Bauma,” says Albrecht.
An important question remains whether customers will also be able to get green hydrogen to the construction site in the foreseeable future. “It’s a typical chicken-and-egg problem, but we’re making advance payments for hydrogen,” emphasizes the head of technology.
After all, the group can draw on electrical experience. Tower cranes have always been electric. Mining excavators that run on mains electricity by cable have also been around for some time. According to the company, every eighth unit sold for special foundation engineering equipment and crawler cranes with a lifting capacity of up to 400 tons is already an “unplugged” model, i.e. battery-operated.
Ambitious goals in digitization
The plans for digitization are also ambitious. Software and sensors are elementary for safety, person recognition or collision avoidance. Digital platforms and interoperability play an increasing role. Liebherr therefore has its own subsidiary in Ulm with 80 software specialists.
For autonomous work, the demands on the assistance systems and their controls are becoming more and more complex. “We do believe that teleoperation is possible with one operator who can simultaneously operate several different devices from a distance – for example a wheel loader, then a bulldozer via the same platform,” says Albrecht.
However, the head of technology does not see fully autonomous driving on the construction site in the near future. “The construction site is too dynamic an environment. That’s more likely to happen in a gravel pit or in mining.” But partial automation is possible on the construction site. With the new assistance systems, even a businessman can create a flat surface.
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