Demand drivers
The world is facing an increasingly acute challenge to provide materials and goods that are essential for people while preserving scarce resources and limiting emissions.
Demand for Konecranes’ products and services is driven by market conditions in manufacturing industries including general manufacturing, metal production, power generation, automotive, pulp and paper, raw materials and chemicals. The Manufacturing Purchasing Managers’ Index (PMI) and manufacturing capacity utilization rates are the macro indicators that best describe the operating conditions of the two industrial Business Areas. We are also a major player in the container handling industry. In Port Solutions, the operating environment is mainly driven by global container traffic.
Customers generally invest in new equipment either to expand capacity or replace old equipment. Investment in new lifting equipment is cyclical and varies across different industries depending on the economic environment. Konecranes believes increasing demand for higher productivity, safety and ecological-efficiency presents growth opportunities.
Customer segments
Historically, Konecranes’ largest customer has accounted for less than 2 percent of its net sales and Konecranes’ top ten customers have on aggregate accounted for less than 10 percent of its net sales.
Approximately 80 percent of Konecranes’ customers are in the industrial production sector, including general manufacturing, metals, power generation, petrochemicals and pulp and paper. In general, the need of Konecranes’ customers for services and new equipment is linked to industrial production volume and capacity utilization.
The remaining approximately 20 percent of Konecranes’ customers are container ports and terminals. Their propensity to buy services and new equipment is generally related to world trade and container volumes.
Global footprint
Much of Konecranes’ growth has been organic, although we have a strong acquisition track record as well. Konecranes has acquired nearly 100 companies over the last 40 years since the beginning of its internationalization in the early 1970s. In the past ten years alone, Konecranes has expanded through acquisitions in APAC, the United States, and various European countries.
As Konecranes has expanded its operations, its business has become increasingly international in scope, with its products being manufactured at its own facilities in the Americas, EMEA and APAC, as well as through global subcontracted networks, and sold worldwide. As emerging markets mature, they offer significant business opportunities for maintenance services.
Konecranes has the experience and financial strength to become the world leader in material handling solutions creating value for everyone.
Competitive landscape
We have a strong market position in all our three Business Areas.
- In Industrial Service, we are the market leader with our unique global service branch network and unmatched service offering. There is only limited global or regional competition in industrial crane maintenance.
- Our family of leading brands secures our position as the global market leader in industrial cranes.
- We rank #1–3 in the market in all product categories for ports and container terminals.
Megatrends driving our business
We have identified the following megatrends that shape our markets and provide business opportunities: Sustainability, Digitalization and automation, and Geopolitics and macroeconomics.
Sustainability
Digitalization and automation
Geopolitics and macroeconomics
Sustainability
In Konecranes’ customer industries, companies and regulators alike have increased their ambitions to decarbonize operations. Konecranes supports this development through its own ambitious climate targets and an eco-efficient offering. Our products are designed to combine productivity with eco-efficiency, and our extensive service offering lengthens the lifecycle of sold products and supports circular business models. Safety is incorporated into the design, construction, maintenance and service of our products.
Digitalization and automation
Digitalization is accelerating within the industries we provide solutions to, and customers increasingly explore digital solutions to enhance productivity, safety and sustainability. We’re a technology leader in material handling, developing smart, connected products and autonomous solutions, and harnessing the advantages of our purpose-built componentry, technical knowledge and digitalization. Our extensive digital offering supports our position as the supplier of choice, while also providing data that supports us in perfecting offerings such as predictive maintenance. Konecranes applies industry best practices within cybersecurity to provide safe digital solutions to customers.
Geopolitics and macroeconomics
Geopolitical events such as the war in Ukraine do not only bring human suffering – they create disruptions in our operating environment as seen in supply chain challenges, rising energy costs and inflation. These constraints were prevalent across the world in 2022, also impacted by regional COVID-19 related lockdowns. In addition, the increased protectionism over the past few years is reflected in our operating environment.
From onshoring to protecting vulnerable supply chains, our approach is to continuously evaluate our supply network and strengthen it to weather changing external conditions. Our diversified business portfolio and industry-leading position also help protect us from regional and segment volatility.