La Péronnière
Company Perspectives:
With more than one hundred years of experience in the transport and material handling equipment, Pinguely-Haulotte, listed on the Secondary Market of the Paris Stock Exchange since December 3, 1998, is the third largest manufacturer in the world, and Europe's leading manufacturer, of self-propelled aerial work platforms. The core of Pinguely-Haulotte business and its international development strategy revolve around these products.
Fast-rising Pinguely-Haulotte SA has captured the top spots in the market for self-propelled aerial work platforms. The Horme, France-based manufacturer is the European leader, with some 32 percent of the market, and number three in the world, with a market share expected to reach 17 percent by the end of 2002. Pinguely-Haulotte designs, engineers, and markets nearly every category of platform machinery, with 40 models spanning most of the major categories, including articulated booms, telescopic booms, vertical masts, trailer platforms, and, especially, scissor-lifts, the fastest growing category on the market. Led by Pierre Saubot, Pinguely-Haulotte has distinguished itself by concentrating its efforts on research and development, design, engineering, distribution, marketing, and post-sales services. While the company performs assembly of its products, many of the components and even entire machines are manufactured by subcontractor partners. This model has enabled Pinguely-Haulotte to build up production capacity of more than 18,000 machines for 2002. The company expects to produce some 12,000 machines that year, more than four times its production rate just four years earlier. The company has also seen rapid growth, raising revenues from just EUR56 million in 1998 to estimations reaching EUR320 million by the end of 2002. Undisputed leader in France, where the company has gained a market share of more than 40 percent, Pinguely-Haulotte has nonetheless turned to the international market for its growth, and more than 80 percent of the company's sales came from outside of France in 2001. Europe remains the company's primary market, representing nearly 98 percent of sales. In 2001, however, Pinguely-Haulotte established a U.S. marketing subsidiary in order to begin competing head to head with worldwide industry leaders JLG and Grove, both of the United States.
Rescuing Businesses in the 1980s
In the mid-1980s, both Pinguely and Haulotte remained small-scale, albeit respected manufacturers of construction machinery; yet both appeared slated for oblivion before being acquired by Pierre Saubot. Pinguely, the older of the two, had been formed in 1881 in the town of Chambéry. For many years, Pinguely had been a manufacturer of steam locomotives, producing more than 25 steam locomotives in the years around the turn of the twentieth century. Pinguely later switched its production to machinery for construction and other industries, specializing in producing mechanical shovels and other earthmoving equipment, as well as a line of mobile cranes.
Pinguely eventually came under control of the French steel industry conglomerate Creusot-Loire and was joined with Haulotte, founded in 1924 in L'Horme, which had come to specialize in the manufacture of derricks, mobile cranes, and aerial platforms.
The collapse of Creusot-Loire, which filed for bankruptcy in 1984, nearly spelled the end for both Pinguely and Haulotte. As rescue plans were worked out for the major parts of Creusot-Loire, neither Pinguely nor Haulotte were included in the proposed packages. As future president and CEO Pierre Saubot told L'Entreprise, "Just before I bought them, an expert had concluded that the Pinguely and Haulotte companies had no future and should be shut down. But I was convinced of their potential, especially since there was a strong work force and a reputable, 100-year-old brand."
The acquisition of Pinguely and Haulotte was the fulfillment of Saubot's long-time dream. A graduate in engineering from the Ecole Superieure de Paris d'Electricité in 1966, Saubot had gained experience as a salesman for construction machinery, notably lifting equipment, before returning to school to complete a business degree. Saubot then became a engineering consultant. Saubot's specialty was helping companies in financial difficulty. Yet Saubot had long dreamed of heading his own company. In 1985, Saubot gathered his savings and acquired Pinguely and Haulotte. "For ten years, I'd spent my time helping companies on the decline. I felt that it was time that I invested myself personally in one of those companies," Saubot told L'Enterprise.
Saubot set to work reorganizing his new businesses, yet Pinguely and Haulotte were kept as separate companies into the 1990s. Both companies faced into a depressed market for construction machinery, a situation worsened by the fact each of the firms shared a specialty in the production of lifting equipment. Saubot and his management team set out to find a new market--and preferably an entirely new product--for the companies' manufacturing and engineering expertise.
Saubot and his team quickly identified two potential growth areas: all-terrain lifting vehicles for the construction site and self-propelled aerial work platforms. Both areas appeared promising, yet the first was already well developed, notably by Manitou of France. The second, however, represented a new market entirely, and, at least in Europe, one with more or less no competition. Developed in the United States in the mid-1980s, the self-propelled aerial work platform had begun to take off in that market by the end of the decade, largely because the new machinery proved more efficient than traditional scaffolding and other methods for working high above ground.
Yet Saubot had recognized the aerial platform's enhanced safety potential. Already in the 1980s, most of the European Community countries had begun drafting work safety regulations governing above ground work. Saubot's team began designing their own aerial work platforms, placing that activity under Haulotte; Pinguely, meanwhile, took over the group's crane manufacturing operations, which geared production largely toward fulfilling contracts for the French army.
Global Top Three in the New Century
Haulotte's work platforms quickly found takers in the French market, where legislation governing above-ground work, initiated in 1985, continued to be tightened. By the mid-1990s, Haulotte's head start had enabled it to capture the leading position in the French market. By 1995, Saubot decided to concentrate his operations entirely on aerial work platforms--despite having won a FFr300-million, five-year contract for 70 bulldozers and 240 heavy-weight tow trucks for the French army in 1995. Saubot was convinced that his future lay in Haulotte's growing line of aerial platforms. As he told L'Enterprise, "I had sensed an explosion in demand in the market."
In 1995, Saubot combined his two company's into one, forming Pinguely-Haulotte. With annual sales of just EUR25 million, Pinguely-Haulotte set to work reorganizing its operations, including exiting all its product markets except its new core of self-propelled aerial work platforms. At the same time, Saubot put into place the company's manufacturing model. Rather than committing itself to the heavy investments required to put into place is own manufacturing capacity, Pinguely-Haulotte took a more unusual approach, preferring to concentrate its operations on research and development, engineering, marketing, and distribution, and putting into place a broad network of manufacturing subcontractor partners. This model enabled the company to build up its production more rapidly, and at less cost and risk. As Saubot told Le Nouvel Economiste, "Profitability comes first. We have also been attentive to this order of things."
By 1996, Pinguely-Haulotte's revenues had already climbed to EUR40 million and included the sale of some 700 of the company's boom and scissor lifts, compared to just 300 the year before. Yet the company's strongest growth was yet to come. By then, the member countries of the European Community had decided to draft European-wide legislation governing safety for work performed at three meters or more above ground. The new legislation, passed in 1997, encouraged Pinguely-Haulotte to complete its disposal of its former operations, including the delivery of the last of its vehicles for the French army.
The new legislation transformed Pinguely-Haulotte's market. By the end 1997, the company's production was unable to meet the demand. Pinguely-Haulotte was now able to prepare its assault on the larger European market. As part of its international expansion effort, the company began forming sales and marketing subsidiaries, starting in Germany and the United Kingdom in 1997. The move onto the European stage brought the company into direct competition with such market leaders as JGL Industrie and Grove Worldwide. Nonetheless, Pinguely-Haulotte's manufacturing model enabled the company to meet the competition head on with lower pricing. As Saubot told Le Nouvel Economiste, "We set the prices on the market, even in the United States, thanks to our original industrial organization."
By the end of 1998, with sales topping EUR56 million, including more than 1,500 machines, Pinguely-Haulotte went public, listing on the Paris Stock Exchange's Secondary Market. The listing, which raised EUR40 million, enabled the company to step up its expansion. By the end of 1999, Pinguely-Haulotte's sales had nearly doubled and production had reached 3,000 units, including the company's latest product innovation of vertical mast lifts, which were ideal for warehouse and retail store environments. Pinguely-Haulotte's share of the European market had already reached 15 percent, representing more than half of the company's total sales.
The year 2000 marked a new turning point for the company, as production topped 5,000 units at the beginning of the year. In March 2000, Pinguely-Haulotte acquired a new manufacturing plant, in Reims, in partnership with one of its subcontractors, helping to boost production to more than 6,000 units by the end of the year. The company continued to prove itself an innovator in its core market, launching a new 12-meter vertical mast lift that year. Pinguely-Haulotte also began preparing an entry into the U.S. market, which remained three times as large as the European market.
Meanwhile, the company was exploring other international markets, setting up subsidiaries in Spain, Australia, Portugal, and the Netherlands. Pinguely-Haulotte also continued to seek to develop its manufacturing capacity. In November 2000, the company announced its agreement to acquire the European production operations of Terex, of the United States, which included sites in Ireland and the Netherlands. That agreement collapsed the following year, however, as Terex stumbled on a depressed U.S. market. Meanwhile, the strength of the dollar against the new Euro gave Pinguely-Haulotte an edge in Europe. Despite the failure of the Terex acquisition, Pinguely-Haulotte was able to ramp up production to 10,000 machines by the end of 2001.
With sales topping EUR264 million in 2001, Pinguely stepped up its international activity at the end of that year, launching new subsidiaries in Brazil, Singapore, and Sweden. The company also took the leap into the U.S. market, setting up a sales and distribution subsidiary in Baltimore, Maryland. By mid-2002, Pinguely-Haulotte was able to project new record sales: by the end of that year, the company expected its sales to near EUR320 million and its production to top 12,000 units. Pinguely-Haulotte had secured its position as the world's number three maker of self-propelled aerial work platforms, boosting its global share to more than 17 percent. By then, Pierre Saubot had more than succeeded in rescuing Pinguely-Haulotte--he had lifted the company into the world's top ranks.
Principal Subsidiaries: HAULOTTE GmbH; HAULOTTE UK Ltd; HAULOTTE Italia Srl; HAULOTTE Australia Pty Ltd; HAULOTTE Iberica SL; HAULOTTE Netherlands BV; HAULOTTE France Sarl; ABM Industries SA; HAULOTTE US Inc; HAULOTTE Scandinavia AB; HAULOTTE Portugal.
Principal Competitors: JLG Industries, Inc.; Grove Worldwide LLC; Terex Corporation; Komatsu Ltd.; Caterpillar Corporation; Skyjack, Inc; Mobile Tool International, Inc.
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