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The European Union has issued preliminary findings on allegations and complaints that Chinese manufacturers are selling aerial work platforms to Europe at “dumping” prices, a move that could damage Europe’s industry and reduce its revenue, profitability and employment levels, according to European media Vertikal.

After identifying examples of possible pricing issues and comparing import levels from China in December 2023-March 2024 with the same period the previous year, the Commission found that imports of Chinese-made products increased by 16.1% in the first quarter. As a result, the Commission issued preliminary tariff levels for each manufacturer and ordered customs authorities to begin registering all aerial work platforms imported from China and to potentially impose tariffs retroactively based on the ongoing investigation, comments received from affected companies, and stakeholders who now have an opportunity to comment on these findings.

The document reads: "The Commission therefore concludes that there is sufficient evidence to justify the registration of the imports of the products in question pursuant to Article 14(5) of the Basic Regulation. All interested parties may express their views in writing and provide supporting evidence. In addition, the Commission may hear interested parties if they so request in writing and show that there are special reasons why they should be heard. In accordance with Article 14(5) of Regulation (EU) 2016/1036, the customs authorities are hereby instructed to take appropriate measures to register the imports of self-propelled mobile work equipment for lifting persons, with a maximum working height of 6 metres or more, and the imports of parts pre-assembled or ready for assembly, excluding individual components presented separately and not including person-lifting equipment mounted on a vehicle."

The provisional tariffs for sampled enterprises include:

o Sinoboom - 56.1%

o JLG - 23.6%

o Genie - 25.6%

o Dingli - 31.3%

All other companies cooperating with the investigation will be subject to a 32% tariff, including:

o Lingong Heavy Machinery

o Zoomlion

o XCMG

o Haulotte

o Fronteq

o Liugong

o Hangcha

o Chufeng

o Reeslift

o Mantall

o Qiyun Group

o Juxin Machinery

o Yuntian Intelligent

Unsampled Manufacturers/All - Other Tariffs 56.1%

Karel Huijser, JLG General Manager and Vice President for Europe, Africa and the Middle East, told Access International that he welcomed the investigation. “Healthy and fair competition is essential for European industry to thrive. I believe that a swift and decisive decision by the European Commission to restore a level playing field for all manufacturers who, like JLG, have invested heavily in developing world-leading products would be the best outcome.”

Vertikal commented, "We learned from reliable sources a few months ago that the Commission's initial investigation did not show any significant across-the-board dumping by the 'sampled' companies (the four largest importers of Chinese-made aerial work platforms). We understand that the Commission was subsequently informed informally that it had 'sampled the wrong companies', to which it responded that it would also look at the possibility of unfair subsidies. If so, this would likely affect the larger general equipment manufacturers, which may have some form of local or national government involvement."

Sadly, unless the Commission changes course during its investigation, the Commission is using Brazil as a third country of comparison to determine whether Chinese-made machines are being dumped in Europe - this makes no sense. Turkey, South Africa, India, and perhaps better yet, other Asian markets like South Korea, Thailand, would make more sense. As for why it is not using Chinese pricing - apparently it is because China is not considered a free market economy. As far as we know, Chinese-made machines are not sold at a lower price in Europe than in its home market, which is traditionally used to determine whether a company is guilty of "dumping".

That being said, there is no doubt that European aerial work platform production is threatened by imports from China, and this needs to be considered, at least strategically. However, this is not a new phenomenon. In the early days of the aerial work platform market, it was difficult for European manufacturers to compete with American companies because they had a larger home market, higher production volumes and modern factories. Conversely, in the aviation market, Airbus would not have been able to take off without government subsidies and support to help it compete with Boeing.

Another example is that new entrants into the mainstream telehandler market find it difficult to compete with JCB or Manitou, which produce much higher volumes. We know of one US manufacturer that entered the market and found that its production costs for a very basic 17m telehandler were higher than the retail price of the above manufacturers’ models, which included all the bells and whistles – like cabs with radios and air conditioning. That was a few years ago – but it killed the business.

I could go on, but this is a provisional finding that could be subject to complaint. Ultimately, the announcement could be rescinded if the EU decides it is against the EU’s highest interests. However, one wonders if the announcement is just a convenient way for the EU to warn Beijing that tariffs on what it considers to be more critical issues — electric cars, batteries and solar panels — would do more harm to the European economy and consumers.

If these tariffs are implemented, of course, new machine prices will inevitably rise, and while manufacturers’ profit margins will improve, rental company buyers won’t be too happy unless they can pass the price increases on to their customers, the contractors. One positive for them could be that used equipment prices rise in tandem with new machine prices, and their fleet value could improve.

Source: Mechanical Intelligence Station