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Sep 28, 2012

Lifts industry stagnating, facing legislative changes

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Construction|Expertise|Johannesburg|Port|Africa|Consulting|Projitech|Resources|Safety|System|Water|Africa|China|South Africa|Building|Equipment|Escalator Equipment|Products|Service|Services|Transportation|Bill Murphy|Infrastructure|Now|Paul Field|Water|The 2010 FIFA World Cup
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The slowdown in construction activity following the 2010 FIFA World Cup, paired with the lag effect South Africa is experiencing as a result of the 2008/9 world economic crisis, has led to stagnating numbers of new lift and escalator installations, says independent lift consulting company Projitech managing member Bill Murphy.

With 32 years’ experience in the industry, Murphy is the deputy chairperson of the Lift Inspections Authority of South Africa (Liasa) and sits on the South African Bureau of Standards (SABS) Lifts and Escalators technical committee.

He notes that while there is some demand for new lifts and escalators for several new buildings that are being constructed, this does not necessarily contribute to growth in the lifts industry.

“We often see old, vacant buildings in the city centres where the lifts are no longer being maintained, which essentially reduces the size of the maintenance port- folio of lift service providers whose core business is the after-sales servicing of lifts and escalators.

“Old buildings are also being demolished to make way for new developments and are often replaced with structures that do not require any form of vertical transportation, thereby restricting industry growth,” he says.
Murphy adds that, although the yearly number of newly installed lifts has doubled since 1995, with between 1 000 and 1 200 new lifts a year, the industry is still not growing at the rate lift manufacturers and suppliers would like.

“Given the number of lift companies in South Africa, this is not a huge cake to divide among all the players,” he points out.

Legislation Changes

Meanwhile, Murphy notes that recent amendments to legislation, namely the Occupational Health and Safety Act (OHSA) and the Lift Escalator and Passenger Conveyor Regulations, will now more effectively regulate the quality and validity of mandatory inspections on lifts and escalators, which are, by law, required every 24 months.

He says the recent amendments and mooted future amendments will change how lift inspectors and, eventually, lift manufacturers and suppliers operate.

“The amendments by the Department of Labour (DoL), which regulates the lift, escalator and passenger conveyor industry, now requires that any person who wishes to offer his or her services as a lift inspector, or a lift inspection body, must obtain accreditation by the South African National Accreditation System (Sanas).

Sanas has been appointed by the DoL to assess the inspectors against International Organisation for Standardisation (ISO) and IEC 17020 standards.

“The assessment is not only on the ability of the inspectors to perform inspections, but also sets a list of criteria that inspectors need to have in place before they can obtain accreditation.

“The accreditation will apply only to the specific scope of lift and escalator equip- ment for which the inspection body applied for accreditation,” he says.

Murphy notes that, in the past, lift inspectors inspected all types of lift and escalator equipment, but will now have to prove their capability to do so.

Only once they have obtained the Sanas accreditation for which they have applied, will the inspection body be able to apply to the DoL for certification to perform these inspections.
“Sanas is expected to provide some guidance for lift inspection bodies to [assist in achieving] the accreditation, with the objective of having these inspections performed in a uniform manner across the industry.

“The involvement by Sanas will go a long way towards ensuring that only lift inspection bodies with the correct struc- tures and expertise are allowed to carry out this important function,” he says.

He notes that the accreditation of lift inspection bodies is the first step in the process of regulating the lifts industry in South Africa.

Future amendments to the lift, escalator and passenger carrying conveyance regulations will also require lift manufacturers and suppliers to acquire accreditation by Sanas to operate as lift and escalator maintenance service providers, manufac- turers and installers.

“As a member of Liasa, this is something we have been concerned with for years. There have been too many instances of lift com- panies finding a gap in the market for their products, which can turn out to be unsafe and of poor quality, resulting in additional spending by lift owners to correct the equipment to meet the required standard.

“The lift and escalator regulations clearly stipulate the criteria required for the design and construction of lifts and escalators, as well as when they may be installed and put into use. We see this new development with regard to the accreditation of lift manufacturers as a positive development,” he says.

The way in which lift inspections are carried out will also change, states Murphy.

“In the past, the inspection was carried out in one step and a certificate was issued as a certificate of safety, including a list of items that needed to be completed before the lift was certified as safe.

“Now, an inspector will be required to inspect the lift and, if need be, issue a list of things that need to be corrected. The inspector will then be required to go back to the lift or escalator once the outstanding requirements have been met and issue the certificate only once the lift is fully compliant to the inspector’s satisfaction,” he says.

For consumers, the inspection will be a more lengthy and expensive process, but Murphy says this is because, once the inspector awards the certificate, he or she is stating that the lift or escalator is in compliance with the OHSA and other relevant standards.

Lift inspection bodies’ accreditation will be valid for a four-year period, with a yearly assessment of the business by Sanas.

“Inspectors’ knowledge of the laws and legislation will be thoroughly tested. Sanas is in the process of accrediting its own technical assessors from the lifts industry who will assess the ability of lift inspectors to perform inspections on equipment for which they have applied for accreditation, and ensure that they have kept up to date with the latest technologies and standards.

“We are considering the provision of ongoing training for inspectors, where needed, because the industry will change. Soon we will be introduced to new tech- nologies from overseas, like lifts that operate without any ropes.

“These kinds of technologies are already being used overseas and there is no reason why they should not be introduced here. It is important to know the market and what the domestic market can and cannot afford,” he says.

Challenges

The biggest challenges currently facing the industry are skills and training, says Murphy.

“It is like a double-edged sword. If the market is not growing, expensive training facilities will drain your resources quickly,” he notes.

Murphy says the loss of skills is problematic.

“The lifts industry tends to produce multiskilled people who can easily apply their technical skills to other industries. A lot of people get their qualifications and training, only to move to other industries,” he explains.

Investment, or the lack thereof, in the country, as well as in the construction industry, is a contributing factor to the stagnating growth of the lifts industry, says Murphy.

Further, Murphy’s business partner and industry veteran, Paul Field, adds that technology is growing faster than skills, which can result in companies importing installation teams from countries like China to work in the country for a short period.

“This is a complicated challenge because sometimes local skills are not available or are too expensive. Sending local people overseas for training is also expensive, so this is really a complicated challenge to deal with,” he says.

Murphy identifies the movement of staff between lifts companies as another challenge, as it leaves a vacuum in some companies that needs to be filled.

Future Outlook

Murphy asserts that the state of the con- struction sector will determine the state of the lifts industry, although some lifts companies are optimistic of an upswing in 2013.

“The country has a lot of infrastructure and buildings that are vacant as a result of businesses relocating out of city centres. We see much of this especially in the City of Johannesburg. This opens up a new market, as developers are often looking to turn office buildings in that area into low-income-level apartment blocks.

“This means they will need to modernise the old lifts and, as consultants, we are able to assist them in making the most of the old lift shafts. If there are six lifts in the building, for example, we might suggest modernising three and removing the other three. They would then be able to use the old shafts for services like water reticulation and drainage for the baths and showers,” he explains.

Murphy and Field see this modernisation market growing in the future, resulting not only from old buildings being con- verted, but also from clients who need to upgrade and ensure their lifts comply with new legislation.

Other areas they identify as market opportunities for the industry are large businesses, such as banks and property owners who invest in their existing buildings. This equates to a partial upgrade or a full replacement of existing lifts and escalators, notes Murphy.

“We see multiuse developments emerg- ing, like shopping centres that have reached capacity in terms of shops, but they still need to attract new customers, so apartment blocks and office blocks are built on the properties.

“One shopping centre in Johannesburg plans to build a 60-storey office block and two extra levels of shops within the next few years. This is positive for the lifts industry, as these buildings will need new lifts and escalators,” says Field.

Edited by: Chanel de Bruyn
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