May 07, 2012
Mining truck, tyre supply to reach balance in 2015 onwardsBack
Caterpillar|Education|Mining|Systems|Training|China|India|United States|USD|Equipment|Systems|Doug Oberhelman
© Reuse this
“We have been playing catch-up with the mining industry for a decade or more,” he adds.
Current lead times on securing a mining truck could be anything from 18 months upwards.
A disinvestment in the mining supply business in the 1990s was followed by an exploding mining market from 2002 onwards as China and India opened up their markets, leaving tyre and capital equipment suppliers short of production capacity.
“We are pouring cash into our mining business,” says Oberhelman. “In 2009 and 2010 we doubled our capital expenditure every year. We have doubled truck production already and we will double it again in the next few years.
“We are spending $4-billion in capex this year and the biggest chunk of this will be for mining – and this is on top of acquisitions.”
Oberhelman says customers have already placed truck orders with Caterpillar for mines opening in 2014, in an attempt to circumvent long lead times.
He notes that specialised mining tyre supply is very much in the same boat as mining truck availability, with only the recent recession providing somewhat “of a breather”.
However, Oberhelman says the major tyre manufacturers have indicated that they are investing heavily in the production of 32 inch tyres and upwards and that the supply-demand situation should be in balance by 2015 onwards.
However, he warns that a rapid increase in mining truck demand could again upset tyre and truck supply-demand dynamics.
‘TECHNICAL TRAINING FAILING US’
“Technical training at schools is failing us [Caterpillar],” says Oberhelman.
“We reject 60% of the applicants at our production facilities.”
Apart from “highly stressed education systems globally”, Oberhelman also attributes this situation to the death of “tinkering” as kids used to grow up with farm equipment, but are now raised on a diet of “joysticks”.
He notes that the US capital equipment manufacturer has “an insatiable demand for technicians.”
“The only, but only competitive advantage a country has is its education,” he emphasises.
Oberhelman says Caterpillar would need to hire 20 000 people up to 2020, with its 12 000-strong Chinese employee contingent expected to more than triple over the next ten years.
Edited by: Creamer Media Reporter© Reuse this Comment Guidelines (150 word limit)
Updated 1 hour 3 minutes ago Power utility Eskom said it would extend power cuts to 2 000 MW of electricity from 12:00 to 22:00 on Friday due to a shortage of generating capacity. The cash-strapped State utility, which has been forced to reduce electricity supply in Africa's most advanced...
Updated 1 hour 6 minutes ago The Department of Telecommunications and Postal Services (DTPS) has set aside R200-million of its R1.4-billion budget this year to kickstart the first phase of South Africa (SA) Connect national broadband strategy. Over the next three years, the department aimed to...
Updated 2 hours 7 minutes ago The Department of Trade and Industry (DTI), which last year committed to the initial creation of more than 100 black industrialists within three years, has developed a draft policy framework to guide the introduction of financial and nonfinancial support mechanisms...
Recent Research Reports
Steel 2015: A review of South Africa's steel sector (PDF Report)
Creamer Media’s Steel 2015 report provides an overview of the key developments in the global steel industry and particularly of South Africa’s steel sector over the past year, including details of production and consumption, as well as the country's primary carbon...
Projects in Progress 2015 - First Edition (PDF Report)
In fact, this edition of Creamer Media’s Projects in Progress 2015 supplement tracks developments taking place under the Renewable Energy Independent Power Producer Procurement Programme, which has had four bidding rounds. It appears to remain a shining light on the...
Electricity 2015: A review of South Africa's electricity sector (PDF Report)
Creamer Media’s Electricity 2015 report provides an overview of State-owned power utility Eskom and independent power producers, as well as electricity planning, transmission, distribution and the theft thereof, besides other issues.
Construction 2015: A review of South Africa’s construction sector (PDF Report)
Creamer Media’s Construction 2015 Report examines South Africa’s construction industry over the past 12 months. The report provides insight into the business environment; the key participants in the sector; local construction demand; geographic diversification;...
Liquid Fuels 2014 - A review of South Africa's Liquid Fuels sector (PDF Report)
Creamer Media’s Liquid Fuels 2014 Report examines these issues, focusing on the business environment, oil and gas exploration, the country’s feedstock supplies, the development of South Africa’s biofuels industry, fuel pricing, competition in the sector, the...
Water 2014: A review of South Africa's water sector (PDF Report)
Creamer Media’s Water 2014 report considers the aforementioned issues, not only in the South African context, but also in the African and global context, and examines the issues of water and sanitation, water quality and the demand for water, among others.
This Week's Magazine
While economic forecasts for the African continent are most favourable, African airlines may not be able to benefit from the expected growth in the region’s gross domestic product (GDP), International Air Transport Association VP: Africa Raphael Kuuchi has warned....
The Automotive Production and Development Programme (APDP) will need to change substantially post 2020, says Metair Investments South African operations COO Ken Lello. “We must not make tweaks. We have to change. What we are doing is not sustainable.”
Banking group Absa’s forecast is for the rand to end the year at around R13 against the dollar, weakening further to R13.50 by 2016, says Absa sectoral analyst Jacques du Toit. He warns that possible interest rate hikes in the US may see capital being pulled from...
The Dispute Resolution Centre at the Bargaining Council for the Civil Engineering Industry (BCCEI) is now open to handle party-to-party disputes. The BCCEI represents the interests of all level four to nine Construction Industry Development Board companies.
Communications technology firm Ericsson sub-Saharan Africa head Fredrik Jejdling says the company’s commitment to sustainability and corporate responsibility has been integrated into all facets of its operations, which has provided it with sustainable revenue...