Rock Products

NOV 2018

Rock Products is the aggregates industry's leading source for market analysis and technology solutions, delivering critical content focusing on aggregates-processing equipment; operational efficiencies; management best practices; comprehensive market

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Page 37 of 107

36 • ROCK products • November 2018 Tariffs have added a wrinkle and affected some optimism, but these tariffs don't pick and choose. They're affecting all man- ufacturers. As to the new trade deal, it appears it will have more of an impact on automotive and agricultural industries than our own. MINOO MEHTA: Business of BKT OTR tires larger than 24 in. has been very good this year. Since we started concentrating on this segment, three years ago, we have built our range up to 49-in. size, with different patterns and compounds for various applications. The tires on wheels are creating lot of repeat demand as customers see the tires performing, in terms of cost per hour. We expect to finish strong this year with high double-digit growth. The national economy is certainly doing well and the unem- ployment rate at 3.7 percent is the lowest. However, there is acute shortage of qualified labor and truck drivers, which has escalated costs. The trade wars haven't helped business because the tariffs have raised the input costs. Hurricanes, even though never a good experience, will also generate rebuilding business, giving construction a boost. Steel tariffs have impacted OE business. Vehicles have become more expensive to produce, which have slowed the market. However, local steel mills are doing quite well and have started making money, thereby buying more tires. BKT exports to more than 160 countries. We are experiencing more growth compared to previous years is in United States, Australia and most of the European Union. The results are yet to be seen. We may see help in farm sector the most. Looking after American interest first is new trend and will have some positive and some negative trends and impacts. CISZCZON: Polydeck's overall business continues to grow on a year-on-year basis due to our focus on customer needs. In my opinion, the national economy is the strongest in recent memory. It also seems consumer confidence is very high at this time. Commercial construction seems to be slightly down in recent months. The good news according to the USGS, crushed stone production is up 3 percent and sand and gravel is up 7 percent in the first six months of 2018 over 2017. No question steel tariffs are impacting our business and rais- ing the cost of doing business. Based on what I have read, the new version of the NAFTA trade agreement should bring more jobs to the United States and Canada, which should also help the aggregate industry in general. STEPHEN ROY: The outlook for the North American economy is quite healthy. We've seen an increase in demand in the construction industry despite the imposed tariffs. Volvo CE's efforts to improve efficiency across the supply chain and our investments in innovation and new technologies to modern- ize the construction industry have been bearing good fruit: our global net sales went up 24 percent in this third quar- ter, with North America growing 29 percent. We think that having a strong trade agreement between North American countries is important. 2. How is your business doing specifically in the aggre- gates industry? Are producers actively investing in new equipment this year, or planning for future capi- tal improvements? What problems are you solving for aggregates producers? GRAY: There is good confidence in the aggregate industries. High volume facilities are at or near full production and investment in new equipment and systems is up. We solve uptime and availability problems with older equipment and design in inventory control ability into new plants. LEPP: Our aggregates sector continues to show steady growth. Greater confidence in the economy has caused a push for new equipment and capital projects that has been lacking in past years. Growing acceptance of drum motor technology in the industry is also helping continue this upward trend. LININGER: The aggregate market has been particularly strong for us. We have seen growth in component purchases as well as new, complete portable and stationary plants. I believe the new business climate has given producers the confidence to invest in an entire system, rather than just replacing one component of their current system. I spoke with a customer recently who was buying his fifth Kodiak cone crusher from Johnson Crushers International. He was focused on setting up his company to be successful, not just in the good times we are experiencing right now, but investing in new technology and better, more efficient equipment to give them an advantage when the next inevitable downturn affects his business. There are many aspects of the purchasing decision we help customers work though. The most common aspect, and most important, is safety. This focus on providing a safe environ- ment and safe equipment for end users coincides with our company safety philosophy. Being able to bring a customer to one of our factories and show them the safe work environ- ment that we maintain, as well as the safety components we implement on our equipment is priceless. Another aspect we address with many customers is diesel emissions. While the group doesn't manufacture engines, we utilize them in many of our products including self-con- tained units, track-mounted plants and others. In an effort to limit the emissions from engines, we introduced a hybrid technology in 2017. Since its launch, the hybrid technology Q&A Forum

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