An Elme intermodal (piggyback) spreader.

International trade may be quite different today without the invention of "boxes"; the long metal containers that many manufactured products have spent time in. Forkliftaction.com News reporter Christine Liew spoke to the world's leading makers of machine attachments that move containers.

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The world of boxes

Today many goods, from ipods to frozen beef, are transported in long, predominantly Chinese-made metal boxes in various sizes and colours. Before "the box" was invented, cargo was loaded individually onto trucks. Arriving at a port, cargo was individually unloaded at the dock before being hoisted into a ship's hold. The traditional way of transporting cargo was time consuming and expensive.

Containerisation was introduced in the 1950s. Intermodal cargo transport, using containers loaded onto container ships, railroad cars and trucks, is largely said to be the idea of American entrepreneur Malcolm McLean. He developed the metal shipping container that replaced the traditional piecemeal way of moving cargo in 1956. McLean was said to have had the idea 20 years earlier after reflecting on how cumbersome the traditional method was. In 1956, McLean's first container ship sailed from Port Newark, New Jersey, en route to Texas. There were 58 trailers onboard. He later founded a cargo transport business, Sea Land Inc, which was acquired by world-leading cargo transport company Maersk in 1999.

ISO standard containers are usually eight foot wide and eight foot to nine foot six inches high. Their lengths vary. The most commonly used lengths in international commerce are 20 feet, 40 feet, 45 feet, 48 feet and 53 feet, with 20 and 40 feet being standard ISO lengths.

Moving boxes

Container-handling forklifts and reach stackers depend on container spreaders as an "arm" to pick up containers. Spreaders have twistlocks that fasten onto containers' corner blocks, holding them in place while the container handling machine picks them up and moves them onto train cars or trucks. The standard position of container blocks allows spreaders to handle different container sizes.

Industry sources told Forkliftaction.com News 75 per cent of container spreader production took place in Europe. Elme, of Sweden, is the world's leading spreader manufacturer for forklifts and reach stackers with an expected production of 850 spreader units for 2006. Its customers include Linde, Hyster, Svetruck, SMV and Clark. Only Kalmar, Fantuzzi, CVS Ferrari and PPM manufacture spreaders in-house. Other independent spreader makers, like Smits Spreaders and Singapore-based RAM Spreaders, manufacture for those wanting to outsource spreaders.

No hard data is available on the number of spreaders sold each year but Forkliftaction.com News guesstimates from interviews that Elme, Kalmar and Fantuzzi are the world's top three spreader producers, manufacturing about 2,000 spreader units annually.

The accidental industry leader

Privately-owned spreader manufacturing company Elmhults Konstruktions AB (Elme) started in Amhult, Sweden, in 1974 as a one-man show. Founder and president Gösta Karlsson said he did not set out to be the world's largest spreader manufacturer, "it just happened".

In 2004, Elme made 580 spreaders, 720 in 2005, and this year Karlsson estimates production output at 1,000 units. Eighty-five per cent of the spreaders are attachments for reach stackers and forklifts, the rest for cranes.

Today Karlsson employs about 100 staff to produce spreaders for some of the biggest forklift manufacturers. Linde, Hyster, Svetruck, SMV and Clark buy spreaders from Elme. Even manufacturers like Fantuzzi and CVS Ferrari that make their own spreaders, buy some from Elme. North America's leading container handling forklift specialist Taylor Machine Works Inc has bought Elme spreaders.

Karlsson is modest when interviewed.

He did not want to brag but said most container handler manufacturers had bought Elme spreaders at one time or another.

"Our spreader business is growing because it is more efficient for those who make machines to concentrate on their core business and outsource spreader manufacturing," Karlsson said.

He credits "efficient manufacturing" and "value for money" as the keys to his business's success.

"Fifteen years ago, if we hadn't automised production, we'd be out of business. The volume we have today totally depends on efficient manufacturing."

Elme holds 12 patents for spreaders, including crane spreaders. Details of the patents are confidential. Karlsson said Elme was currently working on a patent for double box handling. Two prototypes were being tested against the competition. Ironically, the company's main competitors are its customers.

"Most, at one time or another, made their own spreaders," Karlsson said.

North America's container handling specialist

A Taylor empty container handler.

Taylor Machine Works Inc, of Louisville, Mississippi, and Hyster Company, of Greenville, North Carolina, are the only North American container handling equipment manufacturers. Taylor produces its machines in US while Hyster has moved big truck production to Europe.

Mike Boyles, Taylor's director of engineering, says a spreader is an "extremely important" part of a container handling machine.

"The unit is part of a system but since it engages the load, it's subject to a lot of dynamics - braking, accelerating, etc. The load can be raised quite high ... all these things put a lot of stress on the spreader. It's a particularly challenging thing to design.

"The vehicle is just as important. We view it as a system ... the whole design has to be balanced," Boyles said.

Taylor claims to be North America's largest manufacturer of laden container handlers. The family-owned company does not disclose its machine output or sales figures. It started making container handling equipment in the 1960s. A few years ago, Taylor established an agreement with Italy-based CVS Ferrari to market the entire range of CVS reach stackers under the Taylor name in US. However, Taylor made "a couple of models of reach stackers for specific markets in North America", Boyles said.

In the 1960s, Taylor outsourced spreaders from North American spreader maker Ropco acquired by Kalmar subsidiary Bromma in 1986, Boyles said. The company made its first spreader in the early 1980s.

The European pioneer in China

Fantuzzi reach stackers at work.

Fantuzzi Group, of Reggio Emilia, Italy, the company that pioneered reach stacker and empty container handling forklift production in China, has made its own spreaders since 1968. The company, which claims to have a "prime market position" in the world's busiest container handling ports, Singapore and Hong Kong, is the only container handling equipment maker to produce spreaders in China. Dalian Forklifts and Heli are two of China's container handling equipment producers. None of them makes spreaders.

Fantuzzi product manager Jimmy Lozada rates spreaders as "very high" in importance to container handling equipment.

"They are the cause of 90 per cent of equipment breakdowns as they are the most stressed structure of container handling equipment. End users usually have electric or hydraulic problems due to the vibration and shocks spreaders are subject to."

Fantuzzi will make about 360 units of container handling equipment this year, half of which are reach stackers and half are forklifts. The machines and spreaders are made in plants in Lentigione, Italy, and Xiamen, China.

Lozada said the two plants had the capacity to accommodate future growth.
"The company was building around 450 to 500 container handlers in 2002 and 2003 and the in-house capacity for higher throughput has been positively tested."

However, Fantuzzi sources 10 per cent of its spreaders from Elme.

"Some European and US customers want piggyback spreaders and, since we only sell a few, we have not started engineering them. Elme has patented many functions ... it will be difficult for us to do it without infringing them," Lozada said.

Made in Italy only

A CVS Ferrari reach stacker.

CVS Ferrari SpA of Roveleto di Cadeo in northern Italy, decided to manufacture its own spreaders when it entered the container handling business. The Italian manufacturer produced 200 reach stackers and about 100 container handling forklifts in 2005. Production output for 2003-04 was similar and CVS said "production capacity" was now its main problem. That was why CVS purchased 16 per cent of its spreaders from Elme.

"Elme is supplying many of our competitors and they are able to offer a very good product at a very competitive price. Since our production facility is under pressure by other models we decided to outsource [for empty container handling forklifts]," CVS Ferrari sales director Paolo Groppi said.

While other forklift manufacturers have established or plan to establish plants in China, the Italian company was adamant about producing locally.

"China is planning to become the factory of the world and they are pushing hard to reach their targets in a very short time.

"Our product is highly sophisticated and by having the right kind of machinery and technology you can offer [products] at a very competitive price. If you consider the margins available today in the market and the possibility to recover your investment in a factory in China by those margins, you must be highly confident in a long-term investment with a very low rate of return," Groppi said.

CVS has 12 factories in northern Italy and plans to double production capacity in the next two years through its home-based facilities.

Groppi said it was difficult for CVS to source the employees it needed overseas unless huge investments were made in training.

"The level of customisation of our production demands a high level of autonomy from our workers and an ability to respond to varying demands in a short time, plus a high degree of flexibility," he said.

Why produce in-house?

There are many serious questions to consider before a manufacturer decides whether to outsource spreaders or produce in-house. What does my market need? Do I have the production capacity? Does in-house production detract from my core business?

Elme's Karlsson said his spreaders were an option for manufacturers that wanted to focus on their core business of equipment manufacturing. The ones that make their own spreaders sourced some from Elme. However, they maintained "flexibility" and "customer needs" were compelling reasons for in-house production.

Fantuzzi's Lozada said making spreaders in-house was a marketing approach.

"The key advantages are flexibility of design for customisation and delivery [of the product]," he said. There was little difference in prices between outsourced and in-house spreaders.

Loazado said there was no present need to outsource spreader production because the company had organised production so it was able to offer value to its customers.

"We have standardised componentry among our various types of spreaders so we can offer customers certain advantages. Customers are happy with the spreader designs available and our back-up service for units in the field."

Lozada said OEM spreader makers made most designs required by the market.
"Only a few typologies are missing and customisation of standard designs can sometimes be difficult to outsource at costs compatible with market requirements."

CVS Ferrari's Groppi said the company's spreaders covered the whole portfolio of CVS machines.

"Our new range of reach stacker, the Ferrari 400 generation, is fitted with our latest spreader model that is two tons lighter than our previous one. We were not able to find the same characteristics in spreaders available in the market.

"OEMs need to make a standard product able to satisfy most requirements at a competitive price. Normally they are quite resistant to innovation and slow to change. Since we have our own manufacturing facility we can develop a product dedicated to our specific needs and update it when necessary."

Groppi said CVS regularly compared its spreaders with OEM spreaders available in the market "to monitor costs".

"Sometimes, for certain models, we may opt to outsource more than to make. The criteria depend on selling volume of specific machines and availability of a product in the market to satisfy our requirements."

Taylor's Boyles succinctly summed it up in a question: "Who's closer to what our customers want than us?

"We have control of the design, such as the particular application you find your equipment being used in. You get feedback from customers, you make sure you meet their needs. What's off the shelf might not do a good job in a particular environment for a particular load.

"It allows us to put features, durability and productivity into the spreader according to our customers' desires."
Boyles said there could be times customers asked for a specific spreader because they had good experience or were familiar with it.

However, Taylor has no plans to outsource spreaders.
"Our customers like our spreaders so it's like giving up what's attractive to people if you give it up. It's an important part of our product, customers tell us.

"We've toyed with other spreaders in a counter-test and that has not turned out to be successful," he said.