Caterpillar Sees Enormous First-Quarter Growth

Daewoo Targets No. 3 Position in Excavator Manufacturing

Wed September 15, 2004 - National Edition
CEG



Daewoo Heavy Industries America Corporation (DHIAC) has announced its new “Jump to the Top” initiative, which is being executed worldwide throughout all Daewoo Heavy Industries and Machinery Ltd. (DHIM) organizations in an effort to help lead Daewoo to the No. 3 position in worldwide excavator manufacturing by 2008.

Daewoo currently holds the No. 4 position with 11.2-percent excavator share behind Caterpillar, Komatsu and Hitachi, according to information compiled from the Off-Highway Research International Database Service and the Korea and China National Official Sales Records.

This new program is designed so that the company can build on past successes while becoming globally recognized for superior product quality and service.

The new company-wide initiative is being communicated as a common goal for DHIM, its employees and its distribution networks in Korea, China, North America, Europe, Japan and South Africa.

In order to reach this goal, all DHIM companies are working together to continue increasing Daewoo’s market share and brand awareness in their respective countries.

“Our approach is quite simple. Communicate the importance of teamwork throughout the company to let each and every individual Daewoo location, employee and customer know that they are integral to the continued success of the organization,” said Y.S. Kim, export manager, Daewoo Heavy Industries, Seoul, Korea.

“All Daewoo employees work under our new philosophy of open, responsible and value management. All information on the company is made public internally and externally so that confidence continues to grow within the company and among our customers. We encourage people to provide us with feedback on the products and services being provided by the company so that we can maintain superior equipment,” said Kim.

Daewoo’s new goal to become the third largest equipment manufacturer in the world is being driven by the slogan “Jump to the Top.”

“We have implemented this program to give all our employees and distributors a cohesive goal to work towards each and every day. The program has increased morale throughout our organization and has helped create a positive energy that will lead us into this position,” said D.R. Kang, executive managing director, Daewoo Heavy Industries.

The new “Jump to the Top” program’s success will be evaluated based on the company’s ability to continue increasing its rate of growth in comparison to other worldwide excavator equipment manufacturers and its ability to become accepted globally as a leading manufacturer of equipment, quality service and dedicated personnel.

Since its initial entry into the construction equipment market, Daewoo has worked toward providing new and improved services and product advancements.

“Daewoo has been a strong company in Korea for a long time. Today, however, we are a worldwide company with a global focus. We have a steadfast commitment to providing top quality products and service to construction equipment dealerships and their customers throughout the world. We will not deviate our attention from this goal and continually work to improve upon our products and services,” said Carl Yoon, executive vice president, DHIAC Heavy Construction Equipment Division.

DHIM has experienced steady growth since its first excavator manufacturing plant opened in Korea in 1977. The original plant is presently operating at maximum capacity with an output of 8,000 machines per year and there are plans in place for building a new, supplemental plant nearby within the next few years.

Additional manufacturing facilities were built in 1990 in Belgium and in 1994 in China to meet the increasing worldwide demand for Daewoo equipment. Together, these plants produce approximately 18,700 machines per year.

Throughout the course of the company’s growth, Daewoo recognized the need to support its growing international customer base and responded by setting up corporate headquarters in the United Kingdom, France, Germany, Japan, the United States and South Africa. Its mission is to provide superior sales, parts and service to the 724 global Daewoo distributors and their customers.

“It was extremely important to us and our customers many years ago that Daewoo have a corporate headquarters in North America. It made our job of selling their machines easier. People feel that if a company is nearby, they will get the product support and parts availability that is so imperative to the success of a construction business,” said Eric Seikel, Central Jersey account manager, of Hoffman Equipment in Piscataway, NJ.

“We have been extremely successful in selling Daewoo machines because of their proactive approach in designing, producing and supporting quality equipment. They have listened very closely to the market and delivered what was necessary to gain product acceptance — and then some. It is this attention to individual worldwide markets and their commitment to their product and the markets they serve which will ultimately help them reach their ’Jump to the Top’ goal and become the third largest equipment manufacturer in the world,” said Seikel.

Continued research and development is one of Daewoo’s primary areas of focus within the “Jump to the Top” initiative. Its Construction Equipment Research & Development Center in Korea has a staff of more than 100 experts solely dedicated to ensuring that Daewoo stays on top of current and future equipment trends.

Its highly-trained R&D professionals focus on designing and engineering new technology through improved components, products and product enhancements for Daewoo’s full line of existing models and other conceptual equipment presently on the drawing board. This dedication ensures continued quality and that the company will remain globally competitive over time.

In addition to its Research and Development Center, Daewoo opened a dedicated Center for Product Reliability in 1996. At this center, all component and assembled parts, as well as materials used to manufacture any part, are tested to their extremes. Durability, structural safety, life assessment and material testing are just some of the tests that take place in this four-floor, 13-1ab facility.

Specialty tests include a climate test chamber to ensure that varying weather conditions around the world will not affect the durability of the machine, as well as noise and field tests to ensure operator safety and comfort.

“Our growth strategy is very aggressive for the coming years. Since our reorganization in 2000 when we separated from Daewoo Heavy Industries, we have been able to focus more closely on our construction equipment program and the results are evident. We are now a top player in the manufacture of excavators worldwide,” said Kang.

Research and development, along with reliability, are key components in the manufacturing process. Inevitably however, machine parts wear and need to be replaced.

Daewoo’s 24-hour robotically-controlled parts depot, which houses more than 75,000 parts, is located in Ansan, Korea. Parts orders sent to this facility from around the world are quickly filled.

With an automated storage and retrieval system, parts orders received via phone, the Internet or via fax are filled quickly and accurately, eliminating any possible human error from the equation. These parts are delivered worldwide and can be expedited for quick delivery to a Daewoo distributor or directly to the customer.

Parts depots in the United States, Europe, China, Japan and South Africa are all integrated into the main parts depot in Ansan to ensure a high level of accessibility and fulfillment of customer parts orders.

Downtime is a major headache in the construction business.

“Daewoo’s 97 percent worldwide fill rate is exceptional and helps us keep our customers satisfied with their purchase,” said Mike Craver, vice president of parts, JW Burress Equipment in Winston-Salem, NC.

To further enhance its commitment to supplying world-class customer service, Daewoo has opened a Technical Training Center. At this facility, Daewoo trains service technicians from all over the world to ensure customers get either 24-hour service throughout Korea or 72-hour service outside of Korea from highly trained Daewoo service personnel when and if a local dealership needs assistance in addressing the problem.

Daewoo certified technicians who complete courses at the Ansan Technical Training Center are able to troubleshoot and service all Daewoo equipment and engines.

Sixty-one dormitory type rooms are on-site at the technical training center to house service personnel attending these training sessions.

“We consistently strive to improve our service to our dealerships and their customers. Often times, we send Daewoo personnel into the field to service customers machines and also to get their feedback on how the equipment is working along with what improvements or features they would like to see made to the machine. This feedback is then communicated back through the organization and the appropriate actions are taken,” said Kang.

In recent years Daewoo’s export growth has grown with 53.5 percent of the equipment manufactured being shipped outside of Korea in 2003. To mark this steady growth, DHIM split from its parent corporation in 2000 to become its own individual company with a primary focus on the equipment market. Product lines handled by DHIM include forklifts, machine tools, excavators, wheel loaders, diesel engines, defense products and mini-excavators.

In recognition of dealers being an integral part of the company’s success, Daewoo has recently been hosting select representatives from some of its dealerships around the world to view the manufacturing and support facilities throughout Korea and China.

“After visiting the Daewoo manufacturing and service support facilities in Korea and China, I realize that this is a company that will stand behind the machines they sell our dealership,” said Cole Leavitt, vice president of Gorham Tractor in Buxton, ME. “They are excited about their potential for future growth and are actively pursuing opportunities to bring their product to the marketplace more quickly and cost-effectively, both of which are imperative to our contractor customers.”

Worldwide, Daewoo employs approximately 5,000 people. Over the past few years, while most companies have cut back their workforces; Daewoo has increased substantially and continues to grow as the demand for its equipment climbs. Some successes in recent years include the launch of the Mega-V Series wheel loaders in 2000, receipt of ISO 9001 Certification in 1994 and the launch of the New Solar-V Series excavators in 2002.

For more information, call 770/831-2233.