Hitachi braves tough economy to open Brisbane facility
JAPANESE machinery firm Hitachi has unveiled an $80 million facility in Brisbane to act as a beacon while facing harsh conditions not seen since the onset of the Global Financial Crisis.
The corporate support facility in the Brisbane suburb of Wacol will handle the building, pulling apart and maintaining of Hitachi Construction Machinery's largest mine excavators and dump trucks.
Unfortunately, Friday's curtain-raising came at a vastly different time compared to when the 80,000sqm Corporate Support Group Facility first left the drawing board five years ago.
International coal and iron ore prices have fallen by more than 50% in the past 12 months, forcing mine companies to cut costs and predicted profits began to deteriorate.
Even earlier this year, the demand for mining excavators in particular meant resource giants would be forced to wait up to two years for a machine order to arrive.
Now it would take between three and six months.
Machinery suppliers have traditionally been first to spot green chutes in tough times, as big players prepared for an upswing long in advance.
General Manager of Mining Eric Green told APN there was little good news on that front, saying Hitachi has watched demand fall from about July.
Mr Green said it was the slowest period he had seen since the GFC hit the industry in late 2008.
"The GFC was a fairly big impact but for Australia, we didn't fare too badly out of that," he said.
"Since then, it has been very high demand and most major miners have been really pushing to increase production.
"This one has really stopped overnight and we feel decisions not just for new equipment but used and other equipment has stopped.
"It's a real slowdown."
The Hitachi mining boss said he predicted an improvement in the second half of next year as global stocks of coal and iron were run down.
In the meantime, he said Hitachi Construction and Mining would focus on bringing in its new range of dump trucks and excavators as a signal that Hitachi was fighting for its share even in the tougher times.
"With the introduction of mining trucks from Japan, it's obviously important that we send a message to the customer base that we have the infrastructure to support the products that we sell," he said.