) reached a new milestone by successfully manufacturing and
supplying rough terrain crane in Brazil. The rough terrain crane is
its first indigenously built crane in Brazil.
Geographically, the company intends to expand in the Latin
American region which includes Brazil by increasing its
manufacturing activities. It has plans to expand in the lines of
crane product support along with aftermarket coverage catering to
the needs of a wide customer base.
The expansion plans are in line with its long-term strategy to
flourish in the emerging markets of China, India, Brazil, Russia
and the Middle East. The company is increasing its manufacturing
activities in these regions in response to the growing demand
driven by increase in population.
Recently, Terex has entered into a joint venture with Russian
Machines for producing construction and road-building equipment in
Russia. The companies have agreed to manufacture, sell as well as
distribute their products in the markets of Russia.
In 2011, Terex made the largest acquisition in China by buying
82% of the outstanding shares of Demag Cranes AG, which has been
merged with the company by forming a new segment named Material
Handling & Post Solutions ("MHPS").
The collaboration will help Terex in capturing the growing
demand for cranes in China. Moreover, a substantial improvement in
demand in the emerging markets could offset the weaknesses faced by
the company in the European markets.
Terex also inked a deal with China-based Sinomach Heavy Industry
Corporation to make the latter a strategic partner for its troubled
crane business, Sichuan Changjiang Engineering Crane Co. (SCE
Under the deal, Sinomach owned more than 50% of SCE Crane and
Terex offered its overseas distribution and support channels as
well as engineering capabilities for the business.
However, Terex is not the only company to start production in
Brazil. One of its competitors,
Manitowoc Company, Inc.
) has also opened a new production facility called the Passo Fundo
facility in Brazil supporting the energy and infrastructure
activities in Latin America.
Currently, Terex retains a short-term Zacks #3 Rank (Hold). We
have a long-term Neutral recommendation on the stock.
MANITOWOC INC (MTW): Free Stock Analysis Report
TEREX CORP (TEX): Free Stock Analysis Report
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