China LGMG (Lingong Group Jinan Heavy Machinery Co., Ltd.) registered a company in the UK and established a new factory in the country to take over its existing UK and Ireland distributor, APS (Access Platform Sales), for aerial work platforms and telescopic forklift distribution.
There are indications that manufacturers want to be closer to end customers and diversify their sources of income by offering more services. This trend is particularly evident in the crane market, as major aerial work platform manufacturers such as Manitowoc, Hiab, and Palfinger have been acquiring distribution companies in the past year or two.
The argument for diversification may not be significant for aerial work platforms, making it unlikely to be a major driving force. Manufacturers often believe that they can make more money through “direct sales,” thanks to reduced commissions or lower prices.
Initially, LGMG seemed interested in acquiring APS rather than going through all the challenges and costs of establishing new business. However, considering Brexit and potential tariffs, being located in a free trade zone may bring some potential benefits.
