China's Sany: From Hunan Home to Peachtree City
Heavy equipment maker's 'grand plans' benefit Georgia
Trevor Williams
Changsha, China and Peachtree City, Ga. - 11.08.11
Sany Heavy Industry Chairman Liang Wengen leads Georgia Gov. Nathan Deal on a factory tour at the company's industrial town and headquarters in Changsha, China. After the tour, Mr. Deal operates a concrete pumping truck, extending its boom into the air.
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The lobby of Sany's $60 million factory in Peachtree City.

Taking the highway between the airport and downtown ChangshaChina, it's easy to see why construction equipment maker Sany Heavy Industry Co. has enjoyed explosive growth in just 17 years.

Shrouded in a gray mist of clouds and smog, cranes tower above massive high-rise apartment complexes built at breakneck speed to house China's rapidly urbanizing population.

Each structure, built on a mind-boggling scale rarely seen in metro Atlanta, requires huge amounts of concrete.

Making the trucks and pumps that send this crucial raw material as high as 250 feet in the air has enabled Sany to become the leader in China's sizable concrete market.

The company's 2011 sales are projected to reach $11 billion. While China still accounts for 90 percent, the company's drive to become a global player is benefiting Georgia, which is home to the largest of its five overseas factories.

Sany has spent $60 million to build its first and only North American plant in Peachtree City, and its economic impact continues to grow even as it ramps up to full capacity. On top of 130 employees already working there, Sany recently announced a plan to spend $25 million over the next five years to hire 300 engineers and technicians for a new research and development hub.

Liang Wengen, the company's founder and chairman, whose $8 billion fortune makes him one of China's richest people, revealed the expansion plans during an Oct. 21 meeting with Georgia Gov. Nathan Deal in Changsha.

On a four-city mission to China, the governor spent half a day in the Hunan capital visiting Sany and signing a cooperative agreement with the province's governor. GlobalAtlanta met up with the delegation during a reporting trip to China.

Building on its strength at home, Sany has embarked on a quest to introduce its brand and to correct the world's "biased" perception of Chinese product quality. Riding China's wave of development over the last two decades is an opportunity not to be squandered, Mr. Liang said during the meeting.

"It only took us 17 years [to reach $11 billion]," Mr. Liang said. "We think that we owe all this to the opportunity brought about by China's opening up and reform policy."

As for the governor, he's betting that Sany's Georgia success story will be circulated in China, providing a sort of tipping point that will help attract other investors to the state.

Sany at Home

Sany's 272-acre complex in Peachtree City will never rival its home base, a sprawling industrial district that provides both workplace and housing for some 25,000 of Sany's 70,000 global employees.

But the Changsha facility provided a glimpse of the kinds of machines that will eventually fill the mostly empty Peachtree City facility. It also provides a reminder of how seemingly far-flung locales can be sources of investment for Georgia thanks to the integration of the global economy.

Wearing red hardhats and trailed by reporters, translators and executives, Mr. Liang walked Mr. Deal past workers assembling products that will also be imported or put together in Georgia: concrete pump trucks and stationary trailer pumps.

Photos snapped and formalities complete, Mr. Deal greeted smiling employees lining the walkway leading out of the building. Outside, a technician helped him and First Lady Sandra Deal use a remote control to extend one of the world's tallest truck-mounted booms to its full height.

"That's quite a machine," Mr. Deal said with the boom extended after 10 minutes. He joked that he needed a miniature version for his grandsons.

"I have marveled at how many high-rise buildings have been built in China everywhere we have been, and I wondered how they could build them so fast and how they could build them so high," Mr. Deal said during the meeting with Mr. Liang. "After operating your machine, I think I have a better understanding of how they do that."

A New Home in Peachtree City

Mr. Deal's caravan was met with much fanfare at the Sany facility after snaking through the streets of Changsha.

Endless rows of trucks lined the entry road, as did Chinese and American flags alternately staked in the ground. Guards on elevated pedestals gave a full salute. Even during the afternoon lunch break, the place bustled with activity.

Granted, no governor was to be received when GlobalAtlanta visited Sany's U.S. facility, but it was more of a work in progress. While the Changsha complex was a cluster of expansive buildings - some old, some new - the gleaming glass-front facility in Peachtree City stood alone in a clearing as if dropped from the sky.

Two large Sany excavators operated just beyond the entry gate, their constant clank and whir the only sounds on a plot of red clay and grass separated from other industrial buildings by a wall of trees. Vultures glided in a cloudless blue sky. At 3 p.m., no one manned the front desk in a modern, white-walled lobby outfitted with chairs in Sany's signature red.

Though only about 30 percent the size of the 1.1 million square foot building Mr. Deal visited in Changsha, the Peachtree City plant still impresses.

It comprises some 360,000 square feet, including office space, David Zhang, chief financial officer for Sany America Inc., told GlobalAtlanta during a brief tour before the China trip.

Pointing to a diagram of the factory floor, Mr. Zhang laid out the main products that will be put together In Georgia. On one side, crawler cranes - used for buildings more than 20 stories high - will be assembled from parts imported from China. Nearby, concrete pumps will be mounted on Mack trucks. In a corner near the office, the small space set aside for R&D belies its importance to Sany's continued advancement.

Operating with the slogan "Quality Changes the World," Sany has twice broken its own Guinness world record for the world's tallest concrete pump, a distinction that requires constant innovation in its main product.

The Chilean government chose a Sany crane to be used in rehearsals for the rescue of the 33 miners trapped for more than two months in 2010. The company also donated a 62-meter concrete pump to help plug unstable nuclear reactors in Fukushima after Japan's March earthquake.

Eventually the company even hopes to make excavators in the U.S., Caterpillar Inc.'s home turf. Sany's excavators - large, earth-moving machines with articulated arms - overtook Caterpillar's in the China market in 2009. They still need environmental clearance in the U.S., a process that has taken longer than expected but should be complete this year, Mr. Zhang said.

All Peachtree City-made products are designed specifically for the North American market, where many construction firms rent expensive equipment rather than buying it, he added.

So far the crawler cranes have sold well. It will take time for all product lines to make a profit in the U.S., but their presence here will contribute to name recognition that will boost Sany in multinational bids.

"The U.S. is very important for our brand," Mr. Zhang said.

'Grand Plans' Globally

During the press conference at Sany, Mr. Liang laid out the company's "grand plans" for the future. By 2015, the company expects $50 billion in sales, nearly five times its projected 2011 revenues.

Despite the importance of plants in Georgia, BrazilGermanyIndia and Indonesia toward achieving this ambitious goal, China will still make up 75 percent of sales in five years, the chairman told reporters.

Mr. Liang shrugged off Sany Heavy Industry's decision to delay a $3.3 billion share sale in Hong Kong last month on fears of volatility fueled by the European debt crisis.

The company's high profit margins mean that it can afford to focus on brand building instead of raising capital, the chairman said.

Responding to reporters, Mr. Deal laid out Georgia's incentives for foreign companies and highlighted aerospace and information technology as strategic industries. He said the worry that companies like Sany will take market share (and jobs) from domestic firms is the cost of doing business in a free market.

"That is always a concern, but we have all moved pretty much to a free-market environment in which those kinds of parochial barriers are generally removed," Mr. Deal said.

He wouldn't project when the U.S. economy would fully recover.

"If I had the answer to that one, I would probably be running for president of the United States," he said.


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