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FROM THE PRESIDENT

Despite the concerns following the 11th September events in New York and Washington, the UK market for construction equipment remained reasonably strong in the final quarter of last year to provide better than expected full year figures for most products. Other than the UK and a few other European countries, markets were generally down with North America and Germany showing some of the largest percentage falls. So how do the economists see the markets for construction equipment in 2002? Not surprisingly there is good news and bad news. The good news is that with confidence expected to slowly return, the second half of the year is forecast to be better than the first half. The bad news, however, is that for many markets already in recession, the first half is not expected to show any improvement from last year.

In these difficult times most member companies will be hoping for the best, but planning for the worst, trying to put policies, processes and products in place for the upturn when it comes. We have certainly seen some spectacular recoveries in the past. Between 1983 and 1989 world markets for our products doubled in volume and after the severe recession of the early nineties which saw volumes drop by 30%, they doubled again between 1993 and 1999. If this pattern is repeated in this decade we can look forward to a sustained period of strong growth once the markets start to recover. Here in the UK we’re told that the total market in 2002 should be about the same as last year - slower to begin with but picking up towards the end of the year. So lots of challenges for us all in the months ahead.

In the meantime, as we enter the New Year, we are faced with the impact of two new elements of European legislation - Physical Agents Directives to limit operator exposure to noise and vibration. These are in addition to new EU noise regulations setting limits for a wide range of machinery used outdoors, including most construction equipment, that finally came into force on 1 January 2002. However, we are primarily concerned with potential new regulations on upper body vibration. This proposed upper body vibration legislation, were it to become law, would have a severe impact on owners and operators of our type of equipment and those contractors that employ them. Our concern is such that we have taken the initiative to combine our CEA lobbying efforts with other Associations and industry groups in construction and agriculture. Our objective is to ensure that those who finally have to vote on this issue in Brussels are fully aware of the implications for industry and of the impracticality of actually measuring and policing the vibration levels proposed.

Other CEA activities are covered elsewhere in this issue of Newsline, but two developments are now fully in progress as a direct result of the DTI sponsored report, undertaken by Off-Highway Ltd, on Sector Competitiveness in the UK Construction Equipment Industry at the beginning of last year. The first is our Manufacturing Excellence initiative that we launched at last year’s Promoting Performance Conference. We now have six suppliers taking part in the initial MasterClass programme run by the SMMT Industry Forum team and the DTI have pledged further funding for three additional MasterClasses to be completed before the end of March. We have a specially picked team from the CEA and member companies handling this project in conjunction with the SMMT Industry Forum. Secondly, we now have in place another initiative, again partly funded by the DTI, to help promote export development. The CEA has appointed a consultant with relevant exporting experience for a short-term contract to help put the programme in place. If deemed to be successful, further government funding is possible for 2002/03. Finally, a word of thanks to Dan Willis who has announced his retirement from Gomaco after many years in the industry and a long association with the FMCEC/CEA as a Member of the Council, latterly, 1st Vice President. Good luck in your retirement Dan and best wishes from the CEA.

NEIL ALLEN
CEA President
JCB Sales Ltd