LiuGong sells factory and relocates Dressta dozer production

LiuGong said the transfer of production of Dressta machines would increase its production efficiency

China-based OEM LiuGong has sold its crawler dozer factory in Stalowa Wola, Poland, back to Huta Stalowa Wola (HSW), the company it acquired the Dressta dozer business and manufacturing plant from in 2012.

LiuGong is retaining ownership of the Dressta intellectual property and is transferring manufacture of these products to a new factory in Changzhou, China, with the capacity to build 3,000 units per year.

The majority of the staff employed by LiuGong in Stalowa Wola will transfer to HSW, but around 15% will stay with LiuGong to work in a new regional sales hub in the city that will include European parts distribution, training and demonstration facilities and local sales, among other functions.

LiuGong said the transfer of production to China would increase efficiency and speed up the expansion and renewal of the range. It also expected this to mean shorter lead times, particularly for customers in emerging markets. This, in turn, would allow dealers to reduce the levels of inventory they hold.

Howard Dale, Chairman of LiuGong Europe, called it a “a positive move”. He added that, “We are maximising our production capability while investing in building and strengthening our retail and customer support offer.”

LiuGong’s acquisition of the Dressta business in 2012 was the company’s first acquisition outside China and as such was seen as a significant step in the company’s internationalisation.

The company stated from the outset that it wanted to use the facilities it acquired to manufacture other LiuGong products for the European market. Crawler excavators and wheeled loaders were produced in Stalowa Wola from the mid-2010s onwards.

However, the factory’s remote location in southeastern Poland and its poor transportation links proved to be a barrier to scaling up production, efficiently managing supply chains and being able to ship finished machines to customers in a timely and cost-effective manner. The outbreak of war in Ukraine dealt another blow, with sanctions preventing the sale of Dressta dozers to Russia, historically one of the business’s most significant end-markets.

LiuGong is one of the world’s largest OEMs. To see exactly where it ranks, see the latest Yellow Table in International Construction magazine.