Fernando Rivera
Director of Special Projects
Columbus McKinnon
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View from the Top

Lifting Systems Expert Helped Create Mexican Norm

Wed, 01/21/2015 - 14:11

Q: As a leader in lifting systems, how did Columbus McKinnon establish its position in Mexico?

A: Throughout its 130-year history, Columbus McKinnon has specialized in manual and electric hoists. We have a manufacturing plant in the State of Mexico where we make specialized equipment for our brands Chester and Yale according to the PEMEX norms. Because of its experience and history in manufacturing hoists, Columbus McKinnon was invited to participate in the drafting of the norm NMR-183 PEMEX 2014 for cranes and hoists based on international standards, as requested by PEMEX. In 2001, Columbus McKinnon completed the full acquisition of Endor, a Mexican family business founded in 1967 with its own brand of hoists of which Columbus McKinnon already obtained half of the shares at an earlier stage with the intention of taking the brand global. The company subsequently began introducing new brands and creating new products for the Mexican market, including the Lodestar brand, Yale Global King chain hoists, and the CM622 manual hoists. The aforementioned are our most sold products across all the markets we cover.

Q: How important is the oil and gas sector for Columbus McKinnon, and how is this affecting your strategic decisions?

A: The Global King assembly line was brought to Mexico to specifically address the needs of the changing oil and gas industry. The reason behind bringing this line from the US was that delivery times reached about eight weeks and we had to pay for the importation costs. Due to the demand for this line, we decided to assemble it in Mexico. Reduced delivery times are a key advantage from having a plant in the country. We are aware that tendering processes take a long time but we have seen that our equipment is ordered with little time to spare. To cater to the rapid needs of the oil and gas industry, we ensure delivery times of between three and five working days from the manufacturing plant. In addition, we import some raw materials from the US but we reduce costs by assembling the equipment in our own facility. This was the first strategic decision we made in regards to the oil and gas sector.

Q: Which characteristics of your hoists make them particularly safe to use?

A: These hoists have a zero accident track record. Our Yale Cable King is a robust wire rope hoist and a particular favorite within the oil and gas industry. PEMEX drafts its norms with safety in mind as the most important element. We provide lifting systems, so the last thing we want is for a suspended cargo to fall. From a technical perspective, our instruments have backup breaking systems and provide the necessary protection to work in hazardous environments, including areas prone to explosions.

Q: Does having collaborated with PEMEX in the drafting of norms give you a competitive advantage?

A: Columbus McKinnon was not the only company involved in this process since several of our distributors were also included. However, the norm document mentions the participants, so when PEMEX asks contractors to check the norm, they come across our name. As a result, many of PEMEX’s contractors have contacted us and we have referred them to our distributors.

Q: How have the current oil price and PEMEX budget cut affected your business?

A: Columbus McKinnon was most affected in 2014, which was a particularly bad year in terms of sales focused on the oil and gas segment. After a period of progressive growth, our sales plummeted abruptly. This year, our sales to PEMEX have been getting back on track in spite of the rising US dollar. Helpfully, certain projects such as PEMEX’s work in Boca del Rio and the Los Ramones pipeline are going well and need our support.

Q: What role does Columbus McKinnon aspire to play in the future of the Mexican oil and gas industry?
A: Columbus McKinnon aims to keep its position as a leader in standard cargo lifting products, but we want to strengthen our position for specialized lifting products in the oil and gas industry. The products I am referring to, which are the ones we supply to PEMEX, are explosion resistant. The final objective is supplying tools to PEMEX for its exploration and production activities. As these are set to increase, Columbus McKinnon has created a new department dedicated to the oil and gas industry.