Heavy equipment firms get into gear

Chinese producers of vehicles, rail cars expand abroad via global mining giants, reports Du Juan in Perth, Australia.

Hu Weiying, a 30-something engineer from Hunan-based Xiangtan Electric Manufacturing Group Co Ltd, works in Western Australia's Pilbara region, where many mining giants have iron ore projects.

Hu and two colleagues have been working at the Tom Price mine, owned by Rio Tinto Plc, the British-Australian multinational mining giant, for several months as the Chinese manufacturer expands into overseas markets to serve its mining clients.

"I am responsible for collecting data on four XEMC trucks" used by Rio Tinto at the project, Hu said. "The data will be used to improve our trucks."

The four trucks, each of which can haul 230 metric tons, were shipped to Tom Price in June 2012, the first time that Chinese-produced mining vehicles were sold to a foreign customer.

It was just the beginning.

As mining titans such as Rio Tinto, BHP Billiton Ltd and Fortescue Metals Group Ltd sell vast volumes of iron ore to a resource-hungry China, Chinese manufactures are expanding their Australian business by delivering ore cars, trucks and modular accommodation at the project.

On Nov 20, Rio Tinto signed a long-term agreement with XEMC to supply and service heavy mobile equipment for its global operations.

According to the miner, it was the first global agreement Rio Tinto has signed with a Chinese supplier, which demonstrated that Chinese manufacturers are capable of making world-class products.

Under this agreement, XEMC's mining trucks and other equipment will be used not only at the Tom Price mine but at other mines owned by Rio Tinto.

Since trucks and mining equipment are mostly custom-built for use in extreme conditions, such as extremely hot locations or on rocky roads, the cooperation with Rio Tinto will help the Chinese side gain experience for future overseas orders.

XEMC Chairman Zhou Jianxiong said that besides producing high-quality equipment, the company is working to improve its after-sale services.

Another company, Qiqihar Railway Rolling Stock Co Ltd, a subsidiary of China CNR Corp Ltd, is supplying ore cars for Rio Tinto.

As of September, there were 6,500 ore cars from QRRS being used by Rio Tinto to move iron ore out of the Pilbara region, according to Heath Harnden, general manager of railways maintenance at Rio Tinto's iron ore division.

Just back from a 10-day business visit to China, Harnden said that the company plans to increase the number of ore cars from 6,500 to 11,500 by 2015, and all the new ones will be from China.

"We are very proud to work with QRRS," he said.