High
Quality TBM Solutions from Canada made in China
Dubai
(UAE)/Toronto (CDN)/Liaoyang (CN), April 2018. Founded in 1972, Lovat
has been a renowned and leading TBM manufacturer for more than 45
years until now. Specialised in mixed/soft ground and rock TBM
technology, today LOVSUNS Tuneling Canada Ltd. based in Toronto,
Canada, is a 100 % owned subsidiary of the Chinese LNSS (Liaoning
Censcience Industry Co. Ltd.). This fruitful connection of both
cultures promises a successful future for projects with Tunnel Boring
Machines from LOVSUNS all over the world.
Lovat
was founded in 1972 and has been a renowned TBM manufacturer for over
four decades. Over 45 years of development the company became one of
the leading manufacturers of TBMs especially in the mixed and soft
ground TBM technology. In 2008 Lovat was sold to Caterpillar. After
that acquisition the new company was called “Caterpillar Tunnelling
Canada Corp.”. In May 2013 a phased withdrawal from the business
was announced and Caterpillar Tunneling reached out to different
potential buyers. After negotiation, the parent company LNSS
(Liaoning Censcience Industry Co. Ltd.) purchased the assets of
Caterpillar Tunnelling at the end of September 2014 and all assets
were closed between Caterpillar Tunnelling and LNSS. After the
acquisition, LNSS set up LOVSUNS Tunneling Canada which is based in
Toronto. In that sense, LOVSUNS is a 100 % owned overseas subsidiary
of LNSS based in Canada.
High
demand for high quality TBM solutions
One
of the main reasons to buy the company first of all was, to satisfy
the ever increasing local demand for high quality TBM solutions on
the Chinese market. Furthermore, to continue servicing Lovat
customers around the world by leveraging the acquired advanced
technology, management skills, sales experience expertise, as well as
expanding into international markets by supplying highly competitive
China-built, Lovat-quality TBMs and services. Many of the ex-Lovat
experienced engineers and technicians have joined LOVSUNS and are
still working in the company.
Chinese
Market still growing
China
still is the single largest TBM market worldwide. Today, after
acquisition of the Lovat TBM technology, LNSS TBMs are involved in
many mega-city metro projects. LNSS is one of the top TBM suppliers
in China. The other local TBM manufacturers are all state-owned
enterprises coming from railway and other heavy industry sectors.
Being the only private business, LNSS/Lovsuns has become a formidable
player in highly competitive Chinese and international markets.
Infrastructure
projects increasing worldwide
Apparently,
the main markets are in developing countries where local governments
are launching ambitious mid to long term plans to build more and more
infrastructure projects. “China and India are the biggest markets,
and Turkey definitely is an exciting market as well, where we have
witnessed rapid expansion of public transit systems and we already
sold 10 TBMs since establishment of LOVSUNS in this promising market
in less than 3 years. This is a clear proof of market reception after
Lovat/Caterpillar Tunneling assets acquisition. In addition, we are
following closely potential projects in other active markets”,
Hongyu Xue explains.
Synergy
is the key word
The
synergy between both companies is very important for the success.
Even before the acquisition, LNSS already had a massive factory in
China producing TBMs. And now, after the acquisition, the LNSS group
have a remarkable manufacturing capacity in China. The former Lovat
technology and the experienced engineers, technicians and operators
are still working for LOVSUNS today. This kind of synergy between
China and Canada is going to create a big value because every global
customer is looking for cost-effective and high quality TBMs. The
LNSS strategy is focussed on two points: The first one is safety of
operation and the second one is productivity. Today tens of
LNSS/LOVSUNS TBMs built with Lovat technology are used in Chinese
city metro projects as well as international markets.
Expansion
of Chinese companies
The
fundamental reason for the Chinese companies to look for overseas
involvements is the continuous economic growth of China – the
fastest growing economy in the world for the last 15 to 20 years.
China has reached a stage where it needs to upgrade many technologies
in order to meet the fast-increasing local demand. China needs also
advanced technology for its own market’s needs. With the business
expansion in China and the growing capabilities of the companies
there, they reach a certain stage of development in their own
countries they would expand to other overseas markets – naturally,
just like any western companies. That could be a reason why the
Chinese companies with adequate accumulation of all kinds of
resources and capabilities look at the possibilities of acquiring
well-established companies in other countries, in order to gain the
best technology and push on their development both in domestic and
international markets.
LOVSUNS
as a 100 % Chinese owned company legally possesses the Lovat
technology and enjoys a remarkable manufacturing capacity from the
parent Chinese facilities. The TBM was not invented in China and this
technology was used in China many years before the Chinese companies
started to build TBMs themselves around 2008/2009 – not such a long
time ago. At the beginning, there was a lack of technology in China.
But technology will always go to the hottest market with the maximum
economic benefit. That’s why leading foreign brands came to China
and benefited from the big wave of infrastructure expansions. Though
foreign TBM companies are still active in China, Chinese TBM
companies, like LNSS, are increasingly taking the leading role on
this market. Any lack of technology on the other hand is a business
opportunity. When China has purchased the technologies and can
produce a good amount of quality TBM products, this would benefit, at
the end of the day, global customers.
A
result of the centralisation in the group was the facility closure in
Toronto. When LNSS purchased the assets of Caterpillar Tunnelling in
2014, including the Toronto factory, which was the facility of Lovat
for more than 40 years, LNSS already had a big factory in China. From
day one, this was the main TBM facility for LNSS and LOVSUNS. Now
LOVSUNS in Toronto mainly is focussed on TBM design and engineering,
procurement of key components, the international sales, services and
product support. By shifting the Toronto TBM production function to
the main China facilities, LOVSUNS and LNSS can further enhance the
overall competitiveness, so that any new or refurbished TBM can be
delivered to the global clients faster on more competitive terms.
LOVSUNS
started to receive inquiries and orders from North American and
European clients for new TBM and refurbishment solutions. There is a
need for those clients of a continuous support for their Lovat
machines. Flexible solutions were worked out for this situation.
Parallel LOVSUNS is launching plans to further strengthen the role as
an overseas centre of excellence based in Toronto. The recent sales
record of one double shield TBM in US and eight EPB metro size TBMs
in Turkey is a sound proof of the success of such synergy between
Canada and China.
Bright
future
“From
a global perspective”, Hongyu Xue believes, “this China/Canada
synergy will allow us to grow faster both on China and overseas
markets. We will continue to innovate, to broaden and improve our
product line – EPB, rock and slurry TBMs and other machines for
special applications. We bought Lovat technology, a legacy renowned
for the robustness and reliability. We work hard to become the most
specialized TBM manufacturer and service provider to help our global
clients succeed in breaking through tunnels with unique challenges.”
Projects
in Turkey and Northern America
The
first China-Built TBM of the North American market, the TBM for the
Blacksnake Creek Stormwater Separation Improvement Project in St.
Joseph, Missouri (USA), reached the factory acceptance just some
weeks ago in March 2018. And for the Metro project in Istanbul
(Turkey), the job site celebrated also in March 2018 the first
breakthrough.
LOVSUNS
Tunneling Canada Ltd.
LOVSUNS,
former Lovat which was sold to Caterpillar, carried on the Tunnel
Boring Business as the wholly owned subsidiary of Liaoning Censcience
Industry Co. Ltd. – LNSS only one month after the Caterpillar
Tunneling assets were sold to the Chinese LNSS in November 2014 with
the order of the 3.9 m diameter EPB TBM to bore two wastewater
tunnels in Istanbul, Turkey. Further TBM orders for several drives of
the new Metro Line extensions followed. "We designed and
engineered tailormade TBMs for Istanbul and now for the US-market in
Toronto and completely produced the TBMs in the facility in Liaoyang,
China. That means that we very successfully united the best practice,
knowledge and technology of both companies for the highest advantage
of our customers", explains Hongyu Xue, General Manager of
LOVSUNS Tunneling Canada Ltd.
Further
information you may find on
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Hongyu
Xue, General Manager of Lovsuns Tunneling Canada Ltd.,
LNSS
factory in China
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