Executive Summary

The apparent UK market for mechanical handling equipment was estimated by Key Note to be worth £2.6bn in 1995, with UK manufacturers' sales valued at £2.7bn. Between 1991 and 1995, there was an 8.2% growth in the apparent market. The UK is a net exporter of goods in this sector, with a positive trade balance of an estimated £45m in 1995.

The market consists of five sectors, of which the major items are conveyors, cranes, lifts and escalators, lifting equipment, and fork-lift trucks.

The market has been badly affected by the recession in the manufacturing industry and by the slump in the building trade (for lifts and escalators). International competition has become more noticeable in most market sectors in the past 5 years. Whilst the workforce for the industry as a whole has remained constant, there has been a noticeable shift of employees to small companies. Legislation from the European Union (EU) has affected all companies in the industry and there has also been considerable effort expended in the implementation of BS5750 and ISO 9000 quality standards throughout all sectors, but especially by companies in the lifts and escalators market.

The mechanical handling industry is mainly involved in the movement of goods around manufacturing premises. In recessionary times, engineering projects have to compete with financial markets that offer attractive rates of return. If these are better than the return generated by the project, it is unlikely to be funded, and companies which would have supplied equipment for the project suffer a slump in sales until interest rates fall.

UK manufacturers' sales of mechanical handling equipment are predicted to grow by an average annual rate of 5.5% between 1996 and the year 2000, reaching £3.5bn by the year 2000. The sectors that are forecast to outperform the sector average are the conveyor sector, as automated warehousing projects expand, the lifts and escalators sector, as UK and Asian markets grow, and sales due to small companies as the migration of employees continues. Any future government change of taxation rules to allow tax relief on capital expenditure would increase this figure considerably.

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