Bauma China was a success despite losing Japanese industry support
CMME meets with the man behind Bauma and finds out why the industry still believes that the event is not only important but absolutely necessary.
A road trip from Mauritania on the West Coast from Africa to Munich in Germany sounds like hell. But when an ash cloud fell over Europe in 2010 and blocked air traffic, four visitors bound for Bauma were so determined to get to the world’s largest construction event that they rented the best car they could find and set off into the wild of Western Sahara. The rental insurance must have been almost expensive as the petrol.
“We heard unbelievable stories of how people got to the show,” says Klaus Dittrich, the CEO of Messe Munich. “The longest trip was the four guys that travelled from Mauritania by car but we also had people driving from Istanbul and even the Ukraine.”
It is a testament to the enduring appeal of the show that in era where equipment events seemingly pop up every week, that Bauma can still inspire the crazy in people. It is almost 50 years since the first Bauma took place in Munich as trade fair for the German market. Given Germany’s status as one of the world’s major exporters and strongest economies it is sometimes easy to forget that post-war, the newly divided country was ravaged and impoverished.
By the time Bauma opened its doors in 1954 it was an emerging state eager to build on its industry and in state of heavy construction. The show was modest by today’s standards.
“Bauma is one year older than me which is why I can’t remember it,” he jokes. “It covered 20,000sqm in the beginning and took place every year.”
Matching Germany’s evolution into a modern country, Bauma was to later become a three-year event but steadily grew to become a global event. At 555,000sqm the last show was times almost 30 times larger than its first edition. Its organiser Messe Munich has likewise become one of the world’s biggest trade fair organisers: “After we built the new fair ground in Munich we started to internationalise our portfolio.”
Bauma returns in March as the clear number one event in the industry but in reality it is one highlight in arguably the most important year Messe Munich has ever had for its construction flagship. Bauma China held in November was the biggest yet, February sees its part-owned BC India in Mumbai and in September it will host its first ever Bauma Africa. Dittrich’s job is to juggle the very different demands, logistics and occasional geo-politics that come with running a global enterprise.
Bauma China, for instance, was sold out but a dispute between China and Japan over the Senkaku Islands could have easily made the event a disaster. Protestors had already forced many Japanese companies to halt production and the closure of the Chinese offices of Hitachi and Sumitomo. Security forces in Shanghai were reluctant to guarantee their protection at the show.
“All the Japanese exhibitors resigned and didn’t participate because of the political issue of the island,” he says. “They were fearful and the local security asked us to take care of the Japanese exhibitors and we couldn’t guarantee their security. That was the reason they declined to exhibit.”
Thankfully for Messe Munich, Caterpillar made up the shortfall taking a 10,000sqm hall ensuring a 100% take up of space and defying the malaise in the market. Dittrich notes that the event came at a time of flux for Chinese manufacturers.
“Somebody told me that the Chinese economy is like a bicycle if you are not going fast enough it will fall down. They only have 6% growth which may not be good enough. People like Sany in the last 10 years had annual growth of 6%. If they haven’t got that then it will cause big problems.”
Bauma China has helped to establish Messe Munich globally and together with the American Association of Equipment Manufacturers who organise CONEXPO it founded a JV with them for the India market. He explains: “The reason it is called BC India is because it’s a Bauma and CONEXPO Show.”
Unlike its Munich home venue and the Shanghai Expo centre it co-funded and helped design and build, BC India takes place on a brown field site in Mumbai. Doubling in size the second time around, he hints that it is a frustrating arrangement – even if they were happy to build the temporary halls, restaurants and restrooms required for an event of its type.
“Originally we planned India to be 40,000sqm and in the end we covered 85,000sqm which is more than double the first Bauma China,” he says. “The challenge in India is that they don’t really have an international state of the art venue. It’s a limitation at the moment but we are quite optimistic that we will have an alternative next time. The 150,000sqm we have this time is already a limitation on the size of the show.”
His next challenge will be establishing a foothold for Bauma Africa which takes place in September. Dittrich will be racking up airmiles to raise support.
“It’s not easy but we are working with the chamber of commerces and the consulates of the neighbouring countries. We are also talking to the governments in those countries and they are supporting delegations,” he says. “The companies that are exhibiting also have a reasonable level of database of the neighbouring countries. Ambassadors of all these countries will also be invited to visit Bauma in Munich to show them how impressive this sort event can be at a special forum and look at the opportunities for southern Africa.”
Acknowledging the problems he faces he adds: “Our exhibitors are aware that it is not easy to attract visitors from these countries. Everyone knows it could take several years but we have already started to build up this relationship over the next five years. I’m sure we will have a strong show.”
Considering China’s growing influence in both contracting and equipment supply it is not unreasonable to assume that Messe Munich may attract some Bauma China exhibitors to Africa.
“Sure they have a strong interest in Africa because of the natural resources. They have a very strategic view on these countries much more than the Western companies. We are pretty sure they will be there. If their home market is weak they are even more motivated to export.
“At the beginning the idea was to support our Munich customers to enter emerging markets like China. Visitors are not just coming from neighbouring countries but we have visitors coming from South America and Africa. It became a more international show. But if you want to see the newest innovations you can only see them in Munich.”
The main event remains Munich and this year he says that despite the continued depressed state of the European economy, it will be the biggest yet.
“The last Bauma at 550,000sqm was the largest show in the world. However it is growing to 570,000sqm this time around. We’ve taken over an area that is normally used as car park to make room. We have also rented space outside the venue – and we are still fully booked.”
“We learned that it is the second and third tier exhibitions that get cancelled during a crisis, so you have to be number one. Bauma is unique. It’s the whole world market in one place every three years. Many manufacturers adapt their innovation cycle with Bauma. They still want to use Bauma to show their newest innovations to the world.”