The market for forest machines has been stable in Sweden for many years. But in 2007 something happened that could turn the market upside down in the long term. Market challenger Ponsse increased its share of the forwarder market by 38 per cent.
The Finnish manufacturer Ponsse greatly strengthened its position in Sweden following Hurricane Gudrun in 2005. At that time it was vital to get hold of forest machines regardless of their colour or brand. Ponsse was in a position to deliver and sold 21 forwarders that year. The sales were small compared with John Deere’s 150 and Komatsu’s 99 but it was a clear market shift.”We decided to continue to seize market share by recruiting experienced staff and creating a good service organisation,” explains Benny Sondell, managing director of Ponsse in Sweden. In 2006 the total market shrank from 353 to 299 forwarders. Ponsse succeeded in retaining its market share and continued its challenge even though market analysts predicted that machine purchases would fall further during 2007.
Had customers all to itself “We stuck to our plans and in the spring of 2007 we implemented our biggest marketing campaign ever in Sweden,” Benny says. “We did a road show in fifteen locations from Malmö in the south to Älvsbyn in the north and finished up at SkogsElmia.”
Other forest machine manufacturers had chosen to skip the fair and focus their efforts on Nolia in Umeå and the big international gathering at Elmia Wood 2009. Ponsse could present its new products to 33,483 visitors with no competition. Statistics reveal that the venture worked. Ponsse sold 30 forwarders in Sweden in 2007. In terms of the number of units sold, that translates into a 76 per cent increase. At the same time, the total market grew strongly in contrast to all predictions. 2007 saw new registrations of 382 forwarders, or 29 more than the peak year in the wake of Hurricane Gudrun. Ponsse’s market share rose from 6 to 8 per cent, which is an increase of 38 per cent.
Both trade fairs needed In hindsight it would appear to have been a classic mistake to leave the market challenger from Finland alone with southern Sweden’s forest owners and contractors. Benny Sondell refrains from criticising his colleagues’ decision:
“We market ourselves in our own way and exhibit where the customers are. SkogsElmia is an established trade fair. Forest owners and contractors come here whether we exhibit or not.”
He sees no conflict between the two big organisers of forestry fairs in Sweden, Elmia in the south and Nolia in the north. Ponsse exhibits at both, and would do so even if they occurred soon after each other.
“Sweden is a long country from north to south. Not many forest contractors in the south travel up to Umeå to look at machines, and vice versa. Whether it’s a matter of trade fairs or the service organisation, you have to go where the customers are.”
Second biggest in the world The next big forestry fair is Elmia Wood 2009, which is indisputably a key meeting place for the international forestry industry. The debate over whether to exhibit in the north or south of Sweden will recur in 2011, when SkogsElmia and SkogsNolia are both held again.
“We don’t believe there is any conflict – we’ll be exhibiting at both,” Benny says.
It’s not just in Sweden that Ponsse is taking market share. At home in Finland the company has overtaken John Deere and is the market leader. Sales are steaming ahead in Russia and Ponsse is starting to manufacture in South America. Just a few years ago Ponsse was a niche manufacturer. Now it is number two in the world after John Deere for CTL forest machines.
