China's crane industry agency is still in its infancy

In the mid-to-late 1990s, as domestic construction machinery manufacturers grew rapidly and foreign brands entered the market in large numbers, the agency system—originating in the West and already matured there—began to take root in China's construction machinery industry, particularly in the excavator sector. The agency model quickly became a dominant marketing approach. However, due to differences in product types and varying stages of development, the agency system was not widely adopted in other construction machinery sectors. Whether to use direct sales or agency models became a hot topic among manufacturers and agents alike. Engineering cranes, as traditional lifting equipment, had long relied on direct sales due to their small market size and high unit prices. But with China’s rapid economic growth and increased infrastructure investment, the construction crane industry experienced significant expansion. In 2006, industry indicators surpassed those of 2004. As market size grew and companies strengthened, some crane manufacturers began experimenting with an agency system. Among them, truck cranes saw more adoption due to larger market shares, and the emergence of dealers as agents became most noticeable. Compared to the well-established excavator industry, the development of the agency system in the automotive crane sector is still in its early stages. Many companies remain divided on whether to push for an agency model. Some argue that over 90% of the domestic car crane market is dominated by local brands, which have extensive sales teams and well-developed networks. These companies can effectively sell products through direct channels, raising questions about the need for an agency system. Additionally, car cranes are characterized by small sales volumes, complex technology, limited customer bases, and high unit prices. With a total market capacity of only tens of thousands of units, it remains unclear if the agency model is suitable for this segment. Some believe that as global industrial chains become more specialized, the agency model is an inevitable trend for the auto crane industry. To address these concerns, we visited major domestic crane manufacturers and some of their agents. Through discussions on the current state of the agency system and the challenges faced, we aimed to provide a comprehensive understanding of the current situation and clarify the future direction of China's engineering crane agency system. At the end of the 20th century and the beginning of the 21st century, as the sales volume of China’s auto crane market exceeded 10,000 units and credit policies like bank mortgages were introduced, the agency system started to emerge in the automotive crane industry. Major domestic manufacturers began implementing the model. For example, Beiqi established four-in-one vehicle crane agencies in Nanhai, Guangxi, Taiyuan, Shanxi, and Xinjiang in 1995, partnering with China National Mechanical and Electrical Import and Export Corporation. This marked one of the earliest agency systems in China’s construction machinery industry. Puyuan set up a crane agency in Zhejiang in 2001, but many early dealers did not sustain their operations due to various factors. With China’s globalization and the growth of the domestic auto crane market, the agency system gradually developed. Currently, three main marketing models exist: full agency, a mix of direct sales and agency, and traditional direct sales. Large truck crane manufacturers typically adopt the parallel model, while some joint ventures use a complete agency system. Small and medium-sized manufacturers and foreign brands still rely on direct sales. Major domestic manufacturers such as Xugong Group, Puxi, Sichuan Changjiang, and Taidong Yuegong use a mixed direct and agency model. These companies have large marketing teams spread across provinces and cities, handling most of the sales. To meet market demands, some have also developed strong regional dealers and begun testing the agency model in certain areas. For instance, Puxi has over 370 marketing staff and more than 20 contracted distributors, with a 4S agency established in Guangxi in 2006. Overall, the percentage of sales through agencies ranges from 20% to 30%. Tadano Beijing Crane Co., Ltd. is the only company in China that fully implements an agency system. Founded in 2003 by the Beijing Crane Factory and Japan’s Tadano Corporation, it adopted the agency model from the start to rapidly increase market share. Since 2005, it has led the industry in implementing a strict agency system, with 23 regional agents, eight of whom serve as both sales and service partners. Currently, the auto crane agent network is not yet scalable. According to rough estimates, there are around 30 to 40 real car crane dealers nationwide. Some act as channel agents, with strong distribution capabilities but smaller scale and less mature management. Others are brand agents with better experience and more structured operations. The uneven quality of agents and the immaturity of the agency model have resulted in widespread recognition of the system by large companies, but its development is still in its infancy.

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