Kiboko Projects, a South African headquartered equipment management company, together with its principal, XCMG, ranked the fourth biggest construction equipment manufacturer on the 2023 Yellow Table (which compiles the sales for the world’s top 50 OEMs), used the recently ended Mining Indaba to announce their partnership.
The partnership sees Kiboko Group assuming the distributorship of a selected range of XCMG mining equipment to the South African mining industry. The range, says Ngcobo, has been carefully selected to meet the requirements of both mining houses and contract mining companies. Initially, Kiboko will bring in XCMG rigid dump trucks in the 100-tonne (t) to 260-t range. These will be complemented by a line of excavators in the 80-400-t range. In addition to new equipment sales, Kiboko will also acquire some of the XCMG equipment for its own rental divisions.
Transformative partnership
Having ventured into the world of entrepreneurship ten years ago, though initially involved in construction, Ngcobo has always had a special interest in mining. The 2020 surge in demand for commodities, particularly coal, as global economies started to recover, offered a perfect platform for Ngcobo to venture into mining, initially in contract mining, before expanding the offering with a mining equipment rental division.
With a strong understanding of the struggles associated with starting a contract mining business in South Africa, Ngcobo believes the market has a high barrier to entry due to obstacles such as high start-up costs which are exacerbated by the lack of financing, especially in the case of start-ups with little to no credit record. He thus seeks to play a transformative role in the market by providing solutions that speak directly to this group of customers.
“Our partnership with XCMG is groundbreaking, especially for upcoming contract miners who struggle to get a foothold in this market. Affording equipment as a start-up is a major hurdle, and I have first-hand experience of the struggles. In most cases, upcoming companies have to rely on third-parties who often ‘charge an arm and a leg’ for their equipment, which makes it difficult for upcoming contractors to be profitable and grow their businesses so as to be in the position to afford their own equipment,” he says.
To plug this gap, Kiboko is partnering with reputable financial institutions to provide funding for upcoming mining contractors. “For example, we have partnered with a reputable bank to offer a rent-to-buy model, which offers the benefit of flexibility and reduced upfront costs, along with improved cash flow for these young companies,” he says.
Why XCMG?
Before opting to supply the XCMG range of equipment, Kiboko went on a fact-finding mission in China. The company met with XCMG in China and also visited a couple of mines running XCMG equipment. Impressed by the equipment’s performance and resilience in some of the most taxing operating conditions, Kiboko decided to enter into a distributorship with XCMG.
Apart from the build quality of the equipment, Ngcobo and his team were impressed by the wide range that XCMG has to offer. In addition, he says, XCMG is a globally recognised brand that has also made its mark in South Africa since its arrival back in 2007.
“We have initially selected a few items from the XCMG catalogue to supply and support in the local market. Based on how we grow the initial offering, we will probably consider expanding the range with more models in the future,” says Ngcobo.
As an organisation driven by innovation, demonstrated by its in-house AI-driven predictive maintenance, remote diagnostics and automated performance technology, Kiboko is encouraged by the strides that XCMG has made in the fields of automation and electromobility – key trends that address the mining sector’s quest for zero harm and sustainability.
“XCMG has gone the automation route further than most other premium original equipment manufacturers (OEMs). While automation technology is seemingly premature for our market needs, it will at some point become relevant as the local mining sector adapts to the new operational realities. While it is not feasible to automate the whole fleet, we believe that driverless trucks are the answer for risky environments such as where highwalls exist. This allows companies to take people out of harm’s way,” explains Ngcobo.
To be competitive, Kiboko will place value on lower total cost of ownership (TCO) for its XCMG customers. The efficient nature of the machines already provides for the building blocks to ensure lower TCO. This is complemented by their proven reliability, which not only ensures uptime but also high equipment availability.
According to Ngcobo, the days in which Chinese equipment was viewed with disdain are long gone. Chinese OEMs have proven to be real innovators fighting for a larger share of the global capital equipment market. Placed among the top four best-selling construction equipment manufacturers globally, XCMG has proven its mettle among global giants. The stigma around Chinese products, he adds, has also been dispelled by the fact that companies such as XCMG run globally renowned components such as Cummins and MTU engines.
Strong support structure
For Kiboko, a good reputation is crucial, and it fosters trust, credibility, and long-term success, says Ngcobo, which is why the company is investing heavily in its support structures. “We will first focus on a few product lines to allow us to perfect our aftermarket service. We have also invested in a new office and workshop on a 4-hectare site strategically located along the busy R21 highway in Centurion. This facility affords us ample space to pull in large 260-t dump trucks for service, while its strategic location allows for easy access to the major highways,” says Ngcobo.
This support infrastructure will be complemented by a large investment in parts to ensure high availability. In addition to Kiboko’s own parts holding, XCMG already has a large parts warehouse in Kempton Park, near Johannesburg. Kiboko technicians are undergoing OEM training to equip them with the necessary skills to look after the XCMG equipment. The company will also send some personnel to the XCMG factory in China for further training.
“We will leave no stone unturned to ensure that we adequately support our customers. Having been on the other side of the ‘fence’, operating a large fleet of equipment, we understand customer pain points and their support needs. We are therefore well geared to take good care of our customers,” concludes Ngcobo.
