Kalmar: Continuously developing services

Translation: Original published in Finnish on 9/24/2025 at 7:44 am EEST.

Last week we visited Kalmar's factory in Stargard, Poland. In addition to a tour of the factory, the visit included a review of Kalmar's service business development and the impact of the latest steel tariffs on the company. Kalmar's presentation materials on its services business are available here.

General satisfaction with Stargard factory operations, although efforts to improve performance continue

Kalmar's Stargard factory opened in 2010 and remains very modern. Like the company's other factories, the Polish factory focuses on final assembly, testing, and customer deliveries, making its cost structure quite flexible. Similarly, the factory produces almost the entire range of Kalmar products (i.e., straddle carriers, reachstackers, empty container handlers, forklift trucks, terminal tractors), except for Bromma container spreaders, which are manufactured in the company's Malaysian factory. Based on comments from the new local management, minor efficiency measures are planned for the factory, although overall satisfaction with operational efficiency and working methods is high. However, operational efficiency can always be enhanced through minor adjustments and continuous improvement, ensuring long-term competitiveness as well. We estimate that the potential benefits will be more apparent during periods of higher demand since the factory's production capacity is not currently being utilized to its fullest. Overall, we consider the Stargard factory's operations to be in good shape and therefore it does not require extra attention from the group's management. We also considered the comments made by the business managers present during the visit to be a positive aspect, particularly regarding the benefits of Kalmar's demerger in terms of decision-making (i.e., decisions made closer to operations).  

Service business review and growth plans

During the visit, the company also presented its service business development and growth plans, which naturally followed the previously communicated guidelines. In practice, the company has clear key focus areas to grow its services: increasing its share in the maintenance of its own installed base, leveraging the growth potential offered by the electrification of equipment, and increasing customer value through data-driven solutions (especially digital solutions).

Regarding this, the company briefly presented its digital services and its customer platform (MyKalmar) during the visit. This also plays a very important role in areas such as spare parts sales (approximately 50% of spare parts sales are made through e-commerce) and other aspects of the customer experience (e.g., equipment data, training and maintenance requests, predictive maintenance). Consistent with this, the company has successfully increased, through active measures, the share of spare parts deliveries for its own equipment to approximately 30%, up from 25% in 2021. The company naturally still sees strong opportunities in this area, which digital services are also enabling. In turn, the growth potential of the electrification of equipment stems, in particular, from the more demanding servicing of the equipment (including higher training requirements) and the more expensive parts, which is also reflected in the pricing, despite the fact that electronic equipment requires less servicing than traditional equipment. A key role in all these measures is, of course, played by increasing the installed base (currently, the total installed base is 68,000), as well as increasing the proportion of connected equipment in the long term from the current figure of over 14,500.

Regarding the measures taken in its services over the past 1.5 years, the company reported developing its practices, strengthening its service personnel (including leadership, sales, and technicians), as well as increasing its presence closer to its customers. According to the company, it has also been working for some time to transition from a reactive to a proactive service model, for example, by developing digital services. From a sales perspective, the company has also integrated equipment and service operations (for instance, the percentage of offers that include servicing is used as a metric on the equipment side). Overall, the company is striving to become more service-oriented (incl. digitalization and automation), which plays an essential role in achieving the profitability target and remaining competitive as well. Regarding the latter, the company commented that it is currently in a relatively good position, even though Chinese competitors, for example, are seeking to build their own aftermarket businesses. Similarly, regarding electrical equipment, the company stated in general terms that it ranks among the leading players alongside Chinese companies (e.g., Sany), while considering other Western companies to be slightly behind. The company also commented that its customer loyalty, quality, and brand are at a fairly good level. In our view, the competitive situation remains essentially unchanged, and Kalmar's market position is still very strong. Naturally, with the advent of electrification, the threat of Chinese competition must be closely monitored in areas such as battery manufacturing, manufacturing costs, state subsidies, and potentially aggressive price competition.

Regarding its services, the company also reported that the previously announced warehouse relocation and outsourcing in the US, as well as the relocation of the European distribution center to Metz, France, have gone well (e.g., increased delivery speed).

Latest tariff change has slightly delayed deliveries

During the visit, discussions also covered the US market and the latest tariff developments (the so-called Section 232 investigations, which resulted in 50% tariffs for steel and aluminum on certain steel and aluminum derivative products). For Kalmar, Section 232 applies to forklift trucks manufactured in Europe, while container cranes and straddle carriers are not subject to higher tariffs. Due to the unexpected changes in the tariff situation (on August 18), Kalmar also suspended its deliveries to the US in August until the situation became clearer (e.g., documentation). Consequently, Stargard's inventory levels of finished equipment were high at the time of the visit. However, the company commented that the situation had become clearer, stating that it would resume deliveries and expecting the situation to normalize within the next few weeks. Nevertheless, we believe this could result in timing variations in the company's figures between Q3 and Q4 (including cash flow). At the same time, however, it is important to remember that the majority of the company's US revenue comes from locally manufactured terminal tractors, services, and spare parts. Thus, the effects are nevertheless expected to be fairly limited on a group scale and, as stated above, mainly timing-related. We will monitor this matter for any further indications in connection with the company's pre-silent period call, although we consider it quite likely that the company will only comment on any potential effects in connection with the result.

Regarding the effects of Section 232, the company said it would respond through pricing, as it has with other tariffs. Due to the multiple changes in US tariff policy during the year, the company has understandably had to adjust its pricing rapidly, but based on the company's comments, it has learned to operate in the current situation. We estimate that the company will be able to incorporate these changes into its own pricing quite quickly. Kalmar also reported that competitors (incl. local operators) had raised their prices as a result of the tariffs. In our view, this increases the short-term risk to US market volume growth unless the operating environment is more clearly strengthened, considering the likelihood of broader price increases.