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Yellowgate helps provide Australian-first XCMG electric loader

Yellowgate Group’s rent to buy solution has helped Midland Brick trial a XC968-EV electric wheel loader – the first of this model to reach Australia

Perth-based Midland Brick is a brick manufacturer today owned by BGC Group. With a 70-year-old history, the business has established itself as one of the most recognisable brands in Western Australia, producing and selling bricks, roof tiles and pavers.

When the time came to replace one of its old wheel loaders, several factors immediately came into play. One of the main considerations when looking at a new wheel loader was the emissions it released – due to Midland Brick’s fleet consisting of machines that all burn diesel.

“We spoke to all the big brands in the construction and mining equipment industry – none of them [at the time] had anything available as an alternative to diesel engines,” Midland Brick procurement manager Kristian Walter says.

Eventually, Midland Brick found what it was looking for in XCMG – the XC968-EV electric wheel loader.

“When XCMG introduced this particular loader, it stood out for us,” Walter says.

“It instantly triggered our interest to investigate it further, look into the cost and see if it would make sense for us.”

Due to the loader’s energy efficient capabilities, the XC968-EV became a no-brainer as it perfectly encapsulated Midland Brick’s strategy to become more energy efficient. However, with no previous experience with the XCMG brand or the model in question, the company was hesitant to buy the machine. This is where Yellowgate’s expertise and capabilities in the rent-to-buy market came into play.

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Yellowgate

With Yellowgate’s Rent Now, Buy Later solution, its customers can quickly access the heavy machinery they need to fulfil contracts while reducing the financial risk involved.

There could be a variety of reasons that make renting machinery a better solution for a contractor compared to buying. For example, the business could be experiencing a period of high growth or recovery, it could still be setting up, or the business owners may not currently have access to the funds required for outright purchase.

With the rent to buy model offered by Yellowgate, a business can quickly access the heavy machinery required to fulfil a contract at a more manageable cost to the business and in a way that provides a more economical pathway to ownership of the machine down the line should the business decide to purchase it.

It is this flexibility and speed of access to machinery that was a key draw for Midland Brick.

“Other business models usually don’t allow you to purchase an asset within a short timeframe,” Walter says.

“In this instance, we agreed on the rent-to-buy solution, because it allows us to try the equipment and then make an informed decision based on that trial period.”

Midland Brick procurement manager Kristian Walter (left) and production manager Lindon Edge. Image: Yellowgate

Yellowgate’s Rent Now, Buy Later solution offered Midland Brick a rental product in the form of an off-book operational expense (OPEX). This allows Midland Brick to make manageable ongoing rental payments and get its new XCMG wheel loader earning money on site faster than if it purchased the machine as a capital expenditure (CAPEX), which would have required a far larger financial commitment up front.

Yellowgate managing director Chris McRae says businesses usually have CAPEX budgets and, if the business goes over this, spending will stop. In this situation, Yellowgate can continue to supply the equipment to a business, so it can reap the benefits of the asset immediately and capitalise on it later.

If Midland Brick subsequently decides that it doesn’t want to buy the XCMG electric wheel loader, Yellowgate will take it back and either rent it out again or sell it on – giving Midland Brick the opportunity to try out an electric machine and see if it works for the business.

Another key aspect of Yellowgate’s business is its support for customers.

“We’ve got the ability to grow with other businesses,” McRae says.

“People may be looking at uncertain futures, but our product only goes for 12 months, which can help businesses focus on one commitment.

“If businesses are looking for something that’s 12 months into the future, we can help them get the type of asset that they need.”

Buying the electric wheel loader was the first transaction between XCMG and Yellowgate, with the potential for an ongoing partnership in the future.

Yellowgate has provided Midland Brick with an option to buy the electric loader once the rental period concludes. Image: Yellowgate

XCMG XC968-EV

XCMG mining business development manager Steve Lihou says XCMG is a rapidly growing original equipment manufacturer that’s starting to make a name for itself in Australia.

“We feel that we’ve got some technology that is really going to benefit our customers,” he says.

The XCMG XC968-EV has an operating mass of 18.8 tonnes and rated power up to 280kW (375 horsepower). The electric wheel loader also has a 3.2-cubic metre bucket capacity with a rated load of 5.8 tonnes.

Kristian Walter, from Midland Brick, says the XC968-EV is making it easier to move materials on-site.

Without an engine or transmission, the electric wheel loader provides lower maintenance costs for Midland Brick, with this proving to be just one advantage out of many that he says it has over traditional loaders running on diesel.

“After we crunched the numbers, we came to the conclusion using an electric loader would be cheaper for us to run than diesel,” Walter says.

“The loader is also quiet and there’s no pollution or fumes for the driver, operator and any people close by.”

Despite lacking an engine, Walter says the loader doesn’t lack power and the charging is even easier than refuelling a diesel loader.

After a successful procurement, Midland Brick has Yellowgate as its first point of contact for any future procuring and renting solutions.

“If there are other more innovative solutions or capital expenses coming up, we will be more than happy to engage with Yellowgate and explore that solution,” Walter says.

For more information on Yellowgate’s Rent Now, Buy Later strategy head to yellowgategroup.com.au

To find out more about the XCMG XC968-EV, contact Steve Lihou on 0459 824 951 or stevelihou@xcmg.net.au

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