World

class Favco cranes have

come a long way since 1923 -
A construction productivity
perspective
David Chandler May 30 th 2013

Who has not seen a Favco crane sitting atop a major construction site? They are an amazing piece of
engineering, fabrication and erection. Now widely used in construction, engineering infrastructure
and on off shore gas and oil platforms one can see Favco cranes on
projects in Australia, the US, Hong Kong, Korea, Singapore, Malaysia, the
Middle East and UK. Some 120 cranes are now manufactured and supplied
to these countries each year. At upwards of $2 million per new crane
combined with the supporting global
maintenance operations Favelle Favco is now a
big business.
M380 Favco on Brookfield Multiplex London-Pinnacle site Sept 2012

Favelle Favco has come a long way since

founders Arthur Favelle and Harry Cole started
their automotive and oxy welding of car
structures back in 1923. Owned since 1996 by Malaysian listed Muhibbah
Engineering Group, Favelle Favco fits comfortably into the global
operations of this major ship building and steel manufacturing business.
Denmarks Kroll Crane manufacturing group which has followed a similar
journey to Favco is also part of Muhibbah.
Favcos story is a timely one as Australia wrestles with where its automotive sector and general
manufacturing expertise will go in future. Reported by the Australian Financial Review in 1983 Ted
Favelle had by 1971 concluded that the companys future would be best by exploiting its
technological developments and avoid heavy manufacturing, which is subject to high costs and
intense competition in Australia. At the time the company was going through a capital restructuring
with a $300,000 20% equity injection and a $200,000 loan from BLEC1. The Australian Industry
Development Corporation was also close to finalising a long term loan facility for the company. In
1975 the company was turning over $6.8m when Aquila Steel acquired a 50% holding after the
Favelle Mort as it was then known made an accumulated loss of $181,106 and was put into
receivership.
Favelle Favco had mixed fortunes from 1975 with Ted Favelle moving away to start a new company
operated as EH Favelle, but that went out of business in 1985. Favelle Favco could be a classic case
study in how innovation, global recognition, capitalisation, manufacturing, insolvency and succession
1

BLEC was a fledging venture capital business owned 60% by Westpac and 40% by UK group Industry PLC.

planning affects so many of Australias engineering businesses. Fortunately Muhibbah Group

emerged as new owners in 1995-6 and the fortunes of Favelle Favco have since realised their
potential. For interested researchers extensive history of the company is maintained.
Today Favelle Favco undertakes most of the groups engineering design, manufacturing of winches,
power packs, hydraulic, electrical and pre-assembly load testing at the Sydney Preston engineering
works. There is still some cutting and welding of specialist
components such some jib and butt sections. Off shore,
the Malaysian operations engage the expertise of
Muhibbah s ship
building and
welding expertise
to manufacture the
machine decks,
jibs, rope drums
and tower sections.
Other components such as the driver operational cabins are
made in China. Lifting ropes from Japan and the US and
Robello rings from Germany. Australian cranes are mainly
diesel powered while the European Kroll cranes provide the electric driven crane expertise. US
technology is also incorporated in the digital side of electric crane controls allowing for more
sophisticated diagnostic capability and off-site fleet management2.
Here manufacturing of a jib section and pre-delivery for a new M440 crane for Lend Lease at Preston can be seen.

The purpose of my visit to Favelle Favcos Preston facilities was to enquire about where high rise
building crane technology and capability had evolved too and what implications this may have in
helping to improve productivity at the construction site. I have had a long history using Favcos as
they are commonly known in the industry. Concrete Constructions was a big user of Favco 350, 450,
750 and 1500 cranes on projects such as the Sydney Hilton, Centerpoint Tower, the AMP Centre and
New Parliament House in Canberra where I was the Construction Director. There we used two
Favcos in tandem to lift then major 22t section of the New Parliaments 200 tonne stainless steel
flag mast into position. Typically a Favco 450 could lift 4.5 tonne at 33m (100 foot) jib radius.
Interviewing Favelle Favcos Customer Service Manager Ben Ting I asked about what the coming big
leaps in crane technology and capability might be. I was also shown over the Preston site by a
Project Engineer Alex Rios who has a BEng (Robotics & Mechatronics). So you can see where this
may all be going. Favcos have come a long way in capacity. A typical construction crane these days
would be an M440D (Diesel) which can lift 16t at 33m radius and 32t at 16m. Greater capacity is
available in the standard M600D, and M2480D which recently did the heavy lifting at Frasers Central
Park residential development at Broadway, Sydney. The M2480 can lift 330t at 14.4m radius and
110t at 38.5m radius. So capacity is not an issue given the heavy lifting needs of some of Shells and
other resource customers off-shore oil and gas platforms which can now require 1000t capacity.

More information can be found at http://www.favellefavco.com/main-australia.php

Favco responded to the question of where is it all going with a few pointers. Firstly many of the
developments are client need driven. Clients like international Australian specialist lifting and hire
Marr Crane Group challenged Favco to modify designs to the M1280D meet special project needs on
projects such as the Burrinjuck Dam enhancements and the M1680 for refinery projects in Kurnell,
Sydney and Doha in the Middle East. Favco are currently building a special crane with a heavy duty
auxiliary jib which will allow a client to do close in heavy lifting without having to re-rig the setup
from their general full jib load arrangements.
Favco believe that the basic geometry of their cranes will not change much. Increased lifting capacity
will come from smarter physics in design and the return of hook speed for the next lift. This will help
productivity and facilitate the next generation of cranes on super high rise buildings where they
envisage 100t lifting requirements to 1000 meters above the street level. These buildings are already
on the drawing boards in China and the Middle East. Electric powered cranes will see earlier
enhancements in quietness, remote monitoring by satellite and black box e-logs.
New capabilities in recovery crane drives and gearboxes have also been required.
So what does all this mean for Australian construction industry productivity?
The use of tower cranes in Australian construction has been dogged by industrial anarchy given that
virtually all lifting on high rise projects is dependent on crane driver and rigger productivity.
Unfortunately the activities of the FEDFA, BLF and more recently the CFMEU have constrained the
potential of cranes in helping to improve construction productivity. Instead crane crews have been
able to lever extraordinary wages and conditions by holding builders to ransom. These unions saw
off the use of steel structures for high rise construction in the 1970s and 1980s due to constant
disruption and demarcation disputes. The demise of structural steel manufacturing in Australia has
in part been affected by construction now using insitu concrete construction methods which have
less dependency on cranes. This unfortunately limits the potential productivity in construction.
In the mid-1990s I witnessed major innovation and productivity on construction projects in Japan. An
Obayashi project in Osaka demonstrated how the Japanese construction industry was responding to
a steep decline in skilled construction workers, the rising costs of onsite construction overheads and
craft based assembly practices, the slow speed of construction which was heavily weather affected,
the need to reduce construction waste and to improve safety. The project I visited comprised 56
floors to deliver 200,000m2 of floor space in 19 months, including basement excavation. The project
at the time was advanced to the 45 floor, was on schedule and the bottom 30 floors occupied and
earning income.
Obayashi were using one 100t crane. The building was being assembled into 3 floors by 2 bay
structure components at ground level. These incorporated metal floor formwork, reinforcement,
services rough-in and external faade provision. Obayashi reported that they had reduced the
overall on-site workforce by 30% as a result of integrating off-site manufacturing value ads and coordination. The internal hoisting needs of a traditional project were halved by arranging all material
lifting at night and only allowing workers to use the hoists in the day time. The project generated
almost zero waste, had not reported a lost time injury and was achieving just in time production and
quality that was normal for their auto industry.

The project was being delivered over 30% faster than by using traditional construction methods. The
building faade enclosed the building as it went up reducing the effects of weather delay, and the
buildings economic return commenced approximately 50% ahead of norm. The public perception
was that the building looked finished from the street level through most of the construction phase
and went a long way to overcoming the image of construction as dirty, dark and dangerous.
During my European construction tour in 2012 I looked for similar innovation and productivity
achievement. This followed my thinking about why the cost of Australias construction is rising
ahead of all other sectors of the economy and why the productivity agenda for new enterprise
agreements was almost non-existent. The report of this trip is available at Constructionedge.
The Favelle Favco visit confirmed a number of things in my view,
1. Favco Favelle shows how Australian engineering innovation can form a successful
component of an international engineering operation just as long as Australia can continue
producing world class engineers through its universities and colleges,
2. There is no engineering capacity constraint on Favco cranes lifting larger assembled
components on construction sites like those witnessed on the Obayashi construction
project in Osaka,
3. Australia is now confronted by a steep decline in qualified trades people and technically
experienced managers coming through its trade college system now contributing to the
rising on-site cost of construction that affects the viability of all new projects,
4. Construction productivity in Australia remains constrained by project procurement methods
which sustain a fragmented supply chain and fails to establish an innovative productivity
agenda aimed at increased multi-skilling with fewer craft based demarcations across the
professions and trades, and
5. Until government and informed buyer leadership is exerted to establish fundamental
construction productivity measures which arrest the rising cost of projects then further
competitiveness pressures will be placed on all other sectors of the economy.
Clearly Favelle Favco is not a constraint to helping improve Australian construction industry
competitiveness and improved project productivity. Favco is a customer driven enterprise which
only needs to be asked whats possible.
Next time you look up and see a Favco crane atop a construction site its worth reflecting on the
world class engineering, integrated global supply chain and just how far Ted Favelle s vision for
Australian cranes has come.
Report by:
David Chandler OAM has a distinguished career in Australias construction industry. He was the Construction Director of Australias New
Parliament House and is widely acclaimed for ensuring its successful completion in 1988. His experiences include responsibility for major
projects and construction businesses in Australia and around the Pacific Rim. He has performed roles as program director, CEO, board
member and Chairman of a variety of public and private organisations with positive results.
He has been at the forefront of construction industry leadership through roles in establishing the Australian Institute of Project
Management, a member of the former CSIRO Construction Engineering and Mining Advisory Board, service on various working groups
advising on matters related to builder licencing, university course accreditation, affordable housing and urban development. He was
awarded an OAM for services to the construction industry and was a fellow of both the Australian Institutes of Building and Engineers
Australia.

Mr Chandler provides independent advisory for construction clients and businesses in Australia and around the Pacific Rim. David has a
specific interest in challenging Australias construction industry to improve its capabilities, cost effectiveness and innovation.
Follow Davids construction industry insights at www.constructionedge.com.au

A few more Favelle Favco images:

Favelle Favco: Early beginnings 1923

Sections of M 2480D Crane with maximum lift capacity of 330t at 14.4 meter radius 3

Crane sections provided and copyright to Favelle Favco contact: www.favellefavco.com