Finning International said it will take a low-risk approach in Argentina in 2024, though it has a strong outlook for Chile and Western Canada.
Finning said 2023 was a strong year for the company, adding 2024 will see the industrial equipment dealer focusing on its growing business in a “moderating growth environment.”
Finning said it is the world’s largest dealer of Caterpillar products.
South America Outlook
“While changes being made by the newly elected Argentina government have the potential to be positive in the long-run, the Q4 environment was very challenging,” said Kevin Parkes, the company’s president and chief executive. “We have taken action to significantly reduce our go-forward financial exposure and are taking a low-risk approach in Argentina in 2024.”
The company said a strong outlook in Chile “is underpinned by growing global demand for copper, the recent approvals of large-scale brownfield expansions, and increasing customer confidence to invest in brownfield and greenfield projects.”
Mining activity is expected to remain strong, the company said, adding it continues to see “healthy demand from large contractors supporting mining operations.” Finning expects infrastructure construction will remain stable.
“In the power systems sector, activity remains strong in the industrial and data centre markets, and we are well positioned to benefit from growing demand for electric power solutions,” Finning said.
The company said it has a positive outlook for Western Canada. “While the completion of major pipelines has slowed some construction activities in the near-term, it creates additional capacity to move heavy oil and liquefied natural gas to end markets, and we expect to see increased activity in the energy sector and production growth going forward,” Finning said. The company expects mining and energy customers to increase spending levels, “including investment to renew, maintain, and rebuild aging fleets.”
The company also said, based on customer commitments and discussions, it is anticipating strong demand for product support in the oil sands.
U.K. and Ireland Operations
“With the HS2 project deliveries completed and low GDP growth projected in the U.K. in 2024, we expect demand for new construction equipment to remain soft,” the company said, adding it expects “a growing contribution from used equipment and power systems as we continue to execute on our strategy.”
The company said it expects continued healthy demand for primary and backup power generation in power systems. Product support business in the U.K. and Ireland is expected to remain resilient, Finning said.
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