Interview: Liechtenstein's construction giant Hilti Group cements China business

Construction and technology multinational Hilti Group, Liechtenstein's biggest employer, is upbeat on the industry's recovery from the COVID-19 pandemic, thanks partly to an improving building quality in China, its CEO said.

"The quality of construction, the digitization of construction, and the safety requirements of construction, they all increased significantly in China," CEO Christoph Loos told Xinhua in an interview at the firm's headquarters. "For us, China is an inspiration in many ways for how construction also will develop in other parts of the world."

Hilti is based in Schaan, Liechtenstein's largest municipality, and is the principality's largest employer. The company employs around 30,000 people in more than 120 countries worldwide.

China is the group's largest sourcing and production market, where Hilti counts 2,000 employees in five and soon six production locations, an important research and development (R&D) center as well as a sales and engineering team.

Asked about the business outlook in China, Loos said: "We expect significant growth from the core business that we have, we are involved in nearly all larger infrastructure and energy projects across the country."

"Next to sourcing and production and sales expansion, we've also invested significantly into our research and development setup in China, our R&D center in Shanghai is the third largest for us in the world."

Hilti supplies technological products to the construction industry and offers products for measurement, drilling, demolition, sawing, grinding, screw, direct mounting, battery technology, fire protection, and installation technology.

Doubly landlocked, Liechtenstein is the fourth-smallest country in Europe and lies in the heart of the Alps between Switzerland and Austria. Its population of around 38,000 people has one of the highest per capita incomes in the world.

The country's industry is heavily export-oriented and focuses on high-quality goods and services. Manufacturing, machine and plant construction, precision tools, dental instruments and the food industry are the main areas of activity.

The Hilti Group's sales for 2020 were 9.6 percent lower than in the previous year, totaling 5.3 billion Swiss francs (around 5.9 billion U.S. dollars). The operating profit decreased by 7 percent to 728 million Swiss francs due to the COVID-19 pandemic.

"It's true, 2020 was a challenging year especially in the first half. Only a few markets were able to show growth, among them China. But now things are getting better, construction is recovering," Loos said.

"The biggest challenge that we see at the moment is the shortage of supply globally which many industries experience. From, you know, steel to chemicals, all the way to electronic components," he said.

In the first four months of 2021, the Hilti Group increased sales by 14.7 percent to 1,925 million Swiss francs.

The CEO also reiterated the target for CO2-neutrality planned for 2023 with a focus on circularity and the conversion of the worldwide vehicle fleet to more environmentally friendly drive systems.

"We have always acted responsibly, but we felt that this is no longer good enough and therefore we've developed a new significant ambition for us. And that includes this commitment to being neutral by 2023 on the carbon footprint," Loos said.

"We've converted to 100 percent green energy across the world, and we are in the process of converting our 14,000 vehicle fleet to electric and hybrid and natural gas, and the remaining 50 percent we will compensate with own projects that we are developing at the moment in India and in Africa," he added. (1 Swiss franc = 1.113 U.S. dollars)