A veteran heavy equipment dealer told a Vancouver courtroom on Oct. 16 that he believes XCMG equipment was tampered with after 2021, while XCMG Canada denies the claims.
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Chinese state-owned heavy equipment manufacturer XCMG is facing multiple civil lawsuits in Canada alleging it defrauded equipment dealers through serial-number plate tampering, a veteran dealer said in Vancouver on Oct. 16.
Ryan Martin, who described his family’s experience with XCMG, said Arctic Machinery began selling XCMG equipment in 2017 and “business was good up until about 2021.” He told the court, “It’s destroyed our family” and added, “It’s destroyed our family business.”
Martin said Arctic Machinery has dealerships in Prince George, Chilliwack and Kelowna. He said the quality of the equipment changed several years later, and that other XCMG dealers raised similar concerns.
Martin said troubleshooting dealers concluded there was “a process of changing serial number plates and changing the years of the machines in order to maybe misrepresent to the end user what they were buying.” He gave an example: “It would be built in 2020, but really sold to us as a 2022 machine.”
The court also heard that in July, a Saskatchewan dealer filed a lawsuit against XCMG alleging unlawful tampering with serial number plates on equipment sold to it in Alberta earlier this year.
The evidence provided also indicated that LTR Equipment, based in Quebec, filed a similar case, and that a lift company in Ontario has filed a case with related allegations that serial numbers were tampered with.
In a statement, XCMG Canada said Arctic Machinery purchased approximately $18 million in XCMG-branded inventory that it “did not pay for,” and that XCMG is “fully defending the claims in the civil actions.”
Martin said his family business was forced into bankruptcy after XCMG called in its loans, which he said was retaliation for what he described as whistleblowing about the alleged serial number tampering.
Separately, RCMP in Alberta’s K Division confirmed that members of its auto theft unit conducted a search warrant at XCMG’s headquarters in April and that the investigation is ongoing.
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