Kobelco Cranes India Pvt. Ltd, a part of Kobelco Cranes Co. Ltd, Japan, was established in 2010 and commenced production of its first Made-In-India crane in 2012, the year it assembled its 100th machine at its Sri City plant in Tamil Nadu. The company manufactures hydraulic crawler cranes of 100-tonne, 150-tonne and 260-tonne class cranes. Yutaka Goto, in an email interaction with Sandeep Menezes, talks about the imminent recovery of the Indian crane market in the coming years.
Kobelco India was established in 2010, started local production in 2012, and within two years reached its 100th machine. What is your long-term plan in India?
Yes, it’s a great achievement that Kobelco India reached its 100th machine milestone in two years. KCI is already the leading crawler crane company in India and the sole company to produce 100-tonne or higher crawler crane in India.
We are anticipating an increase in our volume and market share as the Indian economy starts to recover and the demand for 100-tonne or more cranes will increase in next three-five. Also, from early next year we plan to start the export of our ‘Made in India’ product.
We would like to fully utilise KCI’s facility to expand our business in India and its neighbouring countries.
We are sure our company will reach the 200th machine milestone in next one year due to recovery of the domestic market and the initiation of export.
Does Kobelco India intend to introduce new products or increase focus on any specific equipment segment?
We will continue to produce and supply the 100, 150 & 250 tonne cranes for the domestic market. Our company may produce different models for export from next year. We will focus on crawler and other crane business in India.
How much growth do you foresee in the Indian crane market over the next five years?
As the market in 2014 shrank to almost one-third of 2012, we may expect the Indian crane market to recover to the level of 2010 within the next three-five years. The main growth drivers are many infrastructure, metro rail, steel and power projects, more FDI in new projects, and new economic reforms.
What is the size of the crawler crane segment in the construction equipment market?
I guess, excavator and other road equipment are dominant in India. The crawler crane segment is less than 10 per cent within the construction equipment market.
Interest rates have started to soften though they remain high and most equipment sales happen through financing rather than self-purchase. Do you think it will boost growth in the industry?
Yes. In an emerging economy, it is very much needed to soften the financing options for all the projects to procure equipment. Even though interest rates in India remain high, their reduction from double digit to single digit will help motivate the sales of high priced product such as crawler cranes.
There is currently a huge shortage of equipment operators and technicians.
Of course, there is a shortage of skillful equipment operators and technicians in the country. KCI itself not only provides excellent customer support but also provides proper training to its customers’ employees to operate and maintain the equipment, including periodical training programmes to its customer’s operators and technicians.
However, that may not be enough to ease the shortage of operators we are now facing.
We may need support from government to provide training programmes to increase the number of operators for the construction equipment market.
India is not governed by stringent equipment norms like those prevailing in the EU and US. As a result, critics claim that global players dump lower end and older technology in India.
We disagree with this claim by the critics. Of course, you may find out the difference in engine due to the gas emission regulation. However, in terms of quality, Kobelco Cranes India is manufacturing world-class quality products in India, the same as in Japan. We produce and supply only top quality and reliable products in this country.