Japanese construction equipment major Kobelco has embarked on a phased consolidation of its manufacturing facility located at Sri City in Andhra Pradesh, while awaiting nod from the head office in Tokyo to take up next phase of expansion.
The construction equipment company, which has completed 10 years of operations in India, is upbeat on the country's construction equipment market with strong demand projected from roads and mining sectors.
Yutaka (Mike) Goto, Managing Director & CEO of Kobelco Construction Equipment India, said, “The 2000 units per annum manufacturing plant set up at Sri City is operating at near full capacity meeting domestic requirement mainly and some exports. We are now in the process of further enhancing the production by internal efficiencies.
However, given the huge demand from the market for construction equipment, we are looking at taking up expansion of the manufacturing base and are awaiting nod form the parent. It is under their consideration.”
Launching new generation mining excavator models SK220XD/SK220XDLC in the 20-24 ton segment, Goto said, “From the first day Kobelco started operations in India 10 years ago, we continue to provide innovative solutions to customers based on their feedback. The new models spread the message 'Power meets efficiency'.”
Kobelco Construction Machinery, the Tokyo headquartered company, founded in 1930, is a subsidiary of Kobe Steel Limited. The Indian arm of Kobelco has a capacity to produce about 2000 units per annum.
“With the manufacturing capacity almost hitting its upper limit, we are currently in the process of further improving productivity within the existing plant. Once this is completed, we will then take up new expansion,” Vikram Sharma, Advisor and former MD of Kobelco in India, said.
Referring to the construction equipment market in the country, in his capacity Indian Construction Equipment Manufacturers Association, Vikram Sharma said there has been gradual uptake for equipment in the past two years after about three years of slowdown. Starting with roads, gradually other sectors have shown positive growth. This will lead to more equipment sales.
Rajiv Sanghvi, Executive Director of Automotive Manufacturers, said, “The demand has steadily been growing for Kobelco equipment. Last year we sold more than 192 units in the AP and Telangana. With construction activity picking up, we see demand for Kobelco equipment going up in a number of sectors.”
The country's $ 3.5 billion construction equipment market sis witness to a rapid growth over the last year after three-four years of tepid growth. Given the focus on the infrastructure sector, the demand for equipment is projected to accelerate.