Home Articles New Buoyant Market Trends Point to Period of Rapid Growth Ahead

Buoyant Market Trends Point to Period of Rapid Growth Ahead

215

MB Bureau Report

Now with the general elections over and a stable government in place, the Indian construction equipment market is looking all set for a period of sustained growth. With the right kind of signals emanating from different sectors, the pace of work on projects, both minor and major, is expected to pick up steam going ahead. All this promise plenty of action in the excavator’s market segment, for they are the ones that will be playing a key role in the initial earthmoving phase of projects. Excavators have emerged as one of the fastest growing product segments within the Indian construction equipment market. They are next only to the backhoe loaders when it comes to the sales in the earthmoving segment. In fact, the country is now counted among the top consumers of excavators. This is not surprising given the gradual evolution of the market. The gradual increase in the scale of projects has meant that there has been a spurt in demand for excavators.

While the backhoe loaders still continue to rule the roost, which is a phenomenon that is unique to the Indian market, the trends could change a few years down the line, given the increasing scale of projects and the high volumes of earthmoving that is involved, particularly in the case of infrastructure and mining projects. Another demand driver has been the increase in large scale residential townships too, where again excavators are playing a key role. With the emphasis on affordable housing projects, this points to further demand for excavators down the line in the near future.

If you were to drive down Indian highways in recent times, excavators have become an increasingly familiar sight. While earlier they were few and far between, these days even the small contractors, who were hitherto hesitant to use them, are now realizing that in the long run, they make more economic sense, with their ability to move large volumes of earth in quick time. In fact, this is one of the reasons for the influx of several models of compact excavators making their way into the market over the last decade or so. The reluctant smaller contractor has been emboldened to try out these sleek machines, instead of relying only on the good old backhoe loaders.

Buzz around mining

The buzz around the mining sector is another thing that is keeping earthmoving equipment manufacturers happy. A lot of positive signals are emanating from the sector. Further reforms are expected in the mineral exploration field in the near future. High capacity crawler tractors have always been the staple of the mining sector. Almost all leading excavator player in the market in India is now eyeing this particular market segment. The niche over 50 T capacity excavators are all set to dominate the mining sector in the days to come.

The growth story of excavators in the mining sector has also been made possible by the availability of corresponding heavy hauling equipment in recent. Huge mining trucks and wheel loaders jostling for space with the heavy-duty excavators in mining sites is fast becoming a familiar sight and augurs well for the future of the market.

 

Intensifying competition

The excavators market segment has been one of the most intensely competitive among the construction equipment market in the country. This is not surprising given the demand for the product. What this has meant is that there is a wide range of excavators available across different capacities. From the mini to compact to the heavy ones, customers never had it so good. Almost every globally renowned player is now eyeing their share of the pie in the Indian market. Some of the top names that are vying for honours include JCB India, Caterpillar India, Volvo CE, Hyundai Construction Equipment India, Liugong India, Tata Hitachi, Sany, etc., to mention only some.

Discerning Customers

The evolution of the Indian market for excavators makes for interesting read. It has been in a way mirroring the trends that were witnessed in the developed countries earlier. While it still continues to be a price conscious market, there are other criteria that customers are applying when shopping around for these mean machines. The players in the market too have taken note of this and are offering solutions accordingly.

After market services for example has emerged as a key differentiating factor. They are particularly important in the case of excavators, because these machines work in some of the harshest environments and wear and tear of parts is therefore common. Every leading player in the market is now ensuring that there is a widespread network of service points available throughout the country. Similarly, prompt availability of spare parts is another key aspect which is being done.

A rapidly discerning customer is also demanding technology that helps him keep track of his machine and ensure minimal downtime. A lot of work is being in the field of telematics and hydraulics by the leading players. Preventive maintenance seems to be the buzzword among construction equipment manufacturers these days. With rising competition manufacturers are now under increasing pressure to come up with newer features and technologies at more frequent intervals of time.

Potential new segments

The emergence of niche market segments is another good news for the manufacturers. A good example if the now booming market for redevelopment projects. They have become a necessity given the choc-a-bloc urban congestion of Indian cities. Demolition of old buildings to bring up new real estate projects is the trend that is being witnessed. Again, this is an area where excavators play a key role, albeit with certain modifications to their boom design. While globally certain brands have been offering specific models for high-reach demolition, in India demolition contractors have been depending on indigenous fabrication to modify excavators for the purpose. However, given the rise in demand, there could be a few manufacturers who may be eyeing this particular market segment and come out with their models in the near future.

Similarly, with the rising focus on water bodies, there is also a ready made market available for amphibious excavators in the country. With cleaning and dredging of water bodies becoming an area of concern, given the water scarcity situation in different parts of the country, this is another market segment that manufacturers could explore in the coming years.

There is also palpable excitement in the air on the entry of hybrid excavator models too. With a lot of R&D being now focused on them, it is only a matter of time before such models make their entry into the Indian market.

Growth curve ahead

There is no doubting the fact that the excavators market segment will be one of the most intensely competitive going ahead. With India expected to emerge as a globally key market for these machines, this is not a surprise. Almost every leading player has set up shop in India to be near the customer. This by itself reflects the positive sentiments that are prevailing towards the potential of the Indian market. Along with being closer to the customer, companies are also looking to do research and finding out how best they can make manufacturers suited to the requirements of the Indian customer. A lot of R&D is happening in the field of excavators, thanks to the presence of top global manufacturers in the country, who have the financial might, technical wherewithal and the manpower to be ahead of the curve. The typical Indian customer as we have seen has become more technology savvy. They are now much more well travelled and want the best that is available globally. The manufacturers on their part are not disappointing them. With the result there is a wide range of excavators available across different capacities. The customers are now looking at value additions when making their final purchase decision. This is not a surprise given the fact that contractors are under pressure to deliver projects, on time and within budget. Customers are therefore taking a closer look at things such as the technology behind the machine and how soon is the payback time.

As we have seen elsewhere in the article aftermarket services have also emerged as key factor. In fact, it is an area that has become an exclusive focus area for manufacturers. The reasons for the same are not hard to fathom. India is geographically a diverse country and comes with its own unique set of demands. It has therefore become important for top brands to have a widespread network of sales and service centers, spread throughout the nook and corner of the country. The spread of projects is also such that it warrants a widespread network of service centers.

Another key reason driving forward the demand for excavators and for that matter every other type of construction equipment is the fact that the rentals and leasing scenario in the country is getting more organized. Earlier this was not the case. However, things are changing for the good now. In fact, rentals and leasing is fast becoming an increasingly competitive market segment by itself with several leading names now in the fray.

With infrastructure and mining projects expected to receive further fillip, what with the elections now over, all eyes are on the earthmoving market segment, particularly excavators. It is a market segment whose growth trajectory is being closely watched by leading global players. A healthy growth rate will mean more players will be keen to make an entry into the Indian market, giving the customers here a greater choice in the coming years. Given all these positive signals, excavators look all set for a period of rapid growth in the Indian market.

Image Courtesy:
https://en.wikipedia.org/wiki/Amphibious_excavator#/media/File:Building_duck_wing_terraces_with_heavy_vehicles.jpg
https://en.wikipedia.org/wiki/Heavy_equipment#/media/File:Tzama02.jpg
https://www.mackaycontracting.com/projects/ak-highway
https://www.heavyequipmentguide.ca/product/701/r520lc-9a
https://www.lectura-specs.com/en/model/con-struction-machinery/crawler-excavators-volvo/ec160el-11683503

LEAVE A REPLY

Please enter your comment!
Please enter your name here