Kobelco Construction Equipment India has launched three new hydraulic excavator models in the 19.1-24-tonne category as it expects India’s excavator market to grow by about 3 per cent this year, supported by State government spending on urban development, irrigation and rural roads.
The new models were launched on Friday and are being manufactured at Kobelco’s facility in Sri City, Andhra Pradesh. The company said the range is aimed at mining operators, large road contractors, smaller contractors and equipment rental companies.
Moses Eddy, Director, Kobelco Construction Equipment India, said the market for hydraulic excavators, excluding mini excavators, is expected to rise from about 31,000 units last year to between 32,000 and 33,000 units this year. The projected growth comes despite a slowdown in the execution of projects by the National Highways Authority of India.
According to Eddy, spending by State governments on urban development, irrigation and rural roads is helping support demand for construction equipment. Kobelco is seeking to expand its presence in parts of Jharkhand and Maharashtra, where smaller contractors and equipment rental companies are looking for more economical machinery.
The Sri City plant has an annual production capacity of 3,500 units and has manufactured more than 20,000 machines for domestic and export markets across more than 16 countries. Kobelco has invested about ₹900 crore in the facility since 2011. Current production is estimated at 2,800-2,900 units a year, and the company expects to reach full capacity in around two years, depending on market acceptance and export demand.
Exports account for roughly one-third of the company’s volumes. The Middle East, Africa and neighbouring countries are among its target markets. Jun Hayama, Managing Director, Kobelco Construction Equipment India, said the launch coincides with the company completing two decades of manufacturing and engineering operations in India.
The new excavator range has a localisation level of 68 per cent, up from 48 per cent in earlier models. The increase has been driven mainly by the use of a locally sourced Cummins engine in place of the Hino engine used previously. The change links the product launch to the wider effort by equipment manufacturers to increase domestic sourcing and reduce dependence on imported components.
KCEI reported turnover of more than ₹2,000 crore last year and expects revenue to reach ₹2,400-2,500 crore this year, Eddy said. He also expects changes in government tender norms and quality standards to improve infrastructure project execution in the coming months.
The company continues to face external risks. Geopolitical uncertainty and shipping constraints could affect exports, while competition from Chinese manufacturers remains a factor in the Indian market. Eddy said Chinese manufacturers had expanded overseas sales partly because of excess capacity following the slowdown in China’s real estate market. Their share of the Indian market, which had risen to about 40 per cent, has since declined to around 33-34 per cent, he said.
Kobelco’s next capacity milestone will depend on market acceptance of the new models, export demand and the pace of infrastructure project execution across the sectors identified by the company.
