CII International Conference on Construction Equipment

The first edition of the CII International Conference on Construction Equipment held on April 10th at Gurugram was focused on the theme ‘Sustainable Manufacturing and Resilient Technologies’. Over 250 participants attended the one-day event that held key discussions on topics such as establishing India as a global construction equipment manufacturing hub, robust and resilient supply chain ecosystem and technological advancement, automation & digitisation and Zero emission in CE industry. Experts in the Indian Construction Equipment sector enriched the sessions with their ground knowledge and industry insights.

Excerpts:

Sunil Khurana, Conference Chairman & COO, JCB India

To achieve success in manufacturing at a global level, it is essential to leverage digital technology for monitoring the processes so that they are optimised and effective. Moreover, OEMs need to take a multifaceted approach that encompasses product development, sales strategies, and offer solutions that are tailored to the needs of customers. Product innovation and development allows companies to be competitive and stay ahead of the curve. Our aim should be selling ‘solutions’ rather than just products as this will enhance our value proposition to customers.

There should also be an emphasis on following sustainable business practices. By prioritizing environmental, social, and economic sustainability, we not only contribute positively to society but also enhance our brand reputation and resilience in the marketplace. Collaboration and support from the government and industry associations are necessary in enabling Indian companies to be globally competitive. I also believe that by working together, the CE industry can overcome challenges and capitalize opportunities to ultimately drive growth and prosperity for all the stakeholders involved.

Manish Handa, President-Backhoe Loaders Division, Action Construction Equipment (ACE)

We've already witnessed significant investments in making construction equipment smarter by integrating it with technologies like IoT that facilitates efficient maintenance, operation and management of the tasks. We can follow sustainable construction practices by exploring alternative fuels such as battery-operated machines and CNG in our construction equipment. We have recently introduced India's first electric crane, highlighting the industry's progress in this area. In fact, many players are actively engaged in developing smart and sustainable construction equipment, and thereby paving the way for a greener future.

Another area of focus is skill development not only for boosting productivity but also for enabling a safer working environment. The Infrastructure Equipment Skill Council has, till date, trained around 10,000 operators, and many of the OEMs also offering skill development programs through company-owned training centres.

We also need to focus on Construction Equipment Intensity, which refers to the value of construction equipment sold for every $1000 of investment in infrastructure. In India, this figure stands at around 5, compared to 20 for Japan and 40 for America. This highlights the significant potential for India to enhance the penetration of construction equipment, potentially by 4 to 8 times. The level of mechanization in India also needs to increase further to accelerate infrastructure growth and to align with our goal of becoming a developed economy by 2047.

Rajiv Chaturvedi, Vice President – Sales & Marketing, After Service & Parts, HD Hyundai Construction Equipment India

The construction equipment industry makes a significant contribution to the country’s GDP, particularly, in sectors like infrastructure and mining. A significant portion of India’s consumer base is highly price-sensitive, which underscores the importance of generating raw materials and producing world-class aggregates. We believe that we can keep costs under control through in-house production and through strategic collaborations we can offer competitive pricing without compromising on quality.

Our aim is to manufacture 60% to 70% of our equipment in India while maintaining world-class standards. Achieving this is crucial if we want to become the preferred choice for customers. Having a well-equipped R&D center is a necessary investment for innovating and for upgrading our equipment. By employing world-class engineers and using cutting-edge technologies, we can produce high-quality products that can compete on a global scale. To excel in global markets, we must first pass the rigorous tests set in India.

Abhimanyu Sharaff, Vice Chairman, CII Haryana State Council & Executive Director, Sanden Vikas India

Manufacturers have introduced IoT-enabled equipment, telematics systems, and digital platforms to enhance equipment performance, improve productivity, and enable remote monitoring and maintenance. Furthermore, the quality of equipment is not only increasing quantitatively but also qualitatively. Modern equipment is becoming more efficient, incorporating rich features, and addressing human comfort and safety concerns. This focus on innovation and improvement underscores the industry's commitment to delivering high-performance and safe equipment for construction projects.

While the operation of construction equipment necessitates skilled and trained operators, we do face challenges due to the scarcity of skilled manpower. Despite this challenge, the construction equipment sector is experiencing significant growth, with India currently ranking as the third-largest supplier. By 2030, it is projected to become the second-largest supplier globally.

Vikas Sachdeva, Head-R&D, Escorts Kubota

The high upfront costs of automation and digital technologies can be a significant barrier, especially for smaller construction firms with limited budgets. Transitioning to new technologies requires users to acquire new skills, which appears time-consuming and costly. The construction industry has traditionally been slow to embrace new technologies, due to customer preferring traditional technology.

Shantanu Roy, Chairman & Managing Director, BEML

Efforts are being made to develop hybrid excavators that can utilize regenerative power from braking systems to charge batteries, as well as incorporate solar energy charging capabilities. Moreover, there is growing interest in unmanned equipment and autonomous vehicles, where digitization and artificial intelligence play pivotal roles.

Furthermore, the government has been actively focused on reducing supply chain and logistics costs across various sectors. Numerous initiatives have been introduced to streamline processes and optimize logistics operations, ultimately driving efficiency and cost-effectiveness throughout the supply chain.

The government is aware of the high borrowing costs and challenges in accessing finance that can impact the competitiveness of Indian exporters, and is working to address them. Initiatives are being undertaken to reduce borrowing costs and facilitate easier access to finance for exporters. Additionally, the acceptance of the rupee in other countries can also help in facilitating transactions and reducing currency exchange risks.

Anil Lingayat, Business Head-Material Handling Business, Godrej & Boyce Manufacturing Co & Secretary, Society of Indian Material Handling Equipment Manufacturers

Currently, India sells around 54 forklifts daily, whereas China produces a staggering 2000 forklifts every day. This vast difference in production reflects the significant potential for growth in the material handling sector, considering China's economy is about three times larger than India's, with the industry's size approximately 40 times bigger.

This disparity presents a clear opportunity for India to bridge the gap and catch up with global standards in the material handling industry. We anticipate this transition to occur rapidly, given the changing landscape and increasing demand for material handling equipment. A few years ago, India wasn't in the electric drivetrain industry, but now it leads. Capability is there, it's a matter of shifting will and establishing partnerships with companies. With this approach, there's no reason why India can't reduce its 25-30% imports by producing locally.

Sanket Virkar, Vice President-India (Advance Manufacturing) JCB India

One major challenge for construction equipment is the technological differential required for machines used in different parts of the world. This poses a challenge to Indian in becoming a global manufacturing hub, as catering to diverse technological needs demands a wide variety of products. We understand this challenge well, as we supply to numerous countries with varying technology requirements, often relying on imports for critical and proprietary components.

The complex supply chain is another challenge as is a lack of focus on innovation. Many manufacturers approach innovation with a mindset geared towards assembly or manufacturing, which may not be conducive to fostering indigenous innovation. To truly become a global hub, we must prioritize innovation and design, rather than simply adopting technology from elsewhere. Logistical costs are a commonly discussed issue and are a barrier to realizing our goal of becoming a global hub. The current erratic nature of logistics costs is particularly detrimental to our efforts.

Gurbinder Singh, Procurement Division, ACE

Supply chain visibility is crucial for reducing procurement costs, ensuring efficient resource allocation, and creating pooled procurement opportunities, which can lead to significant cost and time savings. Supplier collaboration in product engineering reduces costs with improved total ownership cost. This partnership reduces board to road time of product with enhanced application features.

A collaboration-driven value chain is key to an efficient supply chain. Upstream and downstream collaboration is key to operate a lean yet efficient supply chain with best-in-class customer serviceability index.