Professional Documents
Culture Documents
Amit Gossain
onstruction equipment major JCB continues to focus on expanding its footprint in India. The company has always prided itself on the technological superiority of its product range, a belief that saw it recently launch its new 3DX backhoe loader model, surprising many industry pundits who were talking about going slow in these times of recessionary trends. It has also achieved the remarkable distinction of having sold over 100,000 machines in the Indian construction marketplace. In a freewheeling interview with The Masterbuilder its Vice President Marketing & Business Development, Mr. Amit Gossain tells us what makes JCB Indias products tick in the increasingly competitive Indian CE industry. Here are excerpts from the interview. JCB is today an iconic brand. Ask any adult to imagine a 'digger' and they will without doubt recall an image of a bright yellow piece of JCB earthmover. How have you been able to exploit this global persona in the Indian Marketplace? Actually we have our share of young fans as well! So it's not only adults who generalize JCB with diggers. JCB is known to be the leader when it comes to performance, innovation
VM115 Compactor
96
Industry Interaction
How does independent rental fit into JCB's plans? At present, the rental channel is largely unorganized and dominated by plant/ equipment hirers and small contractors in India. We are currently not involved in the business of equipment rentals. We supply machines to our hirers who in turn are in business of hiring and renting. In what way do the issues like taxation, problematic inter-state movement of goods and lack of adequate transit infrastructure affect your activities and plans? What hopes do you have from the govt. in future? Issues like these have been a cause of concern for some time but we have been witnessing a change now as our government is taking all the necessary steps to create business-friendly environment for companies. In addition to the ongoing policy reforms, the government needs to clear important national infrastructure projects without delay by addressing issues of land acquisition, dispute resolution and awarding contracts under clear PPP framework. The ecoMax engines have been a huge success. Will the percentage of your own machines that use JCB engines continue to increase? The company made an entry into engine manufacturing not only to make the products cost competitive, but to ensure that our customers can get the machine and engines serviced at our dealerships hence making us a one stop solution. The new engine plant has been set up with an intention to indigenize the JCB's engines featuring our own standards that would go into
our backhoe loaders, wheeled loaders, and other models from India's largest range of earthmoving and material handling equipment. At present the ecoMAX engine powers our range of backhoe loaders, wheeled loaders, compaction equipment and part of our excavator range. We will plan to launch more products with JCB engines in the future. Accenture study had estimated that the industry is slated to grow at 1617% CAGR from $3.3billion in 2010 to $20-25 billion by 2020 or from 60,000 to 3, 30,000 units. How realistic do you find this estimate and how ready is JCB to exploit this opportunity? The Infrastructure sector in India is passing through one of its exciting phases today, the immediate concerns notwithstanding. The Indian construction equipment market is a booming market and has a lot of potential for growth to reach the desired world class level. Moreover the recent report released by CII in consultation with Accenture says that with the increased participation of the private sector we expect the industry to increase from ~ 25 percent to ~ 38 percent over the next decade. Public sector has and will continue to play an important role in the overall growth trajectory of the infrastructure sector in India. JCB India is all set to leverage this opportunity. We have recently invested in upgrading our facilities at Pune and Ballabgarh and our dealerships continue to invest in their facilities to gear up for the future. JCB has doubled the number of parts and outlets in the past five years from 200 to 450, though appreciable, are such strategies instigated from the threat posed by rapidly growing contenders like CNH? At present, JCB has 57 dealers and over 450 outlets in the country. We have the strongest and the largest distribution network in the country and the main objective of establishing such a huge network is to provide unparallel service to our customers. Our distribution
network is one of our major pillars of success, and we will continue to expand it and our dealers will continue to expand as they have the volumes to support it. The objective is to go deeper and deeper into India, which means going as close to our customers as possible. We have over 5500 people who are employees of our dealers, but who are trained by us for selling and servicing these machines. We want to be always available for the customer to provide immediate assistance whenever and wherever required. According to you what are the main factors that will drive the Indian construction equipment industry's growth in the next decade? To ensure smooth growth of the construction equipment industry, the government will have to take few steps such as simplification of tax regime, increased engagement of industry associations etc. to encourage growth. However, the main growth pillars for this industry are: India's expanding economy the reason for such radical economic growth is because of the increasing demand for commercial, industrial, institutional and residential infrastructure projects, a trend which is expected to continue in the coming years Mechanization - Though India is adopting the mechanized processes but still there is a long way to go before we become fully mechanized. For e.g. for material handling applications the use of Pelletization greatly increases efficiency, safety and output. There is a lot of scope here... Using machines instead of manual means also ensures that the job is completed in a safer manner. It is also imperative to educate the machine operators about the safety features.
98