While the construction equipment industry has been impacted by slowdown, Subir Kumar Chowdhury, MD & CEO, JCB India has started to see the green shoots of recovery. The company, to strengthen its market position in FY20, is planning to invest in automation and diversify its portfolio.
The company currently has five factories in the country and has invested this year in its 6th factory in Vadodara, Gujarat, which will start running by the end of next year. While Backhoe loaders remain to be JCB’s flagship product, Chowdhury says, over the last two years, the company has invested heavily in excavators.
“We are gradually moving into power products — generators and the agricultural sector; these are the two portfolios we are readying. In terms of technology, we will continue to build on our ‘Intelli’ series, along with a new range of technologies,” says Chowdhury.
Chowdhury mentions that the company witnessed unprecedented growth in 2018 over 2017, which was, in fact, the best year for the industry, with 90,000 plus units sold and JCB alone selling 43,000 plus units.
“The entire segment that helped the growth in 2017, 2018 was roads, or to a certain extent, irrigation. Road projects declined in 2019; Payment to contractors emerged as an issue; NBFCs had immensely contributed to the scenario as our lending is largely through NBFCs. Also, we had the election year. These were the structural changes, which put together resulted in a slower 2019, but we are quite hopeful about 2020.”
The CEO believes that with the NBFC crisis behind now, banks have a better level of liquidity today, and structurally, the industry is getting more consolidated.
India market
The company’s market share in the country is about 50 per cent. Chowdhury says, ”The strength in our product, strength in our distribution and the technology we are offering, have helped JCB stay ahead in the market.”
India accounted for 47 per cent of the total global sales of units last year, while this year it was 42 per cent. The group, says the CEO, has always looked at India from a future potential point of view.
“JCB has believed in investing in India, even when there’s a downturn. For instance, in 2008-09, when there was an economic meltdown, we invested heavily; Again during the slowdown in 2013, we invested in the Jaipur factory and now in 2019, we are investing in Vadodara,” says Chowdhury.
Technology
JCB has recently launched its all new ecoXpert Backhoe Loader, with fuel savings of up to 12 per cent and up to 22 per cent lower maintenance costs at Excon’19, the international construction equipment and construction technology tade fair held in Bengaluru last week. The company has also launched its new range of side engined Telehandlers at the event.
“The new 3DX also comes with JCB’s ‘IntelliPerformance’ and ‘IntelliDig’ technology which will give customers real time information about the performance of the machine. JCB’s LiveLink - an advanced telematics technology is a key element of our product support. LiveLink benefits customers in better fleet management through remote monitoring and management of the machines.”
The company has a LiveLink command centre at its Ballabgarh (Delhi-NCR) facility. Presently, over 1,25,000 LiveLink enabled machines are working across the country.
One global quality
Chowdhury says, “We aim to give all the machines built under the JCB brand the same touch and feel. We started this almost 7-8 years back. We have exported to around 110 countries. Europe, Japan, Australia, North America and Russia are a really important market for us. Even before ‘Make in India’ movement started, for JCB, the whole theme has always revolved around ‘Make in India for the world’.”
Exports contribute 20 per cent to the company’s revenue.
Social connect
Mentioning that the company believes in giving back to society, he says “The brand is constantly moving towards social engagement. In 2014, when we launched the Jaipur factory, we had a clear idea that we want to work for women empowerment. We wanted to have at least 25% of women on board, and today we have 34% of women there. We take them through a strong training process.”
The company’s mission in the upcoming Vadodara factory is to have at least 50% women on board.