ECE Performing Well with Right Marketing Strategies

Rajinder Raina
"After a prolonged period of slump, the CE market is expected to witness sustained growth in future with government awarded roads and other development projects such as Smart & AMRUT cities. The demand for new equipment like road repairs & maintenance, cold milling and recycling, compactors, and PTRs will grow where reliability/up time cost of operation & safety will move centre stage. We, at ECE, understand that the best way to address the market, during lull period, is to ship shape the organization with an idea to reduce the cost without compromising quality. We achieved success which is evident from the fact that ECE performed better than the Industry. This will go a long way as the markets pick up and customers become more demanding. The task was tough but we came out well. We've even improved our existing products and also developed new ones for future requirements," says Mr. Rajinder Raina, GM-Marketing, ECE in an interview with S. A. Faridi.

What is your overview about the CE market in the coming years considering the Government's initiative to fast track project clearances, and also announcing an investment of Rs.5 lakh crore in road development projects and around Rs.1 lakh crore in Smart and Atal Mission for Rejuvenation and Urban Transformation (AMRUT) cities projects in the next five years?

CE market suffered a prolonged slump, in the past three years, wherein the market has gone down by a whopping 35–40%. The current dispensation looks earnest, busy, and keen to see things happen. If we look at the road sector, for the quick approval of projects, MoRTH has been empowered to approve projects worth Rs.10 billion and above as against the earlier constraint of Rs.5 billion. Owing to low offtake on PPP based projects; the government has resorted to EPC model. NHAI has awarded more than 80% projects on EPC basis in the past 18 months. The government is seized off the need to rebalance risk and other attendant hazards in PPP projects and therefore is working out on an appropriate exit clause in various project allocations. This is what will make Rs.5 lakh crores investment a reality.

The last 3 months have witnessed an arrest of degrowth /marginal growth in some sectors. Road Construction equipment in particular has seen some decent growth. As the projects get awarded, the market will witness sustained growth in future. The government outlook for 30Km/day in next 2-3 years looks doable as it remains a priority area for PMO. The concerned minister and the secretary are personally involved. Projects like AMRUT and Sagar Mala being Mega projects, the next 5 years hold promise. The ease of FDI and slowdown in China makes India a favourable destination whereby funds should not be a constraint for infrastructure projects in particular.

In the current slowdown spell, how has the company been able to handle pessimism both within the company and outside, and remained focused to perform and contribute to its business targets?

The last 3 years were pretty tough for all the Industries and infrastructure sector suffered equally if not more. ECE had a task in hand and the best way to address the market was to ship shape the organization. We set about a clear cut task of bringing down the breakeven point by revisiting all the operational areas. The Idea was to reduce cost without compromising quality. One of the best global consultants was engaged to streamline processes, cut flab & make the organization deliver more to all its stakeholders. The proof of the success was evident from the fact that ECE performed better than the Industry. This will go a long way as the markets pick up and customers become more demanding. The task was tough but we came out well. This period also helped ECE to improve the existing products and also to develop new ones for future requirements.

Escorts TRX1550

With the focus on sustainable infrastructure construction, how do you see the shift in demand trend of advanced CE equipment in the market?

Indian market continues to be price sensitive and not much would change in the next 3 to 5 years. The size of high-end technology equipment will grow but not very significantly. Demand for new equipment like road repairs & maintenance, cold milling and recycling, compactors of more than 12 ton capacity and PTRs will grow. Reliability/up time cost of operation & safety will move centre stage.

ECE is one of the prominent material handling equipment manufacturers. Nowadays, ease of operation, safety, and reliability have become vital selling points. What innovative features are being added in ECE products to have an edge over competitors?

India essentially remains a market of low skill sets on the machine operating front. A lot is being done on skill development but it will take time. Since the operators work for more than 8hrs a day, the machines need to have built in safety systems like audio visual warnings & auto shut offs. The visibility for the operator along the entire load profile & around the machine area has to be optimum to avoid accidents. The operating controls have to be such as to reduce the fatigue of the operator. The cabin needs to be spacious with option for AC, a music system, a mobile charger etc.

Our cranes, by design, have much higher factor of safety compared to the competition on all three planes of load handling. The abuse value is high with fool proofing in various operations. This reduces the reliance on operator alertness.

Roads & Highways sector looks promising in the coming years and developers are looking for productive and reliable machines. How is ECE positioning its equipment to serve the purpose?

Escorts EC 5250
Escorts offers two soil compactors ECE5250 (10Ton Class), ECE2420 (12.5T Calibre), HD85, Tandem Vibratory Roller, and EC3664 (3T mini tandem roller). These products incorporate the best in class hydraulics and other aggregates with Indian Engines conforming to BSIII norms of emission. The fact that ECE 5250 has been around for more than 30 years is the proof of its reliability as its resale value. ECE2420 is a preferred product for national highways, expressways and airports. Today, the productivity is linked with cost of production. Our compactors have the lowest fuel consumption per km road compacted which gives a decent saving as 60% of cost of production goes into fuel. Our service network of 150 Outlets includes places like North-East, Kargil, and outskirts of Kashmir. This not only ensures maximum uptime but also allows the hirers to have the confidence and commit 95% uptime and above. Director General of Border Roads has been repeatedly buying our machine as they are fully satisfied with our services and parts back up in the Border Roads.

How are your backhoes technologically superior and offer better working experience?

Our Backhoe Loader DigmaxII offers technology which is optimum and appropriate for the Indian work conditions and applications. It is the only backhoe loader which delivers equally high efficiency in good earth, mining and river bed sand excavation. The highest dumping height makes it compactible with dumpers of all make and the reach on the backhoe stands-out. Productivity/hour and the cost per unit material excavated are the two winning performance parameters of DigmaxII. The equipment monitoring system on DigmaxII has been so well accepted that others are following suit.

Productivity, fuel efficiency, operators safety, and comfort are few mantras now a days when one chooses a compactor, but still initial investment plays a big role.How does ECE manage both ends to retain its leadership in road compactor segment?

Our road compaction equipment are well priced but of late some players have gone flat out on dropping the prices. This has made our job a tad tough but we are still able to make it by diligently explaining to the customers the cost of parts and availability of service network, particularly because compactors keep travelling and migrating from place to place.

ECE is the exclusive distributor of one of the premium tower crane manufacturers Comansa; how do you see the market of such high-end crane? Would you please shed light on its technical attributes?

As rightly put by you, Comansa offers flat top tower cranes. The demand for tower cranes in India has still not matured for the premium segment and it will take some time particularly because the real estate is yet to see a revival. It will continue to remain a niche product but we value our partnership with Comansa, the product and its role in the major projects.

Being the fastest growing economy, India is attracting attention of all the world powers, paving ways for the entry of several global players in the country. What are ECE's strategies and initiatives to retain its market share in this highly competitive environment?

The Indian Growth potential has been factored in by all the global players. You name a company and they have a direct or indirect presence in India. This includes the leading names from China, Korea, Japan, Europe, and US. All product categories have more than 5 to 6 leading players which makes the market place a battle ground. All segments have one dominant player and no player has more than one star product. The price sensitivity is there to stay, in such a challenging parenthesis. ECE has a clear cut road map where Pick & carry cranes shall continue to be our mainstay with continued effort to consolidate our leadership position. On road compaction products, we are ready for our targeted slice of the market. Digmax II, having entered into the market late is already amongst the top five & has a potential to keep moving past the nearest competitor. The expanse & the robustness of our dealer network gives us a distinct edge.
NBM&CW November 2015
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