Escorts Kubota: Diverse Fleet from Backhoe loader to Crane & Compactor

Escorts Kubota
Escorts Kubota, Sanjeev Bajaj - Chief Officer

At Escorts Kubota, we believe that upgradation of products, minimizing operational costs for customers, focus on quality & reliability are crucial in the field of infra construction. Hence, our aim is to ensure all these aspects are met, so that our machines always provide value to our customers.

It’s been nearly an year since Kubota Corporation & Escorts Limited, decided to join hands and become one company in India. This partnership has started adding a significant value to the Indian construction market by bringing in added strengths and values of both the companies. With Escorts Kubota’s deep understanding of market dynamics, extensive network of channel partners, and the fusion of expertise in product design, quality control, and production, we’re well-positioned to introduce something truly unique to the Indian market in all the aspects.

Anticipated Market Resilience amidst Election Dynamics and Regulatory Uncertainty

We anticipate that the ground-level demand will remain consistent, due to which the end-users/contractors will be optimistic of availability of construction equipment. However, at the macro level there are couple of reasons that might impact the demand briefly during early Q1 next year. Firstly due to general elections, there might be some slowness due to the code of conduct & short term disruptions in fund flow.

Secondly, there is still some uncertainty regarding the exact date of BS5 implementation. Once that date is confirmed, there might be some impact on the market due to price increase. Typically, every time there is a price increase due to change in emission norms, it takes some time for the new prices to stabilize with some initial dip in the volumes.

Besides these factors, I don’t foresee any dip in the government’s expenditure for infrastructure development and hence in demand for machines for the ongoing and upcoming projects.

Investing in Greenfield project to expand operations

In the last few years, we have witnessed a consistent supply-demand gap in construction equipment, with customers having to wait for products for 45 to 60 days or even longer, especially in the case of pick-and-carry cranes. We believe that our customers are working against stiff project timelines and we have to offer a faster delivery of factory fresh products. To meet this endeavour, we have recently invested to boost the production capacity within our plant as well as at our vendors.

We understand that in coming years the demand will grow further and hence in Escorts Kubota’s mid-term business plan, we have committed to establishing a Greenfield project which will set even higher benchmarks for quality & reliability. This project involves a substantial investment in setting up a world-class plant and engineering capacity.

We believe that the next decade is going to rewrite India’s growth story exponentially and our investments are a testimony to our commitment to meet the future demand.

Striking a balance between high-tech and value for money machines

Kubota’s strength lies in its equipment manufacturing prowess, designing, and in engine manufacturing. We are presently adopting the Kubota Production System (KPS) in our plants. This system defines the principles of manufacturing excellence. It will vastly enhance the efficiency of manufacturing in terms of productivity, inventory, safety, quality and the overall cost of production, thus delivering higher value for money to our customers.

Additionally, Escorts Kubota Limited is exploring synergies between global technologies available within the Kubota ecosystem and the possibilities for innovative engineering in India. For this purpose, an engineering services set-up is planned in collaboration with Kubota Global, which will come into existence in the near future. It will aim to address global engineering needs of Kubota Global as well as cater to future product line in India which will be Hi-tech and provide more value for money.

KPS

Building trust in global customers

Traditionally, the overall share of exports within the industry has been operating at around 8 to 9%, in terms of the overall volume. With the transition to BS5, there’s a big opportunity for India to grow this number as many potential international markets will open up. The cost advantage of manufacturing in India and selling globally is a benefit that’s likely to be sustained. However, what is important for manufacturers is to provide the necessary specifications required in global markets while adhering to the expected quality standards. Manufacturers today are already customizing products and tailoring the specifications for specific countries that have their own distinct norms, guidelines, and certifications, which may differ from those prevalent in India.

Duty cycles might be lower, so durability might not pose much of a challenge, but reliability, performance, safety norms, and aggregate performance during the warranty period need to be improved along with reducing the number of service interventions to build trust of global customers. Product reliability is imperative to succeed, particularly in the first few years of operation.

Exploring fuel alternatives

Kubota specializes in engines up to 120hp worldwide and consistently exploring new technologies. At our Greenfield project in India, we will focus on incorporating future technologies in our engines, including alternative fuels. We have already developed electric as a power source technology and have been exporting electric tractors for past few years now. During last Excon, we had demonstrated hybrid technology on cranes with CNG and diesel, but we believe that these technologies are to be timed and developed further for commercial introduction in the Indian market.

As an industry player, it’s our responsibility to reduce the carbon footprint in construction while also minimizing costs, considering diesel is a big expense. Most of the OEMs are looking at hydrogen as an option to power internal combustion engines, which seems very promising. Electric-powered machines are also a great idea, but need charging infrastructure and the power generated must be adequate to sustain a full day’s work.

Essentially, the cost of these technologies and their operational suitability will be the deciding factor in the time to come. Transitioning to alternate fuels or electric power can reduce project costs for our customers only if we ensure that the initial equipment cost is feasible for our customers. As the technology options are maturing, we will introduce them in the coming time with better feasibility and supporting environment.

Mini Excavators versus Backhoe Loaders

There can be differing opinions on this, but I strongly believe that the growth of the mini excavator industry, specifically in the up to 5-ton category, hasn’t significantly impacted the volume of backhoe loaders. This year, the industry is expected to reach around 3200 units for mini excavators, which is still low and cannot say it has dented the market for backhoe loaders.

As regards their application, the jobs which involved tight spaces or tricky corners which were being done by backhoes are better managed by mini excavators. However, it is difficult to quantify the exact level of substitution. Over the last 2-3 years, the backhoe loader volume has sustained the growth, despite mini excavators making inroads in the excavation space.

There are a few aspects in this segment which will have some bearing on customer choices in future, such as emission norms changes for BHL (excavators are not impacted), norms and ease of movement of the machines across between sites, ease of after sales service, knowledge and comfort level of the customers with the product type and finally the multi utility of the machine for varied applications. As of now, excavators in mini or mid segment are creating a space with newer applications and the growth is not at the cost of BHL volumes.

Enhancing soil compactors

The core technology behind tandems and soil compactors remains fairly similar at heart. However, additional features in these products can significantly benefit customers by making their work easier while cutting down on costs. For instance, our recently introduced variable RPM feature in soil compactors allows the machine to reduce RPM when not in productive use, thereby cutting fuel cost. Safety and fuel saving features like auto-idling, telematics, compatometers etc can also be integrated into the compactors for more value.

Owing to the monotonous applications, manufacturers in India and abroad have not significantly differentiated these products, apart from meeting different emission levels and adding some electronic features. There are newer technologies available for higher tonnage soil compactors with some in the testing phase, but we will not see a sudden shift to the higher tonnage/greater capacity compactors at present.

Transitioning to higher capacity, safer cranes

We have observed that traditional pick and carry cranes are losing favor in industries where stringent safety norms are becoming the norm. With the advent of BS5 technology, small capacity cranes will see a higher increase in cost, making it further shift to safer high tonnage cranes for some safety-oriented customers which are better designed, the trend which consequently is expected to catch up in the overall industry as well.

Customers prioritize certain crane types for specific jobs based on the project requirement which meet the safety norms. These equipment are not susceptible to abuse unless there’s operator error or lack of safe working conditions. Therefore, our focus remains on making our equipment more resistant to abuse. This might involve incorporating sensors or switches to make them more abuse-resistant, providing a secure working environment for both our customers and their on-site operating staff while maintaining the high performance and stability levels.

Presently, the main segment in the market remains the 15-ton category, showcasing significant volume, and it’s expected to retain this position for some time. Despite a growth in numbers for higher tonnage cranes such as the 20-ton and the 23-ton models, their base is relatively small compared to the established 15-ton segment but growing.

However, with the shift towards more precast construction methods and an increase in the construction of bridges that demand heavy lifting, the need for higher tonnage cranes is on the rise. Our technological capabilities can meet these requirements, as we have developed models up to 35 tons as well as some new concepts for the future craning requirements.

Ensuring machine performance and reliability

Escorts Kubota
Performance is a key area for us. Our cranes have a robust structure that ensures stability while lifting and the ability to handle load when ground conditions change. Reliability is equally critical for us where we strive to ensure that our machines require minimum repair and maintenance services, and our customers are not burdened with unexpected breakdowns, especially when meeting project completion timelines.

In recent years, we have added numerous safety features in our cranes, including digital technologies that enable machine owners to monitor operations, receive and send warnings in case of an error by the operator. We are also investing a lot in training of the operators.

While everyone aims for a cleaner and safer working environment supported by technologies, it’s essential that it remains economically feasible for the customers’ business. Therefore, we constantly work towards ensuring that the basic ownership costs of our machines and their long-term operating costs are advantageous to the customer.

Establishing stronger ties with customers

Customers have become very knowledgeable about this industry. It’s a mature industry now and customer expectations have increased. Operator comfort, visibility, reliability, and safety have become even more important to them. Accordingly, we are improving our products and investing to further enhance their quality and reliability, so that customers continue to trust our brand with repeat orders. The economic viability of these machines is also a concern area for customers, hence, we focus on lowering fuel consumption, increasing maintenance intervals, and maintaining the cost of spare parts. We believe that reducing the total cost of ownership of our machines and minimizing downtime is crucial for our customers’ business.

Like we have shown in the past, we aim to continue innovation in the construction equipment industry, bringing a transformation in the pick-and-carry cranes, and enhancing productivity, reliability, economics, and safety in our upcoming products. Similarly for backhoe loaders and compactors, we have plans to grow the business with the support of our brand strength and the customer experience.

We have more than 80 channel partners serving every city & remote areas of India. Our strength lies in building trust and gaining the confidence of our customers in our products and services, be it the fleet owners, corporate entities, retail customers or customers who seek tailored solutions.

To ensure a seamless experience for our customers, we try to understand the complexities of their projects, and strive to provide a hassle-free experience. We have invested significantly in our channel partners, enabling them to handle the day-to-day needs of our customers - whether it’s acquiring new equipment, looking for some service, or relocating their machinery between sites.

To demonstrate our products’ strength, we have invested in demo equipment, allowing our dealers to conduct on-site demonstrations. We have set up a digital learning platform for our dealer teams, where they are given extensive training on sales and services by our staff and also by the customer’s team.

We have revamped our website and are present on various social media platforms, showcasing testimonials and customer learning programs. We’re in the process of developing DIY programs aimed at customers, covering topics such as basic maintenance and product selection guidance for specific applications. These DIY projects and learning modules are designed to empower customers, making them more comfortable and knowledgeable about our products and thereby encouraging their satisfaction and loyalty to the Escorts Kubota brand.
NBM&CW - December 2023
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