Linnhoff: “Our new plant to leverage business in India”

Klaus Thesenfitz Ashok Tanna
(Left to Right): Mr Ashok Tanna & Mr Klaus Thesenfitz
Asphalt and concrete batching plant manufacturing major, Linnhoff which claims to have made sizeable inroads among road contractors and concrete batching plant owners, is now looking forward to strengthen its brand image further with commissioning of its new manufacturing facility near Pune. P.P. Basistha had an opportunity to interact with Mr Klaus Thesenfitz (Chairman- Lintec Group) and Mr Ashok Tanna (MD-Linnhoff India), during his recent visit to the company's new state-of-the-art plant. Excerpts:

How would the new manufacturing facility contribute towards leveraging Linnhoff India's business presence in India?
Our new manufacturing plant will substantially contribute towards reduction of delivery times of the plants at the contractors' site, which is getting increasingly crucial with compressed job schedules in projects in India. Furthermore, it will enable us to make pricing of our products competitive, at the same time retaining the quality of the plants manufactured under acclaimed German technology. Most significantly, based on the firm demand fundamentals of the Indian road construction business, owing to large number of projects being planned, the new plant in Pune will enable us to serve the road construction sector optimally, in turn allowing us to develop the critical mass of our products. This will allow us to offer better product support to our plants.

Linnhoff Factory

What will be the present quantum of localization of the plants?
Being an assembly unit, the new plant will source critical components like gearboxes, burners, valves, electric motors, screw conveyors locally from the same suppliers as earlier plants manufactured in Singapore. These components will be supplied by the manufacturers of global reputes such as Sew, Nord, and Schneider. The vendors have service back-up facilities in India, which should not make product support and replacement an issue for the parts in the country. Steel structural items and computers for the plants will be sourced from India. Based on attainment of certain critical mass of the plants, we have enhanced sourcing of other parts and components from India, in near future, for which we have started appointing vendors in accordance with our own quality standards.

Could you please brief us about the range of asphalt batching solutions being made available by Linnhoff India?
We have wide portfolio of asphalt plants comprising 80-124-160-200-240-320-400 tph. For the Indian road construction sector, we, initially propose to produce mass required 80-200tph range plants. However, depending on Indian market requirements, we may also take up production of 240 tph plants. The smaller capacity of plants will also find usage for road construction projects in the North Eastern part of the country and other hilly areas. Our local production would comprise Linnhoff's cost-effective CMX-series of compact mix batch plants. The CMX series batching plants involve components like Dryer Screendrums, hot storage bins, bag houses, mixers, and weighers are moved to site in modular form and are assembled there in sequential order. These plants are also known as semi mobile plants, as they don't need a heavy civil structural foundation and come with a skid mounted design. Linnhoff's range of batching plants comprises MSD-series modular batching plants, CMX-series compact mix batching plant, TSD-series mobile batching plant, LH-series tower batching plants, HRC-series recycling asphalt attachments to existing new plants, mastic attachments to existing/new plants. Linnhoff's plants are marketed in European Union and Middle East.

Till adequate critical mass of your products is developed; how are you looking to make your production commercially viable and pass cost benefit down to your customers?
We have been targeting export markets like Africa, Russia and even markets like Germany for marketing our plants. This has allowed us to hedge business fluctuations in the Indian markets. With our fully commissioned manufacturing facility in India, assembling range of asphalt plants, we will keep looking towards the export markets as mentioned as well as newer markets targeting smaller, medium and big size projects. We have got forty asphalt batching plant units supplied to the Russian market. Further, we have received fresh order to supply five units.

To make your plants attuned to Indian applications, would you be undertaking engineering improvisations in the products resultantly also making them further cost-competitive?
Our asphalt plants are made according to our standard international specifications, which is able to cater application requirements for all variant of jobs across the markets. Our plants are cost-competitive to own and operate as they have lesser fuel consumption and minimal maintenance requirements. The plants can be operated with coal and RAPand are much environment-friendly.

How will timely onsite support be ensured?
We have created a central warehouse at the new plant that will ensure timely parts and component support to the units working at site. We have recently appointed a logistics service provider, to ensure timely parts availability to our plants working at the site. Further, Linnhoff India's team of 60 service engineers and regional after-sales strategic partners, which we propose to double by the end of this year, will strengthen our service support further.

I appreciate the facts based on my observation and interaction with road contractors, our dealers and company officials that technology can be a key differentiator for products sales. However, it may not be the only differentiator, for a product like asphalt plant in India, especially based on the fact that the market is a buyer's market. The reason what I perceive is that buyers are governing the market with their own negotiating purchase terms owing to numerous external factors linked to production. Timely availability of aggregates and transportation lead times for transporting the aggregates from the source of its origin to the site is a major issue. For projects taking place in eastern parts of the country lead transportation distances can be between 200 and 300 kms or even beyond from the aggregates crushing plants and the asphalt batching sites.

Linnhoff Asphalt Plants

Further, crushing laws vary from state to state. To minimize the lead times, the contractor may have to make alternative transport arrangements through additional dumpers. Further, road bridging may require to be done with nearest road sidings, which ideally is not the best option. All these factors have definitely had a cost bearing on the operation of the plants. These are some of the critical issues in India, not altogether under the jurisdiction of the contractor who can influence sales. Not discounting the same, we have put in an elaborate product support structure in place which comprises complete operation and maintenance services. Through our specialized service department, we provide complete team of personnel to operate and maintain along with providing the required throughout at a nominal cost. We make our plants available on rent for the complete/partial tenure of the project backed by our operation and maintenance services. We provide refurbishment services backed by guarantee, where we retrofit used Linnhoff plants. We also support customers through plant buyback arrangements. I would like to point out that we are strongly making our services operation, commercially viable by supporting our existing 271 plants working in India.

Linnhoff's new technology plants can be adapted for recycling and reuse of old pavements, thereby saving natural resources and generating less waste contributing to the green movement. Presently a dozen of these units are operational in India for 30% recycling and one unit for hot recycling up to 70% of RAP usage.

The most modern technology of remotely operating and controlling these plants through SCADA systems is our standard feature, wherein the road development authorities can monitor the asphalt production and its consistency. These parameters are used to check the quality of road work, increasing the life of the pavement and reducing the total cost of ownership to the corporation. Thereby giving full returns to the citizens with smooth long lasting roads and less bumpy rides.

The same plants can manufacture Mastic asphalt, Coloured Asphalt and Warm mix Asphalt mixes. Today, 4 Mastic installations are successfully operational in India for the past few years with full set up of Mastic Cookers and Pavers.

These plants can also be supplied to operate on natural gas and Coal.

Coal is the latest value add to the Asphalt manufacturing process. Linnhoff India has a few plants operational on it as well.

Our present investment of Rs.60 crores in India further reassures our commitment to provide our customers full solutions in Asphalt and Concrete Technology.
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