Construction equipment sector in India can be classified into four segments i.e., earth moving, road construction, concrete and material handling equipment. Of the four, earth moving equipment segment acquires the largest share and accounts for nearly 60 per cent in the overall construction equipment category. The prime drivers for this construction equipment segment in India are mining activities and construction industry. Within these industries also, the key demand drivers are road construction, urban infrastructure, irrigation and real estate.

Earth moving equipment segment

It mainly comprises excavators (compact excavator, dredging, dragline excavator, front shovel and others), loaders (skip loader and wheel loader), backhoe loaders, construction tractors and others (grader, scraper, track loader and material handler etc). Out of all, backhoe loaders which are most commonly used to move large amounts of earth or to dig foundations and landscape areas, account for 65 per cent of the earth moving equipment segment.

Key market players

While this demand for earth moving equipment is collectively catered by about 250 domestic (small, medium and large) manufacturers, yet the top ten players rule the market. The key earth moving equipment manufacturers in India include

  • Bharat Earth Movers Ltd (BEML)
    • JCB India Ltd
    • Tata Hitachi Construction Machinery
    • Komatsu India Pvt Ltd
    • Action construction Equipment Ltd (ACE)
    • Mahindra Construction Equipment
    • Hyundai Construction Equipment India Pvt Ltd
    • Escorts Construction Equipment Ltd
    • Caterpillar India Pvt Ltd
    • L&T Komatsu Ltd

    Opportunities for earth moving equipment manufacturers

    The Indian earth moving equipment industry is poised for excellent growth in the coming years, based on India’s overall manufacturing sector and infrastructure growth. To leverage this opportunity, some of the key measures that should be taken by the earth moving equipment manufacturers include

    • Focus on development of individual and pooled capabilities to develop global competitiveness across the sector.
    • Indulgence in collaborative endeavours to provide integrated services and to promote the industry’s interests.
    • Working with the government to promote technology development.
    Challenges faced by this heavy equipment manufacturers

    While there are opportunities in future, there are challenges too…

    • There are various occasions when various project bottlenecks like project approval delays or other regulatory issues put barriers on the construction equipment sale.
    • Many times, there are delays related to forest and environment clearance and due to this also, the infrastructure projects are hampered, thus, affecting the equipment demand.
    • Manufacturers also have to face issues like timely availability of raw materials.
    • Last but not the least, end-users are also becoming demanding and want world-class technology for better fuel efficiency, higher productivity and profitability, thus, it is also posing as a challenge for the earth moving equipment manufacturers.

    Shining future ahead

    Despite the challenges, the earth moving equipment industry in India is poised for exciting trends and times ahead. In fact, the earth moving and material handling equipment segment is projected to grow at the CAGR of 8.42 per cent from 2015 to 2020. Further, with the increased FDI inflows, joint ventures, infrastructural investments, government initiatives and policies, the earth moving equipment manufacturers in the country have all the reasons to rejoice.