September 07, 2008

KCEIL to set up hydraulic base in India

It is reported that Kobelco Construction Equipment India Limited, a JV between Japanese conglomerate Itochu Corporation of Japan and Kobelco Construction Machines, has decided to set up a manufacturing base for hydraulic excavators in the country.

Mr Kenji Sakamoto executive director of Kobelco Construction Equipment India said “We will soon take up a feasibility study on setting up a manufacturing facility in India within the next two years. The Indian market looks very promising and is estimated to grow at 30% to 35% in 2007. He added that our aim is to position India as a hub to cater to the market in Asia. We would like to localize production to the extent of 40%, and perhaps import other components directly from our facilities in Japan and Thailand.”

Mr Vikram Sharma president & CEO of Kobelco Construction Equipment India said that “There’s been a tremendous change in terms of technology awareness in India. Sectors powering demand for excavators include road construction, mining, power and ports. He added that this year some 9,000 excavators are likely to be sold.”

Kobelco Construction Equipment India, which began operations in January 2007, is a 70:30 JV between Itochu and the USD 2.5 billion Kobelco Construction Machines whose 80% is owned by Kobe Steel. Kobelco Construction Equipment India has launched Kobelco’s top line products like 20 and 35 tonne hydraulic excavators to grab a sizeable chunk of the market in India. These tonnages make up for almost 70% of the domestic market.