Currently, our focus is on modernisation and being able to add value inside the company. This includes cost-cutting and improving overall efficiency, says Kapil Sehgal, Director, Bucher Hydraulics. Excerpts from the interview.
How do you assess the current CE market scenario?
The current scenario does not look good as some of our customers are not picking up materials, parts are not available, orders are on hold and this is reflected in our order book. The construction sector is badly affected.
Has the negative sentiments impacted the demand-supply scenario for the Bucher products?
We are a component supplier to construction equipment manufacturers. If their demand goes down, it affects us. Currently they are not able to sell machines, so we are not able to sell our products. The scenario depends on the sales of machinery.
What about Bucher Hydraulics' expansion plans?
We will be moving to a new plant in October. Basically we are planning to complete most of the work of the plant in Phase 1; in Phase 2, we will focus on expanding our production as and when the market improves. Currently, our focus is on modernisation and being able to add value inside the company. This includes cost-cutting and improving overall efficiency.
Concepts like lifecycle cost, fuel efficiency, safety and reliability have become an integral part of purchase decisions. What is the bearing of this on Bucher's design philosophy?
Today, design decisions have started impacting construction equipment manufacture. Bucher Hydraulics has been in the forefront of knowledge offering for fuel efficiency and overall cost. Being part of an international group, we have the technology and expertise from around the world.
Could you brief us on the new series of valves the SV18 and SV22?
The SV 8 and SV22 are successful in Europe and China. In India, we plan to bring in another series, the LVS 12, which is a proportional flow-sharing valve of up to 300 litres per minute. We intend to start assembling and testing this valve locally, to offer the customers better technology at affordable cost.
The SV18 and SV22 are suitable for machines of over 40 tonnes but in India these types of machines are not in common use at the moment. The LVS 12 meets the requirements of the 20-40 tonne range, which is more commonly used in India.
The shift towards advanced technologies in the off-road segment is seen as a niche segment. Is lack of awareness or the cost the issue here?
Cost is a major factor which is keeping customers back. So we have to continue doing the same thing as before, since new products will take some time to gain acceptance. People just look at the cost of the product and may not probably understand the benefit part. Basically, market leaders have to start with innovation in India and bring in new technologies, which will percolate down to the users.
How do you assess the overall market for hydraulic systems for off- road equipment?
There are enough equipment manufacturers as well as potential. Sometimes, international companies are forced to use hydraulics which are being used abroad. India can become a sourcing hub, say in the next three to five years.
What sort of growth do you envisage this fiscal and what are the major growth drivers?
This year, we expect a growth of 10-15 per cent over the last year but the growth is going to come only from the agricultural sector. We don't expect much from the CE sector.
What is Bucher's R&D spend? Any new product launch planned?
We have six product competent centres located in Switzerland, Germany, US, and Italy. They are technology drivers and they follow world market and global players and develop technologies, because in Europe, people work three to five years ahead of time. What is developed today could be launched three or four years later. So, our people are working with them and developing the products which will be needed in the near future.