Our fully integrated and purpose built manufacturing facility at Kolkata delivers state-of-the-art design, manufacturing and product technologies. TIL distribution network offers mobile cranes: industrial cranes, truck- mounted canes, rough terrain cranes, and all terrain cranes, lattice boom crawler cranes, and lorry loaders, says Somnath Bhattacharjee, President, Material Handling Solutions and Equipment & Project Solutions Business, TIL. Excerpts from the interview.
What has been the market trend for mobile cranes in the last couple of years?
The mobile crane segment in India is largely dominated by pick-n-carry cranes. The downturn in the economy and the challenges in the market have adversely impacted the sales of material handling equipment that include mobile cranes. The mobile cranes sales contracted considerably in 2012. Overall, the demand for cranes including higher capacity mobile as well as crawler cranes, also witnessed a significant slowdown. This decline in demand is primarily driven by slower execution of projects and clearance related issues in the infrastructure and power projects which have large potential for higher capacity cranes.
Despite the current material handling equipment demand scenario, the long- term outlook for domestic economy remains positive with significant investment in infrastructure development scheduled in the 12th Five Year Plan. Further structural changes in the key government policies are likely to improve the demand outlook.
The market demand for mobile cranes is estimated to grow by 15-20 per cent in coming years considering a GDP growth rate of 7-8 per cent. Though pick-n-carry cranes up to 15T capacity enjoy a major share of demand, the requirement for higher capacity mobile cranes with advanced features is growing as well due to continuous change in heavy lift sizes, besides growing customer preference for mobile cranes with better safety features and technology.
How do you assess the growth of specific markets for mobile cranes other than the traditional pick-n-carry cranes?
Smaller capacity pick-n-carry cranes enjoy approximately 90 per cent of share in the mobile crane market and the rest of the crane demand is for truck and truck-mounted, crawler, rough terrain and all terrain cranes. However, when the application is more specialised and involves higher load, longer reaches, severe ground conditions, higher capacity mobile/crawler cranes are used. Growth in demand for cranes is highly linked with the project execution and new project awards in the infrastructure sector.
To what extent has the economic slowdown impacted the growth of specific markets?
The slowdown has impacted demand for material handling equipment across entire infrastructure and mining sector. However, the demand slump has been witnessed more in sectors where dependence of project award and execution is contingent on land acquisition, forest and environmental clearances. The demand outlook for material handling equipment in the infrastructure and mining sector will significantly improve with policy changes in land acquisition, environmental and forest clearances besides framework of financial closure of projects by banks and financial institutions.
Is import a major threat now?
Indian customers are exposed to world class material handling equipment. However, the purchase decision is primarily based on total cost of ownership, quality, specification and technology. The recent weakening of the Indian rupee against major global currencies will make the locally produced material handling equipment more competitive against the equivalent range of imported material handling equipment in terms of total cost of ownership and lifecycle cost.
What is your take on existing safety norms?
Cranes are designed to carry out heavy lifts and therefore, requires high safety consciousness with everyone associated with crane use. The existing safety regulations prevalent in India need to be benchmarked with global standards to improve safety in crane operations and reduce accident rates especially with smaller capacity cranes which are built on tractor chassis. Major causes of crane accident in India are overloading, unavailability or failure of safety devices in the crane, faulty slinging, operator's poor knowledge of crane operation due to lack of training and awareness, failure to level the crane properly and most importantly, noncompliance with safety norms and lack of proper maintenance.
What kind of built-in safety features are on offer in the TIL's crane range in India?
At TIL, safety is a key priority. Each of our cranes is fitted with safe load indicators (SLI). If anyone is trying to lift loads beyond the rated capacity, SLI cuts the system off, thus ensuring safety. Along with stricter regulations and better design, other important factor is to have trained operators capable of safe operating of cranes, thereby preventing accidents. At TIL, we conduct year- round trainings and development programmes for crane operators to sensitise the crane owners and operators on safe operational practices.
Brief us on the range of lifting and loading solutions offered by TIL in India.
TIL has been a market leader in manufacturing, engineering and distribution of mobile cranes in India over five decades. TIL designs, manufactures and markets a comprehensive range of equipment for material handling, lifting solutions with integrated pan Indian customer support and after-sales service. Over the years, TIL's equipment range has been recognised as state-of-the-art and sets the industry standard in specification, quality, durability, safety and total cost of ownership. TIL's technology partnership with world leaders reaffirms our commitment to always provide best-in-class products and services to our customers.
Our fully integrated and purpose built manufacturing facility at Kolkata delivers state-of-the-art design, manufacturing and product technologies. TIL distribution network offers mobile cranes, industrial cranes, truck-mounted canes, rough terrain cranes, and all terrain cranes, lattice boom crawler cranes, and lorry loaders.
Our products incorporate the use of latest drive line components, state-of-the-art hydraulics and load-bearing structures made out of micro alloyed roller quenched high tensile steels. These products set a benchmark by way of enhancing safety, fuel efficiency, reliability and operating comforts. In addition to our indigenously manufactured range, TIL also distributes a complete range of mobile and lattice boom crawler cranes from Manitowoc and Grove USA. This range represents lifting capacity up to 450 MT in the mobile crane segment and 1,600 MT for lattice boom crawlers.
What are market trends in the hiring segment, especially for high capacity cranes?
The primary focus of crane hirers is to acquire assets which are versatile in application, offers high reliability and yields higher resale and residual value. The resale value of the equipment largely depends on the active population and brand image of the product.
How do you address the issues of high cost of financing?
The interest rate in India has remained elevated yet stable in the last one year. The interest rate is only one element of cost of the owning and operating cost of the equipment. At the time of economic downturn higher interest rate adds to the negative sentiment towards investment. But as the economic activity picks up, the hiring rate improves due to higher demand and accordingly the buying sentiments do not get affected even if the interest element remains elevated.