The worst is over. That is the opinion of most OEMs regarding the market slowdown. Rather than staying concerned about the difficulties caused by the slowdown, now the equipment players are working towards gaining the mid and long-term opportunities. In any case, the slowdown was considered just a passing phase and everyone knew that the opportunities beckoned, just beyond. So, the major players in the construction and earthmoving equipment market are moving ahead with a clear strategy to tackle the current slowdown and at the same time, cash in the potential opportunities.
Irrespective of the current crisis, components, accessories and spares companies plan to develop their market further in India, by way of setting up of new facilities or expanding the existing ones, introducing innovating marketing strategies, coming closer to customers, and revamping operations in a more productive way. For example, the Sona Group is expanding its facility to manufacture steering systems after a positive feedback from its customers.
In the automotive component sector, an interesting trend is that many business tie-ups are happening between Indian and global companies. The latest development in this line is the acquisition of Germany´s Kuepper group of companies for Euro 200 million by Amtek Auto. Amtek had this March, purchased Neumayer Tekfor Group for an estimated Euro 500 million euros. International truck majors like Fiat Group´s Iveco and American Paccar are also looking to enter the country to tap the potential here.
Other machinery and component makers are anticipating a possible bounce-back of the construction and infrastructure sector in India by next year. Players in infrastructure and allied sectors feel that after elections, things are going to change, though not too fast. The industry also expects a change in the approach towards project implementation procedure.
While the long-term outlook for the Indian construction and infrastructure sector looks intact, the way to the target looks uncertain. The uncertainty in policy-related matters and the nearing election at the Centre are likely to hold back prospects at least for an year. In the interim, it is a wait and watch time.