LiuGong excavator provides the highest productivity in its class due to effortless hydraulic controls, and spacious cabin. Liugong lays lot of emphasis on operator comfort in order to increase operator’s efficiency, says Sunil Sapru, President, LiuGong India. Excerpts from the interview with Equipment India.How do you view the growth prospects of CE industry, especially for the excavator segments? What are the growth enablers?India’s infrastructure industry has huge potential for growth and opportunities for investment. We see the construction industry on the rise and this will have a significant impact on the excavator segment as well. We foresee a positive trend in equipment purchase with more small players entering into the aggregate industry. The growth prospects look very good on the medium and long term perspectives. However, given the recent worrying trends in global economic conditions and the monetary regulation to contain a raging inflation within the country, in the short term perspective, growth may slow down. Indian CE companies have to localise components and develop vendors to meet global quality standards, this will aid in offering cost-effective products to the customers.The growth drivers include the current and proposed financial outlay in road infrastructure, housing, power, irrigation and segments like ports and airports. All these are major growth enablers of the CE industry because they not only use large construction equipment but also generate secondary demands in cement, steel and mining which all require large number of earthmoving and construction equipment.What is the demand-supply scenario for excavators for different tonnage and horse power? What is the total market for all classes put together?We see a very buoyant trend for earthmoving equipment in the next five years. The government investments have been articulated clearly for the 11th and 12th Five Year Plans and when these investments in value are translated into equipment worth, it clearly signifies the emanating demand of equipment. Seeing the demand ahead, we have invested further in our local facilities and have planned some new investments in the start-up facilities. We will see the demand and supply situation even out in the future. The market of hydraulic excavators in India was 14,500 units in 2011and this is expected to more than double over the next five years. However, the focus is now shifting to the retail segment also and we plan to become a major player in the medium size excavator market in the next four to five years.Many first-time buyers opt for BHL as the price of excavator below 10T is over 50 per cent more than BHLs. What is the trend now and how do you look at the potential for the market segment that graduates from BHL to excavators?Excavators are the second highest selling construction equipment in Indian market after backhoes. As the Indian construction equipment matures, the role of heavy equipment like excavators is bound to grow, considering the amount of large construction projects across various sectors like mining, roads, irrigation, ports etc. However, the price of the excavator below 10 T is only slightly higher than that of the backhoe loader. But at the same time, there are certain sections of backhoe loader buyers who are graduating to the 7-8 T class excavators. Both these segments will continue to grow simultaneously but the growth in the excavator segment will be much higher than backhoe loader.What are the technology trends in the mid-sized excavators?Product improvements enhance productivity and performance of engine and hence it is an ongoing process for LiuGong as well as for other equipment manufacturers. With shifts in trends of machine utilisation, type of applications and hours of usage of a machine several technological improvements are making excavator better. The latest technology machines have electronically controlled engines, electronic monitoring and control systems with automatic mode selection. They operate at higher pressures and hydraulic flow which results in better breakout forces and faster cycle time which leads to better fuel efficiency.The input cost is heading north, putting enormous pressures on the OEMs. Added to this is the recent Budget putting more pressure on the manufacturing sector. What is your take on this?The input cost is certainly going up and there is a definite pressure on our margins. We are increasing our efficiency to balance the input cost. We are trying to be competitive by increasing the entire operational efficiency of our organisation. Moreover, most of the players in CE industry were forced to increase the machine price by 4-5 per cent on an average. The demand will keep its pace over the next 2-3 years irrespective of rising interest rates and prices.How do you assess the potential for various attachments and what are the market trends?By offering different attachments suiting variety of applications, productivity has been increased, which is reflected in the sales pattern. An attachment greatly increases the versatility of the machine, which then can be used for several different applications, thus entirely eliminating the need of the machine. With the attachments like quick coupler, break hammers and a host of other models on offer, we can foresee a change in the excavator sales which helps the early completion of projects in a cost-effective manner. LiuGong offers the host of world class attachments for excavators which includes the ones mentioned above.Tell us about the range offered by LiuGong in excavators for various segments, and the value addition incorporated in terms of environment friendliness, safety, energy saving, and fuel consumption?LiuGong offers a wide range of excavators to the Indian market ranging from 8T to 36 T operating weight range. The machines are offered with various boom/bucket options to suit the different applications. With strengthened critical components and superstructure, proven reliability of hydraulic components, these power-packed robust machines are productive and durable in the toughest conditions. The LiuGong excavator provides the highest productivity in its class due to effortless hydraulic controls, and spacious cabin. LiuGong lays a lot of emphasis on operator comfort in order to increase operator’s efficiency. The machine operates at a higher pressure and hydraulic flow which results in better breakout force, faster cycle time, which further leads to better fuel efficiency. Our efforts have always been to make most fuel-efficient machines for our customers which also mean our machines are environment friendly. The equipment also comes up with more digging depth, longer machine life, superior technology and service back-up facilities.Brief us on the hydraulics. How does it help in better performance and fuel efficiency?A very efficient hydraulic system has been incorporated in the LiuGong machines, a result of a long R&D process, followed by the rigorous reliability and performance tests before it is offered to the customers. The variable displacement axle piston type hydraulic pumps supports the hydraulic system and is made to synergise with the engine through the intelligent electronic system, the CAPC (Computer Aided Power Control System), which comprises unmatched features like the total horsepower and control system which leads to better performance and fuel efficiency.Has the latest emission norms brought any design changes in the product?In India, we are shifting to the Tier-III norms. The US market has already shifted to the Tier-IV norms and other developed markets in Europe have followed suit. Liugong offers a different set of models that are customised as per the local needs and meets the Tier-3 emission norms in India. But the change has not affected LiuGong excavators being sold in India since all the machines are imported and come with the upgraded engines as well.Tell us about the plant facility and capacity. Is it fully utilised and is there any plan for capacity augmentation?LiuGong, manufacturer of construction equipment, produces over 60,000 units annually, having an extra manufacturing capacity in India with annual production of over 3,000 units of wheel loaders. We are constantly considering its expansion for product lines and its technology upgradation and will make some announcements soon. LiuGong has plans to invest in upcoming projects and expansion within the market demand and is ready to capitalise with additional production capacity and customised customer requirement.What is the market for excavators in the mining, quarrying, and dimensional stone segments?Mining and quarrying activities have contributed significantly to growth, primarily in the sales of large-sized equipment over the last few years. The sale of the mining equipment has grown steadily in line with the increasing mining activities and there is a shift towards the use of larger sized equipment in order to improve the mining efficiency. Their share of the total sales has, in fact, grown in 2011. Currently, we have the 20-22T excavator which can well be used in the mining applications. Underground mining would need extra focus as this in a way is more environment-friendly.The size, swing, reach, and the versatility of compact excavators are perfect for demolition duty. What is the scenario in this segment?There is a lot of the construction activity happening across the country and as the market matures, segmentation is bound to happen. Today, general contracting is the biggest market for excavators; this includes roads and highways, construction sites and mass excavation applications. The 20T class machines are the mainstay of all construction activities and they are found working on all major infrastructure projects in the country. The 33T to 50T range of excavators are primarily deployed in mining, limestone, granite, marble quarries and on large hydro electric power generation projects.