Equipment from Volvo CE is famous for its productivity.

Road construction equipment industry is the backbone driving the Indian economy? Your comments.

Over the past two to three years, the road construction segment has contributed close to 60% to 70% of all construction equipment demand across the country. We expect the road construction segment to see a quick recovery due to the government’s investment in infrastructure growth and construction of projects like national and state highways, along with district and rural roads. This will then trickle down to the many sectors connected to road construction.

With exclusive emphasis on highways through accelerated highways development program by the government, how are OEMs utilising this opportunity to contribute towards the economic growth of the country?

As the government focuses on developing infrastructure and highways in India, we are seeing contractors select road machinery from Volvo Construction Equipment for the low total cost of ownership and strong aftermarket support. We offer high quality and productive equipment that delivers the best levels of fuel efficiency in the industry. With Volvo CE, customers can do more with their equipment and downtime is minimized. Our lower fuel consumption improves cost efficiency and means work environments are cleaner. Overall, our customers can enjoy high levels of return on investment and the reassurance of dealing with one of the world’s very best industrial companies. Plus, Volvo has one of the most experienced dealer networks in India, able to provide expert advice and support whenever it’s needed, with a range of Customer Service Agreements available.

How has the Rs 20 lakh crore economic stimulus package to deal with the fallout of the Coronavirus pandemic affected OEMs?

The Indian government’s $260 billion Coronavirus Rescue Package provides liquidity to small, medium and large businesses. The government has also provided some relief measures for the banking and financial industries to allow credit to open up. While the Reserve Bank of India has taken additional measures to incentivize credit to go further we are still seeing caution among consumers. This in turn will impact companies across India. For 2020, we expect to see a 20-30% impact on volume for the construction industry and for Volvo Construction Equipment.

What are your views on the Ministry of Road Transport and Highways (MoRTH) considering to defer implementation of BS-IV emission norms for construction equipment vehicles? 

The deferred implementation of BS-IV emission norms for construction equipment is welcomed reprieve for the construction equipment industry. Due to COVID-19, the entire industry was at a standstill, so the deferment allows us time to restart operations and ensure we are maintaining the high standard that is synonymous with Volvo Construction Equipment. The emission regulation is very much aligned with our core value of environmental care.

Do you see Chinese companies ban on Indian highway projects as an opportunity?

It’s a decision taken at a geopolitical level, and not really something we are best-placed to comment on.

What kind of policy initiatives or reforms do you expect from the government to support Indian manufacturers?

We are seeing a push from the government to resume activities in road projects and mining sites are becoming operational. We are expecting momentum to build up over the next few months with business returning to more normalcy in Q4.

As construction activities have resumed, what initiatives have OEMs taken to speed up projects?

Equipment from Volvo CE is famous for its productivity, so contractors already know that by using our machines they will get more done. There will be added pressure on projects as we come out of the lockdown and that means reliability and support will be more important than ever. Fortunately for us at Volvo, we have an unrivalled record in terms of machine reliability and our national network of dealer partners are on-hand to provide immediate assistance to customers who need it.

Are you experiencing a decline or increase in demand for a particular road equipment in the wake of the ongoing pandemic? How is it impacting the business prospects and project execution?

As mentioned above, for 2020, we expect to be impacted by COVID. Our production and dealerships have resumed to an almost normal level since mid-June but it is very difficult to predict the demand level. We know there are a lot of projects in the pipeline that need to resume but on the execution side, it’s hard to predict the speed of pick up.

Since June, we have seen the rate of calls to our customers centres return to almost normal level and we are also seeing our spare parts business picking up. Both are positive signs that bode well for us returning to business as usual soon.

What kind of support do you expect from the government to boost the road equipment sector in the country?

As infrastructure development in India moves into the 21st Century, construction operations are in the spotlight like never before. The fine margins on modern job sites mean that securing a small advantage in something as routine as equipment choice can translate into a big difference in profitability. With Volvo CE, construction companies know they can take advantage of equipment with best-in-class productivity, and when support’s needed world-class backup is available.

Our company is well-known for delivering some of the most advanced designs in the industry, which results in leading levels of productivity.

Another trend that’s emerging in equipment procurement is the move away from owning equipment to leasing. For smaller contractors, or those leasing from us for the first time we offer a range of attractive financing options through our Volvo Financial Services arm.

What are your future projections for the Indian road equipment sector?

With credit-ratings agencies like Moody’s forecasting 7%-8% growth for 2021, we are expecting the road equipment sector to rebound and see growth in the upcoming year, especially since the government is focused on investing in infrastructure and building out the nation’s highways and roads.

Hits: 83