Indian Earthmoving Industry: What does the future hold?

Make in India initiative, large infrastructure projects, enhanced government spending in budget 2021 make it an exciting area for people to be in!

The Indian earthmoving industry part of the automobile market in India saw companies put upwards of 40% growth in revenue sales and growth in the past year. Though the pandemic affected most of the industries worldwide, the Indian automobile industry showed a contrast and was among a few which posted progressive growth among all its sub-sectors. 

The earthmoving sector particularly dominated by the demand of backhoe loaders and followed by excavators, cranes and material handlers saw an uptick as well. Companies like JCB which constitutes up to 80% of the market share posted a growth in sales of up to 30%. Upcoming players in the market such as Caterpillar and Escorts Construction also instilled confidence in their investors with good numbers. The ancillaries providing original spares to these companies also saw huge demand built up both from the companies as well as the aftermarket limiting the effect of lost time in lockdown.

India being a developing country with a plethora of infrastructure projects right on the door is the reason behind this growth according to industry experts. Large highway projects all across India, special emphasis on the northern states, commissioning of the mining projects have led to this increase in demand. The initiative of Make in India has led to many foreign companies set up their base in India with new industrial townships being set up in Karnataka and Maharashtra. A loss in confidence with Chinese companies has benefited Indian manufacturers as well. Companies like JCB and others are now looking towards Indian manufacturers for their demands rather than importing them from China.

The increase in foreign trade and the setting up of multiple ports across the coastline of southern India has also boosted construction activity and will boost demand for material handlers and hydra cranes. These ports will serve as a hub for economic activity as well as provide numerous business opportunities for the SME’s nearby.

All in all, a policy change in terms of make in India, good domestic demand and loss of confidence in China as a manufacturing and trading hub will provide a boost to the small Indian manufacturers and its distribution network in the upcoming years.

Author

Himanshu Bansal