Tata Hitachi mulls local production of 87-tonne mining excavators.
November 05, 2018
The Rs. 3,800-crore mining and construction equipment maker Tata Hitachi mulls production of 87-tonne mining excavators in India. Currently, the company imports such machines to meet domestic demand.
According to Sandeep Singh, Managing Director, the company is conducting a feasibility study for manufacturing the equipment at its Kharagpur (West Bengal) facility. However, it could be “few years” before production starts here.
“We are assessing the consumer demand and feasibility of local manufacturing of these 87 tonne excavators at the Kharagpur unit. We were making 47, 65-tonne and 120-tonne machines already. But we feel there is a need for a unit with a capacity in between the two,” he told reporters at a press meet on the sidelines of The Indian Mining and Machinery Exhibition (IMME) 2018, organised by the CII.
Tata Hitachi is 60:40 joint venture between Hitachi Construction Machinery of Japan and Tata Motors.
The mining segment accounts for 11 per cent of the company’s annual revenue, which is projected to touch Rs. 4,500 core this fiscal. The roads, railways and irrigation segment accounts for the major chunk of its turnover.
The mining gear market is pegged at Rs. 8,000 crore, growing at 10 per cent per annum. Procurement by state-owned Coal India accounts for 50 per cent of the demand.
The company also plans to enter the pre-owned equipment market. A part of its Kharagpur plant will be used in “re-manufacturing” old equipment. The refurbished equipments will be 30-40 per cent cheaper than new ones
According to Singh, the sale of new construction equipment is a low margin business and after-sales service and maintenance are what actually drive numbers. Apart from Kharagpur, Tata Hitachi has a second manufacturing facility at Dharwad (in Karnataka).