Industrial Automation Magazine India

We have grown bigger than our parent company

Published on : Wednesday 02-03-2022

V G Sakthikumar, Managing Director, Schwing Stetter India.

How is the response to the Technovation 2022 week amidst the pandemic? Where have all these visitors come from?
We had planned Technovation 2022 much earlier, but the fresh surge of the pandemic in December cast a shadow. Even in early January we were apprehensive, but by 18th there was hope as the number of cases in Mumbai and Delhi had started decreasing. In consultation with the local authorities who were also watching the situation, we decided the second week of February as the right time and that is how it happened. We were expecting about 1000 people, but the first two days itself we are getting close to that, so by the end of the week we may have twice the number. And they have come from all over the country – yesterday we had some from the Northeast – Assam and Arunachal Pradesh. Large groups have come from Punjab and Rajasthan, besides those coming in larger numbers from Tamilnadu and the neighbouring States of Kerala and Karnataka. Today, because the seminars are on the topic of Railways, there is a group of engineers from Bangalore Metro Rail Corporation here to listen and share the knowledge and absorb new technology and information.
 
How significant is the Metro market in India – it is still early days in Metro expansion?
You'll be amazed to know India is the only country today which is building Metro networks in 28 cities. So globally, there is no match for us in metro projects. There is no other country in the world which is simultaneously building so many extensive metro rail networks. Consider other global cities like London where the network is really huge, but they used to add about 50 km in comparable phases. The new phases in Mumbai, Delhi or Chennai, are each 100 plus kilometres. This is huge, something the outside world finds hard to believe.
 
You mentioned Assam and the Northeast. How is that market developing at present for the company?
It is good. We love the Northeast because we have a better market share there – better comparatively than our national market share. Also because we have a very good dealer network and service and we have a long experience doing infra projects in the region. Almost all the bridges across the Brahmaputra – large bridges measuring 6 or 10 km – infra projects done by L&T, SP Singla or Gammon India, we were the one who supplied the machines and supported the projects. It is not easy to travel there – even to move anything by road is a big challenge. You have to go around Bangladesh to reach the place. We have established a strong service setup there with resident engineers in far flung places like Dibrugarh and Silchar, which makes customers believe in our brand. We reach within a few hours of a call and parts are supplied the next day. This is something contractors in the Northeast are not used to, because they are always at the receiving end, where distance is given as an excuse for not delivering on time.
 
So basically you anticipated the developments and created a network there?
Yes. If somebody asks why we were there when nobody was, my response is, that should not stop you. There is no excuse for not trying, we always believed in that. You see, the Boom Pump market in India was 200 units when we set up this plant here at Cheyyar to make 900 boom pumps per year. The Self-Loading Mixer market was around 4000 and our capacity is around 9000 SLMs. And when did we put the new plant? The slowdown had hit the bottom when we started the project in mid-2019 and inaugurated it in early 2021. We also got the land at a much better price here compared to other sites like Bangalore, Indore, Nagpur or Pune that we considered. So when the talk now is of so many road and highway projects coming up, where are the machines and equipment? So this is the opportunity for us to share knowledge about our capacity and facilities to let everybody see that we are ready.
 
What was the rationale for Schwing Stetter to start manufacturing in India?

Schwing Stetter, a major global player in the concrete construction equipment, operated in India through a dealer, as it has operated in 180 countries globally, with manufacturing facilities only in Germany and a few sites in Europe, plus USA, Brazil, Russia and China. My association with the group is from the late 1990s and at that time there was no plan to manufacture anything in India. But things have changed dramatically during these 22 years of the new millennium and today, Schwing Stetter has five plants in India – four at Sriperumbudur and this one at Cheyyar, an IoT-compliant global hub. Today, in terms of manpower, production capacity, product range, turnover and profit margin, Schwing Stetter India is number one within the group. We have grown bigger than our parent company. So we kept on doing the right things and we did not honestly plan for any growth, yet we have reached where we are. We always looked at the potential, what is available in the market and what we are capable of taking from that, and we planned accordingly, by focusing on whatever potential is there.
 
What is the history of the company’s manufacturing in India and what is the present status as an exporter?
Schwing Stetter India was incorporated in 1998 and started manufacturing operations in 1999. In the initial years the company was a net importer of equipment, but working on indigenisation and in recent years have started exporting equipment – first to the neighbouring countries, and now globally. During the lockdown we began exports to Romania, Saudi Arabia and now to the USA and Germany. The last three years we were going neck-to-neck with our imports and exports poised evenly, but we are now a net exporter.
 
Going forward, how do you see the company scaling up?
This is important. If you see the total construction equipment business in India, only 10% is concrete and 90% is something else. We already have a good market share in concrete so what is left is the question. We have a team that can deliver and we have the infrastructure to manufacture whatever we decide to do. There are growth opportunities for all of us to do something beyond what we are currently doing. In concrete, we have already reached a certain level. So that leaves us with the option of expanding into non concrete areas. But we are considering the options, as there is no point in entering a crowded field. Excavators is a field we got into with existing players, but there was room for products with better range and performance. Within two years we have garnered a 5% market share in excavators, scaling up from 200 units in the first year to 600, which is good. So what next, is something we are studying, as there are many opportunities.