Compact specialist looks to replicate Middle East success with new manufacturing base
Compact equipment specialist Doosan Bobcat has announced a new backhoe loader plant in India, marking its entry into one of the world’s three largest markets for the compact construction equipment industry.
The company, which is the market leader in the compact machinery segment in the Middle East and offers three models of backhoe loaders in the region, acquired the new Indian plant last month. The facility sits on a total area 80,000sqm with a factory floor area of 15,000sqm. The production capacity is 8,000 units a year, said a statement from Bobcat.
It added that Scott Park, Doosan Bobcat president and CEO, visited the new plant at the begenning of this month to check on the progress of the business. Bobcat has entered the backhoe loader market in a bid to expand its emerging market portfolio with the aim of exploring mid- and long-term growth engines.
The company introduced its first ever backhoe loader in 2016, choosing the Middle East as the launch market. According to Gaby Rhayem, regional director, Middle East and North Africa, at Doosan Bobcat, including a backhoe loader in its product line-up in the region has enabled the company to offer a total compact equipment solution to customers in the region and helped Bobcat to cement its position as the market leader in the overall compact equipment segment of the Middle East market.
Bobcat’s statement said the decison to manufacture backhoe loaders in India was based on the fact that the country‘s compact equipment market is the third largest in the world after the US and China, with an estimated worth of $1.2bn, where backhoe loader sales account for more than 80%. Since 2014, the Indian backhoe loader market has grown at an average annual rate of 9.7%.
Bobcat has already become one of the top backhoe loader sellers in the Middle East within two years of launch and hopes to tap into the growth of the Indian market to replciate its Middle East success there.
To minimise investment risk, Doosan Bobcat acquired idle facilities in India to produce its backhoe loaders. The company added that this also dramatically shortens the period from preparation time to shipping time compared to the time taken to establish an entirely new plant. Bobcat will be able to start releasing its first batch of backhoe loaders from its India facility in the second half of next year. They will then focus on marketing activities targeting the Indian market in a bid to expand its market share.
While several global manufacturers supply the Middle East market from their manufacturing bases in India, it could not be immediately ascertained whether Bobcat would source backhoe loaders in the Middle East from its Indian plant.
“With government-led infrastructure investment increasing in recent years, the compact market is growing rapidly in India, making it a highly attractive market. Our mid and long-term goal, beginning with backhoe loaders, is to lead the Indian small construction machinery market,” said Park.