The global economic meltdown has had quite an effect on truck, bus and construction equipment major Volvo India Pvt Ltd. Growth declined from a steady 30-35% in 2004, 2005 and 2006 to 10-15% in 2007 and 2008.
“Growth has slowed down to 10-15% in 2007 and 2008 owing to the global financial crisis,” said managing director Mrityunjaya Singh.
In spite of the fall, the Sweden-based company wants to generate 50% of its revenue in India from its soft products such as renting, remarketing of used equipment, services, parts and lubricants. Its hard products constitute construction machinery.
When asked about the sales figure, Singh, who looks after the construction equipment segment, said, “We have sold 7,000 units of all types of construction equipment in India since 2001.”
The company has three manufacturing units in the country, all in Bangalore. Trucks, buses and road equipment are manufactured over there. “2,000 units of trucks and buses and 1,200 units of road equipment are manufactured in Bangalore a year,” he said.
Apart from India, the company has factories in Korea, Canada and Sweden. Among the things they manufacture in these places are hydraulic excavators, motor graders, wheel loaders and articulated haulers.
The size of the Indian construction equipment market is 35,000 units a year. Volvo is in the top six. The cost of its construction equipment varies from Rs 20 lakh to Rs 2.5 crore. The company has 11 dealers in the country.