VP & Head,
Volvo CE India.
Dimitrov Krishnan, VP & Head, Volvo CE, India, tells Prabodh Menon of CT he is hoping for more policy support for the mining industry, given its potential for job creation.
How do you see the coming months with respect to business growth?
The drive to improve infrastructure will unquestionably facilitate further growth in theeconomy and the construction equipment industry. As a company, Volvo ConstructionEquipment (Volvo CE) has deep roots in India and an established sales and support network.We remain the only major manufacturer present in all equipment sectors: mining, road buildingor general construction. This year, with the government’s infrastructure push, we expect to seestrong interest in the EC200D, which was designed specifically for general construction workdue to its ability to deliver high job site productivity and fast cycle times.We believe the industry has enough momentum to continue growth for the next three to fouryears.
The election years typically slows decision making in the government, and thus, we areexpecting slightly reduced demand. We do believe, however, that the growth cycle that startedin India is irreversible. There will be continued growth and we expect the new government tocommit to growth.Any potential challenge could come from global developments; for example, a spike in oilprices, which could impact economic growth in India.We see opportunities for growth in the mining segment, specifically with coal, because thegovernment is opening coal mining for private companies. Even though it’s still in the earlystages, these projects will increase production capacity. Over the past few years, iron miningproduction has been lower, but we expect the government to address legal bottlenecks, whichshould lead to higher production volumes in India.
What are the key issues the industry is confronted with today?
India will need a76.5 million strong workforce (approximately), for its building, construction and realestate sector, according to a report by National Skill Development Corporation (NSDC). Shortage oftalent in the construction industry is a long-term problem that needs to be addressed withbetter education and training. The potential shortage of skilled workers is an issue that bothVolvo and the Indian industry faces.
In order to address this issue, we launched The OperatorChampion competition in India earlier this year to highlight the importance of skillsdevelopment in the construction industry and the vital role equipment operators play. Thecompetition is run in countries across the globe and its inaugural edition in India wrapped up inMarch this year with Bheemappa KS from Karnataka scooping the first prize.The three-day event gathered winners of the nine regional heats staged over the preceding 18months. Each finalist competed in a series of challenges, timed to test speed, dexterity, logic,and more. Operators were challenged on both live equipment and simulators, for bothexcavator and wheel loader operating systems. Some 100 people attended this celebration,including senior leadership from Volvo CE, government officials, major construction contractorsand representatives from Volvo CE dealerships. In addition to receiving the Operator Championtrophy, the winner received a cheque for Rs 5 lakh, while the runners-up each received Rs 2lakh.This event has given people the incentive to perform well in the construction industry. Havingskilled and well-trained workers is something Volvo CE takes pride in.
What are the changes you would like to see with respect to government policy?
The government continues to place priority on building roads and bridges, allocating budget tobuild 35,000 km of road under phase one of the Bharatmala project, along with allocations forurban rail and airport expansion projects. The budget is positive for the sectors Volvo CE serves,such as road and railway construction, quarry, aggregates and irrigation. We expect continuedstrong growth in most of the segments we serve.While we are proud to support the government’s initiative, the government is increasing theimport duty from 10% to 15% for a range of parts and components, including for commercialvehicles and bus components, to help drive the initiative and generate additional revenues. Thiswill directly impact our cost and businesses will have to make those associated pricing calls.More policy support for the mining sector could have provided a good boost for this sector. Themining segment has huge potential to provide job growth, which has been a stated focus of thisgovernment.
What are manufacturers doing to ensure the next generation of equipment are more innovative and efficient in terms ofautomation, artificial intelligence and data analytics?
Volvo CE has a reputation for bringing the latest technologies and innovations to this industry,allowing customers to get better productivity, reliability and efficiency from their operations.Volvo’s Co-Pilot, for example, offers a range of intelligent machine services – including LoadAssist, Haul Assist, Pave Assist and Dig Assist – to help operators deliver higher qualityoutcomes, in less time and with less effort. These examples of automated and assist-functionalities differentiate Volvo’s machines in the market.
To give customers better insight into the performance of their construction equipment, wehave also developed CareTrack, a telematics system that gives owners access to a wide range ofmachine monitoring information to help save time and money. The system generates amultitude of reports, delivering data on aspects such as fuel consumption, operational hours,geographical location and more. The reports are available via a web portal or can be receivedvia SMS or email alerts.The system can also be used to manage machine servicing and the replacement of parts. Thisallows fleet managers to reduce fuel costs, optimize machine and operator performance, aswell as proactively manage service and maintenance for maximum uptime.
Increasingly our customers need to do more with less, which is why Volvo CE continues to pushthe boundaries in terms of delivering the best levels of fuel efficiency in the industry. Beyondthat we are also looking ahead to the future of the industry and investing heavily in concepttechnologies like our pursuit of electrically-driven vehicles, which could be a game changer.
Recently, our company unveiled the world’s first fully-electric compact excavator, the EX2,which is equipped with electric drive systems and electromechanical linear actuators. While it istoo early to say if there will eventually be a shift towards electric engines in the market, VolvoCE believes that going electric is the future of our industry. The EX2 prototype shows ourdetermination to provide zero-emissions machines in the future which will have the samepower and force as conventional equipment. The EX2, however, is just one of a few electric initiatives we have. The LX1, while not fullyelectric like the EX2, is a prototype electric hybrid wheel loader. At a press event in the US inJuly 2017, we presented results from hundreds of hours of testing that show an averageimprovement of 50% in fuel efficiency compared to its conventional counterparts. This equatesto a reduction of 35% in fuel consumption and greenhouse gas emissions.We also showcased the HX1, a prototype autonomous, battery-electric load carrier. It is oneelement of a project that aims to electrify a transport stage in a quarry—from excavation toprimary crushing and transport to secondary crushing. It has already picked up industry awardsfor innovation.
What about user-friendly features, safety and sustainability?
Taking the example of CareTrack, the system is well received bycustomers due to the user-friendly interface. Customers say they like the insight CareTrackprovides, which helps them enhance productivity, machine uptime and supports them withmaintenance, invoicing, fleet management and operator training. With CareTrack, customerscan monitor load efficiency, number of cycles, overload percentages and identify operatortraining needs. For example, CareTrack can tell owners what time the machine operation starts,takes a break, and ends. What’s more, CareTrack allows owners to tap into a wealth ofactionable data including fuel consumption, idle time, machine location, fluid levels and servicealerts. With the time and labor savings CareTrack offers, customers say they view it as aninvestment rather than extra costs.
We have also set four key technology challenges called Triple Zero and 10x: zero emissions,zero accidents, zero unplanned stops and 10x higher efficiency. To help Volvo CE achieve itsgoals, the company is focusing on electromobility, intelligent machines and total site solutions.Volvo CE takes a holistic approach to environmental care addressing continuous improvementswithin the total enterprise, all the way from product planning and development, manufacturingand supply, and product use to recyclability and end-of-life for the products.The company’s focus is always on minimizing its global footprint, specifically when it comes togreenhouse gas emissions and the materials used.We believe this will help us achieve our ambitious goals and pave the way for a sustainableconstruction industry.
Tell us a bit about your manufacturing in India.
Volvo CE has a long history in India. Our factory in Bangalore will be celebrating 40 years ofproduction in the very near future. We see our Bangalore factory as an investment and rely onsupplier capability in India to meet the demand and reduce the investment amount to derivebetter value. Our Bangalore factory is a world class facility. We have a large and experiencedteam at Volvo CE that understands the market, and the needs of our customers. Wemanufacture about 10 different models of construction equipment in Bangalore and some ofour models are constructed from 95% of locally manufactured components.Our production facilities, including the one in India, have some of the highest levels ofautomation in our industry. All our factories operate under the Volvo Production System, orVPS. It’s a toolkit that includes methods such as Six Sigma—which reduces unwanted variationin processes, and Lean—which eliminates wasted time and material, to create a morestreamlined assembly process which helps us offer industry-leading reliability in our machines.The five principles of the Volvo Production System are – Process stability, Teamwork, Built-inquality, Just-in-time and continuous improvement.