22 October 2019

Interaction Damien Giraud, VP, Global-Construciton & Infrastructure, Caterpillar Inc. and John Fallows, MD - Sales & Mktg, Asia Pacific, Global Construction & Infrastructure, Caterpillar Asia Pte Ltd

Our DNA from day one was being international if not global

 

Caterpillar has a long legacy in India dating back to the 1930’s. Today, the company has six manufacturing facilities, 2 R&D centers, 1 logistics and parts centers and various divisional offices and continues to invest and cater to Indian customers. Manufacturing facilities are in Thiruvallur and Hosur, Tamil Nadu; Aurangabad, Maharashtra; and Noida, Uttar Pradesh. The Divisional offices are in Bengaluru, Chennai, Mumbai, New Delhi and Kolkata. As Caterpillar continues to grow popular among Indian customers, DAMIEN GIRAUD, VICE PRESIDENT, GLOBAL CONSTRUCTION AND INFRASTRUCTURE, CATERPILLAR INC. (DG) and JOHN FALLOWS, MANAGING DIRECTOR - SALES AND MARKETING, ASIA PACIFIC, GLOBAL CONSTRUCTION AND INFRASTRUCTURE, CATERPILLAR ASIA PTE LTD (JF) spoke to Rohan Ambike about India as a potential market and the growth prospects for Caterpillar, India.

 

 

There has been an exponential rise in the number of projects in India in the recent years. How do you look at India as a potential market for Caterpillar?

 

DG: Our mission is to help our customers to build a better world. Any highway or tunnel or any infrastructure project that makes use of equipment by Caterpillar is a proud moment for us. The legacy that Caterpillar wants to leave in India is no different from the way we have helped the customers build infrastructure in other parts of the world.

 

JF: In the recent years, the construction and infrastructure sector in India has grown to be very promising and encouraging. The government has mainly focused on infrastructure in India. This includes airports, tunnels and most importantly, the roads. Almost thousands of kilometers of roads are being built and this has generated growth in the demand for construction equipment players like us. We are seeing the industry opportunities on a higher scale than before. This is very encouraging.

 

 

 

 

How do you assess the Indian construction and infrastructure sector? To what extent does it foster growth of your company?

 

DG: Presently, apart from India, there are very few countries that are working on highway construction spanning thousands of kilometers every year. The Indian construction and infrastructure sector has a clear plan to work on and the amount of work is expected to accelerate in the next two years. This is very unique and it takes a lot of work to get that from a government prospective and we are here to help our Indian customers deliver the best for such vast projects.

 

JF: Today, the Indian construction and infrastructure sector is growing much faster than what we have seen before. The movement in the Indian construction and infrastructure sector as a whole, is in the right direction and at a much higher velocity than what we have seen before. The government has recognised the need for having infrastructure and has put resources to work. This is a great opportunity for Caterpillar.

 

 

 

 

Which sectors will be the major demand drivers for the construction and infrastructure sector in India?

 

DG:On a lighter note, growth in funding is what is driving the overall growth. Each and every piece in the area of infrastructure drives the investment around. This has made the sector to grow exponentially. The growing job sites will be beneficial for the contractors in India as they will have to build longer stretches and bigger roads. This will be trends in the coming years. The entire dynamics of the construction sector are turning out to be positive for India.

 

JF: The growth in the construction and infrastructure sector in India not only generates good amount of jobs for people who are building the roads, tunnels and other infrastructure, but it is also an opportunity for companies like us to expand our product line up to build for India and serve the demand. The growth also involves the participation of component and part suppliers and dealership employees. This collectively adds to growth opportunities and translates into growing revenue for the government. It is the ability to modernise and connect the cities together to improve the whole flow of commerce is going to be fantastic for India. When it comes to adaption of technology in India is going to help us and other players. The technology has played a greater role. That is where the industry is going. As Indian customers are inclined to adopt technology, this will work wonders for the country.

 

 

 

 

As a company, what are your takeaways from the Indian market?

 

DG: The most important part is to have the first customer to be satisfied and return to us for some other machine. We, at Caterpillar have teamed up with Gmmco and TIPLcheck that the customers get what they have asked for. We are not just selling our products, but we want to retain our customers. They should come back to us.

 

JF: One major takeaway from India is the need to act locally when we are a global company. We act locally to design and develop to make sure that they are correct for the Indian market. Secondly, it is how we service the customers. We do that through two very large dealerships here- TIPL and Gmmco. They have branches and network of people to support the local customer. We may be a global company, but our success is due to our ability to act locally.

 

 

 

 

Do you practice ‘Make in India and Sell Globally,’ use your India manufacturing base to supply the global market.

 

DG: India has been our ‘go-to-person’ for product designs and software development. Caterpillar India engineering teams are involved in the Global design of our machines and development of software for our equipment and hence an integral part of our global supply chain.

 

JF: We have a sizable manufacturing footprint here in India. We have in all six production facilities, two research and development facilities, one warehousing facility and around eight offices spread across India. In India we are currently manufacturing hydraulic excavators as they are extensively used in this part of the globe. The equipment manufactured here is exported to nearby countries such as Nepal or Bhutan.

 

Off-Highway trucks are another product which is used in India. For us, make in India is to serve the local market. This is good for India as it creates a supply chain for others.

 

 

 
What distinguishes your products vis-à-vis the competition?
 
DG: Our DNA from day one was being international if not global. There are a number of dealers that we have worldwide who have been associated with us for almost 80 of the total 90 years of Caterpillar. In 1930’s we had dealerships in Libya and Tunisia. I think that at all levels in Caterpillars, our theory is to provide equipment to the customers located anywhere in the world. We have designed machines always keeping a broader canvas in mind. We have the same capability when it comes to design, manufacture and logistically deliver. When this is done consistently, it gets into the system. Our concern about the customer irrespective of the location is most likely the key to long time success of Caterpillar.              
 
JF: We stand out as our machines allow our customers to be more profitable than others. We are the largest manufacturers and allow our dealers to have a broader scale. Our dealer in the northern part of India is TIPL, while Gmmco looks after the customers in the south. It is because of them, that we have crafted a name in the Indian market. We do not have that number of competitors who can provide the kind of service that we do. This makes us stand out distinctly in the market.

 

 

 

 

In terms of technology and safety form the operator point of view, what is that Caterpillar offers, making it a stand out from the rest?

 

DG: The cutting edge technology might not be the same for a customer in India, Brazil or China. Rather than cutting edge technology, it is more of the relevant technology that needs to be made use of. Our job is to provide a number of solutions and then we select the right solution for the right market place. This is what is happening in India. There are two parts when it comes to design and innovation. One is the design of innovation, which is being done each day. The second is adoption of innovation. The core of the innovation is to work hard partnering with our dealers and rope in more ideas, explanation and training if required. Our customers come up with some ideas how we can bring in something more for them. Technology adoption has been slow worldwide, but there are a few nations where it has geared up.

 

JF: Some of the relevant technologies for customers in India today are the payload measurement. If this is put on an excavator, one can understand how much load is in the bucket. This might look pretty simple, however from the savings point; the customer has a good idea of the exact amount of material in the truck. Overloading trucks lead to accidents or fines or mishaps. This simple technology can have a dramatic impact on the efficiency of the product. The other example is the Accugrade technology. This can help you understand what you are grading. It will reduce the back and forth in terms of surveying and other works.

 

In terms of future, the future of hydraulics is Autonomous. Those kinds of technologies are going to be used here in India as well. Technology and solution will continue to evolve quickly.

 

 

 

 

How do you look at the growth of Caterpillar India in the next five years?

 

JF: We will be bigger than what we are today. We will be having a broader product lineup than what we have today. We will be having more machines than what we have. The future is positive here.

 

In five years we will be sharing more machines and services. You will see a full commitment to serve our customers in India.




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