Volvo to expand equipment business in India

Volvo Group, the Euro 27 billion commercial vehicle maker of Sweden, plans to expand the construction equipment and road development machines business in India.

This move comes after the company's recent global acquisition of Ingersoll Rand's heavy road construction equipment division for $1.3 billion. IR has a manufacturing plant in Bangalore.

According to Eric Leblanc, Managing Director, Volvo India Private Limited, the company will use the facility of Ingersoll Rand at Bangalore to produce machines like excavators and loaders for the Indian market.

Leblanc said the company is in the process of integrating the operations of Ingersoll Rand (IR) with itself in Bangalore.

"We have completed the acquisition transaction globally a month ago and are currently integrating the sales and distribution of road machinery business of IR with Volvo. We do intend to use their plant to produce other global construction equipment products in India."

Talking to Business Standard, he said IR has a very good engineering base in Bangalore and Volvo will use that to reduce the price of various construction equipment in the domestic market. The company will introduce Volvo brand name on the construction equipment made by IR in Bangalore.

"Over the next 12 months we will launch new range of products. We already have road development machines in our portfoilio like motor graders which will be further expanded," he said.

Volvo will expand the product range of heavy road construction equipment and road making machinery, Leblanc said adding that Volvo will further grow its market share in the Indian market.

Presently, Volvo has 13 per cent market share in the excavator range in the country, behind L&T Komatsu, Tata Hitachi. Last year, Volvo sold about 800 machines like excavators, wheel loaders and graders worth about $100 million in India.

"Right now we don't have any production capacity for excavators in India. We import excavators from Volvo's Korean plant and sell in India. We are looking to manufacture excavators in India but as of now no decision has been taken in this regard. There is a potential to make them in India," Leblanc added.

Volvo estimates the global market for road construction equipment is worth about $4 billion a year and will probably grow as governments spend more money on infrastructure.