Kobelco to Produce Crawlers in India

Kobelco Cranes Co. Ltd., Tokyo, Japan, a subsidiary of Kobe Steel Ltd., announced that it will construct a plant in India to produce crawler cranes. This initiative will strengthen Kobelco’s involvement in the Indian market, which is anticipated to grow rapidly in the future. Investing 1.2 billion yen ($14.2 million) in the facility, Kobelco said the plant is scheduled to begin production in October 2011.

Kobelco claims roughly 50 percent of Japan’s crawler crane market and has 17 percent of the global market. The new Indian plant will be the company’s first overseas production facility.  In addition, among the world’s major mobile crane makers, Kobelco will be the first foreign company to own a facility in India that specializes in the manufacture of crawler cranes, according to the company.

The new crawler crane plant will be constructed in the Sri City Special Economic Zone, adjacent to the hydraulic excavator plant of Kobelco Construction Machinery Co. Ltd., also a group company of Kobe Steel.

Kobelco established Kobelco Cranes India Pvt. Ltd. (or KCI) last month and will open this month. When the crawler crane plant is completed, KCI will integrate production with sales, and will manufacture crawler cranes ranging from 90 to 250 tons.

The world market for crawler cranes saw a temporary drop in demand following the financial crisis in fall 2008, but after hitting bottom, demand has begun to pick up again. India, China and other emerging countries have seen a rapid increase in demand. 

The Indian market for crawler cranes, which reached about 200 units in 2009, is anticipated to grow rapidly to 700 units in the next five years, on the back of strong infrastructure investment.

The Kobe Steel Group in April this year launched a medium- to long-term business vision in which it said it would actively develop its overseas business. Overseas sales are anticipated to increase from the current 33 percent to around 50 percent, boosting overall sales and profits.  An important initiative is to establish a presence in large markets, especially China and India. The company anticipates that in five to ten years, its overseas crane business will become a major base of its earnings.