The booming infrastructure and construction activities have had a positive impact on the road machinery, construction and tipper truck business of Volvo India, says Managing Director Kamal Bali. The company now plans to amplify focus in the long-haul trucking segment where better roads and improved logistics eco-system is raising the need for high-performing truck solutions, Bali says in an interaction with Shashi Kumar Sharma of B2B Purchase.
Trucks, buses, construction equipment, engines – which is the most promising for your business in India?
You cannot pick one at the cost of another. Infrastructure development is imperative for India’s growth, as well as efficient trucking and logistics. Hence, each of our businesses are promising in this regard.
Logistics along with a good infrastructure and road network, are essential for India’s growth. The introduction of GST is helping break down idle time for vehicles and reduce unproductive times in the logistics chain. As a result, the need for vehicles and transport solutions that can do ‘more with less’ and offer high performance will grow. Already, you can see that the higher tonnage trucks are gaining increased traction in the industry.
The third is public transport. India is witnessing unprecedented urbanisation which is likely to continue. We already are facing massive congestion levels and environmental concerns in the city. Public transport has to be the prime choice in cities as use of private vehicles is not sustainable anymore. We are already present across 35 cities with the purpose of making public transport more attractive.
Our products and solutions are entwined with national imperatives and have potential at least for a long time to come. Each one will have their own business cycles.
We are in the right segments of the economy. All our businesses resonate with Indian imperatives and thus are connected with GDP growth. Hence, as long as GDP keeps growing, our business too will continue to grow.
What’s the share of CE business for your group in India? Discuss your future plans in this space?
We have trucks, buses, engines and construction equipment in addition to a joint venture (JV) with Eicher and over $2 billion business in India. While we would not break up business by specific areas, we are bullish on India and its future potential. Our plan is improve our customer experience across all touch points, as we go forward. We are present across mainstream as well as the premium segments and thus aim to play a larger role in the Indian commercial vehicles and construction equipment industry.The aim also is to play a much bigger role in the long-haul heavy duty trucking segment.
You have a wing for finance service
as well. What are the prospects of that business?
Volvo Financial Services which started operations about two years ago does retail finance for all Volvo and Eicher products and is our captive financing arm. Volvo Financial Services India draws on dual strengths – global expertise of Volvo Group and the deep market understanding of our Indian team.
What’s the present investment for Volvo Group
We are investing from the last 20 years. Starting with trucks, we introduced buses, construction equipment, and formed a successful JV – VE Commercial vehicles. We’ve been investing every three to five years and continue to bring in new businesses and capacity expansion. Just this month, our JV announced plans to invest Rs 400 crore in a plant in Bhopal which will further enhance its capacity levels.
Construction, mining and irrigation are trucking industry’s mainstay while for buses, focus is on public transport.
Kamal Bali, Managing Director, Volvo India