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2023-11-16

Construction Equipment Set for Substantial Growth

INDIA REPORT
Aditya Kondejkar

The construction equipment industry anticipates a robust 5-year outlook with a projected 15% year-on-year growth. This optimistic forecast is anchored in the momentum generated by ongoing construction projects and increased infrastructure spending. The government’s substantial allocation of $130.57 billion (Rs 10 lakh crore) underscores its commitment to fortifying this sector.

Moreover, the recognition of the scale and technological prospects within the construction landscape further emphasizes the strategic importance of advancements in this domain.

Source: Times of India:   Read The Article

The construction equipment (CE) sector has undergone significant transformation over the past 2-3 years, marked by major players reaching peak manufacturing capacities and subsequently embarking on expansive growth initiatives.

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2021-03-20

Semiconductor Shortage Restricts Growth of Indian Auto Industry

Aditya Kondejkar

As the industry is coming out from the COVID impact, its growth is hurt by a shortage of semiconductors. Many OEMs have revised the production plans downward due to this shortage. We anticipate the shortage of semiconductors will exist for the next 4-5 months. Though it will hamper monthly production, it will have only a moderate impact on the total year’s production. But If the chip shortage lasts, production cuts could reduce the inventory of vehicles for sale in India and overseas markets.

The issue started in the Q2 2020. Due to COVID-19, auto OEMs worldwide drastically reduced their production and component orders. Concurrently, chipmakers were improving the supply chain, which had been disrupted by COVID-19. They witnessed a spurt in orders from electronics companies for items such as phones, laptops, gaming console makers and witnessed a spike in sales volume during the pandemic caused by changing work and school patterns.

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2020-02-25

Thailand Auto Industry Brakes Sharply

This article initially appeared in the February 2020 issue of PowerTALK News.

THAILAND–Vehicles produced in Thailand are exported to the world, including Asia, Oceania, the Middle East and Europe. However, the automobile industry is in trouble because of the double punch of the global economy slowing down due to the US-China trade friction and the spread of the new coronavirus.

Akihiro Komuro
Akihito Komuro

Exports, which account for half of Thailand’s automobile production, where Japanese and other automakers such as Toyota and Honda have production bases, have fallen, and vehicle production turned negative for the first time in five years in 2019. In addition, the spread of the new coronavirus is catching up. It is expected that the impact on Thailand’s automobile industry will be even greater if the shutdown of factories in China and production cutoffs are prolonged and parts procurement is delayed.

Source: NHK

PSR Analysis: From about September 2019, it has been reported that many Southeast Asian automobile industries, including Thailand, have begun to slow down, but this has been attributed to a slowdown in trade due to US-China trade friction.

Today, of course, there is the same problem, but the rapid spread of COVID-19 is a new problem. Many automotive industries around the world are supported by the supply of parts from China, and a slowdown in supply could severely impact car production. Especially in Southeast Asia such as Thailand and Indonesia.  PSR

Akihiro Komuro is a Research Analyst covering the Far East and Southeast Asia for Power Systems Research.

2021-11-21

Chip Shortages Cause Worst Festive Season in Decade for Auto Industry

Aditya Kondejkar

2021’s festive period from Navratri to Diwali (October) marked the worst performance for India automakers in nearly a decade. Usually, sales of PVs peak during the period, however, the demand was much lower this year. 

Further, two-wheeler and tractor sales dropped by about 10%. The major reason for this drop is supply-side challenges on semiconductors and lack of demand in entry-level segments for both PVs and two-wheelers.

In the commercial vehicles space, the situation was somewhat better with an increase in demand for interstate movement of goods.

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2022-01-22

2021 Trailer Industry Grows 33% at 163,000 Units

The Brazil trailer industry registered 163,000 new license plates in 2021 vs. 122,000 in 2020, growing 33.5%. The result could have been even better since the segment was affected by a lack of components, such as steel, tires, etc. Export sales climbed to 4,600 units vs. 2,100 units in 2021.

Source: M&T / Anfir     Read The Article

PSR Analysis: The growth is in line with truck sales that confirm the health of the transportation industry. The growth of exports confirms the recovery of key markets of Trailers and MHV.

Fabio Ferraresi is Director Business Development-South America for Power Systems Research

2022-09-28

Festive Demand Expected To Boost Auto Industry

INDIA REPORT 
Aditya Kondejkar

Adequate rainfall across the country along with the start of the long festive season will keep the demand for automobiles positive and help keep the momentum going in this segment. Additionally, normal monsoons in most parts of the country resulting in a decent agricultural harvest kept demand positive. So, automakers are focusing on building up inventory in anticipation of higher demand

The Indian economy is poised to shrug off the modest tapering of growth in Q1 2022, and aggregate demand is firm and set to expand as the festival season sets in. Hatchback cars and affordable, non-electric motorcycles and scooters are set to register bumper sales in the coming months as India gets ready to celebrate its first ‘normal’ festive season after a gap of two years. Above-normal rains, positive consumer sentiment and a generally optimistic mood are also expected to boost sales of these entry-level vehicles.

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2020-08-23

Kubota To Build Factory for Small CN Equipment in US

FAR EAST: JAPAN REPORT

Kubota will invest up to US$ 93.9 Million (10 billion yen) by 2026 to build a factory for small construction equipment in the US. The company will manufacture crawler-driven models used for residential construction and other purposes locally to increase the production by 25%.

Akihiro Komuro
Akihito Komuro

With COVID-19, there is a movement of people moving from the city center to the suburbs in the US. Kubota expects that the demand for small construction equipment will increase in the regions where it has sales channels and aims to become the largest manufacturer in the US by increasing production. First, they will invest 5.6 billion yen (56 Million USD) to build a new factory in Kansas.

The company will start mass production of its “Compact Track Loader (CTL)” in September 2022. By 2023, annual production will reach 3,000 units. Depending upon demand, the company could be producing 5,000 units annually by 2026. Japan is producing about 20,000 of the same model. With the addition of 5,000 units from the United States, the total production will increase by about 25%.

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Used Construction Equipment Prices Fall in SE Asia, Demand Slows with COVID-19

The prices of used construction equipment continue to fall, and bidding prices at major auctions are 10% lower than in the same period last year. This is due to a decrease in demand from Southeast Asia due to the COVID-19.

Akihiro Komuro
Akihito Komuro

Demand in Japan is steady due to the torrential rains in Kyushu and other factors, but the price decline in overseas markets has lowered the overall market.

Demand in the Philippines and Thailand also declined. In Southeast Asia, demand for cranes and other infrastructure-related equipment has been high for the past few years, but there have been several construction delays and stoppages caused by COVID-19. The average unit price at the crane truck auction was about 6 million yen, a 20% drop from January to March before COVID-19.

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2023-06-19

Indonesia Plans To Become Major Player in Car Industry

SOUTHEAST ASIA: INDONESIA REPORT

Amid the global shift to EVs, Indonesia is vying to become the new leader in this segment.

Indonesia has already surpassed Thailand in passenger car production and has begun full-scale EV production ahead of Thailand. Thailand has begun to defend its position as the auto manufacturing hub of Southeast Asia by offering preferential policies for EVs, including subsidies for both domestic production and sales.

Indonesia’s greatest strength is its abundance of nickel, which is used in car batteries. It is said to have the largest nickel reserves in the world, and investment in this resource is growing rapidly. In April, the Indonesian government announced that it was considering investing in a nickel production venture involving Ford of the United States and that VW of Germany was also considering participation.

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