Handling with care. When it comes to material

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1 Plant visit 44

2 Handling with care Of the Demag Cranes 26 production sites around the world, its India plant in Chakan near Pune has the unique distinction of having the widest product range. By Niranjan Mudholkar When it comes to material handling equipment, industrial cranes play a vitally important role in manufacturing, just as they do in other industries. Indeed, it could be said that the strength of the cranes segment directly reflects the overall economic situation due to its relationship with key sectors. Not surprisingly, the industrial cranes market is on the rise due to growing demand from the automotive, infrastructure, power equipment, logistics, steel and general engineering industries. Despite the inherent significance, this Rs2000 crore market is rather fragmented with only a handful of organised players active. However, these few companies dominate the overall market with close to an 80-per cent share. While there are no official figures available to show the actual consolidated sales numbers there is not yet a formal trade body it is estimated that the annual demand for industrial cranes in 2011 was approximately 15,000 units, and that it is likely to touch 20,000 units by It is in this light that we decided to visit the manufacturing facility of one of the few organised players, Demag Cranes and Components India. Demag India is a wholly-owned subsidiary of Demag Cranes & Components GmbH Germany, which has presence across 60 countries with 26 production sites. The Indian operation offers a complete range of products and services available under the Demag AG umbrella. Its business is broadly divided under three divisions: cranes, components and services. The Chakan plant, which is also the company headquarters, performs all vital functions, including design, development, manufacturing, and sales and services, including refurbishment. Besides the Demag Brand, the company also sells Gottwald cranes for port technology. 45

3 Vitals Company: Demag Cranes & Components (India) pvt. Ltd. Company head: Suhas Baxi, CEO & MD Plant location: Chakan, Tal Khed, District Pune. Plant manager: Dieter Eichler, COO Plant area: 12.7 acres History In India, Demag has had a very reputable presence since its first sale in 1913 to Tisco. Represented by an agent since 1958, Demag decided to incorporate its own Indian subsidiary in 1996 to be closer to its customers and provide them with better solutions, products and service support. Accordingly, a trading operation was started. Manufacturing Date when manufacturing started: July 2010 in the current Location Manufacturing in India: Since 2000 Products manufactured: Cranes and components Manufacturing capacity: 1,000 cranes per annum Catering to which market: India, Sri Lanka, Bangladesh Raw material used: Mild steel Staff strength:

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5 Expansion First steps: Trading operation between In 2000, a manufacturing plant was set up at Hinjewadi to manufacture and assemble cranes. As business and installations in India grew, a need to increase manufacturing capacity arose. The current plant was part of an expansion plan in Future plans: Future expansion plans will be shaped by market dynamics and the ability to serve pan India customers efficiently. 48

6 Parentage Demag Cranes & Components (India) is a subsidiary of Demag Cranes AG, which is one of the world s leading suppliers of industrial cranes, crane components, harbour cranes and port automation technology. Services, in particular maintenance and refurbishment services, are another key element of the group s business activities. In financial year , the group, with 6,000-plus employees, generated revenue of over a billion euros. It had operative earnings before interest and tax of EUR75.7 million at the end of last September. For the yearlong period before this, 19.3 per cent of revenue was generated in Germany, 27.5 per cent in Europe excluding Germany and Russia, 15 per cent in North, Central and South America, 15.3 per cent in Asia, 17.4 per cent in the BRIC countries and 5.4 per cent in other countries. Since August 2011, the USbased Terex Group has held a majority share in the company. 49