Challenging Terrain
The hydraulic excavator market in India has been impacted by the slowdown after the onset of COVID-19 pandemic. Though the market recovery is slow, it can bounce back with the support of policy measures as vast opportunities lie ahead in infrastructure creation in the country.  

Hydraulic excavators are versatile pieces of equipment for use in construction projects. They have also revolutionised mining operations and hence have become very popular and widespread. Hydraulic excavators work in challenging conditions of construction, mining and solid waste handling operations. Sandeep Singh, Managing Director, Tata Hitachi Construction Machinery Company, says, “With its vast application possibilities and ease of operation, the popularity of hydraulic excavators has seen a tremendous growth over the years.”  

Over the years, hydraulic excavators have replaced cable shovels, rippers and dozers in several applications to become the most important and principal equipment in construction and mining sites. Vivek Hajela, General Manager and Head - Construction Equipment Business, Larsen & Toubro highlights the importance of hydraulic excavator, “It is central to operations and drives downstream operations like haulage, dozing, grading, compaction etc. Hence, its availability, utilisation, and reliability determine the overall productivity of the site which is key to a project’s success.” 

A wide range of speciality attachment have enormously increased the versatility and utility of hydraulic excavators in applications such as breaking, demolition, piling, super long reach applications, amphibian underfoot applications, clamshells, drilling, scrap handling  etc to name a few. Hajela adds, “It is now left to the imagination of the user to think in how many varied ways hydraulic excavator can be made use of. Today, attachment innovators can turn your imagination to reality. Hence, it is imperative that the machine’s capability is well understood, operators are qualified and trained to utilise the machine optimally, 
based on site conditions and working environment.”  

According to Puneet Vidyarthi, Brand Leader, CASE India, hydraulic excavators are important equipment since they provide adequate safety, efficiency and versatility to work on the tricky grounds of construction 
and mining. 

The COVID-19 impact
According to an earlier Off-Highway Research report, crawler excavator sales in India was expected to reach 37,000 units in 2023, from 25,474 units in 2018, indicating a growth of 45 per cent in the 2018-23 period. However, the onset of COVID-19 has impacted the market with slowdown in construction activities, creating a sudden dip in demand and sales of hydraulic excavators. 
According to Singh, despite the rising numbers of cases of COVID-19, there was hope that construction activities would continue and the industry was looking forward for a record sale in the month of March. However, “due to the imposition of the lockdown, construction activities ceased and hence all activities of sales came to a halt in the last week of March, which is generally a very important month of the year. Given this, the sales of excavators were severely impacted. As April saw a full lockdown with only select construction allowed post 20th, there was hardly any demand for machines and operations were also disrupted. Therefore, the market size in April was, no doubt a multi-decade low, but unlike commercial vehicles, it was not zero,” he adds.

According to Hajela, hydraulic excavator demand grew by almost 25 per cent year-on-year during 2015-19. He elaborates on the trend, “The last fiscal was a tough year with demand contracting by almost 30 per cent during the first nine months, but was seen to revive post-EXCON. COVID-19 dealt a severe blow and March sales of hydraulic excavators were reduced to only about 10 per cent of the normal monthly sales. The economy including all construction activities are severely paralysed due to the pandemic. The lockdown brought all ongoing projects to a standstill and the machines lying idle at sites across the country. Only mining projects which were covered under the Essential Services Maintenance Act have been in working condition. Hence, sales in April and May are almost negligible, and soon there will be monsoon.” However, recently many construction projects are restarting and machines being re-activated. The stimulus package announced by the Central Government is also expected to give some momentum. “We expect revival in demand only from September, but overall hydraulic excavator demand during FY2020-21 may contract by 20 per cent over FY2019-20,” says Hajela.

Dimitrov Krishnan, Managing Director, Volvo CE India speaks on the impact of the COVID-19, “In India, we have seen its impact since mid-March and more so since the announcement of lockdown by the Prime Minister on March 24. Most of the construction sites have stopped operations and so have all of the industrial operations in the CE industry just like all other industries. There is just a small fleet of equipment working in coal mining sector to keep power supply on as an essential service. Parts supplies to these sites have been made available based on special permissions for the same. In the coming weeks and months, we will also see a demand crisis due to lack of confidence in the buyers.”

Vidyarthi adds, “It’s difficult to estimate complete impact on the hydraulic excavators market, however we can say that there hasn’t been any significant activity in the market since the last two months, owing to the current scenario. The recently announced economic stimulus related to the construction sector is likely to help in easy clearances of projects and fast project completion which will help in bringing back the construction sector on track. This situation will help in demand of all construction equipment including hydraulic excavators as well.”

Nischal Mehrotra, Director-Sales & Marketing, LiuGong India, observes, “Last couple of months (March and April), almost 75 per cent of the market was impacted by the COVID-19 crisis. Going forward, we foresee a de-growth to the tune of 30 per cent compared to last year.”

When the going gets tough…
The COVID-19 pandemic has adversely impacted globally over the past couple of months. Indian construction sector is also under the pressure of this slowdown. However, as part of the relaxation in lockdown, construction activities in major projects were allowed from April 20 and activities have started at most of the large national highway projects. Singh says, “We do see a significant recovery in activity this month also. However, given the uncertain scenario, customers are cautious of purchasing new equipment. Further, the large numbers of labourers at most sites have returned to their native places and customers have to make do with whoever is available. If there are no operators/mechanics, they are unable to execute the projects.”