Increased cost of manufacturing due to steep rise steel and oil prices globally, has forced the leading construction equipment manufacturer JCB to double its global sourcing from India. The company presently does around 15 per cent of components and equipment sourcing from India for its worldwide plants and the same would cross 30 per cent within this year.
JCB group CEO Matthew Taylor said this on Monday before rolling out the 75,000th JCB machine from India. Matthew asserted that the advantage of low costs of manufacturing in India would make the country JCB's global sourcing hub.
"Prices of steel and oil have seen a steep rise over last eight months leading to increased cost of manufacturing. Because of this, we need to source more and more components and other accessaries from India to UK and other centres," he added. The JCB chief pointed out that customers will have to pay for the increased costs up to a certain extent.
Along with the roll out of its 75,000th equipment, the company also inaugurated its spareparts warehouse and a full-fledged training centre at Talegaon industrial estate.
JCB India Managing Director Vipin Sondhi said, the company has marginally increased its product prices over last four months and a similar price rise might happen in another three to four months. "The overall slowdown in construction business has not affected us so far. But, the same might show certain impact in another three months. In addition to this, the inceased interest rates on loans too have affected our business. But, we will still grow at a similar rate as last year," Sondhi claimed.
Talking about company's plans to double sourcing from India, he said, "We have sufficient capacity to increase India sourcing. The country would soon develop as global sourcing hub for JCB," he added. JCB India presently has three plants. The company invested around Rs 300 crore in India last year and some more investment is expected during the next year as well.
