Caterpillar India is strengthening its manufacturing capacity and product range as emerging markets will contribute to more than half the demand for construction equipment industry and allied sectors in the coming years.

Addressing a press conference on the launch of a new variant of backhoe loader, the Cat 424B, Ramesh Tipirneni, Country Manager, Caterpillar India, said the company has added a second engine production line at Hosur to make the 3406 series of engines.

The new Cat 424B is an optimised and more fuel-efficient version of the existing range. The backhoe is priced around ₹20-24 lakh. The company will assist buyers with its Cat Finance Solution operated by Tata Capital Financial Services.

Its $150 million Perkins engine manufacturing plant coming up in Aurangabad will start production next year. It will make engines for gensets and for original equipment manufacturers, he said.

Vivek Chandrasekharan, Director – Asia Region, Building Construction Division, Caterpillar, said the emerging markets are expected to contribute to more than half the global demand for construction equipment in the coming years.

Caterpillar equipment caters to construction sector, mining, energy and transportation. The slowdown has hit the construction equipment industry for now. In 2013, the total domestic sale of backhoe loaders is estimated at 27,500 units.

In the first half of the current year, industry sales are down about 25 per cent. But the industry is optimistic on growth in the coming year with the Government focus on infrastructure and industrial development, he said.

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