Kubota Corporation announced 17 billion Yen investment into the production capacity of the Hirakata excavator manufacturing plant in Japan in response to high demand for mini excavators.
The approved investment into production capabilities such as painting, assembly and other critical manufacturing processes is expected to increase production capabilities from the current 48,000 units annually to 78,000 units by the end of 2024. Construction of the new 12,150 square-meter building which has been earmarked to handle painting and assembly has already commence and according to a senior official at Kubota Japan, these new production additions will allow Kubota to not just address demand from North America and Europe, but also the steadily rising demand from other countries such as Australia and South East Asia.
The drivers behind the sudden demand has been attributed to the COVID-19 pandemic as the pandemic has been seen as the cause behind residential construction and infrastructural development projects as governments try to revive their economies through investments into infrastructure and urban development projects. According to the same official from Kubota, this demand is expected to continue over the next few years. The new facility that is currently being constructed will see a section of the current painting and assembly processes being moved to this new building which would certainly enhance production capabilities strategically as space will be created to extend the current assembly lines by introducing more machining, component attachments and welding equipment.
The new painting facility component will also incorporate the latest technologies such as the use of powder painting which does not only minimize paint loss and reduce volatile organic compounds (VOC), but also environmentally friendly and superior in terms of rust prevention. The entire facility is ‘eco considerate’ as the heat that is generated by the coating processes of the machines will be reused and the facility will also be fitted with solar panels on the roof that will reduce the impact of the plant on the environment significantly.
On a similar note, Bobcat also announced an investment into its North American plant located at Rogers, Minnesota. Although the amount of investment was undeclared, the investment according to officials will increase the plant size by a staggering 225,000 square feet earmarked to enhance production capacity and also achieve a higher level of streamline efficiencies across it process platform. The extension of the plant will also see more jobs for the people of Minnesota by the end of this year.
“Bobcat has always been committed to Minnesota as much as it is committed to the environment and its core business” stated the president of Doosan Bobcat for North America Mike Balweber. The location of the facility is strategic as it will be sitting right in the middle of the intersection of two primary roadway systems (Highway 101 and Interstate 94) which according to Bobcat is critical towards optimizing manufacturing logistics. These investments are also in response to the increasing demand for excavators for purchase or for short term excavator rental, not just in North America, but also other parts of the world. This investment comes in sequence to other investments made by Bobcat recently such as the expansion of its Litchfield facility for 26 Million USD and 70 Million USD investment into the North Carolina plant.
Based on market sources, most major manufacturers are expecting a surge in demand in various excavator categories from the mini segments all the way to the larger classes as the impact of the COVID 19 pandemic winds down. Some manufacturers are investing into future demand for electric construction machines through collaborations with various partners involved in the manufacturing of power packs such as Tesla and Proterra.