An Overview of the Indian Elevator Market
Since the liberalization of the Indian economy in 1991, there has been a great increase in the demand for elevators, also the government had imposed a ban on collapsible gate elevators, thus creating a path for international players to capture this segment. During this period Schindler was trying to establish at 100% subsidiary to start its operations in India.
Indian customers are considered to be price sensitive and majority of the market preferred single door speed elevators (65%) and then two door speed elevators (20%). Single door speed elevator is a type of elevator door which consists of horizontal sliding panel. Two door speed elevator on the other hand consists of two horizontal sliding panels. Price and simple products are the key factors that are taken into consideration for most Indian buyers, but after sale services too is becoming a major concern in elevator buying decision.
After liberalization there has been a growth in the tourism industry and an increase in foreign tourist and business visitors coming to India. This further leads to the growth of the hotel industry, which is the largest buyer of top line elevators.
The key players in the elevator industry are Otis (50%), Kone (8.8%), Bharat Bijlee limited (8.6%) and ECE industries limited (8.4%). Otis dominated the market, both from product and service point of view and it is also considered to be the most profit making firm in the elevator industry.
Elevator industry in India today
Given the annual growth rate of approximately 8.5% between 2006-07 to 2010-11 and a growth rate of approximately 4%-5% despite the global recession, the real estate market in India is growing at a steady pace and will continue to grow steadily because it is backed by strong drivers such as a large base of middle- class households, high disposable incomes and young workforce. Because of such growth in the real estate market there is a tremendous need for elevators and escalators and hence the elevator industry in India is growing at a fast pace. Increasing demand for commercial spaces such as office, retail and hospitals as well as increasing demand for housing units and infrastructure development are the factors that lead to the growth of the elevator industry in India. Hence there is major scope and potential for further development of this industry.
The company Schindler is a manufacturer of elevators and escalators worldwide. Besides manufacturing, the company also installs, modernizes and maintains elevators and escalators in buildings, offices and malls.
The inception of Schindler can be traced back to 1874; it was founded by Robert Schindler and Eduard Villiger. Its head office is in Ebikon, Switzerland.
Till the 1950s Schindler did not have a local market base in India and hence could not carry out their business operations. However in the year 1958 they entered into a long term distribution agreement with ECE industries limited...