Could you please give an overview of Komatsu’s presence in Chile?

The Komatsu-Cummins joint venture was formed in 1999, taking over from the previous distributor for Komatsu and Cummins. Komatsu and Cummins joined together to form KCC, and since then the company has experienced significant growth, both in market share and volume, providing our customers with a wide variety of equipment and services. We are the distributor for both Komatsu and Cummins in Chile, while we also have a rental company with a fleet of over 600 machines, as well as remanufacturing and component repair shops to support our fleets. Overall, we have over 5,000 people across Chile. The mining industry is our main market. Today, we have 20 mining contracts and we are present in most of the major mining sites. We have a very strong focus on training and developing qualified personnel considering that 70% of our workforce are technicians. We have been investing significantly in improving our capacity. We are very close to finalizing the construction of our new repair facility here in Santiago. It is an investment of around $33 million, which will likely be the most technologically advanced mining component repair facility in the region. We will continue to invest in increasing our support capabilities and we think of ourselves as a full-service company rather than just an equipment supplier.

How does the acquisition of Joy Global fit into Komatsu’s overall strategy?

As a result of the Joy Global acquisition (now Komatsu Mining Corporation) we have an even wider range of equipment, including drills, rope shovels, large mining loaders, and a full line of underground equipment and conveyor systems. Mining is relevant to Komatsu’s strategic plan. In order for us to add the most value, joining forces with Joy Global made a lot of sense, since it is a very complementary business. Komatsu’s offer included several products for mining, including hydraulic shovels, trucks, and a variety of earth moving equipment. Joy Global, on the other hand, provided machines that Komatsu did not have. The possibility for synergy between the two companies is significant. Joy Global was also a company whose corporate philosophy is very similar to ours. We share similar values and a direct-to-customer approach in terms of distribution. We are positive it is a win-win for both companies and for the mining industry.

What steps has Komatsu taken toward automation?

Komatsu has been working for many years on automation, leading the development of autonomous haulage systems (AHS) for mining operations. We were pioneers in deploying autonomous trucks and today we have fleets running in Chile, Australia and Canada. Here in Chile, we have operated an AHS at CODELCO’s Gabriela Mistral mine since the end of 2007. Likewise, Komatsu has made great advancements in the application of operator assistance methods for construction machinery. An example of this is SMART Construction. This system is a combination of intelligent machines and operation planning methods that can significantly increase productivity in a construction site. Complex machinery can be operated properly by people without intensive training or accumulated experience. This addresses the shortage of qualified labor, while improving productivity and the quality of the final result. All of the more complex tasks of the operation are managed by the machine automatically. Finally, we are also working on ways to remove people from harm’s way via remote operation. We believe that a combination of automated and remotely operated equipment will provide the industry with a safer, more productive environment in the future.

How receptive has the Chilean mining industry been to automation?

At first it took some visionary customers, like CODELCO in Chile or Rio Tinto in Australia, to really endorse the technology and push for its successful application. Many other players in the industry are evaluating this technology, but it has not been a priority for them so far. When you have several fleets running with good results for a long period of time, the industry generally accepts that this is a reliable and working technology. We are at that point right now. We expect to see significant growth in automation going forward. There are a lot of benefits to it in terms of safety and productivity.  The obvious benefit of automation is to remove people from harm’s way. This results in a safer operation, as it reduces the amount of people exposed to risks, but it also makes operating in remote, harsh locations easier. This is becoming more relevant to the industry as new deposits are in increasingly remote locations where reducing operating footprint is critical. Finally, automation is all about reducing variability and improved utilization and productivity. We see significant productivity gains across our AHS operations globally and this will increase even further going forward.

What types of hybrid machines does Komatsu offer?

In Chile in particular, we have hybrid excavators operating in the forestry sector with good results in terms of fuel burn and emissions reductions. We also have an LHD loader with hybrid technology for hard rock underground operations. We expect this machine to be very attractive to customers operating underground due to the implied emissions reduction inside the mine. Eventually, moving from hybrid to fully electric and battery operated equipment will reduce the requirement for underground ventilation, which is a significant cost for these operations. The use of hybrid technology in other large-scale mining equipment is an area we are also looking into. More efficient equipment and fewer emissions are priorities for development and hybrid is one alternative for achieving it.