Aftermarket - September 2011

I N D I A ’ S F I R S T M A G A Z I N E F O R T H E A U T O M O T I V E A F T E R M A R K E T

Vol. 1 No. 3 September 2011 64 Pages `50

Brought to you by Auto Monitor

EXTRA MILEShaman Motors

CUTTING EDGEAdvanced diagnostic solutions

INTERVIEWRamchandra Rao, ED, Eaton

Lucas Indian Service:

The Retail Connection


SEPTEMBER 2011 AFTERMARKET 1

Moderation in vehicles sales is expected to continue for some more time due to increase in interest rates and low sentiments due to uncertainties in different economies around the world. However, there is no caution

on negative growth since the demand for individual mobility is firm and the buy-ers are only postponing their purchases temporarily. Similar situation prevails in the used cars sales too.

With vehicle population increasing more so in the rural areas, there is an immense opportunity for entrepreneurs in the aftersales service business. This is also due to the fact that there are limitations for OEMs in expanding their service network as it is practically impossible to cover every nook and corner of the coun-try. Multi-brand third-party service centres for all segments of vehicles can fill the gaps seamlessly. Firstly, it will benefit the vehicle users due to proximity of service centres. Customers expect the service centres to be close to residential localities just for the sake of convenience. Secondly, the multi-brand third-party service centres can offer quality repairs and services for even new generation vehicles that demand diagnostic and other state-of-the-art equipment. These service cen-tres can match the OEM authorised service centres primarily due to technical capabilities and the scale of operations. Thirdly, it will protect the end users from buying counterfeit products.

Multi-brand third-party service centres will be profitable for a couple of rea-sons. These service centres can bank on standardisation of tools, equipment and space. On an average, more than 80 percent of the tools for each and every seg-ment of vehicles are common. Therefore, it works on economies of scale as well as optimisation of resources. Moreover, the manpower utilisation will also be bet-ter since the availability of talent pool is key. According to industry estimates, the vehicle dealerships currently employs about eight lakh people, for both selling and servicing the vehicles. And in the next five years it is expected to grow by at least four folds. Though the rural population will come in handy to fill the gap, training is crucial as the service centre needs skilled hands. Collaborative efforts amongst authorised service centres and the multi-brand third-party service centres will help to plug the gap in every aspect.

Wishing you much pleasure reading. Do send us your feedback.

Collaborative approach essential

T. Murrali [email protected]

EDITORIAL

2 AFTERMARKET SEPTEMBER 2011

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NEWS

NEWS

REARVIEW

FOCUS CUTTING EDGE

COVER STORY

CONTENTS

6 Michelin to expand dealership network

8 A well trained technician is an asset: Bosch

10 Talbros seals aftermarket with Ezy Drive

12 Metafab introduces new garage equipment

13 SKF evaluating presence in servicing business 15 AI’s aftermarket solutions to help fleet operators

24 Experts’ shield car owners with advantages

37 Rubber supply mismatch may hit profitability of tyre makers

56 Advanced electronic diagnostic solutions for vehicles


8

12

10

13

26

24

37 56

26 Lucas Indian Service: The Retail Connection Lucas Indian Service is firming up its foray into car retail accessories under the brand Carplus

I N D I A ’ S F I R S T M A G A Z I N E F O R T H E A U T O M O T I V E A F T E R M A R K E T

Vol. 1 No. 3 September 2011 64 Pages `50


EXTRA MILEShaman Motors

CUTTING EDGE Advanced diagnostic solutions

INTERVIEW Ramchandra Rao, ED, Eaton



Cover DesignMahesh Talkar


NEWS

Michelin is looking to renew its focus on passenger car and

commercial vehicle radials with a wider distribution network and customer education. It is looking to expand its reach, particularly in Tier II and III towns and cities, by enrolling more dealer part-ners and points of sale.

The French tyre manufac-turer has around 750 exclusive and non-exclusive dealers across Tier I and II cities primarily for selling passenger car tyres. The company is looking to grow this network in double digits over the coming months.

The company has two retail-ing formats—Tyre Plus (a multi-brand and multi-product servicing outlet) and Michelin Priority Partner (MPP) outlet (a multi-brand tyre outlet). The former is Michelin’s global for-mat and encourages dealers in most locations to not only be multi-brand tyre dealers, but also have other products and services including wheel align-ment, balancing, batteries servicing and fitment and other aftersales solutions for end cus-tomers. On the other hand, MPP is a relatively basic format with tyres and some related serv-ices offered to customers. Both formats are constrained by the location and size of the outlets and partners may add or reduce the services offered while oper-ating under given constraints.

“We are facing hurdles in terms of acceptance of tube-less tyres in several product segments (tyre sizes) as the market is still evolving and customers are getting educat-ed on the benefits of radials,” said National Sales Manager, Passenger Car, Michelin India, Chandan Thakur. He added that the mass segment (12,13,14 and 15-inch tyres) for compact and mid-size sedan is seeing good demand and is likely to continue to grow in the coming months. Increasingly, customers are look-ing to go for a change in tyres even before the normal life span. Moreover, most customers are not particular about the OE fit-ted tyres in a vehicle and opt for a different tyre brand to meet various objectives like perform-ance, comfort, reliability and safety.

The French tyre maker launched Primacy LC and Pilot Stock 3 in the comfort and per-

formance range respectively. The tyres are meant to enhance the fuel efficiency of the vehicles as well as provide performance and comfort due to adoption of latest treading technologies and tyre design. “Like any other serious player in the tyre manufacturing, we are looking to grow our pres-ence in the mass market segment with latest technology products at competitive price. But I can-not provide further details at this stage,” said Thakur.

According to Thakur, most manufacturers have moved on to offering tubeless tyres as an OE fitment in the passenger car seg-ment. This is particularly true for Tier I cities where the rate of acceptance of tubeless radials is higher due to greater availability as compared to Tier II and Tier III cities.

Radial tyres are increasingly preferred due to ride com-fort, longer lifecycle, safety and economy of usage among other factors. “Barring a few segments in the passenger vehicles and small commercial vehicle seg-ment, most personal and small good transportation vehicles have moved to radials and the trend is likely to accentuate in the coming months,” said Thakur.

Michelin has presence in the OE segment with customers like Honda and Mercedes. However, the company derives a majority of its volume and revenue share from the aftermarket business in India. �

Michelin to grow dealership network; add tyre plus outlets

Chandan Thakur, National Sales Manager Michelin India

Abhishek Parekh


NEWS

In a bid to impart train-ing to aspiring engineers and technicians to enhance

their competency levels for bet-ter employability, the Bangalore headquartered Bosch and the Chennai-based SRM University (SRMU) recently announced the launch of SRMU— Bosch Joint Certifi cation Training Centre.

The training centre has several machines and equipment includ-ing vehicle diagnostics, and will impart training to undergraduate, post graduate, polytechnic, voca-tional school students and nearby industry personnel to make them

more competitive in the automo-tive industry. The course modules offer an effi cient combination of hardware and teaching methods as industry-oriented training in the fi eld of automotive technol-ogy as per the Bosch concept. Successful candidates will be awarded a joint certifi cation from Bosch and SRMU. The automotive component manufacturer will also train the faculty for the centre at its Bangalore and other facilities to enable them to impart training as per industry requirements. Both the parties have equally invested in the `22 lakh project.

“Absence of relevant skills is the single largest handicap in India today. Training programmes like this will help enhance the employability of the students. Our industry knowledge, expertise in the automotive sector and tech-nology capabilities has helped us win the trust of our customers. We believe that a well trained techni-cian is an asset to the business and hence we have taken a step ahead and are working towards empow-ering the budding talent in the industry,” said Vice President and Head, Automotive Aftermarket, Bosch, S Muralidharan.

A well trained technician is an asset: Bosch

Dr M Ponnavaikko, Vice Chancellor, SRM University (fourth from left); S Muralidharan, VP & Head, Automotive Aftermarket, Bosch (second from right) along with other officials at the training centre


NEWS

The company has provided serv-ice training for more than 30 years to automotive vehicle manufac-turers, TAFE colleges and its own service organisations. “The estab-lishment of this centre will help us leverage our partnership with SRMU to empower the aspiring engineers and technicians match the industry standards in terms of skill set,” he said.

The Vice-Chancellor of SRMU, Dr M Ponnavaikko said, a recent study by the Tata Institute of Social Sciences (TISS) stated that a major-ity of the students pursuing higher education were not industry-ready. The survey also mentioned that only 25 percent of them were employable. NASCOM report also confi rmed it, he said.

Recalling the former President of India, Dr Abdul Kalam who said, ‘India does not have a problem of unemployment but un-employa-bility.’ Ponnavaikko said this was due to the widening gap between industries and insti-tutions. If institutions want to improve the employability of their graduates, they have to focus on

reducing the important skill gaps through improvements in cur-riculum, teaching methods and industrial training.

“The institute-industry inter-action is realisable only when the industries enter into academic col-laborations with the institutions, establishing an industrial environ-ment in the University campus to expose the staff and the students to the industrial practices. The cur-rent initiative of Bosch with SRMU is the right model for bridging the gap between the industry and

institutions to make the graduates employable,” he said.

Muralidharan said the joint certifi cation programme will not be confi ned to the aftermarket division of Bosch alone; instead it will look at the company as a whole since the education and training are vital for the automo-tive industry. “We will not have any direct advantage; it will be a part of corporate social responsi-bility initiative of the company,” he said. Bosch is a technology pro-vider and its expertise does not confi ne only to mechanical engi-neering but also across several streams including electrical, elec-tronics and communications. To a question whether SRMU would extend the services of this centre to other streams of engineering, Ponnavaikko said the company along with the group companies of Bosch is planning to offer simi-lar programmes to students of few other streams of engineering including mechatronics and elec-tronics. In this way, the university can leverage the inherent poten-tial and tangential relationships amongst different modules of engineering, he added. �

S Muralidharan explains the company’s diagnostics equipment to Dr M Ponnavaikko & university faculty members, at the training centre

Documents being exchanged at the function


NEWS

With a view to enhance driving and riding com-fort and increase the

ease of fi tment during a repair, Talbros Group, which is popu-larly known for its steering and suspension components, automo-tive component manufacturer, launched two new products for the automotive aftermarket.

The two new products are a clutch assembly for passenger cars and a sealant for sealing and gas-ket applications under a new brand name, Talbros Ezy Drive, creating the scope to introduce more prod-ucts under this brand name inthe future.

The sealant, known as Talbros Dyna Bond, is a high grade RTV sealant for sealing and gasket appli-cations. It has been designed to give outstanding performance in typical automotive and industrial gasket-ing applications including valve covers, oil pans, water pumps, rear axle housing and sealing fl anges. It is non-corrosive and can withstand high pressure, can be shaped into any form instantly and cures fast.

“Both the products will be avail-able across the nation. Initially we shall be delivering power and drive comfort to all new generation vehi-cles. This will gradually expand to touch other segments of the auto-motive industry,” Chief General Manager, Sales and Marketing, Munish Malhotra said.

The company which is a sup-plier to some of the largest OEMs in the country like Ashok Leyland, Bajaj Auto, Cummins Group, VE Commercial, Escorts Group, Force

Motors, General Motors, HeroMoto Corp, Hyundai, John Deere, Mahindra and Mahindra, Maruti Suzuki, Suzuki, TAFE, Tata Motors, Tata Cummins, Simpsons and inter-national corporate like Affi nia, Carraro, Dana, General Motors, Kubota, JCB India, Nissan Micra—is known for its quality.

It is also a single source supplier to Mahindra Navistar and Fiat India. The component manufacturer also supplies to tractor manufactur-ers like Sonalika and New Holland Fiat. Daimler is the latest addition to Talbros’ client list in India.

The group has manufacturing units spread across the nation. Out of the 13 manufacturing units that the group owns some of them are located in Gurgaon, Faridabad, Chennai, Pune, Uttarakhand to name a few. It has a research and development centre equipped with testing facilities.

Owing to the increasing demand the group has set up two new plants—one in Pune and the other in Orgadam, near Chennai. The group has also ramped up its production capacity by around 30 percent in order to be able to meet the demands of its OEM and after-market business.

The new plants, which have commenced production recently, are producing steering and sus-pension parts. The component manufacturer had set up another

plant in Sitarganj (near Rudrapur) last fi nancial year. This plant pro-duces gaskets for the three major OEMs in Pantnagar, namely Tata Motors, Ashok Leyland and Mahindra and Mahindra.

Talbros started its journey in the year 1956 by manufacturing auto-motive components like gaskets. Today, the company is renowned for the automotive components like steering and suspension com-ponents, gaskets, stampings, rubber products and forgings.

The group has several joint ventures and collaborations with global players like Federal Mogul from USA, Nippon Leakless Corporation from Japan, Affi nia Group from the USA and most recent being Presswerk Krefeld (PWK), Germany.

It exports to countries like the US, UK, Argentina, Italy, Thailand, and Japan among others. “We are open to new export destinations in case an interesting opportunity comes our way,”stated Malhotra. In the last fi nancial year the group touched a turn over target of `1,550 crore. It expects to perform better this year. �

Talbros seals aftermarket with Ezy DriveShambhavi Anand

Talbros EzyDrive clutch assemblies


NEWS

Metafab Engineers, with its forte in hydrau-lic lifts, is planning to

expand its garage product port-folio in the four-wheeler segment further. It has recently started manufacturing post lifts for four-wheelers and introduced garage equipment for agriculture equip-ment also.

In this process, the equipment-maker is setting up a new factory spread over one acre in Faridabad (NCR) for the production of post lifts. The new unit will be inside its existing plant. The company is currently producing around 10 to 20 units of lifts per month on a trial basis, but will increase to 400 lifts per month once the new facili-ty is available. Metafab has already invested over `eight crore on the new unit, which will be in opera-tion in a couple of months.

The main target customers for the new product range will be those who buy such equipment from China. It will directly con-nect with the distributors who sell the Chinese products in India. The products will be priced competi-tively with comparable Chinese products as it has made many strategic modifi cations to cut the costs, which which includes a cut in marketing expenditure.

It is also developing new prod-ucts like automated bike washers with steam as a main force to com-pensate the water scarcity. Water is precious and this machine will convert it into steam, then re-con-densing it back to water.

The company is primarily

manufacturing garage equip-ment for the two-wheeler segment with around 300 different prod-ucts. Its product range includes lifts, motorbike pneumatic han-dles, waste oil collector, battery

charger and spark pluck cleaners. Currently, it makes 400 bike lifts per year.

Though the consumption of electricity of its equipment is already less, to reduce it further, the manufacturer is develop-

ing new actuating units and is considering bringing back hydro-nuematic lifts. It is also working on increasing the number of dis-tributors. Presently, it has 70 district level distributors and it will add 60 more in this fi scal across India.

Looking at the increasing pres-ence of super bikes with the entry of companies like Harley Davidson and BMW, the opportu-nity in the big bike segment has increased. In order to encash this opportunity,it has developed new lifts for these kind of super bikes. It also plans to introduce garage equipment for ATV bikes, which are in demand in the places like Bangalore and Pune.

In the last three months, it has produced over 58 types of garage equipment, which includes both for two- and four-wheelers and hopes to make revenue of around ` 20 lakh from this segment. They are growing at around 30 percent every year. The company clocked a turnover of `33 crore in FY11 and projects it to reach at `fi ve crore in FY12. �

Metafab introduces new garage equipmentNabeel A Khan

The new factory will be

inside its existing plant.

The company is currently

producing around 10 to 20

units of lifts per month on

a trial basis, but will in-

crease to 400 lifts once the

new facility is available.

Metafab has already invest-

ed over `eight crore on the

new unit, which will be in

operation in two months

A range of products by Metafab


NEWS

SKF India is evaluating ways to enhance its presence in the spares and vehicle servicing

business. It has been contemplating on entering vehicle servicing busi-ness. Such a foray may come about in the commercial vehicle servic-ing side but company offi cials insist that any such initiative on vehicle servicing is at a very preliminary stage and may take a very different form altogether.

Tie-ups with authorised service stations and third party garages are being enhanced in the com-ing months. It is in the process of evaluating a partnership model for having a presence in vehicle serv-icing business or any other model suitable in the evolving market scenario. The key consideration is what value could be offered to cus-tomers under any partnership or self-started initiative.

“There are a number of electrical or electronics related faults occur-ring in a vehicle and this may be a major opportunity for any player like us to offer expertise to custom-ers, perhaps in partnership with another company,” said Director, Automotive & Textile Business Units & Pune plant, SKF India, Ranjan Kar. He added that the unorganised nature of the vehicle servicing infrastructure points to various opportunities even as cus-tomers are beginning to demand higher service standards and qual-ity assurance.

Though SKF Group has been

selling certifi ed automotive com-ponents in various other markets, including India, it is not present in vehicle servicing business in any of these markets. The need to evaluate entry into servicing busi-ness has been prompted by the unorganised nature of the market as well as growing vehicle popula-tion and rising demand for quality and certifi ed service infrastruc-ture. The company has recently started a certifi cation programme for mechanics for technicians in various aspects of automobile serv-icing. This initiative is aimed at raising the standards of service in automobile repair workshops and service stations.

“Garages are playing an impor-tant role in organisation of the automotive service business. The reliability of service rendered is critical, whether it is available from authorised service station or third party garages,” said Kar. Service centres has to be available

at the arms length, especially for commercial vehicles.

The company sells products including brake pads, steering and suspension systems compo-nents. These components are not manufactured by the company but are certifi ed for quality assur-ance purpose. The initiative is not only helping the company grow its business, but also in organising the aftermarket business.

SKF is one of the leading suppli-ers in the areas of bearings, seals, mechatronics, services and lubri-cation systems. The company’s service offer includes technical support, maintenance services, engineering consultancy and train-ing. It has three manufacturing facilities in Bangalore, Pune and Haridwar and services its custom-ers through its strong channel partner network. It manufactures the entire range of bearings for all vehicle segments within the auto-motive and engineering sectors. �

SKF India evaluating presence in vehicle servicing business Abhishek Parekh

Ranjan Kar, Director, Automotive & Textile Business Units & Pune plant, SKF India


NEWS

Leading industrial exhibition organising company Messe Frankfurt is celebrating the

40th anniversary of its international trade fair brand—Automechanika. Messe Frankfurt is Germany’s lead-ing trade fair organiser with Euro 448.3 million in sales. Frankfurt continues to be the home venue, a fi xed star and a strategic orienta-tion aid for the sector and, last year, it attracted 4,471 exhibitors from 181 countries and 155,000 visitors. Close to 80 percent of the exhibition space for the next Automechanika from 11 to 16 September, 2012 has already been sold.

According to the company, the fi rst Automechanika opened its doors in Frankfurt AM Main on 18 September, 1971. At that time, nobody predicted that the trade fair would develop into the leading business platform for the supplier industry, the workshop sector and the trade. And it was the industry that generated the initial impulses for the new event.

The trade associations, espe-cially the Federation of the German Motor Vehicle Trade (Zentralverband Deutsches Kraftfahrzeuggewerbe e V-ZDK), were not deterred by the cancella-tion of the Frankfurt Motor Show (IAA) and instead called for an event for the automotive parts and accessories suppliers who were also represented at the IAA.

Around 500 companies and 75,000 visitors from 63 coun-tries came to Frankfurt for the première. The participants were delighted and the results were

encouraging. Accordingly, it was decided to hold the new fair in the years between the IAA shows. Today, Automechanika is not only one of the leading fairs organised by Messe Frankfurt, but also the preferred international trade-fair brand. In addition to Frankfurt, the event is held at eleven ven-ues worldwide such as Moscow, Shanghai, Bangkok, St. Petersburg, Dubai, Mexico, Buenos Aires, Kuala Lumpur, Madrid, Istanbul and Johannesburg.

The Messe Frankfurt Group has a global network of 28 sub-sidiaries, fi ve branch offi ces

and 52 international sales part-ners, giving it a presence for its customers in more than 150 coun-tries. Events ‘made by Messe Frankfurt’ take place at more than 30 locations around the globe. In 2010, Messe Frankfurt organised 87 trade fairs, of which more than half took place outside Germany. The company’s exhibi-tion grounds, featuring 578,000 sq mt, are currently home to ten exhibition halls and an adjacent Congress Centre. The company is publicly owned, with the city of Frankfurt holding 60 percent and the State of Hesse 40 percent. �

Automechanika celebrates40th anniversary

Glimses of Automechanika 2010


NEWS

Chennai-based Automotive Infotronics, the 50:50 joint venture between Ashok

Leyland and Continental AG, will be focusing on aftermarket also while it consolidating its business plans covering three areas—Hu-man-Machine Interface (HMI), connectivity and sensorics.

Chief Executive Offi cer, Automotive Infotronics, Dr Aravind Bharadwaj said the cluster with body controller, a multiplexing sys-tem developed for one of its clients, Ashok Leyland for its U-truck plat-form will be out in October. This will be the vehicle manufacturer’s unique electronic architecture.

According to him, the instru-ment cluster is not just a unit that gives information like speed, tem-perature and pressure, but actually a data centre. “Our cluster has a USB drive, which can even help retrieve logged-on data for about 30 days. It also has gear shift advisory system helping the driver to drive the vehicle for optimal perform-ance. These inputs help the fl eet operator to understand the drivers’ driving habit and take corrective action,” he said.

To a question whether these systems can be retrofi tted and be a potential product for the aftermarket, Bharadwaj said the company has already proved it by fi tting multiplex systems in few buses in APSRTC fl eet. This is part of JNNURM’s compliance requirements. When asked if the company would look at provid-ing similar solutions to passenger cars, he said, “nothing prevents us from catering to passenger cars but CV is out bread and butter. For instance the telematics can

be used in radio taxis to enhance performance. We would like to be Continental’s Centre of Excellence in CV segment in the region,” he added.

Last year, the company intro-duced ‘Flex CAN (Controlled Area Network) Cluster’ for the European market. Flex CAN clus-ter is designed by Automotive Infotronics and manufactured and sold by Continental in the European and other matured mar-kets. It is a fl exible instrument cluster designed for off-road appli-cations (tractors, snow-mobiles etc). The cluster is based on CAN and is fl exible enough to be modi-fi ed for different OEM applications based on specifi c demands from the customer. Multiple variants of the original design had already been created, he said.

Yet another product that the company has commercialised and currently working on upgrades is ‘Engine Control Panel’ for gensets manufactured by Ashok Leyland. This is an integrated instrument panel monitoring engine parame-

AI’s aftermarket solutions to help fl eet operators to optimise profi tability

Products developed by AI

Aravind S Bharadwaj, CEO, Automotive Infotronics

T Murrali


NEWS

tres like temperature, pressure, fuel level, the RPM and the total number of hours the engine has run. In addition, it also safeguards the engine as the cluster can be pre-programmed with remote start and stop applications. With power cuts prevailing across the coun-try and the vehicle service centres trying to optimise the existing resources to enhance profi tability, attendant-free gensets including the one manufactured by Ashok Leyland are in great demand.

After commercially releasing the telematics and multiplex systems, the company sees tremendous opportunities in a vehicle as dif-ferent systems within the vehicle need to communicate with each other for the overall performance. However, the challenge is to estab-lish the communication at the least possible cost, while maintaining the customers’ expectations and ensuring safety. With the vehicles getting more complex, driven by regulations as well as increasing expectations from the end-user in terms of enhanced driving com-forts and economical aspects including profi tability, the manu-facturers have no options but to provide the requirements at a com-petitive cost.

Elaborating on the strategy,

Bharadwaj said the company, in the case of HMI, is looking at developing an ‘Indian driver work-place’ covering the entire aspect of the drivers’ requirements. The system that the company devel-ops will help the driver to be very alert while being more productive, eventually helping the fl eet opera-tor to derive better profi tability. “While developing products we had looked at passenger and fl eet operators. However, the driver, who spends his time in the vehi-cle, also needs to be taken care of. We have enough data that provides the number of times the driver has to shift gears in a day ending up in severe fatigue. Therefore better ergonomics is essential. Besides, the controls have to be in close proximity to him for improved performance. This is our objective in developing driver workplace” he said.

Secondly, the venture will look at ‘connectivity’ as its focus area since the communication between the vehicle and the outside world is essential for improved transport economics and better mainte-nance of vehicles. The company is currently developing ‘low cost telematics on-board unit, which will be launched in fi rst quarter of next year. Combined with multiplex

system the whole unit, in future, can offer several benefi ts to almost all the stakeholders in the business since it not only tracks but also indi-cates the driver / fl eet operator on the defects in the vehicle. Besides, it also alerts the service centre about issues like the spare parts require-ments and so on. Instead of the vehicle going to the service centre for diagnosis, the system enables the garages to reach the end cus-tomer and provide the solution. This prognostic approach will help avert major breakdown thereby upping the uptime of vehicle sub-stantially. In addition, it will also help the vehicle manufacturers with tips to take corrective action, if necessary, arising out of common problems. These facilities will sig-nifi cantly enhance the operating economics of the fl eet operators, he said. Besides, it will also support the service centres to optimally utilise the service including the inventories.

Thirdly, it will look at ‘sensor-ics’ as electronics is integrated in almost every component of the vehicle. “The body controller is the gateway, which controls all the other electronic controllers. Similarly the telematics control-ler can just be another node in the body controller,” he said. �

Products developed by Automotive Infotronics form part of several vehicles including the U-Truck of Ashok Leyland


NEWS

TVS Logistics Services (TVS LSL) inaugurated its logis-tics assembly facility at

Sholavaram, about 40 km north of Chennai recently. The facil-ity was inaugurated by Managing Director, Ashok Leyland, Vinod Dasari in the presence of the Managing Director, TVS Logistics, R Dinesh.

This will be a dedicated and full-fl edged assembly facility for the power solution business unit of Ashok Leyland, to assemble genset engine power-packs in the range of 10 to 2,000 KVA capacity for both domestic and export markets.

According to the business model, Ashok Leyland will sup-

ply engines and radiators to TVS Logistics, which will provide end-to-end supply chain solutions by ensuring infrastructure, procuring child parts, assembling, packag-ing, material handling solutions and logistics solutions for the assembled genset engine power-packs as per OEM’s requirements. This arrangement would also mean that TVS Logistics will be a single-point of contact for Ashok Leyland for assembling the genset engine power-packs.

With an initial investment of `2.5 crore, the plant will have the capacity to assemble 14,500 units per annum. The 70,000 sq ft facil-ity has the infrastructure to scale

up to 30,000 units. Strategically located near the Ennore Port and well-connected by road to the cities of Bengaluru and Kolkata, the facility will assemble differ-ent power-packs and is expected to meet Ashok Leyland’s sales requirements for the next three years.

Dinesh said, “This facility is a milestone for us as very few sup-ply chain companies globally have the capability to provide end-to-end supply chain solutions which include taking ownership of the sub-assemblies. Thanks to our acquisitions in the US and UK, we are now able to offer this serv-ice in India.”

Dasari said the association with TVS Logistics will help the com-pany to offer greater value to its customers through customised power solutions meeting their specifi c requirements at a reduced delivery time. “Our power solu-tion business is growing robustly in tune with the domestic genset market that is shortly expected to touch two lakh units per annum,” he said. �

TVS Logistics powered to assemble Ashok Leyland gensets

With an initial investment

of `2.5 crore, the plant

will have the capacity to

assemble 14,500 units per

annum. The 70,000 sq ft fa-

cility has the infrastructure

to scale up to 30,000 units


NEWS

SPX Service Solutions, which provides engineering, manu-facturing, distribution and

customer support services to all segments of the vehicle service market, intends to strengthen its aftermarket portfolio in India.

The company has a major part of its vehicle service business for OEMs in the country and is look-ing to launch new products for the aftermarket in the next 12 months under three key product lines—multi-brand diagnostics, workshop equipment and air con-ditioning repair and recycling systems. Apart from these three major categories, there might also be other product launches as well.

“The Indian customer is no less busy than the one in the US. They do not have time to sit in a work-shop for long hours or bring their vehicle to a garage more than once for the same problem. Such prod-ucts will reduce the time of repair and will signifi cantly increase the reliability of repair. A good amount of our focus has been on the OEM business. But as the car parc grows, a reliable, mature and organised aftermarket will also grow. We intend to increase our footprint in this segment,” Managing Director, SPX Service Solutions India, Tony Sharma said.

Another reason for the com-pany’s focus on the aftermarket segment is the increasing complex-ity in even the entry level cars like the Nano. “The vehicle complexity is going up. It is not uncommon to have multiple controllers even on low-end vehicles. This increases the

need for diagnostic and specialty tools,” President, SPX Service Solutions (Global), Tanvir Arfi said.

A lot of products from SPX are pro-prietary to its OEM customers and their dealerships. But it also has diagnos-tic systems, shop equipments, special purpose tools which it manufac-tures and sells under its own brand name. Currently, the OEM busi-ness contributes 65 percent of its total vehicle service business worldwide and aftermarket con-tributes just 35 percent.

Diagnostics is the driving business for SPX and is also its focus for the future. SPX has helped vehicle manufacturers like Ford, Nissan, Jaguar Land Rover, Renault, Honda, and Harley Davidson among the global play-ers and Maruti, Tata Motors and Mahindra & Mahindra among the Indian manufacturers design pro-prietary diagnostic systems for their dealerships. For aftermar-ket, the company will make their own brand of diagnostic systems to help diagnose multi- branded cars. Keeping the price sensitiv-ity of the Indian market, these systems will be available at com-petitive prices.

In its research and develop-ment centres based in Chennai, Pune and New Delhi, the com-pany is working on several interesting projects aimed at the Indian car market. “The glo-

bally available products cannot be brought to the Indian market without customisation. Here, we are trying to modify the globally popular products suited for India market to match the local require-ments,” Sharma said.

Apart from customising, the local R&D centres are also working on several diagnostic development projects for OEMs, design work, development of special purpose tools and inexpensive multi-brand scan tools for aftermarket. It intends to bring these products to the market by next year.

Another interesting project that the Indian market can wait for is three dimensional wheel align-ments. “It has a three dimensional technology with two cameras at affordable price for multi brand garages,” Arfi said.

The company is looking for organic as well as inorganic expansion, suitable tie-ups and partnerships for expanding in the Indian market. The $ seven billion company earns $ one billion from vehicle service business. It expects to signifi cantly outpace the growth of the automotive industry. �

SPX to increase footprintShambhavi Anand

Some aftermarket products by SPX


NEWS

Manufacturer of car care products, 3M, has recently opened its fi rst

exclusive store in Chennai follow-ing its retail expansion. This will be the company’s fourth store in the country, following one in Pune and two outlets in Bangalore.

The company offers a wide range of car care products including car-detailing services and a range of treatments that are designed to maintain the car irrespective of its age and condition.

The 3M Car Care products (a division of 3M India) and solutions were introduced in India in 2002, after its success in the US, China and other parts of Asia. The store has been set-up under a franchise

agreement with an independent service provider. “We are plan-ning to setup 15 more stores this year and aiming for 100 stores across the country in next three years,” said the National Manager for Franchise Business, 3M India, Vishesh Nigam.

The store is spread over a 2,000-sq ft area, will offer car-detailing services for its exteriors, interiors, underbody and engine perform-ance. The exterior services include UV protection, exterior beauti-fi cation, minor scratches, swirl removal and surface enhance-ments. These treatments help to protect and ensure that the beau-ty of the car exteriors last longer, without any periodic attention.

The interior service package includes interior protection and treatments to kill germs, clean and

condition the carpets, upholstery, vinyl, plastic, and rubber surfaces and give a durable and enriched appearance. The underbody serv-ice comprises anti-corrosion and rust protection treatments, which help in long-term protec-tion against corrosion, protection of internal body panels, frame rails and other inner cavities that are not physically accessible, but are prone to corrosion.

The store also offers engine per-formance rejuvenation for both diesel and petrol engines to restore power, performance, fuel economy and effi ciency by removing carbon deposits from intake valves and combustion chambers. The cost of service ranges between `100 to `25,000, from single seat cleaning to complete car.

What’s more, it also sells car care products like additives, clean-ers, fl ushes, battery terminal coats, lubricants for car performance.

The company provides unique products like aerosol-based foam upholstery cleaner. The sprayed foam wipes away taking dirt and stain with it, while keeping the upholstery relatively dry. It is also planning to introduce 3M anti-bacterial interior cleaner developed in India.

The company has been a part of automotive aftermarket busi-ness and it is supplying its products to car dealerships and body shops across India since 1996. Many OEMs have offi cially approved 3M car detailing services. Currently about 1,000 car dealers are enrolled in it cars detailing programme, offering its services to car owners across all makes and models. �

3M opens car care store in Chennai Akmal Rahman B

Vishesh Nigam, National Manager, Franchise Business, 3M IndiaPhot

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NEWS

Eicher Trucks and Buses (ETB), inaugurated its new dealership, Apco Autosales

based in Rajkot, which is situated in the Saurashtra area of Gujarat. With the opening of this new deal-ership, ETB now has 41 dealerships in western India and 210 dealer-ships pan India. ETB is a business area of VE Commercial Vehicles (VECV).

The new dealership, which is a 3S facility (Sales, Service & Spares) spanning over 36,000 sq ft, has a state-of-the-art fully equipped setup, with contemporary tools and equipment. The professional-ly trained team of Apco Autosales has also undergone training at the Eicher Training School in Pithampur, Indore. The new dealership is part of DGC Group (Dholakiya Group of Companies), which is a prominent business group of Gujarat, primarily dealing in automobile business and is also the dealer of Eicher Trucks and Buses at Ahmedabad and Himmatnagar.

While addressing the gather-ing, CEO, VE Commercial Vehicles, Vinod Aggarwal, said, “We are happy to partner with Apco Autosales. The opening of the new dealership will further strengthen Eicher’s resolve and commitment to provide sales and after sales support to the rapidly growing customer base in western India”.

“The new 3S facility with its state-of-the-art equipment and best in class operating standards will help us enhance customer experience and ensure that our customers are able to get their products serviced faster and

with much ease”, added EVP-Sales, Marketing and Aftermarket, VECV, Somnath Bhattacharjee.

The dealership inau-guration was attended by a large number of customers from all over Gujarat, fi nancers and other invitees. Many customers were handed over keys of Eicher Trucks and Buses during the inau-guration by Vinod Aggarwal.

ETB is making strong inroads into heavy duty trucks segment of 16T-40T with ’VE‘ series of

fuel effi cient heavy duty trucks. Launched during Auto Expo in 2010, the VE series Eicher HD trucks have received a good response from the market with its promise of delivering enhanced value to the customers. Market share of Eicher’s heavy duty trucks’ in Gujarat is increasing and with this new facility, it will keep the

momentum going.The Eicher range of commercial

vehicles are known in the market for their low overall cost of owner-ship and the reason for this can be found in the ‘Eicher advantage’. At the core of the ‘Eicher advantage’ is the vehicle’s highly rated fuel-effi -ciency. Additionally, , all Eicher CVs are also known for their right cargo body sizes, good ability to take the gradients as well as for low main-tenance and longer life. These are well supported by an ever increas-ing network of dealers.

Service coverage is being enhanced by the following measures:• Wide network of over 200 deal-

ers across the country• Higher availability of parts• Mobile service vans available at

all dealerships• 24x7 helpline with an all-India

helpline numberAlso speaking on the occasion

Mehul Dholakiya of Apco Autosales said “We feel honoured to part-ner ETB and with our experience and deep understanding of Gujarat market, we would do our best to provide our customers best in class service.” �

Eicher opens 3S dealership in Rajkot

The inauguration of the Rajkot dealership

The new dealership is a

3S facility spanning 36,000

sq ft and has a state-of-

the-art fully equipped

setup, with contemporary

tools and equipment. The

team of Apco Autosales

has also undergone train-

ing at the Eicher Training

School in Indore


NEWS

Mahindra Navistar Automotives has recently opened a

state-of-the-art Sundaram Automobiles—its new dealership in Kozhikode. While inaugurat-ing the dealership, the Managing Director of Mahindra Navistar Automotives, Nalin Mehta said, “This is a moment of pride for us; we have already sold more than 1,300 trucks across the country within a short span of time and gained tremendous confi dence and appreciation from our cus-tomers. We have created a world class manufacturing plant in Chakan, Pune for trucks with an investment of `950 crore and are creating a modern distribution network in the country as the one here in Kozhikode, to cater to the growing needs of customers.”

The dealership will also feature a well-equipped workshop, prompt spare parts availability, mobile

service vans and highly trained staff to enable their customers to get a hassle-free experience.

Kozhikode is an important market for transportation indus-try—not only for Kerala but for the entire southern India. According to him, the company commands about 50 percent of LCV market share in Kerala and hopes to emu-late the success with HCV range.

The Senior Vice President, TVS & Sons, and Director of Sundaram Automobiles, S V Nana Rau, said that the company has earned a name for itself through custom-

er service in its various business and the dealership of Mahindra Navistar will provide a great oppor-tunity of replicating the same high standards by leveraging its deep understanding of Kozhikode mar-ket. “Together we will help our customers outperform,” he said.

TVS has been represent-ing Mahindra LCV range in Kerala for over 30 years through its showrooms and work-shops located across the state. Soon it will launch additional outlets for HCV in Kochi and Thiruvananthapuram, he said. ��

Mahindra Navistar opens Kozhikode dealership

Inauguration of Sundaram Automobiles

The dealership will

feature a well-equipped

workshop, prompt spare

parts availability and

trained staff to enable

their customers to get a

hassle-free experience

Trucks by Mahindra Navistar


NEWS

Yong Chiang Piston (YCP), a Taiwan-based manufactur-er of automotive pistons is

planning to enter the Indian auto-motive aftermarket with its wide range of products. In a recent interaction with Aftermarket, Sales Manager, YCP, David Chen said, “We see a huge market for our products in the Indian mar-ket. To establish it, we are looking for wholesalers for distribution and promotion of our products for both heavy vehicles and passen-ger cars.”

YCP is already supplying its products to many countries like the US, Peru, Argentina and Brazil. To create and develop its brand image in India, the compa-ny is participating in trade shows with a broad product portfolio. It also believes that this initiative will provide a platform for the company to enter the Indian market. “We are par-ticipating in many exhibitions around the world and especially in India to fi nd some potential customers,” he said.

The com-pany will be operating directly from Taiwan until it sets up its offi ce in India. When asked about setting up a manufac-turing plant in India he said, “If the market is good and the volume is large, may be we will set up a factory in India in the coming years.”

According to him, it will be diffi cult for the company to com-pete in the Indian market, but he believes that with quality, deliv-ery time, service and cost effi cient products, YCP will sustain its position here.

The company has two brands called YCP for pistons and Tiger for other auto accessories. It is currently manufacturing products like pistons, wheel cov-ers, bumpers, grilles and hoods for Honda, Mitsubishi, Nissan,

Toyota Ford, Ashok Leyland, Mazda and Maruti Suzuki.

The company is looking forward to supplying it products to OEM’s in India. As an entry level, it wants to start its business by selling it products in Indian aftermarket. “We can manufac-ture components for any cars—it depends on the demands of our product in the market,” he said.

The company has registered a turnover of about $3.5 million in 2010 and expecting to register $5.5 million in next two years by foraying into the Indian market. �

Yong Chiang enters Indian aftermarketAkmal Rahman B

David Chen, Sales Manager, YCP

A range of components manufactured by YCP

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REARVIEW

It was back in the year 1999 that the glass product sup-plier to major automobile

manufacturers, Asahi India saw an opportunity in windshield replacement business. The idea of providing repair and replace-ment service for automotive glass was conceptualised in the form of Windshield Experts’ and the fi rst store, known as the WE store, was set up in the National Capital Region (Bikaji Cama Place) in 2001-02.

While many would have thought a specialised business in windshield repair and replacement was too optimistic an opportunity, the company experts proved them wrong by completing 10 years in the business successfully. Today, the company has 59 service cen-tres in 33 cities across the nation and does 4,000 replacement jobs every month. It earned a revenue

of around `30 crore in FY11. “Most OEMs have identifi ed

laminated glass as the 13 most critical components in an auto-mobile for safety in case of an accident, followed by the steer-ing column, air bags and other parts. The automotive aftermarket is a place where a lot of unethi-cal practices take place both in terms of products used and the quality of workmanship. We bring convenience, ethical and safe practices and good quality prod-ucts to the customers as we believe that the segment we are targeting seeks such practices,” COO, Auto Services, Windshield Experts’, Vikram Khanna told Aftermarket.

Presently, the company’s main service is auto glass repair and replacement. The company has also started replacing wipers as it is recommended to change the wiper blades during the replace-ment of a windshield. Also the

Shambhavi Anand

Experts’ shield car owners with advantages

Vikram KhannaCOO, Auto Services, Windshield Experts


REARVIEW

wiper blades cost only one-twen-tieth of the cost of the shield, so most people prefer to change it rather than letting it cause damage to the shield.

Another critical product during glass replacement is the glue used. Known as Urethene, the glue gives adhesive strength to glass and pre-vents the driver/passengers from being ejected out of the wind shield in case of an accident.

To deliver quality services at the convenience of customers, the staff has to be well trained. Currently, most of the training happens on-the-job. But the company is in talks with a training partner for devel-oping off-site training curriculum for all levels of employees. The pro-gramme will most probably start by the last quarter of FY12.

It believes in offering the servic-es through convenience of location for the customer and fast turn-around time. It has 20 stores across the NCR, which Khanna believes is “not adequate, though a fair number”. “We want to offer our customers the advantage of prox-imity. No one wants to travel long distances just to get their wind-shields replaced,” he added.

To add to the convenience of the customers, the company has started a mobile service. Be it the

customers’ workplace or their homes, they can book the services and get it done at their doorsteps. Currently, the mobile services can be availed mostly during the working hours, however, in case of appointments fi xed prior, services can also be provided early morning and late evening.

Another convenience, which is very important from customers’ perspective, is cashless service. “It is predominantly an insurance driven business. We have pan India tie-ups with most of the insurance companies in the private and the public sector. Our coverage, from insurance standpoint, is 88 per-cent,” Khanna said.

Windshield Experts’ is based on the business model of European automotive glass repair and replacement company Belron and is currently into the automotive glass repair and replacement of light vehicles (passenger vehicles, light commercial vehicles, multi-purpose vehicles). With the car parc for this category increasing in the country, the opportunities seem to be growing rapidly. The company expects to have 5.4 mil-lion replacement jobs in a year by 2020 in India. “With the increase in the number of vehicles, the size of the replacement market will

increase and so will the opportuni-ties for us,” Khanna added.

Belron is believed to have replaced 11.7 million automotive glasses worldwide last year.

Talking further about the oppor-tunities, Khanna said that there is a general perception that the wind-shield is replaced only after an accident, which is not true. It can get damaged due to other reasons also and might need replacement. The ratio of the two is almost 50-50. It plans to educate customers about the same. Non-accidental glass replacement holds immense poten-tial. The company would like to increase its presence in these areas.

To provide a faster turnround, the company is working on improving its backend processes. This involves developing portals in collaboration with the insurance partners. This portal will enable the company in accessing cus-tomer information instantly and getting real time approvals from insurance companies to carry out a job after the customer has put a request. The company has a clear future plan—it wants to increase its proximity to the customers by increasing the density of stores in the existing cities, provide a faster turnaround and remain focussed on glass repair. �

WE offers services at the convenience of customers with trained staff

Chennai headquartered Lucas Indian Service (LIS), a specialised aftermarket player—focused on auto elec-trical and diesel injection systems in the country—is

fi rming up its foray into car retail accessories under the brand Carplus. The pilot project, introduced a little over a year ago, is ringing in positive signals for the company to help fi nalise its plan in this area of business. The company feels that the response from the two dedicated showrooms in Gurgaon and


The Retail Connection


COVER STORY

T Murrali


COVER STORY

Ludhiana is encouraging and it is now trying out several options to reach out to the discerning cus-tomers. As part of its initiative, LIS has opened a counter in a depart-mental store in Delhi a couple of weeks ago. This move is expected to help the company to under-stand the customers’ expectations in terms of reach and conven-ience besides, the availability of the range of products, said the President, Lucas Indian Service, Sandeep Abbi.

Talking to Aftermarket, he said, “This is a pilot project, an experi-ment to see how we can go about it in a big way. It is in the nascent stage and we are trying to under-stand the retail business. Retailing is different from the normal after-market sales and service support business, since it involves vehicles and accessories. Right now, we are going through the learning curve in understanding what the customers look for—the accessories purchas-ing pattern of both new vehicle owners and the old ones. Opening a smaller format, in the departmen-tal store, is again a learning process to understand whether we should have standalone stores or be part

of a mall or a departmental store. The idea is to offer a unique and different buying experience to the customers. They can touch and feel the products and have a different experience as far as car accessories are concerned.”

Abbi said that at this point of time, these outlets are owned by the company and going forward, when it wants to expand in a big way, it might look at franchise model also. “We have a roadmap, which basically envisages us to look at about 120 outlets over a period of fi ve to seven years. This is contingent on us fi rst having our learning and business model in place,” he said. It will escalate once the learning is completed in about a year or so.

The company will be focuss-ing on the entire range of cars. Normally, in high-end cars, a lot of

accessorisation has already hap-pened. And so it is really at the A, B and C segments of cars that require accessories. And to sup-port the requirements, Carplus deals with the complete range of accessories—from infotainment to security systems, navigation, upholstery, interiors and exteri-ors. It also deals with different brands. Besides, the retail outlets carry out several services including anti-rust treatment, wheel balanc-ing and such things. The two retail outlets have specifi c bays where the customers can see the work in progress from an air-conditioned lounge. The retail store also deals with tyres for passenger cars.

Asked if LIS would extend a sim-ilar concept to two-wheelers, he said, “We may consider at a later stage but at this point of time we would like to focus on passenger cars and multi-utility vehicles.”

The network that LIS has estab-lished over a period of time is largely oriented towards dealing with electrical and fuel injection systems of automobiles. And the entire value chain is aligned to that. Therefore the company will be largely confi ned to these two

Sandeep Abbi, President, Lucas Indian Service

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COVER STORY

segments as it feels that there are still many unrepresented avenues within auto electrical and fuel injection systems. However, there are certain items including high performance lamps and HIDs that are currently dealt with by Carplus, which might come in as part of the company’s distribution network, he said. Lispart already deals with these kinds of products including halogen lamps, and it will only be a natural movement for the company to expand the product portfolio.

The entire aftermarket busi-nesses of Lucas-TVS and Delphi-TVS is overseen by LIS. It sees tremendous synergies amongst different business divi-sions such as Lucas-TVS (auto electrical), Delphi-TVS (diesel fuel injection system), Lispart (outsourced auto parts) and Lucas (batteries, ignition coils and switches). The core busi-ness of the company is to provide sales and service to auto electri-cal components manufactured by Lucas-TVS and diesel injection systems made by Delphi-TVS. “We have specialised in auto electri-cal and diesel injection systems.

And we are looking to expand in adjacent areas of business. For example, we have recently tied up with lubricant company—Top1 of the US, to distribute its products all over the country except south India. This is basically for exclu-sive distribution of synthetic and semi-synthetic lubricants and not the mineral-based lubricants. Although the market is largely towards mineral-based lubricants, the new generation vehicles and quality conscious customers see merit in going for the synthetic lubricants. We would not be play-ing the volume game. However, it could become the mass market in the future. It’s a strategic move for us,” he said. The company will be catering to the requirements of motorcycles, passenger cars and diesel segment in both cars and commercial vehicles. Later on, it hopes to cater to industrial lubri-cants too, he added.

Under the brand ‘Lucas’, the company sells ignition coils, switches and batteries. Except for batteries, the other two products are manufactured by LIS. It has been supplying ignition coils to the earlier generation of Maruti

vehicles. With the change in tech-nology the company has now been catering to aftermarket require-ments of those vehicles. Besides, it also deals with switches that are primarily meant for starter circuits. In addition, it also out-sources batteries and sells under ‘Lucas’ brand. This is a small part of its operations. Asked if the com-pany will look at expanding its product portfolio, he said the range of switches may expand. The com-pany directly sells its batteries through its dealerships. Besides, it also sells to OEMs who in turn re-brand and sell as genuine parts.

Today, the company has a network of over 2,000 dealers covering close to 700 towns and cities. About two wheelers he said, “We are already in two-wheelers through some of our products since Lucas-TVS is catering to two wheeler segment. Also we now handle lubricants.” Under Lispart it has some spare parts for this segment and this is the area where the company is hoping to strengthen further. “Over the last few years we have started building a portfolio for more two-wheeler parts,” he said.


COVER STORY

Auto electrical and fi lters are the areas where the counterfeit is more. The industry estimate is around 30 percent, however, he feels that it should be more in the auto electrical and fi lters. New generation vehicles with advanced technologies become a natural barrier for the counterfeit.

The company has three mobile units with auto electrical and fuel injection test equipment, to hold campaigns and also to train the peo-ple in the outlets. Each unit caters to one of the three regions—north, east and west. The southern region is catered through the TVS group com-panies themselves, he said.

Lucas Care, which was launched few years ago to cater to the pas-senger car users, is now oriented towards the institutional custom-ers on preventive maintenance. This is because of rigorous demand in this segment..

The company deals with over 10,000 parts and it has developed an inhouse software to manage the supply chain from the manu-facturers till the part is delivered to the end customers. The soft-ware built within its IT systems with certain principles works on

the basis of supply chain man-agement. It helps the company to integrate with its suppliers and subsequently to distributors and dealers. Since retailers are smaller entities, they do not have the capa-bility of holding a wide range of parts. The software developed by

the company helps in replenishing the stocks at the earliest possible time, he said. The company has 23 branches with warehousing capabilities. It is currently build-ing ‘Central Warehousing’ units in Chennai and Puducherry, which will become part of the larger sup-ply chain management.

LIS has 350 service dealers and 40 company-owned work-shops through which, it sets the benchmark for servicing. The company-owned outlets will play a signifi cant role in imparting training to the service dealers. LIS maintains the history of vehicles and even if the vehicles move from one city to the other, the service history can be retrieved to facili-tate easier service.

With the vehicle parc and vari-ety increasing, there will always be growth in the aftermarket business despite the fact that the life-span of the spare parts is signifi cantly increasing. Besides, the increasing awareness of preventive mainte-nance will also spur the demand. According to him, some categories that fall under the replacement cycle and the aftermarket, will also move from repair to reconditioning. When asked about remanufacturing, he said that LIS is already into this in a small way on starters and common rail systems. “These are in very early stages for us to understand on how the processes are to be handled. As we go through our learning, we would defi nitely look at expanding,” he said. �

LIS extensively covers the coun-

try through its four regional

offi ces located at the main met-

ros and 23 branches equipped

with warehousing facilities.

LIS has 350 service dealers

and 40 company-owned

workshops

through which, it sets the

benchmark for servicing.

Distribution


EXTRA MILE

Starting out as a Fiat dealer in the late nineties, Shaman Motors has already evolved into

a distinguished luxury car dealer in Mumbai with brands like Mercedes Benz, Volkswagen and Honda.

Second generation dealer and Director, Shaman Motors, Amar Sheth, has his priorities in place when he says that he aspires to cre-ate a dealership, which is a preferred partner for customer and employees and not necessarily the top seller of the brands on its roll.

Claiming to have minimal attri-tion, he adds that the all policies and initiatives are taken by him and his team to ensure that customers are retained, for their lifetime! He has been trying to achieve this objective through three showrooms of Honda, and one each of Volkswagen and Mercedes-Benz in addition to a used car outlet. A customer gets to choose from a used car costing couple of lakh to a premium marquee costing over a crore.

“Catering to the luxury segment customers is very different from sell-ing cars in the high volume segment.

Abhishek Parekh

Retaining customers

Amar ShethSecond generation dealer

and Director, Shaman Motors

Phot

ogra

phs:

Jos

hua

Nav

alka

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EXTRA MILE

The difference is very apparent in the types of programmes and promotions that are offered to our customers compared to those offered to a customer in the high volume segment,” said Sheth. He added that dealing with the luxu-ry segment is about catering and exceeding customers’ aspirations (not expectations!).

The key aspect in this business is to provide the experience that takes the customers to a different orbit. He has been good at forg-ing relationship going back to his days as a Fiat and Ford dealer in Mumbai. In fact, the architect and designer who have helped design all the showrooms for the three brands, had been angry customers of the Fiat Uno.

Dealing with luxury cars has its typical set of challenges: bringing novelty to the business to retain and keep customers happy. He asserts that it is easier said than done. “The segment is evolving so fast that whatever initiatives are taken up by any dealer quickly become norm and basic minimum that customer comes to expect. As aspirations are met, a new set of aspirations take their place. Keeping up with this evolution is a challenge for any luxury product dealer,” said Sheth. He elaborated that relationship plays a key role in

the luxury goods segment, espe-cially cars, as customer of a luxury car rarely visits the showroom and, more often than not, he has a pret-ty good idea of the product already.

One of the biggest challenges facing any big city dealer or high volume dealer is the rising cost of real estate in cities across the coun-try. “It is very clear to me that the rising cost of infrastructure (land and establishment) and manpower is likely to change the way all deal-ers conduct their business. This will happen sooner in case of metros like Mumbai,” he added. Elaborating further on this point, he said that dealerships will have to change the way they conduct their operations by aiming for signifi cantly higher turn-around of vehicles coming in for servicing by running service bay round the clock. Such changes have already started to take shape and will only get accentuated in the coming years. The dealership work-force would have to get attuned to these changes.

Another major challenge is attracting well groomed and moti-vated people to enter and remain in the automobile dealership business in the face of compet-ing career choices including retail, airlines and hotel management to name a few.

Manpower is not a major con-cern for Sheth at this stage. He attributes the relatively better position on this front compared to fellow automobile dealers to employee-friendly work culture and ‘measured’ growth. In addi-tion to growth opportunities available to employees internally, Shaman Motors also runs inhouse training and knowledge sharing programmes. The key focus of the training is on soft skills and motiva-

tion. A well performing employee is encouraged to work across brands and can earn even twice the amount of his/her base salary through the incentive structure.

“We are not looking to be the top dealer for any or all of the brands we represent, as achieving such an objective would only come with its own set of issues. We are looking to be the preferred dealer for cus-tomers and employees and want to retain both these group of stake-holders for a long time to come,” elaborated Sheth when he was asked about his aspirations. The more relevant criteria on which he measures his success are custom-ers’ upgradation, repeat sales and customer referrals.

Sheth is evaluating getting fur-ther penetration in selling luxury products, not necessarily another luxury car brand. He is also quick to point out that though compe-tition has been growing in the premium luxury segment with Audi and BMW having a good run in the country, these brands are growing from a very low base. “We have established a relationship and trust with customers, which can help us further expand our reach across product segment,” said Sheth. But immediate priority is to consolidate the presence in the three existing car brands and pos-sibly go to newer locations. �

A well performing employee can earn even twice the amount of his/her base salary

32

IN CONVERSATION

AFTERMARKET SEPTEMBER 2011

Eaton is a global leader in automotive valves and also has a major presence in trucks, construction equipment and industrial equipment segment. It is a relatively younger player in the aftermarket segment in India having established its presence around three years ago. Executive Director-India, Automotive Division, Eaton, Ramchandra Rao speaks to Abhishek Parekh on the company’s journey thus far and its vision for the future.

‘We intend to grow our presence in

clutches and engine valves’

32

Since how long have you been oper-ating in the aftermarket in India?

It has been around three years since we have begun establishing our network here.

What are the other products or systems in your global portfolio having good prospects here?

Apart from locking differentials, which can have a good potential as in many other South East Asian countries, there are some products that are suitable for the Indian mar-ket. We are looking to enhance our presence in the medium and heavy duty clutch segment though I would be unable to provide more details about the strategy for that product. So we are looking to grow product range and reach in differentials and clutch range.

What is Eaton’s strategy for prod-ucts and services to the aftermarket customers in India?

Eaton operates in essentially two product groups: automotive and trucks, globally. The automotive product group mainly comprises engine valves, locking differentials, super chargers, valve actuation systems and plastic products or components. In the truck segment, we manufacture and sell transmis-sions, hybrid systems for buses and

33 SEPTEMBER 2011 AFTERMARKET

IN CONVERSATION

clutch systems. In India, we manu-facture and sell medium and heavy duty transmissions and engine valves. We also have a presence in locking differentials for automotive segment and medium and heavy duty clutch systems in the truck portfolio. Eaton is globally the larg-est engine valve manufacturer. We intend to grow our presence in a major way in the aftermarket for clutches and engine valves in India as these products have a high degree of wear and tear and need to be replaced at regular intervals.

How evolved is your distribution network in India for some of the aftermarket products?

We do not sell directly to the end customers (for instance, fl eet own-ers) but make an effort to have a network of distributors or wholesal-ers who do not deal in a competing product or product range. We have enrolled around 40 distributors cur-rently, primarily for selling engine valves. The distribution network in India for most players in the after-market is a little different from that observed in developed countries.

Typically, distributors and even retailers of part groups for say, chassis systems, engine parts or exteriors are concentrated in par-ticular locations. Also, there are numerous separate or combined outlets for batteries and tyres. We have a well entrenched distribution network in the western, eastern and the northern parts of the coun-try and are beginning to establish major presence in the south as well. Our distribution strategy is geared on two basic principles: ensur-ing that our products occupy the best available shelf space and has a recall value with the mechanics or retailers.

What are the key aspects to ensuring a reliable distribution network?

Availability of spares with retail-ers and top of the mind recall plays a critical role in this process. This availability is complemented by efforts of our sales representa-tives, who are assigned with the task of understanding custom-ers’ requirements and converting prospective demand into sale of Eaton products.

Is counterfeiting a major issue that you are tackling?

Given our limited size and mar-ket presence, we have not yet encountered a major threat from counterfeits. Moreover, counter-feiting affects most players in the aftermarket but it needs to be detect-ed faster. We can only address it if we can detect it. I feel adequate care in packaging and labelling is one of the better ways to tackle this men-ace. But given the fact that we are not a very large player in the Indian aftermarket, we are not adversely affected by this menace as yet.

What are the major challenges for growing your presence in the after-market segment?

The key challenge is access to mar-ket and customers. It is very critical to identify key locations for cater-ing to different vehicle segments like trucks, buses, passenger vehi-cles and construction equipments. Most markets are geographically concentrated around certain key locations and it is critical to identify those and get access to distributors or retailers there. The second chal-lenge is to offer value prepositions at various price points. If this is not adequately addressed, then there is a danger of getting into a quagmire of prices, discounts, incentives to

distributors and retailers. We have been able to capture around 15 per-cent marketshare in the product groups in which, we are present in India overall. I must add that we are not present in the two-wheeler valve business, either in the OEM or in the replacement and that is a major market from which we are absent.

How do you sense the market evolu-tion in India and what does it mean to you?

I sense two distinct macro level changes happening in the aftermar-ket in India. As the overall quality of systems and components improves and technology evolves to a different level, it will get increasingly diffi cult for a large number of mechanics or technicians to service all aspects of any vehicle. This will lead to a con-solidation of servicing capabilities to a restricted set of service providers, whether authorised or unauthor-ised. Such a consolidation based on sophistication of vehicle technologies and capabilities or specialisations will imply that an aftermarket player would need to reach these locations rather than go after the entire avail-able market at a much higher cost. So instead of making effort to reach out to towns and cities in northern Maharashtra, it would be better to focus only on reaching out to the Ahmednagar cluster and so on.

GST (Goods and Services Tax) would also have a major impact on our distribution strategy since the fl ow of goods will be smoother and streamlined than what is currently the case. The more the sophistication coming into the workshop or service infrastructure, the higher the level of automation in the back offi ce at dis-tributors and retailers. What’s more, the more evolved retailing concepts are a given and already happening. �

33


STUDY

The ‘Delhi Effect’ Distribution companies

have always been wary of wholesalers in their distri-

bution chain. Ideally, companies want selling agents in their distri-bution chain who also act as true distributors; who are willing to continually service a defi ned ter-ritory for selling and collections in small lots. However, the stark reality for many distribution com-panies is the dominant presence of wholesalers who buy in large bulks and sell them to the lowest bidder without any territory allegiance. When wholesalers dominate the distribution chain, it leads to territorial confl ict and pricing competition for the same brand making it more of a commodity, rather than a brand.

The problem of wholesalers is largely confi ned to one major market—the Delhi wholesale mar-ket. The Delhi market tends to sell about 15 percent to 20 percent of the entire country’s sales for most auto spare part companies, while it accounts for maybe about eight-10 percent of the country’s consump-tion. No doubt, the sales manager

in-charge of most companies based in Delhi do not tend to have many friends. While he is always on targets, his colleagues continu-ally rant about Delhi material sold in their area. The effect is not just limited to nearby territories, but the distributors across from Salem to Silguri, Kutch to Kovalam and Ranchi to Raipur—all complain-ing of ’heavy infi ltration‘ of Delhi material into their area.

‘Delhi Material’Let us try to understand this

phenomenon of ’Delhi material’—how come the goods from Delhi travel to the length and breadth of the country and are sold in anoth-er distributor’s area?

A retailer’s business model is quite simple to understand: Sell at MRP and try to maximise on the profi t. The only way to maximise on the profi t is to buy cheap and ensure that the total costs (pur-chase and transport) should be the lowest rate possible.

Logically, a retailer should buy from a distributor located closest to him (the transportation charged would be the least). But when a Salem-based retailer bypasses his

Puneet Kulraj


STUDY

closest distributor and opts for a distributor based in Delhi, there can be only one conclusion—he is getting a cheaper deal from Delhi. You would know of course that the cost of transportation from Delhi would be substantially high com-pared to getting it from the local distributor. It can mean only one thing: the cost at which he buys from Delhi is substantially lower.

How is it possible that when both the distributors (Salem and Delhi) get the same margin from the company and yet their selling prices are so different that a Delhi seller can undercut the Salem sell-er, even after compensating the substantially large transporta-tion costs? You probably know the

answer, but if you do not, let me introduce you to the protagonist of this piece: the Delhi wholesaler.

The Delhi WholesalerFound in locations like Kashmiri

Gate, Chawri Bazaar and Punjabi Bagh, operating out of pigeonholed cubicles that serve as an ’offi ce‘, the wholeseller is extremely well connected (multiple telephones off the hook simultaneously) and is a speculator to the core. He can put the traders on Wall Street to shame with his knack for ’rolling‘ stocks and money for the thinnest of margins.

Spend a few hours in any of the trading hubs, look past the incred-ulous sights of entire engine blocks

or gearboxes being carried around overhead in wicker baskets, and you will see deals being struck on phones and slips of paper—the essence being two things: quantity and percentage points. Yes, this is the environment where hardcore trading at its fundamental raw level will never cease to amaze you. The Delhi trader, knows only one thing, and that is to ’roll‘ his money as fast as possible and the best weapon in his hands—price!

The business model is simple and in two parts: buy large quanti-ties at cheap prices and sell them cheaper still. The fi rst part is exe-cuted very well with the sales or territory manager who sees this as an easy way to meet his numbers

Puneet Kulraj, Founding Partner, Vector Consulting Group


STUDY

and actively get the best discounts from his company.

‘Sell Cheap’Once this is done, the second part

is easy—sell cheap. How cheap is cheap? Well, legend has it that some-times some of the traders sell at a price below what they buy for, and they make their money by selling the cardboard outer packing cartons that the goods come in! They have little or no overheads, sometimes holding no stocks at all and delivering goods straight from the company’s depot to the customer—the famous “bill to-ship to” phenomenon.

Now this is inventory turns at its cut-throat best. Good for the wholesaler, good for the Delhi sales manager and good for the retailers in Salem, Siliguri and Gandhidham. They can buy the stuff at such a low rate that it not only takes care of transportation all the way from Delhi, but also beats their local distributor. Those who can buy the quantities for this to work, do it all the time. It forces the local distributor to drop his prices too in a desperate attempt to maintain his volumes.

However, what does this do for the company? It creates a market that is strife torn, with one distrib-utor undercutting the other, prices being ruled by speculators, spikey sales leading to uneven distribu-tion resulting in surplus stocks in one part of the country and creat-ing shortages in other parts that are left open for competition.

Imagine, for all the brand build-ing, advertising, the 4Ps of Kotler, the fate of the product is decid-ed by the wholesaler who, based on the quantity he has been able to corner, and the price that he has got, puts out the ruling price

of the day “aaj ka bhav” for the product. Thus, so vitiated can the environment become that some companies experience a severe back lash from their other distribu-tors and even face desertion.

But due to dominant sales of Delhi market, companies fi nd it very diffi cult to bite the bullet. If one has to stop the sales to the Delhi wholesale market, it means an immediate drop in volumes—what happens to the targets? No doubt companies, particularly the auto spare parts, have learnt to live with this confl ict forever.

Is there a way to get out of this mess without affecting the sales target even for the immediate term? To answer the question, one needs to understand why real distributors never dominate the supply chain. The answers lie with the companies itself. Most companies operate on

the push mode. They tend to sell in one big lot towards the month end, spiced up with attractive discounts, while overall availability at a SKU level suffers throughout the month. The pressure of high unwanted inventory, forces many selling agents to always look for fastest way to get rid of the inventory. Over the years many selling agents, particu-larly in the Delhi region, have used

it to their advantage rather than complaining against the system. Any person who acts as real dis-tributor suffers very badly—on one hand he does not get good availabil-ity to continually service his market with small lots, and on the other hand, he has fi ght off the wholesal-ers in his territory.

If companies want to take advantage—they have to help make distribution a lucrative busi-ness, which means they should have ability to continually service small requirements of the distribu-tor throughout the month. But how can they do that when they have their sales target and their forecasts actually go haywire: they have to push the inventory. The only way out is to get out of the push mode to a pull mode. They have to move to a model of supplying as per con-sumption, which in turn will help distributors earn high ROI and invest more in the market. Once the distributors start earning high ROI and company sale per real dis-tributor starts going up, they can convince many of the wholesalers to get converted to distributors. If many are not willing, at least, they will gather courage to replace them with real distributors.

Implementing a pull-based par-adigm shift requires signifi cant changes right from production planning to sales planning and relationship with distributors. It requires signifi cant collabora-tive efforts to create a whole new world with real win-win principles. Sounds much better than staying in confl ict! �

(The author is the Founding Partner of Vector Consulting Group (www.VectorConsulting.in). He can be contacted at [email protected]. Views expressed are personal.)

Found in locations like

Kashmiri Gate, & Pun-

jabi Bagh, operating out

of pigeonholed cubicles,

the wholeseller can put

the Wall Street traders

to shame with his knack

for ’rolling‘ stocks for

the thinnest of margins


FOCUS

Rubber supply mismatch may hit pro� tability

Tyre manufacturers have been wilt-ing under the pressure of rising natural rubber prices, adversely

affecting profi tability. Even as most tyre manufacturers have announced growth in sales in the last fi scal as well as the fi rst quarter of this fi scal, they are struggling to remain profi table.

Apollo Tyres sees the gap between the growing demand for natural rubber and dwindling supplies to increase to ‘alarm-ing’ proportions of around one million tonnes by year 2020, according to the company’s latest annual report. It further

Abhishek Parekh


FOCUS

points out that the natural rubber market had been characterised by rising prices and a shortage in supply. The prices hit as high as $6,768 a tonne in February this year. The tightness is likely to last till 2018.

A large number of today’s pro-ductive plantations had come up in the 1980s. Most of these will require massive uprooting and replanting between 2012 and 2018. Combined with this is the spec-tre of dramatic climate change, where the past few years have seen unprecedented rains and even fl ooding in the two largest natural rubber producing coun-tries of Thailand and Indonesia. This is likely to lead to major demand supply mismatches in the coming months.

The company is working on mul-tiple fronts to address the situation. Apart from accelerating research to substitute natural rubber in the tyres, the company has also entered the area of rubber plantations to secure future supplies. On the other hand, it is hopeful of making most of the upcoming demand for tyres with signifi cant capacities coming onstream this calendar year. The company’s Chennai plant will reach its planned capacity towards the end of this year.

The company’s annual report further points out that the June quarter saw India’s growth rate in passenger sales outstrip that of China. As China starts to slow down, India will take its pre-eminent position; not just in the automobile industry but across various sectors.

The rising cost of raw materials has begun to bite most front-line tyre manufacturers even as demand continues to show robust

growth across all vehicle segments. Ceat announced an operating

loss of `25.04 crore for the quarter ended June 2011 as against `32.9 crore operating profi t. The compa-ny net loss increased to `41.9 crore in the fi rst quarter this fi scal as compared to `13.87 crore net profi t in the fi rst quarter in the last fi scal.

The company standalone revenues for the last fi scal stood at `3,751.62 crore as against `2,989.98 crore in the previous fi scal. The operating profi t in the last fi scal decreased to `106.73 crore as compared to `277.59 crore in the previous fi scal. The net profi t decreased to `22.28 crore as compared to `161.03 crore in the previous fi scal.

JK Tyres’ net sales grew to `1,401.67 crore in the fi rst quarter this fi scal as compared to `1,163.49 crore in the fi rst quarter of last fi s-cal. The operating profi t in the fi rst quarter reduced to `40.04 crore as compared to `50.8 crore in the fi rst quarter, last fi scal. The net profi t in turn went down to just under a crore rupees as against `19.53 crore in the fi rst quarter last fi scal. It was similar story for the largest tyre manu-facturer MRF, which announced net sales of `2,573 crore in the fi rst quarter, this fi scal as compared to `1,925.4 crore, but its operating profi t reduced to `140.3 crore as compared to `154.98 crore. �

The rising cost of raw materials has begun to bite most frontline tyre manufacturers

Apollo Tyres sees the

gap between the grow-

ing demand for natural

rubber and dwindling

supplies to increase to

‘alarming’ proportions

of around one million

tonnes by year 2020

according to the

company’s latest

annual report. The

tightness is likely to

last till 2018


FOCUS

Customers adopting a ‘wait and watch’ attitude and even down trading to

smaller vehicles, is causing a con-cern among auto fi nanciers and even auto dealers. Additionally, most banks, auto fi nance compa-nies and even dealers lament meek response from buyers.

“It might help banks and auto fi nance companies if we (fi nan-ciers and vehicle manufacturers) sit together and fi gure out attrac-tive schemes and initiatives to help push up sales in such a market. I do not see a major upturn in vehi-cle sales, with a limited upturn in upcoming festive seasons includ-ing ‘Navratri’ and ‘Diwali’,” said Executive Vice President, Auto Loans, HDFC Bank, Rajan Pental. He added that though customers are looking forward to new launch-es in the coming months, they are essentially adopting a ‘wait and watch’ policy with most choosing to defer purchases. Additionally, he also pointed out that the phenom-enon of increased preference for diesel vehicles in the recent months on the back of expanding fuel price differential is causing concern as vehicle manufacturers are unable to produce a suffi cient number of diesel cars leading to deferment or cancellation at customers’ end.

Dealers and auto fi nanciers are not benefi ting, despite larger ticket size or sale value, from the increased preference for diesel vehicles. “Customers are put off by

long waiting periods. Though man-ufacturers are trying to address this situation, the scenario is wors-ening over the recent months and has hurt dealers and fi nanciers alike,” said an ICICI bank offi cial. He added that the interest rate sce-nario is uncertain and is beginning to hurt vehicle sales.

Pental added that the festive season beginning with Onam in Kerala has not been encouraging from the vehicle sales perspective. Even as vehicle manufacturers are looking for solace with several other festive seasons including Ganesh Chaturthi, Navratri and Diwali over the next couple of months, the sales are unlikely to take a major upturn, going by current indications. Moreover ‘serious’ buyers are more likely to increase the cash component in vehicle value (implying lower loan amount) and even buying entire-ly on cash. This has always been

the case when interest rates climb higher, but holds particularly true in current times with several lower cost options like the Nano or the Ford Figo.

Increasing prosperity in rural areas due to higher grain pro-curement and other agricultural improvements has meant robust tractor sales and opportunities to fi nance tractors, according to an offi cial from Mahindra Finance. But CV sales, which is relatively less affected by interest rates, has been showing signs of softening in certain segments.

Banks as well as vehicle fi nancing companies are look-ing for support from vehicle manufacturers by devising and promoting special schemes target-ing increased sales at dealership levels, joint effort at pushing sales in Tier III and smaller towns as well as easier terms in the current high interest rate scenario. �

Lacklustre auto sales causing concerns among fi nanciers, dealersAbhishek Parekh


EVENT

PaintExpo 2012 to boost latest painting technologies

For companies with inhouse painting facilities as well as job-shop coaters, increasing

material and energy effi ciency in coating processes are top priori-ties. Appropriate solutions will be presented at the fourth edition of the PaintExpo, whose exhibitor list already includes at least 230 com-panies. The exhibition programme at the leading international trade fair for industrial coating tech-nology, which will be held at the Karlsruhe Exhibition Centre from 17 through 20 April 2012, ranges from pre-treatment to quality control.

Regardless of the industry sec-tor for which metals, plastics, glass, wood and other materi-als need to be coated—strong demand for improved efficiency and, at the same time, enhanced quality and ecology is being felt in all market segments. Increased f lexibility is an additional issue

which concerns companies with in-house painting operations. On one hand, this involves smaller and smaller manufac-turing lot sizes in many areas. On the other hand, painting sys-tems are in demand which can be f lexibly expanded and set up for various processes.

Companies with inhouse painting operations and coating job-shops will fi nd solutions to these challenges at the PaintExpo. Registered participants come from the fi elds of equipment and appli-cation technology—and nearly all of the market and technology lead-ers are included in the exhibitor list. As a result, the upcoming event will not only encompass the world’s most comprehensive offerings for liquid painting, powder coating and coil coating, it will also present innovative developments and new trends in all of the sectors repre-sented at the exhibition.

Optimising ProcessesIn order to reduce energy and

material consumption, efforts are being made to decrease the number of steps required when coating parts made of metal and plastic in various industry sectors One of the solutions to this problem involves primerless liquid painting systems. These make it possible to replace the conventional three-coat system consisting of primer, base coat and clear coat with a two-coat fi nish. This results in more demanding requirements for the surface of the substrate, and thus for pre-treat-ment as well.

Nano-technology is playing an ever greater role in paint produc-tion as well, amongst others the nano sol-gel process. Applications for these paint systems include, for example, the application of transparent, highly scratch-re-sistant protective coatings on high-gloss anodised, decorative aluminium parts. The signifi cance of UV paints continues to grow as well—for plastic as well as metal substrates. In the fi eld of solvent-based paint systems, the trend is moving towards higher and high-er solid content levels in order to reduce the solvent percentage.

An optimised application technique which assures greatest possible transfer effi ciency is a prerequisite for reduced material consumption. This is made possible by paint guns and high-speed rotary atom-izers with a spray jet, which is matched to workpiece geometry for better quality and fi nishing. �

Glimpse of a previous PainExpo


AUTO POINT

The government of India is committed towards increas-ing the production and

effi ciency levels in the agricul-ture sector and has recognised improvement in farm mechani-sation as one of the important factors that would push the effi -ciency levels in agriculture.

The movement called ‘Green Revolution’ started in1960, laid down signifi cant steps towards development of the agriculture sector that included conces-sional credit for buying tractors, which consequently boosted trac-tor demand. Furthermore, rise in the awareness levels, substantial improvement in agricultural cred-it disbursements combined with increase in the income levels has fuelled the growth in tractor demand.

CARE Research estimates that the overall tractor population has increased from around 0.15 mil-

lion units in 1970 to around 4.2 million units in FY11 and its pen-etration level has increased from around one tractor per thousand hectares in 1970 to around 29 tractors per thousand hectares currently.

Tractors drive mechanisation levels

The rise in tractor penetration also improved the mechanisation levels signifi cantly in agriculture sector. CARE Research estimates the share of mechanical and elec-tric power in overall power used in agriculture sector has increased from 83 percent in FY01 to 86 per hectare in FY06 and further is esti-mated to have increased to around 90 per hectare in FY11. The share of tractors in mechanisation devices which is the primary driver infl uencing the rise in mechanisation in agriculture sec-tor has increased from around

Rise in farm credit to push mechanisation

levels in agriculture sectorRevati Kasture Head, Industry Research, CARE Research

Vishal Srivastav Analyst, CARE Research


AUTO POINT

48 percent in FY01 to around 60 percent. in FY11.

Tractor industry remains buoyant

After surpassing hiccups in FY09, the tractor industry was back on the roll in FY10 register-ing a strong growth of 31 percent. The growth momentum continued in FY11 as the industry observed a healthy rise of around 22 percent in its domestic unit sales. Healthy monsoons in most parts of the

country, rise in minimum support price (MSP), favourable farm credit scenario coupled with shortage of agricultural labourers owing to the rise in employment opportunities in rural areas through National Rural Employment Guarantee Act (NREGA) led this growth.

West-India to drive growth

Improving irrigation facility and good monsoons in the last four-fi ve years have boosted agri-culture produce and consequently tractor demand in western India.

Maharashtra was among the high-est growing tractor market during the last fi ve years. CARE Research foresees the high growth momen-tum to continue in the western region as Maharashtra and Gujarat are expected to witness a healthy growth scenario in the coming four-fi ve years. Low penetration levels, increased farm income and increasing demand from infra-structure activities would drive this growth.

During the last two-three years, the demand in the southern regions have been adversely affect-ed by fl oods in Andhra Pradesh (AP) and Karnataka which are the two major tractor markets in Southern India. However, CARE Research believes that the lower penetration levels combined with rising coverage of non-banking fi nancial companies (NBFCs) in agriculture credit would lead to improvement in credit availability and thus boost the tractor demand during the next fi ve years.

Historically, the northern region has dominated the trac-tor demand. Punjab, Haryana and western UP have the highest trac-tor penetration levels in India. However, during the last two years, fl oods resulting in crop loss have subdued the demand growth to some extent in this region. CARE Research expects growth in trac-tor demand to slow down in these regions in the next four-fi ve year period. Eastern UP, which is among the largest agriculture belts in India is expected to drive northern India sales owing to low level of penetration.

CARE Research foresees the replacement demand, increased infrastructure activities and shortage of farm labourers owing

Trend in tractor domestic sales

-10%

-5%

0%

5%

10%

15%

20%

25%

30%

35%

0.00

0.10

0.20

0.30

0.40

0.50

0.60

FY05 FY06 FY07 FY08 FY09 FY10 FY11

Tractor sales ( LHS) Growth( RHS)

Units

(in

mn)

Source: CMIE and CARE Research

Tractor penetration

0

5

10

15

20

25

30

35

0.0

1.0

2.0

3.0

4.0

5.0

FY71

FY81

FY91

FY01

FY11

Tractor population (LHS)

Penetration per thousand hectares (RHS)

Units

(in

mn)

Source: CARE Research Estimates


AUTO POINT

to creation of various alterna-tive employment opportunities through NREGA to push the trac-tor demand in Northern regions at moderate levels in the next fi ve-year period.

Large Investments Expected

Strong recovery in tractor demand during FY10 & FY11, after a bleak performance in FY09, raised the utilisation levels of all the key players considerably in FY11. Gauging the huge opportuni-ties in the domestic market, almost all major tractor manufacturers have announced expansion plans for the next two-three years. It is estimated that around `1,800-2,000 crore has been lined up towards investments in capacity expansion and product development in the next two-three year period. CARE Research foresees the industry growth levels to come down from the current levels as the utilisa-tion rates are expected to drop for the next two years. However, mod-est rise in domestic sales coupled with healthy export growth would

be able to maintain the utilization rates at healthy levels.

Demand Towards TractorsCARE Research estimates, large

tractors (greater than 41HP) would

continue to drive industry growth and register a rise of around 11-12 percent during FY11-FY16 period. Continued buoyancy in southern and western markets due to lower penetration levels and increas-ing demand from non-agriculture application would drive this growth. Mid-size tractor segment (31-40HP) which dominates indus-

try demand is expected to witness marginal growth of around three-four percent on CAGR basis, while the demand for small tractor seg-ment (less than 30HP) is estimated at a CAGR of fi ve-six percent during FY11-FY16. Cannibalisation main-ly from large tractor segment is expected to pull down the growth levels of mid-size tractor segment in coming years.

EBITDA To Benefit The growth in the top line of the tractor industry is expected to percolate to the bottom line, as margins in FY12 are estimated to witness a marginal rise of around 10-20 BPS. Although the rise in input prices kept the industry margins under strain in FY11, CARE Research foresees input prices to marginally soften in FY12, benefi ting the industry margins by some extent. �

(The report is prepared by CARE Research, a division of Credit Analysis & Research. Views expressed are personal.)

Source: CMIE and CARE ResearchNote:

Har: Haryana, Pun: Punjab, UP: Uttar Pradesh, MP: Madhya Pradesh, J&K: Jammu and Kashmir,

Utt: Uttarakhand, Him: Himchal Pradesh, Bh: Bihar, Jar: Jharkhand, Or: Orissa, WB: West

Bengal, Chh: Chhattisgarh, Ass: Assam, TN: Tamil Nadu, AP: Andhra Pradesh, Kar: Karnataka,

Ker: Kerala, Guj: Gujarat, Mah:Maharashtra, Raj: Rajasthan

Trend in power contributed by tractors

0

10

20

30

40

50

60

70

80

Jar

Chh

Har

Pun

UP North

MPJ&K

Utt

Bh

EastOr

WB

TN

APSouth

Ker

Kar

Guj

Raj

Mah West

Ass

Him

Expected growth scenario next 4-5 years

Low HighLow HighLow HighLow High

Indiaaverage

Trend in repo rates during last two years

4.0

4.5

5.0

5.5

6.0

6.5

7.0

7.5

8.0

Jun

-09

Au

-09

Oct

-09

Dec

-09

Feb

-10

Ap

r-10

Jun

-10

Au

-10

Oct

-10

Dec

-10

Feb

-11

Ar-

11

Jun

-11

per

cen

t

Source: CMIE and CARE Research

CARE Research estimates the share of mechani-cal and electric power

in overall power used in agriculture sector has in-creased from 83 percent in FY01 to 86 per hectare

in FY06 and further is estimated to have in-

creased to around 90 per hectare in FY11


SPECIAL REPORT

Product specific dealership network

Tata Motors recently announced plans to set up dedicated dealerships for

its range of vehicles including the ‘micro’ car Nano, new generation utility vehicles like the Aria and the Safari as well as passenger cars. The company plans to set up 300 dedicated dealerships for the Nano (in addition to more ‘inno-vative’ sales outlets) and another 100 outlets for its utility vehicles (UVs), including the Aria and the Safari, by the end of this fi scal, according to a company offi cial.

Ashok Leyland-Nissan is eval-uating setting up a dedicated dealership network for it recent-ly launched LCV—the Dost. M&M already sells its SUV—the Scorpio—through a dedicated dealership network in certain locations and has established a separate network for its passen-

ger car- Logan (now rechristened Logan Verito).

Industry experts are of the opin-ion that given the economic and cultural diversity in the country, it may be an opportune time for vehicle manufacturers to evaluate the feasibility of product specifi c dealerships. The dedicated deal-ership network could provide a better connect with the custom-ers and help dealers in targeting specifi c set of customers in spe-cifi c locations depending on the economic, demographic and other social parameters.

“In the global markets, you really don’t have such a huge difference in the big and small cars (or their customers) like we have in the Asian market. Also depending on the products, vehi-cle manufacturers have separate locations for the vehicle which are fast moving and others kind of vehicles. But I would see this

(product segment-specifi c dealer-ship) more relevant for the Indian conditions, looking at the diverse customer profi le here,” India Leader for Automotive Practice, PriceWaterhouseCoopers, Abdul Majeed told Aftermarket.

Tata Motors currently has around 250 odd full-range deal-erships. After the dealership network restructuring exercise, the company would have three kinds of sales outlets catering to customers for the Nano, UVs and passenger cars. Few select deal-ers would continue to offer the complete range of its products/models. Dedicated passenger car dealerships would be opened this fiscal, but the company is yet to decide on the number of such outlets.

In the course of this fi scal, Tata Motors will transform some UV-specifi c dealerships and full-vehicle range dealerships

The dedicated dealership network could provide a better connect with the customers

Nabeel A Khan


SPECIAL REPORT

to passenger car sales outlets. Analysts are of the opinion that the change of course could have been driven by the ‘alarming’ fall in sales of its Nano. The com-pany’s passenger vehicle sales dropped across categories, with sales of Nano declining by 64 per-cent to 3,260 units in July this year. The company posted a 14.30 per cent rise in commercial vehi-cle sales at 40,798 units in the domestic market.

Industry play-ers are of the opinion that it is no longer suf-fi cient to have a good product/model portfolio. Growing com-petition and widening model line up implies

that the vehicle manufacturers also needs to communicate to the customer, offer products at suit-able locations and gain confi dence of the customer. India is a huge country with rural pockets, urban pockets with diverse set of custom-ers within these pockets of scarcity and affl uence.

CMD, Carnation and Former MD, Maruti Suzuki, Jagdish Khattar observes, “This is some-thing new and let’s see how it

works. I don’t know if they (Tata Motors) will also have dedicated after-sales service. Yet, I think a dedicated dealership may help in spiking up the sales.”

It is felt that a dealership having premium as well as other sorts of products, all under one roof, will divert attention of the customers while having one segment product range can help the dealership to offer the customer right product.

However, not every player is yet falling for this gameplan. Maruti Suzuki does not buy this opinion that dedicated dealerships can gain additional customers or help serve customers in more focussed manner. “We don’t see much viability of having product or seg-ment-specifi c dealership”, Chief General Manager (Marketing), Maruti Suzuki, Shashank Srivastava told Aftermarket. �


STUDY

Deloitte Touche Tohmatsu’s Global Manufacturing Industry Group recently

released a report titled ‘Gaining Traction: Will Consumers Ride The Electric Vehicle Wave?’. Senior Director and India Manufacturing Leader of Deloitte Touche Tohmatsu India, Kumar Kandaswami stated that signifi cant technology barri-ers have to be overcome to give the consumers the driving experience that they want and at a price point that would be close to that of the vehicles with Internal Combustion Engine (ICE) before EVs are mass produced.

Though a large section of the pas-senger vehicle customers including those from the educated and the affl uent are willing to consider buying Electric Vehicles (EVs), the

actual buyers with the current gen-eration of technology would be in the range of three to fi ve percent by 2020, according to the report.

“Electric vehicles are no longer just an idea in the minds of car buy-ers. They are willing to consider the EV as a practical commuting option. While this is good news for manu-facturers of EVs, it must also be recognised that there are a number of barriers that they have to cross before this interest to consider elec-tric vehicles translates into sales for them,” Kandaswami said.

As per the report which is based on a survey conducted across 17 countries including India, China, Japan, Europe and USA covering 13,500 respondents, the majority of potential consumers are likely to be educated and from urban locations.

EV report on India market released by Deloitte

Kumar KandaswamiSenior Director & India Manufacturing Leader,

Deloitte, Touche Tohmatsu India


STUDY

India seems to have an almost equal number of male and female potential buyers unlike some of the more devel-oped markets where male buyers tend to be signifi cant. Interestingly, the early adopters are likely to be from the affl uent sections as compared to the middle income groups in the developed economies.

A third of Indian customers expect to purchase the EV for around `four lakh and another third willing to go up to `seven lakh. This would cor-respond to the prices they would pay for their conventional cars with ICEs. Clearly, there is unwillingness to pay a premium for clean tech-nology, as is found to be the case in most markets, he said. The accept-able purchase price varies between 20 and 50 percent of the annual income of the early adopter segment, except in the case of Europe where the respondents are willing to go

as high as 75 percent of the seg-ment’s annual income. The report further stated that the respondents expect the manufacturers of the government to deal with addition-al development or manufacturing costs. Overwhelmingly, respondents disagreed with the notion of paying a premium for technology that is clean and can mean energy independence. In the case of China and India, about 20 percent of the customers would be willing to pay about ten percent more as premium.

Further, there is anxiety in the minds of customers who expect the EV to deliver a range that is about four times what they report as their average commuting distance. In addition, the manufacturers have to overcome the challenge of charging time. About half of the customers would expect this to be two hours or less. In addition, there

is an expectation that the charging infrastructure is in place.

While fuel price increase may not be the only factor that drives cus-tomers to buy EVs, it is a fact that they have a mental benchmark of 130-150 percent of the current fuel prices that will make them consider electric vehicles. Moreover, fuel effi -ciency of vehicles can also infl uence the pace of adoption. A little over 70 percent of the respondents said they would consider the EV if the fuel pric-es crossed `85 per litre. Conversely, 74 percent of the respondents are less likely to consider buying an EV if the ICE cars were to deliver 32 kmpl. While the notion of EV is appeal-ing and the point of change seems to be in sight in terms of customer readiness, signifi cant technological barriers have to be overcome in order to achieve mass adoption of EVs, he added. �


SPECIAL REPORT

Major fall in insurance rates detrimental to growth

The falling cost of motor insurance policies, though attractive for end customers in the immediate term, may be detrimental for the

growth of the motor insurance segment and for cus-tomers as well, in the long term. Fair and reasonable pricing of risk is a key factor in any segment of the insurance industry and players are putting this busi-ness sense aside in order to garner a marketshare.

The detariffi ng of the motor insurance segment has led to a drop in tariff by around 30 to 40 per-cent across policy horizon, according to Senior Vice President, Motor Insurance, IFFCO Tokio, Abhay Kumar. The key cause of concern, according to Kumar, is that the rates of comprehensive motor insurance are falling beyond ‘reasonable’ level with complete disregard to the associated risks. This is leading to free falling tariff scenario that is detri-mental for the motor insurance segment as a whole and could lead to higher cost for customers in the long term. “The primary concern seems to be mar-ketshare acquisition and nothing beyond that in some of the market segments,” added Kumar.

There is a limited scope for innovative product offering or product differentiation in the current scenario of price war, as the end customer is main-ly focussed on two key aspects while buying motor insurance: price and service quality. The quality of service is one of the major issues likely to turn into a differentiating factor defi ned by how easy or smoothly can claims be settled and policy acquired.

The process of buying a new policy and renewal needs to be streamlined for most motor insurance providers, in order to get to the next phase of growth. Moreover, a large number of existing two-wheeler

buyers and owners would be graduating to purchas-ing four-wheelers as prosperity level rises and product offerings get widened. Hence, the growing passenger car sale is likely to be the major focus area for IFFCO Tokyo in the coming years.

The company is focussing on growing its pres-ence through multi-pronged approaches, including presence at automobile dealerships as well as direct selling network or agents.

Most passenger car buyers continue to maintain and drive their car for around eight years and any insurance company has to be in regular touch with a customer for all of these eight years, if it has to make a mark for itself. Most of the customers would be in touch with dealers or authorised service centres for the three or four year warranty period, but is likely to go out of the dealers’ loop post the warranty period on the vehicle. An insurance company needs to build up multiple channels to ensure that the customers stays in contact and renews his/her policy.

The company is a joint venture promoted by Indian Farmers Fertiliser Co-operative (IFFCO) and its asso-ciates, The Tokio Marine and Nichido Fire, which is one of the largest insurance companies in Japan. The Indian promoter’s contribution is 74 percent, while Tokio Marine has contributed 26 percent through Tokio Marine Asia. Tokio Marine has been awarded as Asia’s General Insurance Company of the year (2008) by the prestigious Asia Insurance Review. It has a widespread network of more than 170 offi ces across the country and many more in the pipeline for the coming year. �

Abhay Kumar, Senior Vice President, Motor Insurance, IFFCO Tokio

Abhishek Parekh


SPECIAL REPORT

Vehicle Recycling: An eco-friendly method of reusing car scrappage

Last year, it was reported that sales of new cars have increased by around 30 percent in India. Although people

are constantly upgrading their cars to newer models, there are still a signifi cant number of vehicles being used for more than 15 to 20 years that are scrapped by the unorganised sector and have serious consequences for the society and ecosystem.

Currently, scrapped vehicles are cut and sold by low-tech units in the unorganised sector and operate with low recoveries. Also, crude techniques are implemented that pollute the environment to a great extent. There is an urgent need to upgrade the old technology and processes and to set up modern facilities with greater capacity to deal with the expected increase in vol-umes of vehicles due for scrapping.

Need For GARCTo address these issues, the Ministry of

Heavy Industry in collaboration with the

Society of Indian Automobile Manufacturers (SIAM) has installed a recycling and demon-stration centre in Global Automotive Research Centre (GARC) in Chennai, which was execut-ed by National Automotive Testing and R&D Infrastructure Project (NATRiP).

During the inauguration of the facility, Captain NS Mohan Ram, Chairman of SIAM said, “The modern scientifi c recycling unit like this reduces global warming and green-house gases. With effi cient recycling, India can recover over 1.5 million tonnes of steel scrap, 180,000 tonnes of aluminium scrap and 75,000 tonnes each of recoverable plastic and rubber by 2020.”

The recycling of parts and materials from motor vehicles is not new in the industry. For a long time, metal parts in particular have had a value, either in terms of reuse or recycling. When a car reaches the end of its useful life, it is usually passed on to a vehicle dismantler. The dismantler will extract the potential envi-ronment polluting materials such as operating fl uids and batteries, and then sell the hulk on to a shredding operation to break the hulk in

Vehicle parts recycled in an organised way

Bhargav TS

Phot

ogra

phs:

Bha

rgav

TS


SPECIAL REPORT

to fi st-sized parts. Ferrous met-als are then removed by magnetic separation and non-ferrous metals are sorted both mechanically and manually.

Composition UpgradesIn modern vehicles, the com-

position of the car has improved substantially over the years. For example, ferrous metal content has decreased signifi cantly as lighter and more fuel-effi cient materials such as plastics have been incorpo-rated into the vehicle design.

Around 76 percent of the weight of the average car is metal, most of which comprises steel sheet. As mentioned earlier, the overall metal content of cars has declined rapidly over the past 20 years accompanied by an increase in the proportion of non-ferrous metals such as alumin-ium and magnesium. Currently, around 98 percent of the metals in cars could be recycled by the steel industry and re-smelting plants in the production of new steel and sec-ondary metals such as aluminium and copper.

The Plastic EdgePlastics used in the car indus-

try have risen considerably. Two decades ago, the average plas-tic content was 8.5 percent and today, the plastic content is around 11 percent. Plastics are used for their distinctive qualities, such as impact and corrosion resistance, in addition to reduce weight and cost.

Due to its lightweight properties, the use of plastics can lead to consid-erable energy savings, for example, if a car weighs 1.3 tonnes without plas-tics, it consumes approximately an additional 1,000 litres of fuel during its life compared to a car weigh-ing 1.1 tonnes with plastic. Despite

the relatively high recycling rate for End of Life Vehicles (ELVs), the pro-portion of plastics from ELVs being recycled is extremely low. One rea-son for this is the wide variety of polymer types used. Identifi cation, by marking components at pro-duction or by improved sorting technologies, will be vital if the prac-tice of recovering plastic parts is to become viable. One of the few plastic parts currently being recovered from ELVs is battery cases, accounting for 5,000 of the 14,000 tonnes of automo-tive plastics.

The most common auto-motive plastics types are polypropylene (PP), polyethylene (PE), polyurethane (PU) and poly-vinylchloride (PVC). PP accounts for approximately 41 percent of all car plastics (common in bumpers, wheel arch liners and dashboards), and like PE and PU (most com-monly used in seat foam and gear knobs), which can be easily recy-cled. The operating fuels of the vehicle is the another major con-cern during vehicle recycling—the effects of inappropriate treatment of fl uids removed during servic-ing are also signifi cant. Increasing amounts of engine oil are being recovered and recycled however

lubricating oil has the greatest pol-lution potential.

Regulating ResourcesMost of the waste oil collect-

ed for recovery is processed (by removing excess water and filter-ing out particulates) and used as a fuel burnt in heavy industry and power stations. However, stricter emission limits and fuel quality controls resulting from environ-mental legislation could mean a reduction in the amount of waste oil used in this way.

The recycling rate for car bat-teries is estimated to exceed 90 percent. However, a signifi cant number of batteries are still not recovered and recycled (for exam-ple, many scrap cars still contain batteries when they are shredded). A revision of the existing battery legislation is currently being undertaken.

Currently, there are no regu-lations in India to deal with the disposal of ELVs. Two-wheelers which account for 80 percent by number are particularly impor-tant in India. The recycling centre at Chennai is a model unit and can expect many centres like this pan India. �

Vehicle parts recycled in an unorganised way


Warehousing infrastructure: Key to faster logistics growth

The CII Institute of Logistics organised a two-day conference on ‘Building Warehousing Competitiveness: The Key to Logistics Success’

on 28 and 29 July, 2011 in Chennai. More than 300 delegates attended the conference from vari-ous industries. The Minister of State (IC), Ministry of Consumer Affairs, Food & Public Distribution, Government of India, Prof KV Thomas, inaugurated the conference.

The two-day conference discussed various meas-ures such as upgrading the Indian logistics industry in terms of technology and resolving the infrastruc-ture as well as regulatory issues with a focus on warehousing.

Delivering his inaugural address, the minister said that the Union Government has plans to create a Special Purpose Vehicle (SPV) to undertake stud-ies on foodgrain storage handling and transportation. Besides, the Planning Commission is also conduct-ing a comprehensive study to suggest measures for the development of a modern storage infrastructure to boost the growth of the warehousing sector; the centre has also introduced a negotiable warehouse receipt system in the country.

The minister added that with a view to providing the much-needed renovation to the warehouses, the diversifi cation of services have been initiated on a

wide scale aimed at improving the agro-supply chain. “The effi ciency of the private sector and the funda-mentals of the public sector can be combined and the risks can be shared,” he said. The logistics market is valued at `5.6 trillion in 2010 and it is likely to touch around `17 trillion by 2015.

The two-day event, had around eight exhibitors including Coign Consulting, Chep India, Indospace, TCI, and TVS Logistics. Participants from sever-al segments including the offi cials of Tamil Nadu Warehousing Corporation, Voltas, Fenner, Blue Star, Ashok Leyland, Harley Davidson, TAFE, TVS Lucas, Delphi and Godrej were present.

On the fi rst day, there were three sessions dur-ing which, speakers from various industries talked about their experience with warehousing. The session bought forth issues like transformation of warehous-es from end-to-end distribution, regulatory issues faced in the warehousing sector and warehousing for aftermarket applications. On the second day, the con-ference covered issues like managing fi nished goods inventory, essential infrastructure, technology and advanced systems for warehouse management.

Warehousing PotentialWarehousing accounts for about 20 percent of the

domestic logistics market and is expected to grow

(L-R) Dilraj Singh Gandhi, Principal Consultant, Consulting, PricewaterhouseCoopers; Mark Drabenstott, Secretary General, Global Coalition for Efficient Logistics; Prof KV Thomas, Minister of State for Consumer Affairs, Food & Public Distribution; R Dinesh, Event Chairman & JMD, TVS & Sons; Mike Nithavrianakis, Deputy High Commissioner, British High Commission & KV Mahidhar, Head, CII Institute of Logistics


SPECIAL REPORT

at a rate of 35-40 percent annu-ally, displaying high potential for growth over the next few years. “It is imperative for the sector to not only modernise but also adopt best practices to achieve a world-class infrastructure platform,” Event Chairman & Joint Managing Director, TVS & Sons, R Dinesh said while addressing the event.

British Deputy High Commissioner, Mike Nithavrianakis, spoke about warehousing com-petitiveness in the UK and said that commercial opportunities were enormous and both countries should address the signifi cant opportunities for mutual benefi t.

In order to identify effi cien-cy of the Indian logistics sector, CII has inked an agreement with Switzerland-based non-profi t organisation GCEL last December. Through this initiative, the CII and GCEL will undertake a study on the effi ciency of the Indian logis-tics industry and the various ways to help develop the industry, as it involves a large amount of trade.

During the event, Principal Consultant, PricewaterhouseCoopers (PWC), Dilraj Singh Gandhi released an exclusive report titled ‘Building Warehousing Competitiveness’, prepared by CII-Institute of Logistics and PWC. Addressing it, he said, “From a mere combina-tion of transportation and storage services, logistics is fast emerging as a strategic function that involves end-to-end solutions that improve effi ciencies. In this report, we have tried to encapsulate our analy-sis on the warehousing services in India, their current challenges and future opportunities and discuss ways to improve and make ware-housing more effi cient.”

In the past few years, the space and size of the warehouses in automotive industry are growing as it is developing at a rapid pace in India. Manufacturing com-panies are facing diffi culties for managing the warehouses due to the unprecedented growth. The transition time for the supply chain has also reduced compared to few years ago, as the technol-ogy is implemented from taking orders, distributor confi rma-tion for releasing the dispatch to invoice processing—all these cre-ates pressure on warehouses. To overcome these complications, it is necessary for warehouses to modernise, as the pull-push and internal processing is becoming much faster.

According to the President, Chep India, Pranil Vadgama, another challenge in the supply chain in India is the huge volume of the inventories as the industry is growing. To overcome this, col-laborations in the supply chain via equipment pooling will help the companies to drive the effi cient fl ow of materials and information.

Regulatory IssuesThe event also discussed the

regulatory issues on warehousing, Director, Cogin Consulting, Arif Siddiqui, spoke about the leverag-ing the regulatory framework to optimise growth opportunities in the sector and other issues in the warehousing industry.

The conference also discussed warehousing for aftermarket appli-cations. Addressing the issues, the Group Head, Mobis India, Mukund Srinivasan spoke about the pan India opportunities in warehousing and added that creat-ing multiple warehouses will help

the companies to take the prod-uct closer to the customer, which will help in delivering the product much faster and more easily—this method is called as ‘depot to cus-tomer network’.

Other key factors for aftermar-ket warehousing are that it should have RFID (Radio Frequency Identifi cation) technology and bar coding with TDS (Tax Deduction at Source) so that it will be able to improve warehousing operations faster. “Just having a warehouse management system with ERP (Enterprise Resource Planning) but without properly designed ware-house automation can become a major constraint” said the Chief Operating Offi cer, TVS logistics, KB Nagaraju.

According to CII-Institute of Logistics and a PWC study, the dynamic market requirements have made it imperative for Indian warehousing players to over-come challenges and maintain, improve and sustain competi-tiveness. Various measures such as skill development, policy initiatives and government meas-ures, IT adoption and increased investments in the sector can be effective in increasing the com-petitiveness of the Indian warehousing players. However, this journey can be smoothened and simplifi ed if the challeng-es and concerns are addressed with collaborative efforts among all stakeholders including the government and its agencies, policy-makers, entrepreneurs, investors, logistics service pro-viders, manufacturers, farmers and sellers. The mutual integra-tion among them will rewrite the success story for the logistics and warehousing industry. �


CUTTING EDGE

Designers of auto parts are

resorting to more and more

varied and stringent parame-

ters to be satisfi ed by surface fi nishing in

a bid to meet noise and pollution norms

as well as decreased warranty claims,

eg a mundane fi nish like 0.4 Microns Ra,

which can be achieved by grinding, is

suffi xed by the word ‘Microfi nished’ to

ensure 200,000 KM warranty from the

same part.

In the mid-1930’s, it was discovered

that automobiles transported to the

west coast from Detroit, had a much

higher rate of wheel bearing noise,

such as chatter and clicking than did

the cars sold closer to Detroit. It was

discovered that the bearing races

(which were only ground) brinnelled

during shipping due to the constant

vibration of the railroad carrier.

The weight of the vehicle and vibra-

tions of the shipping carrier caused

the stationary needle bearing to com-

press the non micro-fi nish surface.

The needle bearing thus rolling over

the brinnelled low spots, causes an

undesirable clicking noise.

An examination of the texture left on

a metal surface as a result of machin-

ing operation will reveal tool marks,

fragmented metal and chatter. When

a metal or steel part is machined, the

surface becomes fragmented and also

annealed if a heat generating grinding

process is used. This type of surface

will not support high bearing loads. It

can cause poor performance or bear-

ing failure.

Loads are equally distributed if

the shaft bearing journal have cor-

rect geometry and surface texture.

Roughness on a bearing journal breaks

up the supporting oil fi lm and allows

Microfi nishing: The process of perfectionMilind D Kelkar

Milind D KelkarMD, Grind Masters Machines

CUTTING EDGE


the surface to contact each other and

cause pre-mature wear. Waviness in

roundness geometry is referred to as

Chatter or Lobing and it is another fac-

tor which increases the bearing loads.

The combination of roughness and

waviness geometry are most detrimen-

tal to bearing life.

Newer more fuel-effi cient smaller

engines produce higher bearing loads

than engines produced a decade ago.

Engine test studies have shown that

some bearing surfaces with slight

cross hatch fi nish specifi cations help

engines maintain maximum hydrody-

namic oil fi lm on journals, but oil seal

surfaces generally do not require cross

hatch fi nishing. A cross hatch fi nish

on an oil seal may cause a vane-type

pumping action to pump oil past the

seal. An oil seal with a straight- line

fi nish is much more effective.

Roughness average (Ra) surface

measurement are nearly always shown

on engineering drawings where sur-

face fi nish is specifi ed, but it is not the

only surface measurement that indi-

cates a good bearing surface.

Ra can be misleading. Both the sur-

faces shown in sketch below have same

Ra value, but surface with fl at areas

makes a better bearing surface with

good oil retention.

Bearing ratio Tp is extremely

important since it illustrates the

amount of bearing area one can expect

from a surface.

Grinding operations of crankshaft

main bearings and connecting rod

journals, camshaft lobes and bearing

and transmission shafts will produce

bearing journals with many differ-

ent types of errors, including errors in

roundness, waviness, chatter, taper,

barrel, hourglass, etc. Even though

a bearing journal has optimum sur-

face fi nish, the hydrodynamic oil fi lm

cannot be maintained if any of these

conditions exist.

MicrofinishingIMPCO spent half a century to

develop the process that enables man-

ufacturers to accurately remove the

amorphous material layer and thus to

control surface fi nish, bearing ratio,

geometry, and even size of bearing jour-

nals. The patented IMPCO Generating

Bearing Quality (GBQ) process is used

by manufacturers responsible for nearly

90 percent all crankshafts produced in

North America. GBQ Microfi nishing has

been proven to assure effi cient, trouble-

free, long-term performance.

The worldstar series by IMPCO

is a benchmark for production

machine tool reliability & automak-

ers worldwide fi nd this essential in the

production of long life, high perform-

ance engines, both gas & diesel with

minimal warranty costs. Grind Master

Machines is an exclusive Licensee of

IMPCO in India & China.

(The author is Managing Director,

Grind Master Machines. Views expressed

are personal.)A range of microfinishing machines by Grind Master Machines

Auto part designers are

resorting to increas-

ingly varied & stringent

parameters for surface

fi nishing in a bid to

meet noise and pollution

norms and to decrease

warranty claims


CUTTING EDGE

Advanced electronic diagnostic solutions for vehicles

Actia Muller, a French spe-cialist in manufacturing electronic diagnostic and

mechanical testing solutions for vehicle inspection centres and car repair centres, has developed Bilanmatic 10 000Mx, a test lane employing the latest technology for increased levels of work effi -ciency and productivity. The test lane ensures low maintenance costs even in adverse operating conditions, optimal serviceabil-ity of facilities and comes with an easy installation option for an entirely new, independent produc-tion line.

The Bilanmatic 10 000Mx fea-tures: a can-bus, which allows effi cient communication between test chassis and the console thus improving accuracy in meas-urement procedures, a 22” fl at screen of excellent graphic qual-ity, a USB port to provide fast and easy connections for peripheral

test equipments. The test lane is also confi gured for remote assist-ance, a new service which enables engineers to access test lane from a distance for instant settings update. The lane may be split into

several test bays, allowing simulta-neous testing of multiple vehicles: 16 possible users via 16 infra-red remote controls (patented by

Muller Bem). The lane is perfect for drive-through testing.

The Bilanmatic 10 000Mx is part of a comprehensive range of electronic diagnostic devices, car repair equipment and test lanes provided by Actia Muller. The range meets the most strin-gent demands of all key players in the global market. Leading car manufacturers, vehicle inspection networks and automotive service players opt for Actia Muller in their day-to-day business.

Actia Muller has established its presence in India with Actia India and is looking forward to the launch of its vehicle inspection equipment in India as part of an initiative to ensure driver safety nationwide. The company’s test lanes have already been deployed in the country, one of which is at the Rishab Motors Hyundai dealer-ship in New Delhi. �

The Bilanmatic 10

000Mx test lane ensures

low maintenance costs

even in adverse operat-

ing conditions, optimal

serviceability of facili-

ties and comes with

an easy installation

option for an entirely

new, independent

production line


PRODUCTS

Corrosion-resistant paints

Star Paint & Oil Industries offers Rubberex acid, alkali, chemical and corrosion-resistant paints that are based on a highly stable rubber hydro-

carbon compound of uniform quality, which gives a highly durable and anti-corrosive protective coating. These are fast air-drying paints with which the coat-ing obtained is of excellent hardness elasticity and free from pores. Due to the chemical inertness, the paints shield the effects of water, moisture, stream, acid fumes, alkalis, salt vapors and transitory wet-ting organic solvents on metal surfaces. Applications include: protection from effects of acid fumes, indus-trial pollution and corrosion on steel structures and pipelines in refi neries and petroleum complexes, stresses (Kate) of overhead roofs in sugar and chemi-cal plants, suspension springs of motor vehicles, ship body from salty sea conditions, etc.

Star Paint & Oil Industries, Mumbai 400 023.Tel: 022-2265 2243, Fax: 022-2265 3201Email: [email protected], Website: www.starpaintindia.com, Certifi cation: An ISO 9001:2000 Certifi ed Company

Tyre pressure indicators

Digital tyre pres-sure indicators offered by Elak are

accurate instruments for checking tyre pressure in two-wheelers, cars, trucks, etc. These pressure indicators are meant for automobile showrooms, wheel alignment centres, petrol pumps, transport corporations, automo-bile service centres, tyre showrooms, etc. The tyre pressure indicators are meant to replace the exist-

ing analogue type indicators currently used, which do not give accurate reading due to zero error and also due to wear and tear in mechanical components. Technical specifi cations include: accuracy of ±1 PSI; measuring range 0-150 PSI; super bright LED display (25 mm); dimensions 28 cm (H) x 17 cm (W) x 9 cm (D); weight 2 kg; operation at 220 V AC; and fi tting of 1/4 BSP nuts for connecting regular and coiled hoses.

Elak Pvt Ltd, Chandigarh 160002.Tel: 0172-265 0308, Fax: 0172-265 5318Email: [email protected], Website: www.elakindia.com

Fasteners

ABC Industrial Fasteners have devel-oped fasteners that

are useful for mopeds, scooters, motorcycles, tem-pos, cars, motors, buses, trucks, as well as in auto-mobile industries. The components are Philips star punch & slotted machine screws, rivet self-tapping screws, nuts, washers studs, Allen screws, grub screws, BSP, BSPT, NPT, tapper plugs, copper packing wash-ers, carriage bolts, NIB bolts, square head bolts, T-bolts, coach bolts, solid dowel pins, tapper pins, grooved pins, external/internal threaded pins, spring dowel pins/roll pin cotter pins, etc. These fasteners can be supplied as per IS, BS, JIS, DIN, ISO, ASTM standards and as per customers’ drawings or samples. Threads are in mm size coarse & fi ne pitch, BSW, BSF, UNC, UNF, BSP, 4-12 no of size, NC/NF threads and STS screws 2-14 no. The fi nishing is olive green, blackened, bright zinc (silver & blue shades), yellow zinc, cadmi-um, nickel & natural fi nish self colour. Applications are in buses, tractors, car body division, mopeds, motorcy-cles, scooters, automobile industries.

ABC Industrial Fasteners, Mumbai 400 072.Tel: 022-2847 0806, Fax: 022-2847 0705,Email: [email protected], Website: www.abcfasteners.com

Halogen lamps

Phoenix Lamps offers a broad range of halogen lamps for 2- and 3-wheelers, passenger cars,

commercial vehicles and off-road applications. The lamps are E1, E4 and DOT compliance. Additionally in India these lamps are approved by Automotive Research Association of India (ARAI). The lamps are offered as standard lamps, xenon blue, all season, dark blue and blue white lamps. Lamps with different wattages as high-performance lamps (+30%, +60%), & extra life lamps are also offered. The most widely used lamps are dual fi lament lamps, namely H4 and HS1 lamps. H4 lamps are generally used in 4-wheelers and com-mercial vehicles, whereas HS1 lamps are used in 2-wheelers. These lamps are available in 12 V and 24 V with different wattages and life.

Phoenix Lamps India Ltd, Noida 201 301.Tel: 0120-4012222, Fax: 0120-2562943, Mob: 09250507110, Email: [email protected], Website: www.halonix.co.in


PRODUCTS

Vehicle tracking systems

Kusam Electrical Industries

offers Kusam-Meco’s vehicle tracking systems (model KM-VTU-01) that are suitable for many applications, such as vehicle security, fl eet management, BPOs, etc. With the superior sensitivity GPS module on broad, the systems can easily get a fi x even in urban canyon condition. Unlimited number of vehicles can be tracked & six individual zones can be monitored at the same time on the same screen. The vehicle tracking systems can track the vehicles using GPRS as well as SMS. SMSes can be sent using panic button to pre-defi ned numbers in case of emer-gency from the vehicle. Applications are in bank vehicles, emergency vehicles (ambulances/police vans/fi re brigades), private taxi services, public trans-port systems, logistics, fl eet management, individual vehicle monitoring, BPOs (drops & pickups), school buses, etc.

Kusam Electrical Industries Ltd, Mumbai 400 015.Tel: 022-2412 4540, Fax: 022-2414 9659, Mob: 09867000456Email: [email protected] Website: www.kusamelectrical.com Certifi cation: An ISO 9001:2000 certifi ed company

Switch tape equipment

Dadmatrac Electronics offers switch tape equipment that are used to fi nd out the speed, accel-

eration of vehicles by using the time logged v/s preset distance. The logger is microprocessor-based having an alpha-numeric display and a keypad for making entries. Parameters to be programmed are test-type, number of switch tapes, distance between switch tapes and

number of laps. Once programmed the equipment is ready to conduct the test. The time is recorded to the 2nd decimal place and the parameter in m/sec² or km/hr is displayed instantly. An audible beep from the log-ger signifi es the end of the test and the results can be viewed again for each distance per lap after which the data may be erased. Until erased, the data remains in the non-volatile memory of the logger. The equip-ment also has a provision for mock testing of the set-up before commencing the actual test. Technical specifi -cations include: size of the logger -8” (L) x 4” (W) x 1.75” (H); operating voltage -12 V DC external source; current consumption -600 mA (max); size of switch tape -0.04 m (W) x 1 m (L); memory size -2K non-volatile; and time recorded (least count) -0.01 sec.

Dadmatrac Electronics Pvt Ltd, Gurgaon 122 016.Tel: 01274-634 1459, Fax: 01274-634 1459 Mob: 098104 94100, Email: [email protected] Website: www.dadmatrac.com

Halogen lamps

Phoenix Lamps offers a broad range of halogen lamps for 2- and 3-wheelers, passenger cars, commercial vehicles

and off-road applications. The lamps are E1, E4 and DOT compliance. Additionally in India these lamps are approved by Automotive Research Association of India (ARAI). The lamps are offered as standard lamps, xenon blue, all season, dark blue and blue white lamps. Lamps with different wattages as high-performance lamps (+30%, +60%), & extra life lamps are also offered. The most widely used lamps are dual fi lament lamps, namely H4 and HS1 lamps. H4 lamps are generally used in 4-wheelers and commercial vehicles, whereas HS1 lamps are used in 2-wheelers. These lamps are available in 12 V and 24 V with different wattages and life.

Phoenix Lamps India Ltd, Noida 201 301.Tel: 0120-4012222, Fax: 0120-2562943 Mob: 09250507110, Email: [email protected] Website: www.halonix.co.in

Tractor parts

Tractors (including also the earthmoving machines) components encounter low

speed-high torque loading for longer periods of time. These are subject-ed to intense variations in loading,

poor engine cooling due to low travel speeds and fre-quent stop-start conditions. This induces extreme thermal and mechanical stresses in tractor engine parts, and only the proper foundry and machining practices can produce a tractor part that is robust enough to survive the elements and the harsh fi eld operating conditions. Garima Global does it with guaranteed precision.

Garima Global Pvt Ltd, Mumbai 400 053.Tel: 022-4037 8888, Fax: 022-6756 8999Email: [email protected] Website: www.garimaglobal.com Certifi cation: An ISO 9001:2008 certifi ed company


PRODUCTS

Dome nuts

Friends Engineering Works offers dome nuts that are available in different dimensions. These

dome nuts are manufactured using good quality raw materials so that they are resistant to chemicals and tem-perature variations. The dome nuts are extensively used in automotive industry for fi xing the wheels, steering columns and exposed car body parts. Technical specifi cations include: M-5 to M-16, 3/16” to 5/8”.

Friends Engineering Works, Ludhiana 141 010.Tel: 0161-2673622, Fax: 0161-2673623 Mob: 09872464194Email: [email protected] Website: www.fewnuts.com Certifi cation: An ISO 9001:2000 Certifi ed Company

Hydraulic lifting platforms

Truck-mounted hydrau-lic lifting platforms from Vanjax Scales are avail-

able with scissor type lifting mechanism. These lifting platforms are ideal for lifting loads to the required height levels on the machines, ramps, storage racks, etc. Loads are evenly balanced on the table. Strong steel base and upper frames are free from torsion. Scissors arms are self-guided on rollers with ball or taper roller bearings. Hydraulic cylinders can be actu-ated by manual pumps or power racks with either AC or DC supply. Hydraulics is designed for continu-ous operation. Lifting and lowering can be done at a constant speed. The overload protection value is inbuilt in the hydraulic circuit. Other safety features can be incorporated as per customers’ requirements. The hydraulic lifting platforms have all-steel fabri-cated structures with wheels of suitable size. They are available in standard capacities ranging from 500 kg to 5,000 kg and special purpose non-standing tailor-made to individual customer’s requirements up to 25 tonnes.

Vanjax Sales Pvt Ltd, Chennai 600 098.Tel: 044-4282 1000, Fax: 044-4598 5700 Mob: 09789976611, Email: [email protected] Website: www.vanjax.in Certifi cation: An ISO 9001 certifi ed company

Automotive oil seals & O-rings

Apex Precision Agencies offers a wide range of

automotive oil seals and O-rings manufac-tured by Functional Oil Seal Industrial Co Ltd, Taiwan. The range includes: general use seal

to high pressure seals with fl ange seals, side lip seals, triple or more lips seals, shock absorber seals, outer direct lip seals, wiper seals, muddy seals, PTFE lip seals, convoluted lip seals, with back-up ring seals, felt lip seals, leather lip seals, split seals, bore cover seals, axial lip seals, unitised seals, valve stem seals, clutch seals, bearing cover seals, air-conditioning compres-sor seals, bonded washer seals, ring packing seals and gamma ring seals.

Apex Precision Agencies, Mumbai 400 088.Tel: 022-2551 6158, 2555 0900 Fax: 022-2556 4987Email: [email protected] Website: www.apexmachatronics.com

Spring steel circlips

Zenith Industrial Products have developed

external and internal spring steel circlips, E-clips, snap rings, C-rings, spring wash-ers, fl at sections, square sections dou-ble coil type spring washers, external and

internal star washers, disk fan lock washers, bearing washers, wave washers, disk spring washers, knurled washers, push-on washers, belleville washers and safety washers. These can be supplied as per IS, BS, JIS, DIN, ISO, ASTM and GOST standards or as per clients’ samples or drawings. Material grades include En-9, En-42J, brass, SS-304 & 316 grade. Applications are in machine tools, engineering industries, tex-tiles, automobiles, electrical & electronics, pump & valves and home appliances, as well as in other serv-ice industries.

Zenith Industrial Products, Mumbai 400 072.Tel: 022 2847 8806 Fax: 022-2856 0705Email: [email protected] Website: www.zip-india.com


ADVERTISERS’ LIST

Pg N o. Advertiser ...........................................Tel .................................E-mail ............................................Website

BIC .....ADEA Awards ........................................+91-22-30034650 [email protected] ...... www.adea.in

7 .........Anand Automotive Ltd .........................+91-11-26564542 [email protected] .... [email protected]

3 .........Bosch Limited ......................................+91-80-22999269 [email protected] .... www.boschindia.com

51 .......Engineering Expo .................................+91-9819552270 [email protected] .............. www.engg-expo.com

9 ......... Federal Mogul ......................................+91-124-4784530 [email protected] ... www.federalmogul.com

BC ...... Litel Infrared Systems Pvt Ltd ..............+91-20-66300636 [email protected] ............................ www.litelir.com

5 .........Madhus Garage Eqpts ..........................+91-80-26660656 [email protected] .......... www.madhusindia.com

45 .......Maha India Automotive Testing Equip ...+91-11-40601464 [email protected] ...... www.maha-india.in

41 .......Naman Electronics ...............................+91-79-22900186 [email protected] ...... www.namanelectronics.com

17 ....... Subros Ltd ............................................+91-11-23414946 [email protected] ..................... www.subroslimited.com

FIC ...... Sushma Industries ...............................+91-80-28397463 [email protected] .... www.sushmaindustries.com

� Our consistent advertisers

(UTTARAKHAND)


PRODUCT INDEX

AC service equipment ........................................................... 5

ADEA - Automotive Dealership Excellence Awards ............... BIC

Alternatives........................................................................... 3

Automotive air-conditioning................................................. 57

Automotive oil seals & O-rings ............................................. 59

Automotive p arts .................................................................. 57

Automotive p roducts ............................................................ 7

Automotive r elays ................................................................. 57

Batteries ............................................................................... 3

Bottle cap torque testing systems......................................... FIC

Brake p ads ............................................................................ 3

Brake testing equipment ...................................................... 5

Bus A C ................................................................................... 17

Clutch plates & cover assemblies .......................................... 3

Collision repair systems ........................................................ 5

Compressors ......................................................................... 17

Computerised wheel aligners ............................................... 41

Condensers ........................................................................... 17

Cooling m odules ................................................................... 17

Corrosion-resistant paints .................................................... 56

Crimp testers ........................................................................ FIC

Cylinder l iners ....................................................................... 57

Diesel smoke meters ............................................................ 41

Dock levellers ....................................................................... 57

Dome n uts ............................................................................ 59

Exhibition - Engineering Expo .............................................. 51

Fasteners .............................................................................. 56

Filters .................................................................................... 3

Force & torque gauges .......................................................... FIC

Force ..................................................................................... FIC

Force/pressure calibration & testing equipment .................. FIC

Four gas analysers ................................................................ 41

Fuel injector cleaners ........................................................... 41

Gas a nalysers ........................................................................ 5

Gasoline systems .................................................................. 3

Gear pumps .......................................................................... 3

Goetze p istons ...................................................................... 9

Halogen l amps ...................................................................... 56

Halogen l amps ...................................................................... 58

Heating s olutions .................................................................. BC

Horns .................................................................................... 3

Hoses & tubes ....................................................................... 17

HVACs & evaporators ............................................................ 17

Hydraulic lifting platforms ................................................... 59

Instant drying/curing technology for water-based colour .... BC

Lightings ............................................................................... 3

Lubricants ............................................................................. 3

Motor testing systems ........................................................... FIC

Nitrogen infl ators ................................................................. 41

Pressure sensors & indicators ............................................... FIC

Relays ................................................................................... 3

Spark p lugs ........................................................................... 3

Spot welding equipment ...................................................... 5

Spring steel circlips ............................................................... 59

Spring t esters ........................................................................ FIC

Starter motors ...................................................................... 3

Switch tape equipment ......................................................... 58

Tensile t esting ....................................................................... FIC

Testing & safety technology .................................................. 45

Torque tool testers................................................................ FIC

Torque .................................................................................. FIC

Tractor p arts ......................................................................... 58

Tyre changers ....................................................................... 5, 41

Tyre infl ation e quipment ...................................................... 5

Tyre pressure indicators ....................................................... 56

Vehicle tracking systems ....................................................... 58

Wheel a ligners ...................................................................... 5

Wheel balancers ................................................................... 5, 41

Wiper b lades ......................................................................... 3

Product ................................................................................Pg N o. Product ................................................................................Pg No.

FIC : Front Inside Cover BIC : Back Inside Cover BC: Back cover

DATA


JUN

E 20

11

1373

538

2201

165

1222

33

5825

46

2719

72

1753

40

8889

9 23

833

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1 10

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0 67

4259

39

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1064

2548

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10

1230

434

2047

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1186

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35

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09

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18

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2 17

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54

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34

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Why Aftermarket?

India has been scripting success stories in the auto industry for some time now. Vehicle production has doubled in the last six years and still growing strong. And this momentum is expected to continue for the next few years as the density of passenger

cars in India is just 12 per 1,000 population, which is abysmally low even when compared with our Asean peers. Healthy economy, increasing disposable incomes, expanding urban centres, creation of new townships and growth in infrastructure will only catalyse the growth of automobiles further.

The used car market, which is still in its nascent stage, is predominantly in the unorganised sector. However, the business is set to boom due to infl ow of vehicles on account of shrinking life cycle of passenger cars—from about 15 years a decade ago to about fi ve years now, at least in the cities and towns. Today, the cream for dealers lies in the after sales service, which is why multi-brand third party service stations are mushrooming. Most of the players in this space offer quick repair service, which is a money-spinner. And this is the stimulant for more players to get in to the organised multi-brand service centres and used car retail outlets.

It is a well known practice in the country that the owners of older vehicles migrate to independent service networks for various reasons including proximity, convenience, affordability and faster service. Besides, the trust that the neighbourhood garages offer outweighs the authorised service centres due to personal attention etc. Moreover, with the vehicle manufacturers focusing more on the warranty period, catering to service requirements of older cars are being taken up or shared by independent players. However, with the vehicles getting feature rich, the probabilities of the conventional garages offering repair services is getting reduced. To address the issue, some of the branded third-party multi-brand car service companies have conceptualised methods to help these garages move up in the value chain both in terms of technical capability and profi tability.

These factors made the Indian automotive aftermarket grow at a steady pace. With the vehicle parc increasing, it is expected to expand rapidly over the next fi ve years. The total size of the Indian aftermarket is currently estimated at `33,000 crore, while the global market is worth `2,700,000 crore. These mind-boggling fi gures only reemphasise further the potential for growth.

Automotive aftermarket offers tremendous opportunities for the players across the value chain and we at Infomedia 18 believe that these esteemed people should be informed of the developments periodically. And this is the impetus for launching a new magazine—Aftermarket.

The monthly magazine will keep you posted of the developments in this segment in terms of news, views, trends, technology, analysis and features on best dealerships and review of service centres.

Aftermarket will initially have eight sections—News, Rearview, Cover Story, Interview, Cutting Edge, Focus, Viewpoint and Extra Mile. Besides, it will have snippets on new products that come in to the aftermarket space. The News section will update you on the recent happenings while Rearview will look back some of the best service centres and their best practices. Each issue will have a cover story, which will be topical in nature. You will have the opportunity to listen to celebrity CEOs of companies operating in the aftermarket, in every issue under the Interview section. Cutting Edge will have stories on technology, Focus on some issues concerning the segment and Viewpoint, as it denotes, will have the viewpoint of industry representatives. The last section, Extra Mile, is all about the art of selling automobiles—you will have stories on the best dealerships and can be a stimulant for you to emulate best practices.

- T Murrali

POST SCRIPT

Aftermarket - September 2011

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Transcript of Aftermarket - September 2011