Auto Monitor - 26 November 2012

Auto MonitorI N D I A ’ S N O . 1 M A G A Z I N E F O R A U T O M O T I V E N E W S , V I E W S & A N A LY S I S

“WE WANT TO BE NUMBER ONE IN SALES BUT NOT FOR ANY PRICE”

INTERVIEW

Pg 08Pg 12-16EAST INDIASPECIAL

NEWS IN BRIEFFat Bob for `12.8 lakh

Harley Davidson has added sixth product- Fat Bob in its CKD portfolio

in India. The cruiser bike will be assembled at Bawal plant in Haryana. The motorcycle, pow-ered by a 1,585 cc engine with a six-speed transmission is priced at `12.8 lakh (ex-showroom Delhi). The bike is equipped with a fuel tank capacity of 18.8 litres.

“The introduction of the Fat Bob, our newest addition to our line-up available through CKD, is further proof of our ability to move ahead of the marketplace by listening to our customers,” said MD, Harley-Davidson India, Anoop Prakash. The new bike will be available with an air cooled, twin cam engine delivering 126 N-m @ 3500 rpm of peak torque.

The Bawal plant is only assem-bly plant outside the US, apart from Brazil. The company started selling bikes in 2010 and it expects to sell close to 2,000 units this year, double the number it sold in 2011. Currently, the company sells 13 models through nine dealerships across the country.

Jamshedpur-based NVH and fly wheels manufacturer Metaldyne India has bagged fresh orders worth `25 crore

from Tata Motors and Volvo Eicher Commercial Vehicle (VECV) in the face of slowing growth and uncer-tain demand environment.

The new product to be sup-plied to VECV will be vibration dampers for the commercial vehicle manufacturer’s European and Indian application. Tata Motor has given new orders for axle components. Tata Motors is the company’s biggest cus-tomer in India and the supply of the new component will start by December while for VECV, the products are still under approval. After the approval the Metaldyne will have a slight ramp up in pro-duction by next year and from mid 2013 regular supply to VECV will begin. In all these new arrangements, East India based component makers has invested around `five crore.

The company has been impact-ed by the current sluggish market trend and experienced a signifi-cant fall in its sales in the third

quarter of this fiscal. Metaldyne India is a joint venture between American component maker Metaldyne and Jamshedpur-based Arush Group. Metaldyne owns majority 51 percent stake while Sanjay Sabherwal owned Arush Group owns the remaining stake in the company. The com-pany’s total turnover last fiscal was around `85 crore.

In addition to orders from VECV and Tata Motors, it has bagged another supply deal with a car maker and a truck man-ufacturer to supply vibration dampener. It already supplies dampers to Nissan.

The company’s capacity uti-lisation has dropped to around 40 percent in recent months compared to 70 percent earlier and is continuing to drop due to lacklustre performance of the

commercial vehicle segment. “Idle capacity cannot be imme-diately utilised as the changeover is not possible in a short time. Apart from launching new prod-ucts, we are looking at every single process, and doing a lot of introspection and trying to improve our processes and look-ing at weakness and trying to strengthen them so that when the time improves we are in a better place to come back to form,” said Managing Director, Metaldyne India, Sanjay Sabherwal. The company which has 15 percent

of total business coming from Passenger Vehicle segment, is now also looking at increasing its business here.

Metaldyne is one of the largest producer of fly wheels for heavy and medium commercial vehi-cle applications in India with 25,000 units a month production capacity. It also exports compo-nents produced at Jamshedpur plant to the various internation-al markets including US, UK, Japan and Thailand and exports contributes around 40 percent of its total revenue.

Bridgestone India is eval-uating entry in the two wheeler tyre market in the long term con-

sidering the high volumes and continuous growth in the seg-ment. The company already sells non-nylon based two-wheeler tyres outside India for higher capacity motorcycles. Bridgestone however perceives growth in two wheeler segment in India and believes it to be the next natural progression for itself.

“Two-wheeler market in India is huge and we will look forward to come into it. We are studying what kind of possibility can Indian two wheeler market offer and offer solutions accord-ingly,” said Managing Director, Bridgestone India Pvt Ltd, H

Tanigawa.According to Tanigawa none

of the Bridgestone India’s facili-ties can support manufacturing of two-wheeler tyres and the company will not import two -wheeler tyres owing to the high import duties. It is however focus-ing on increasing sales shops in rural India like its competitors.

Tanigawa added, “Our strat-egy will be to first set up sales shops in rural India and small cities with a friendly staff and better services. We want to satisfy the customers to buy Bridgestone tyres even at a rela-tive premium price. We will be expanding network.” He further hinted at manufacturing tyres for agricultural market after it enters the two-wheeler arena.

Capacity ExpansionBridgestone has recent-

ly invested `2,600 crore in its Pune plant that has an installed

capacity of 30,000 tyres per day. Bridgestone is looking to manu-facture 10,000 tyres per day in this plant by January 2013 and will further increase the capac-ity to reduce imports. The Pune plant will cater to the replace-ment market as well as the OEMs while the company’s second plant in Indore with a produc-tion of 15,000 tyres per day will

continue to cater to the commer-cial vehicle market. Speaking on imports and demand, Tanigawa further added, “We are under the process of expanding our capac-ity to cater to different market segments. The Indore plant capacity is around 15,000 tyres per day. If the new plant gets fully operational then we can think of stopping imports.”

He also said that Bridgestone wants to cut down its exports to zero within five years time and will consider more investment if demand increases.

The company currently churns out around 450,000 tyres from its two plants while it has demand of around two million tyres per month. With imports accounting for more than 75 percent of the total demand, Bridgestone has set its focus on reducing the company’s imports by utilising its plants to their maximum.

Metaldyne bags orders from VECV, Tata Motors

Bridgestone mulls entry into 2-wheeler segment

Our Bureau New Delhi

Nabeel A Khan New Delhi The company’s

capacity utilisation has dropped to

around 40 percent in recent months

compared to 70 percent earlier

Scan this code onyour smart phoneto visit www.amonline.in

www.amonline.in26 November 2012Vol. 12 No. 40 50 Pages ` 50

Philipp von Sahr, President, BMW India

Top 5 3W makers

Company Oct-11 Oct-12 Change

BAL 18,823 23,640 25.59%

Piaggio 17,984 18,081 0.54%

M&M 6,332 6,973 10.12%

ATUL AUTO 2,520 3,330 32.14%

Scooters Ind 1,708 1,615 -5.44%

Top 5 3W-Exporters

Company Oct-11 Oct-12 Change

BAL 25,368 26,676 5.16%

TVS 2,010 2,460 22.39%

Piaggio 1,979 1,570 -20.67%

M&M 234 87 -62.82%

Force Motors 42 42 0.00%

* Source: SIAM/ ** Excluding exports/ *** all sub segments considered/ ^ excluding MRPL

DATA MONITOR

Nabeel A Khan & Jagdev Kalsi New Delhi

H Tanigawa, MD, Bridgestone India

Sanjay Sabherwal, Managing Director, Metaldyne IndiaPh

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: Jag

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si

Feasibility of manufacturing vehicles in the Eastern part of the country got major boost when Tata Motors decided to manufacture the Nano in Singur in West Bengal around five years ago. But unfriend-

ly business climate led to the company deciding to shift the base to Gujarat.

Component manufacturers in East India have been facing rough weather for a while now. Given the lack of a vehicle manufacturing facility and no major investments commit-ted for any automobile manufacturing facility in recent times, supply base is slowly but surely withering away. The fact that major chunk of components manufacturers cater to the requirements of Tata Motors and Hindustan Motors, has meant a bleak business outlook for these suppliers. The slow-down in the commercial vehicle segment has affected the capacity utilisation for majority of the auto component man-ufacturing units in and around Kolkata and Jamshedpur.

A mid-sized supplier lamented that the outlook for any recovery in off take is bleak and it’s a double whammy for suppliers with manufacturing facilities around Kolkata due to logistical issues. He pointed out that it was imperative

to diversify revenue base and cut cost ruthlessly in order to survive. Despite acknowledgement regarding unfriendly business environment in and around West Bengal, suppli-ers are not openly voicing dissent or steeping out of the state. But for how long?

It is imperative for a conducive business environment is created and manufacturing facilities are encouraged in Eastern India. Our current issue focuses on some of these issues plaguing the manufacturing activities in the Eastern region.

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QUOTESPeter Mosch, Member of Supervisory Board, VW

Anoop Prakash, Managing Director, Harley Davidson India

Pressure to cut costs is definitely higher in such difficult times, but we must keep up spending to meet our expansion goals

We are getting a good pull in smaller towns. There are a lot of people who have the same key attributes as we have, in wanting personal freedom

Auto Monitor

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Metaldyne India striving to shrug of low capacity utilisation 12The slowdown in the commercial vehicle segment has affected the capacity utilisation for majority of the auto component manufacturing units in and around Kolkatta and Jamshedpur

Kiswok Industries to supply gear boxes, carrier housings to Tata Motors 14Kiswok industries has added gear boxes, carrier housings for Tata Motors and is also in talks with Diamler-Bharat Benz and Volvo Eicher to supply these new products

Demand fall is future gain: Baynee Industries 16Even as demand from OEMs has fallen drastically in the last couple of months, Baynee Industries finds it as an opportunity to build a foundation for a stronger future

DSM focusing on innovations as proportion of plastic parts in cars go up 11Even as common parts continue to be made of plastics but OEMs have had to innovate in the usage of this material in non-traditional areas including under-the-hood components

Shriram offers value added service to enhance delivery experience 18Shriram Automall aims to expand to around 60 key cities by 2013 and recently launched its a major outpost in Hyderabad

CONTENT

BMW Group Academy UK helps students discover auto retail 40BMW Group Academy UK hosted a visit by students and teachers to give young people chance to experience apprenticeships available in the UK’s auto retail sector

JLR, Chery JV to manufacture China specific, existing model line-up 42Jaguar Land Rover and Chery Automobile Company Ltd recently laid the foundation stone for their new manufacturing facility in Changshu, near Shanghai

Volkswagen delivers seven million vehicles up to October 44Volkswagen Group achieved a 10.2 percent increase in worldwide deliveries from January to October 2012, handing over 7.5 million vehicles to customers

CORPORATE

GLOBAL WATCH

EAST INDIA SPECIAL

12

14

11

Auto Monitor

826 NOVEMBER 2012

I N T E R V I E W

What are your immediate plans for the Indian market?

The economical situation in 2013 is expected to be a little better than 2012. We expect a certain growth due to new deal-erships and additional models. Our other strategies include set-ting mobile showrooms wherein we reach the smaller cities. Our number one task then is to examine if the city can have a full-fledged BMW dealership or not. We also want to further develop the brand Mini and make it more known. Mini is a separate brand and is very suc-cessful worldwide as a lifestyle brand.

What is your approach in the Indian market? What will be your strategy?

For me, it is important to be successful in all the aspects. Sustainable leadership means an attractive and most desired brand, attractive products and efficient dealer network. These things continue in the long term. We will offer products at every price point to drive volumes with a sustainable growth strategy. That’s the reason 1 Series comes at the bottom and the 7 Series at the top. We will have leadership and products at every price point across the segments.

What were your sales for 2011?

We retailed 9,371 cars in 2011. We delivered 7,389 vehi-cles till October this year. I’m confident that we will be ahead of our last year’s sales and will be profitable. We go for long-term sustainable leadership. Of course, we want to be number one in sales but not for any price. Price-volume war can benefit the volume manufacturer more than the premium manufactur-er. So, it’s really important not to look only on the sales figures but also on profitability, brand value and customer satisfaction.

You will be assembling six cars at your Chennai plant including the 1 Series and new 7 Series. What is the investment that has gone in to ramp up the production?

Chennai plant produced 1,500 cars in 2007 that has risen to 11,000 in 2012. We have invest-

ed `1.8 billion (`180 crore) to increase the production.

You are getting new prod-ucts in the market. Do you have any plans to invest into a new plant?

Chennai plant has already proved to be very f lexible and by the end of 2013 we will offer six different models from that plant. They have increased their capacity from 1,500 units in 2007 to 11,000 and have also increased their model lines. What we expect of our plant in Chennai to react f lexibly to the demand. Right now, we are operating two shifts in the Chennai plant. We believe that in 2013, we can again increase

our volumes and I can say even in 2013-15 if the economy goes better and higher, we can react with this plant. We just expect them to be f lexible with shifts and lines.

How are you planning to expand your dealership net-work and what new models will be coming in?

We have currently 29 deal-erships and we are planning to have 50 by 2014.

How are you planning to place the 1-series hatchback in the Indian market?

1 Series will be priced under the X1. 1 Series is on the low end of our product range and it will be a

typical BMW with all equipments and premium positioning. It also has a job to conquer customers from the volume manufacturers. It will have all the advantages of a BMW like rear wheel drive, the sportiness and driveability. So, you can say that you are driv-ing a BMW and you don’t have to explain how it feels.

We don’t want to sell it to only the 3 Series and 5 Series buyers, that’s not our challenge. It will bring in additional volumes even if the economical situation is not so good. All BMWs will have a premium price so though we will sell it as a volume product, it will maintain its premiumness. We’ll think about the price of 1 Series in July-August next year.

Price-volume war can benefit

the volume manufacturer more than the premium

manufacturer. So, it’s really important not to look only on the

sales figures but also on profitability, brand value and customer

satisfaction

“We want to be number one in sales but not for any price”… says President, BMW India, Philipp von Sahr. He further talks to Auto Monitor to share immediate developments in their Chennai plant and future strategies from the German carmaker and also talks about the positioning of the BMW’s first hatchback, the 1 Series in the Indian market.

Jagdev Kalsi

Auto Monitor

C O R P O R A T E 1126 NOVEMBER 2012

Vehicle running costs are at an all time high in India due to the steep rise in fuel prices in

the past few years. The focus on keeping vehicle weight to the minimum is a serious consider-ation now during development and one of the most apparent areas to keep weights in check is plastics.

The common parts that have traditionally been manufac-tured in plastic like bumpers, for example, continue to be made of plastics but OEMs have had to innovate in the usage of this material in non-traditional areas. The focus has shifted to under-the-hood components in which DSM Engineering Plastics is a major player.

DSM Engineering Plastics India is part of Royal DSM of the Netherlands. Their range of engineering plastics is used in under the hood components. On the presence of DSM in India, Business Director – India, Sanjay Jain said, “Akulon and Arnite were the first engineer-ing plastics to be used in India in 1982.” Although these plas-tics were sold here, DSM began production only in 1999 in India. Manufacturers like Toyota, Maruti, Tata, Bajaj have been using engineering plastics sup-plied by DSM. DSM’s plastics go into manufacturing components and systems including air intake manifolds, balancer shaft gears, airbag containers, brake boost-ers, cooling systems, fuel systems and lighting.

Speaking on the trends in the automotive sector, Jain stressed on downsizing, reduced fric-tion and use of alternative fuels in addition to weight saving. According to DSM, the valve train contributes to around 20 percent of engine friction at low engine speeds. Using Stanyl PA46 instead of PA66, says DSM, has not only reduced friction by about 22 percent but has also resulted in one percent fuel reduction and 2gm/km reduced CO2 levels. Stanyl PA46, said Jain, is more expensive than PA66. “On an engine component, if you replace PA66 with PA46, you will have to shell out an extra $1.5-2, but in Europe, you save over $180 on CO2 reductions.”

Over a year ago, the compa-ny set itself a target to treble its business in the next five years. The Dutch major has realised the potential of markets in Asian region and sees growth continuing here. Jain said, “Today, Asia is the epicentre of engineering plastics and is

also the fastest growing region which is why we have moved our headquarters from Holland to Singapore.”

DSM’s plant in Ranjangaon is the latest addition to DSM’s production units. It has a capacity of 20,000 tonnes per annum. The company is focus-ing on keeping with the times by having automotive centres around the globe. Jain said, “last year, we opened a centre in Shanghai and I hope to open another centre in India soon.” At the Shanghai Centre, DSM can create simulating effects of different automotive environ-ments according to Jain and can also evaluate metal-to-plastic replacement systems.

DSM has also developed plastic balancer shaft gears for four-cylinder engines. He said, “Plastics are a low stiffness mate-rial. It gives you better absorption of noise.” In addition to noise, a plastic gear will also be lighter and cheaper to produce com-pared to metal gears.

BMW India Pvt Ltd has announced a 10 per-cent price hike on all its cars depending on

model to model starting January, 2013 following a strict “no to dis-counts” policy for its portfolio in India. “We believe in 2013, even with this price increase, we will offer quality products in future though sales might be affected in short-term. We can increase the volumes due to new mod-els and additional dealers,” said President, BMW India, Philipp von Sahr.

BMW has previously announced that it will bring in the updated X1, 7-Series and 1-Series in 2013 and will ramp up its dealer network from 29 dealerships to 50 by 2014. It has managed to sell 7,389 vehicles till October 2012 and is confi-dent to surpass its last year’s

sales of 9,371 units. With rival brand Audi slowly but steadily inching towards BMWs sales figures, BMW is positive at being a sustainable leader in the Indian market. “I promise you 100 percent that we will contin-ue to be the sustainable leader here in the market. We want to be successful in sales but not for any price. So if someone makes a lot of discounts and pass-es us in sales it is his decision. Monthly sales figures are just one parameter. We want to be profitable here. You can always have short term success in sales in a month but that is absolutely not our policy,” said Philipp.

Commenting on withdraw-al of discounts, Philipp said, “Our strategy is not to offer discounts on existing portfolio and get volumes. We will have products in all price points. That’s the strategy that we have to sustain and to maintain our leadership.”

DSM focusing on innovations as proportion of plastic parts in cars go up

BMW withdraws discounts, announces price hike in January Anand Mohan

Mumbai

Our Bureau New Delhi

Philipp von Sahr, President, BMW India

26 NOVEMBER 2012Auto Monitor

E A S T I N D I A12

Auto component man-ufacturers based in East India have been facing rough weather

in recent times given the slug-gish economic environment and lower offtake from key customers due to slowdown in the demand from the automotive sector. Major chunk on auto component demand for auto components emanates from commercial vehi-cle business of Tata Motors and Hindustan Motors. The slow-down in the commercial vehicle segment has affected the capac-ity utilisation for majority of the auto component manufacturing units in and around Kolkatta and Jamshedpur.

“While the idle capacity can-not be immediately utilised as the changeover is not possible for a short time period. Apart from launching new products, we are looking at every single process,

and doing a lot of introspection and trying to improve our pro-cesses and looking at weakness and trying to strengthen them, so that when the time improves we are in a better place to come back to form,” said Managing Director, Metaldyne India, Sanjay Sabherwal told Auto Monitor.

Metaldyne India has been impacted by the current sluggish market trend and experienced a

significant fall in its sales in the third quarter of this fiscal. The capacity utilisation for the com-pany has come down to around 70 percent till the first quarter but further dropped to around around 40 percent in recent months. The company which has 15 percent of total business coming from pas-senger vehicle segment is now also looking at increasing its busi-ness in the segment and reduce its

dependency on the commercial vehicle segment.

“The current business senti-ment is very bad but the actual demand story has not changed. India needs a lot support in terms of policy by the government. Our short term strategy is to get back to the full capacity utilisation as soon as possible and flaw-lessly launch the current orders that we have. Medium and long

term strategy is that we want to be among top two manufactur-ers of vibration dampers in India and we are nearing that goal by taking these additional orders. I hope to get a 20 percent growth in the top line by 2014, and feel that 2013 will continue to be a terrible year,” elaborated Sabherwal in a telephonic interview.

Metal dyne Global is a billion dollar company having manufac-

The company which has 15 percent

of total business coming from

passenger vehicle segment is now also looking at increasing

its business in the segment and reduce

its dependency on the commercial vehicle

segment

Metaldyne India striving to shrug of low capacity utilisation, hopes to garner new business

turing units at 23 locations around the world and India is the only location where it has a joint venture. The company manufactures NVH products, fly wheel assemblies, pulleys and rear hubs in India. Metaldyne is one of the largest producer of fly wheels for heavy and medium commercial vehicle applications in India with 25,000 units a month production capacity.

Metaldyne India, exports components pro-duced at Jamshedpur plant to the various exports markets including US, UK, Japan and Thailand and exports contributes around 40 percent of its total revenue. So far the compo-nent maker was getting technical support from Metaldyne’s US technical centre but now it is planning to to use Indian engineering skill and set up a Technical Centre in Jamshedpur to sup-port certain amount work done here.

Arush Group was set up by Sabherwal in 1992 and signed the JV with Metaldyne in 2000. The group also owns a foundry called Arush Metal Casting which is a separate business and the turnover for this company last year was `50 crore. The foundry supplies to Cummins, Tata Motors, Volvo Eicher and Indian railway, the Group owns three plants in Jamshedpur.

Globally, it caters to OEMs like Audi, BMW, Chery, Chrysler, Daimler, Ford, GM, Honda, Hyundai, Jaguar, John Deere, Mitsubishi, Opel, PSA Peugeot Citroen, Renault-Nissan, Saab, VW, Volvo Truck. It also has a major customer base among tier I suppliers like AM General, Arvin Meritor, American Axle, Benteler, Bosch, BorgWarner, Continental, Cummins, Delphi, Detroit Diesel, Getrag, Linamar, Teves, and ZF.

The key products supplied globally include sintered, forged systems and components for driv-etrain and vibration control systems. It sources raw materials and direct material like aluminium, castings, stampings, machining, heat treatment, plating, bearings, fasteners as well as indirect material like tooling, MRO, assemblies and test equipments from suppliers across the world.

Nabeel A Khan New Delhi

The company’s foundry supplies to Cummins India, Tata Motors, Volvo Eicher and Indian railway and the Group owns three plants in

Jamshedpur

26 NOVEMBER 2012Auto Monitor

E A S T I N D I A14

Kolkata-based casting manufacturer, Kiswok industries has added gear boxes, carrier

housings for Tata Motors and is also in talks with Diamler-Bharat Benz and Volvo Eicher to supply these new products.

The supply of these new prod-ucts to Tata Motors will start in December and the total volume will be around 10,000 tonnes.

Tata Motors is already a lead-ing customer for Kiswok and it supplies brake drums, differen-tial case, differential cover, rear hub, housing brackets for the entire range of trucks.

As the business has gone down the component maker is now

focusing on value addition and development of superior prod-ucts. It is also aggressively looking for joint venture or technical alli-ance to help them produce high quality casting and machining product. It has delayed its plan to set up a new foundry.

“Currently we have put our plan for a greenfield ferrous foundry project on hold and are concentrating on our existing foundry facility where we have already ramped up our capacity

and will be making significant more investments next year for further augmenting the capac-ity. We have already invested in the foundry to the tune of `40 crore and are currently looking to increase our machining capacity for which we are looking for the latest technological options. We are regularly attending trade fairs across the world to identify poten-tial partners,” said Managing Director, Kiswok Industries, Raj Kejriwal told Auto Monitor.

With this new expansion line, the company can produce anoth-er 3,000 tonnes per month, taking company’s total capacity to 6,500 tonnes per month. The compo-nent maker also plans to export gear boxes, carrier housings as its machining lines for these com-ponents are go on stream. The company is also looking at major forward integration by adding painting, machining and assem-bling facilities.

The company’s is currently

The company manufacturers of ductile and cast iron products in India and caters to sectors like automobiles,

agricultural, utilities, engineered

castings and other industries

Kiswok Industries to supply gear boxes, carrier housings to Tata Motors

utilising only 50 percent of total capacity and hopes to ramp up very soon.

“We have been taking active part in ACMA’s cluster programs to improve the work systems and quality, we have also invested significantly in softwares to make work easy and to con-

solidate production reports and to make them available at our finger tips. During this slow-down, we have also taken active steps to reduce costs in terms of energy and raw material con-sumption,” said Director, Kiswok Industries, Mayank Kerjriwal told Auto Monitor.

Kiswok had a turnover of `230 crore in the FY12 and considering the very bleak econom-ic scenario it would be happy to maintain the same this year.

The company was established as Kejriwal Iron & Steel Works in the year 1957 and was subsequently renamed Kiswok. It is one of the leading manufacturers of ductile and cast iron products in India. It caters to diverse sec-tors like automobiles, agricultural, utilities, engineered castings and other industries. Its resources at its three manufacturing sites include high pressure moulding line for casting, CNC vertical turret lathes for machin-ing and two plane machine for balancing of the products.

Nabeel A Khan New Delhi

The company’s is currently utilising only 50 percent of total capacity and hopes

to ramp up very soon with newer products and more

customer orders

26 NOVEMBER 2012Auto Monitor

E A S T I N D I A16

Around thirty percent of capacity is lying idle as demand from OEMs has fallen drastical-

ly in the last couple of months but Kolkata-based component manufacturer Baynee Industries finds it as an opportunity to build a foundation for a stronger future. The component machin-ing company is now gearing up to

utilise the available capacities for production and launch of newer components.

“We are going for new product development and are talking to our customers for more machin-ing components. We have some queries pending at the defence end also,” said Director, Baynee Industries, Devanshu Daga.

The company has received a couple of new machined forged products order from Tata Motors and defence sector and produc-

tion for these new components will start by early next year. The company has been operating in the defence sector for past two to three years but it is now looking to strengthen its presence in this segment as it see great potential for private players. The company is additionally shifting its focus on exports as well for the first time. It has upgraded its plants in Kolkata to match the require-ments and standards apart from increasing efficiency. The com-pany was earning a profit margin of around eight percent but with setting up of new machine across its production line it hopes to reap a 10 percent profit.

The component maker gets about 95 percent of its total rev-enue from CV manufacturers including all the major OEMs like Hindustan Motors, Tata Motors, Mahindra & Mahindra, Ashok Leyland and Eicher.

Daga mentioned that upgradation of plant and new machinery like co-ordinate measuring machine (CMM) has been purchased keeping export markets in perspective. “For our Kolkata plant, we have got a co-ordinate measuring machine

(CMM) which is a CNC pro-grammed machine. This has reduced lead time for inspection and is more accurate,” said Daga.

The company has spent around 12 percent of the cur-rent revenues or around Rs four crore for upgrading of the Kolkata plant and made it a dust-free area for assembly hall pumps. However, Daga maintains that the company is still in the mid-dle of it and will be upgrading the plant further before it starts

exporting. The company’s new facility in Jamshedpur set up with advanced machines at an investment of around Rs three crore, is dedicated to value addi-tion and fine tuning the product.

Baynee Industry expects to close this fiscal year almost flat and will remain cautious on future investments as it sees the market sluggishness to continue. It clocked a revenue of around `30 crore this year compared to `25 crore FY11.

Demand fall is future gain: Baynee Industries

Confederation of Indian Industry (CII) is organising the 11th International Mining and Machinery Exhibition (IMME), the largest trade fair dedi-

cated to the mining industry, in India from 5-8 December in Kolkatta.

The exhibition running for four days would include Global Mining Summit on the first two days of the exhibition. Around 200 plus exhibitors and 9,000 odd business visitors are expected to participate in the upcoming expo. It would also include country pavilions from the US, Australia, the UK, China, Czech Republic, Germany, and Poland for B2B networking forum for visitors/exhibitors.

India is a leading mineral producer glob-ally endowed with a resource base of several major minerals like coal, iron ore, and bauxite. The Indian mining sector plays a pivotal role in the country’s infrastructure and economy. Globally, India ranks second in chromite, third in coal & lignite and bauxite, fourth in iron ore and fifth in manganese. The future of the min-ing sector lies in laying emphasis on scientific mining so that state of the art technology is used for exploration, efficiencies are realised, clean technologies and safe mining practices are adopted with adequate supporting infra-structure, according to CII release.

Mining equipment expo in Kolkatta in Decemebr

Nabeel A Khan Mumbai

Our Bureau Mumbai

Globally, India ranks second in chromite, third in coal & lignite and bauxite, fourth in iron ore and fifth

in manganese

Machining Line at Baynee Industries

Testing Centre

Auto Monitor

C O R P O R A T E1826 NOVEMBER 2012

Shriram Automall India Limited aims to expand to around 60 key cit-ies by 2013 and recently

launched its a major outpost in Hyderabad with the intention of offering a platform to sellers and buyers of commercial vehicles via a public auctioning process.

Apart from the regular auc-tioning of commercial vehicles, the mall will now offer two new services- ‘Shriram One Stop’ and ‘Shriram New Look’. The One Stop concept allows a seller to upload the vehicle information and photographs on the electron-ic kiosks which will be located across all locations. This concept has been introduced to lure sell-ers who don’t want to physically display their vehicles before the scheduled auction.

The New Look service allows sellers to refurbish their vehi-cles before a sale takes place, for which they will be charged sepa-

rately. Shriram Automall claims to have an existing customer base of around one million who prefer to purchase a new vehi-cle once the loan period gets over. The sellers have an option to either sell through the regu-lar auctions or otherwise. The Automall is open to individual as well as fleet operators looking to sell their vehicles. The buyers get the advantage of documentation being taken care of and availabil-ity of financing.

“Buying and selling of com-mercial vehicles happens across the market place, but one doesn’t get to know where, when and what was the actual price paid. So we wanted to introduce value selling and had started with the bazaar concept around 3 years back,” said MD & CEO, Shriram Transport Finance Company Limited, Umesh Revankar.

“With time we realised that everybody wants to have a trans-parent mechanism of buying. They want a public transaction so that one is sure about the right

buying price, right way of buying, and one also gets an opportuni-ty to inspect the vehicles before buying,” added Revankar.

“Every city is different in terms of commercial value. It is chal-lenge to select the right place. Training the customers and our internal team is a challenge. We keep on showing them demo vid-eos to educate them about how an auction happens and how to take part. We have made a lot of investment in making people understand what we are doing,” said CEO, Shriram Automall India, Sameer Malhotra.

“A majority of our time and effort goes in convincing cus-tomers that this is the right way of selling their vehicles. Initially buyers were conservative. They didn’t understand the mar-ket and we were also new in the market. But the more we entered and the more time we spent in the market we realized we are in the right business. This industry is totally new without a number one,” added Malhotra.

Shriram Automall India does not buy the land on which it sets up its operations. Instead it enters into an agreement with the prop-erty owner on a long term basis. The required infrastructure is setup by the land owner. Shriram Automall pays a higher rental to the land owner in return.

“We have a bigger custom-er base in Andhra Pradesh and Tamil Nadu so our services are more in these regions. Smaller vehicles are selling more now as this segment is shaping up now. The choices available to buyers now are more than say eight years back. In developed countries the

ratio of big to small trucks is 1:3. In India, earlier the ratio was less than 1:1. Although the cur-rent ratio is around 1:1.5, smaller vehicles will continue having more demand,” said Revankar about the current market and future prospects.

Shriram Automall is a whol-ly owned subsidiary of Shriram Transport Finance Co Ltd, which is the flagship company of the Shriram group. The Sriram group has business interests spread across diverse sectors like con-sumer finance, life and general insurance, stock broking and dis-tribution.

Shriram offers value added service to enhance used vehicle delivery experience

Volkswagen India kicked off its Regional Parts Distribution Centre (RDC) under its ‘Depot Network Development Project’ in Bhiwandi, Thane. It will

serve the Western, Southern and Eastern regions that accounts for around 60 to 65 percent of the genuine parts sales for the Group in India.

The RDC is located in Bhiwandi (Greater Mumbai) on National Highway 3 and will signif-icantly contribute in the reduction of the current lead time to provide genuine parts to dealers and service centres. This is the second depot by the Group in India under its ‘Depot Network Development Project’ after Gurgaon. The centre is an approximate 21,000 sq metres and back-end operations are managed with the aid of a customised warehousing software - ET2000. The software has been specially designed for Volkswagen Group India. The building and processes within the complex that have been designed in are line with Volkswagen global standards. The facility will have a lean team of Volkswagen personnel who will manage opera-tions with a third party logistics service provider.

“The RPDC will deliver on demand for genuine parts within 24 hours to the VW Group brands deal-er network in the Western region and 72 hours for Group brands dealer network in Southern Region. We are also planning to incorporate Porsche and Lamborghini parts under the umbrella of Group Service to cater its Pan India dealer demands,” said Director Group Service, Volkswagen Group Sales India Pvt Ltd, Dietmar Hildebrandt.

The Volkswagen Group is represented by three brands in India: Volkswagen, Audi and ŠKODA. It has a production capacity of 130,000 cars annually and the Pune facility has been set up with an investment of around Rs 3,800 crore (Euro 580 million). Audi offers the A4, A6, A7 Sportback, A8L, Q3, Q5, Q7, RS5, TT Coupe, R8 Coupe and R8 Spyder. ŠKODA offers the Fabia, Rapid, Laura, Yeti and Superb. Volkswagen has the Polo, Vento, New Beetle, Jetta, Passat, New Touareg and NewPhaeton.

Volkswagen kicks off parts distribution centre in Thane

Pradeb Biswas Hyderabad

Our Bureau Mumbai

Auto Monitor

T E C H N O L O G Y2026 NOVEMBER 2012

Wireless sensor net-works monitor machiner y and equipment in fac-

tories, cars and power stations. They increasingly “harvest” the energy they need to trans-mit measurement data from the environment, thus mak-ing them self-sufficient. At the Electronica 2012 trade fair, Fraunhofer researchers will pre-sent a printed thermogenerator, which in the future will be able to generate energy supply for sensors through temperature differences.

The computer activates an alarm: the machine’s motor is threatening to overheat. The ther-mosensor attached directly to the motor housing reports the threat. The information is transmitted to the maintenance service which ensures that the cause is identified. Sensors can be used in factories, car manufacturers and other areas in everyday life. They meas-ure temperature, humidity and wear and tear. Data is transmitted to the computer via wireless com-

munication and read out. This enables the provision of informa-tion on the condition of parts – for instance, whether maintenance or repairs are required. More and more frequently wireless sen-sors are used which consume very low levels of energy and the power required by the sensor, the processing unit and wireless module derives its power direct-ly from the environment instead of “harvesting” energy from bat-teries Electrical energy can be generated, for instance, from heat or movement. Researchers from the Fraunhofer Institute for Manufacturing Technology and Advanced Materials IFAM in Bremen presented a printed thermogenerator, which can be tailored exactly to technical inter-faces, at the Electronica trade fair in Munich.

Monitoring with energy-autonomous sensors

“Wireless sensor networks facilitate the monitoring of safety-related components”, explains Dr Volker Zöllmer,

Head of Functional Structures, whose work focuses on the topic of Energy Harvesting at the Fraunhofer IFAM. For sensors to work at optimum capacity, they must be attached directly to the component’s interface or even integrated into the com-ponent. The power supply is usually obtained via cable or battery. “However, the limited storage capacity and battery life, as well as the issue of recycling, are critical subjects for the user,” appreciates Zöllmer. “In our experience, a replaceable battery contributes significantly to the design of an application and as such restricts the flexible layout.”

To ensure that the sensor network is entirely suitable for energy supply by means of energy harvesting, it must only consume low levels of energy. If sensors in intelligent networks are only active when sending and receiv-ing data, energy is only required in milliwatts. Thermogenerators can deliver these quantities, for example, converting ambi-ent heat into power. The IFAM

researchers use new production processes to custom manufac-ture such generators.

Printing thermogenerators“Generative manufacturing

processes produce both sensors and sensor networks as well as the required elements for energy har-vesting such as thermogenerators: By directly depositing functional structures, which have an ink or paste base, using ink-jet, aerosol-jet, screen-printing or dispensing processes, not only can electrical circuit boards and sensor ele-ments be attached to different interfaces but it is also possible

to produce structures which har-vest energy,” explains Zöllmer. Using a purposeful combination of metallic and thermoelectrical materials which are successively applied, the researchers manu-facture structures which can be used as thermoelectrical genera-tors. The major advantage of this is that the printed thermogenera-tors can be tailored exactly to the technical surfaces. This makes the sensors less susceptible to faults because the energy sup-ply can be adapted directly to the respective requirements.

(Courtesy: Fraunhofer Institute)

Thermogenerator: New generation energy efficient sensors

Those who want to accurately bend steel or stainless steel tubes and tube systems must accept long auxiliary processing times for the generally una-

voidable measuring and adjusting process. This is because the rebound behaviour of the mate-rials can differ widely – even if the tubes come from a single batch. The production of proto-types and individual items is similarly time and labour-intensive.

The new development from Schwarze-Robitec, which is integrated into the bending tool, measures the bent tubes directly whilst tensioned on the bending machine and imme-diately starts the required further bending process if desired or saves the required correc-tion value for subsequent bends.

Instead of removing the tube after the bending process, checking it on an external measuring system then retensioning it for sub-sequent bending, tube processing companies can bend, measure and adjust in a single stage with the aid of Springmatic. Immediately after the bending of a tube, the new optical measur-ing system that Schwarze-Robitec is integrating into its bending tools records the rebound value, from which the CNC control of the tube bending machine calculates the required subsequent bending angle. Subsequent bending is car-ried out immediately afterwards – either fully automatically if desired or after clearance by the machine operator. “This integrated form of dimensional stability check and tube post-pro-cessing takes only a few seconds per work piece on average. This is contrasted with around three to five minutes required for measuring and adjusting in the conventional way,” Schwarze-Robitec Plant Manager Jürgen Korte said.

When developing the measuring system, the tube bending specialists from Cologne placed particular emphasis on a very broad range of applications. The system can be integrated into almost any bending tool and combined with almost all tube bending machines from Schwarze-Robitec.

“Furthermore, users not only save up to nine tenths of the auxiliary processing times previ-ously required; in individual item and prototype production, they additionally benefit from a noticeable material saving as almost every com-ponent is now also a useable bulk component. These advantages have an effect particularly in tube production for the automotive, machine and plant engineering, and shipbuilding industries,” said Schwarze-Robitec Managing Director Bert Zorn.

Integrated measuring system for tube bending machines

Auto Monitor

E V E N T S2226 NOVEMBER 2012

The third Industrial fair Hannover Messe 2013 in India started in late November. It is being

organised at in India Expocentre, Greater Noida and around 10,000 visitors are expected to turn up over three-days. The event receives around 30 percent of vis-itors from auto industry. The fair has a focus on automation and efficient manufacturing process.

Indian companies including Crompton Greaves, Connectwell Industries Pvt Ltd, Janatics India Private Ltd, C&S Electric Ltd, Raychem RPG Limited among others are expected to showcase solutions that address energy efficiency in production opera-tions at Hannover Messe 2013, to be held between 8th to 12th April 2013 at Hannover, Germany.

Managing Director, HMFI, Mehul Shah said, “Indian com-panies have been participating in Hannover Messe for last 40 years. Over 150 Indian compa-nies are expected to participate in the forthcoming Hannover Messe. Through a single expo-

sure at Hannover Messe, Indian companies are able to reach markets not only in Germany, but also in entire Europe, the US, Middle East, South-east Asia and Africa. Over 1,000 businessmen from India attending Hannover Messe bring home new ideas and technologies to enhance their competitive edge.”

Executive Director, EEPC, R Maitra said, “EEPC India (formerly Engineering Export promotion Council) is the old-est and the largest trade and investment promotion body set up under the aegis of Ministry of Commerce & Industry,

Government of India. EEPC India has the total membership strength of more than 12,000 members ranging from large, medium and small scale enter-prises. Over the years, EEPC India has played an instrumen-

tal role in promoting ‘Brand India’ across the globe as EEPC has an India pavilion at Hannover Messe.”

Hannover Milano Fairs India Pvt Ltd (HMFI) is a wholly owned subsidiary of two of the world’s

leading trade fair organizers Deutsche Messe AG, Germany and Fiera Milano, Italy. HMFI have been bringing trade fairs into the Indian market for Indian and international enterprises since 2007.

EEPC India has played an

instrumental role in promoting ‘Brand India’ across the

globe as EEPC has an India pavilion

at Hannover Messe - R Maitra,

Executive Director, EEPC

Hannover Messe 2013 kick starts at Noida Expocentre Our Bureau

New Delhi

With a focus on industrial and com mercia l pa r t nersh ips, exchange of technology and expertise for future urban

development in India, the Indian Institute of Urban Technology under the aegis of Ministry of Urban Development will host the Urban Mobility India 2012 Conference cum Exhibition from 5th to 8th December in New Delhi.

Urban Development, TransportThe conference will allow Indian companies

to benefit from various technical roundtables and meetings that will be conducted to share ideas and talk about the best prevailing technol-ogies for infrastructure development. Thirteen companies from the urban development sector in France will participate and share their pro-ficiencies at the trade show. A French pavilion will be hosted inside the European pavilion by French Trade Commission-UBIFRANCE in collaboration with European Business and Technology Centre to organise technical work-shops on themes like development of urban and railway networks in Eastern India and transport & technologies.

The French Pavilion, hosted within the European Pavilion, will bring together 13 companies representing the urban develop-ment sector in France. This presence includes: Alstom Transport, Certifer, Deny Fontaine, Egis Rail, Eurailtest, Eurovia, Forest-Line, IDMS, Lumiplan, SCOMA, Visionor, Vossloh Cogifer including three companies feder-ated and accompanied by the International Chamber of Commerce & Industry of the Nord-Pas de Calais region in France. The French Association of Rail Industries (AIF) will also be accompanying the delegation.

French flair for sustainable urban infrastructure Our Bureau

New Delhi

Inauguration Ceremony For Hannover Messe

A French pavilion will be hosted inside the European pavilion

by French Trade Commission-UBIFRANCE to organise technical

workshops on themes like development of urban and railway

networks in Eastern India and transport & technologies

Auto Monitor

C O R P O R A T E 2326 NOVEMBER 2012

Au t o m o t i v e M a n u f a c t u r i n g Solutions is organising AMS India Conference

in the first week of December to showcase teh manufacturing capability and prowess and sup-ply chain in the Western India. As part of the AMS India con-ference, the organisers are also offering the opportunity to visit the Volkswagen plant in Chakan.

The conference will be one of the largest single gatherings of both Indian and international automotive manufacturing execu-tives. These topics and many more will be presented by OEM and Tier supplier speakers, and the new technologies to help meet these challenges will be showcased by the many equipment suppliers in their presentations and at their stands in the conference venue.

Last year’s event saw sev-eral key themes emerge: how carmakers operating in India

will continue to automate their production processes to drive up quality, but also to retain crucial flexibility in a market sub-ject to sharp swings in customer demand. How the supplier com-munity needs to continue to raise its game in quality and delivery; global quality and advanced just-in-time and supply in-line sequencing methods must be part of the India carmaking region’s shared expertise.

A special supplier session has been organised at the beginning of Day Two, with Jayanta Kumar Deb, Vice-President, Engineering and Design, Fiat India outlining to the suppier community exact-ly what carmakers need from them. Suppliers speaking include Sitangshu Goswami from Magna Steyr, T Giriprasad from Rane and speakers from Bosch, Visteon and TVS Group.

As vehicle architecture con-tinues to become more complex, and crash safety testing and reg-ulation become more stringent, so demands on stamping and

body-in-white increase. In a spe-cial stamping session, Yogesh Morade, Senior Manager and Head of Engineering, Die Shop, Mahindra & Mahindra will talk on the vital role of the die shop in the stamping department at the carmaker, and how it is meeting the special challenges of working with high-strength and creating ever-more complex structures.

Klaus Rothenhagen, VP, International Sales, AIDA will give a global view of stamping technology, highlighting instal-lations in China, South America and Europe in his examination of the latest trends in pressing.

The powertrain session at the AMS India conference will high-light the importance of engine manufacturing in India, as this is an area where India’s OEMs must quickly rise to the new demand from the home market for small diesel engines and to the challenge of producing the increasing-ly complex and high-efficiency powerplants demanded by glob-al markets and legislations. The

sessions will feature presenta-tions by OEM engineers including Senthilkumar Rathinam, General Manager - Powertrain Process Renault Nissan Technology and Business Centre India, Saurabh Mohan Saxena, General Manager, Strategic Corporate Business Development at ZF Hero Motors, and industry supplier experts such as Vivek Maheshwari of Kennametal, and M Hariprakash of Castrol, plus talks from machine tool specialists Kennametal, and measurement experts Accurate Gauge.

The paint shop session will include Dinesh Advant of

Mercedes-Benz who will talk about the new paint shop at the company’s Chakan plant, where Mercedes’ will be painted in-house for the first time. Michael Berger of Dürr India, and Joachim Hug of Eisenmann will present their com-panies’ process technologies and recent installations, comparing the requirements of established and emerging-market carmakers.

At the close of the AMS India conference, Siemens will present three special awards to speakers whose presentations are judged to have made the best contribution to the forum for environment, safety and innovation.

A special supplier session has been organised on the second day

with Jayanta Kumar Deb, Vice-President, Engineering and Design,

Fiat India outlining to the suppier community exactly what carmakers

need from them

AMS conference to highlight manufacturing prowess in Western India

Phot

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Jos

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Nav

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Our Bureau Mumbai

LG Balakrishnan & Bros Ltd recently acquired 100 percent of the shares of “GFM INC” located in Detroit Michigan through its subsidiary company “LGB

USA INC”. This Company posted a turnover of USD 15 million in the previous financial year. The deal consideration was approximately $5.5 million. LGB is a leading roller chain manu-facturer based in Coimbatore. The company has 17 chain manufacturing plants, all ISO 9001 certified by Underwriters Laboratories Inc, USA. Three of the manufacturing facili-ties along with the central functions have been registered to ISO/TS 16949 by UL, USA.

LGB has installed comprehensive QC cycles to maintain control over quality standards LGB has all critical manufacturing in-house. This includes a steel rolling division to produce cold rolled steel strips, wires and strips with pro-files. LGB’s tooling division is equipped with sophisticated CNC wire cutting, spark erosion and Mikron CNC Boring machines for precision and complicated machining. It has also set up an Application engineering Cell for designing, manufacturing and supplying chains for spe-cial applications and specific needs.

LG Balakrishnan acquires GFM Our Bureau

Mumbai

VW’s Facility In Chakan near Pune

Delegates Will Be Conferred A Visit to VW’s Pune faciity

Auto Monitor

A U T O N O M I C S2426 NOVEMBER 2012

Consumer durables have become more afforda-ble to rural households in recent years, due

to rising discretionary spend-ing and relatively low levels of price rise in durables. As a result, at least one in every two rural households owned a bicycle, an electric fan and/or a mobile phone in 2009-10. Despite rising affordability, the pattern of pen-etration of consumer durables varies distinctly in rural India - even between states where household discretionary spend-ing is at similar levels. This clearly indicates that even though high-er income is a necessary factor, it is not the sole factor, influencing consumers’ decisions to pur-chase durables.

Here, adequate access to infrastructure – electricity and road connectivity – holds the key. Loss of potential demand, due to poor access to infrastruc-ture, is significant. According to CRISIL estimates nearly 12 mil-lion additional rural households

in Uttar Pradesh and 4 million more in rural Bihar would have owned electric fans by 2009-10, had there been better access to electricity. Further, each of these two states would have had 5 mil-lion more households owning a television set. In contrast to rel-atively poor electricity access, an improvement in road con-nectivity between 2004-05 and 2009-10 appears to have resulted in a sharp pick-up in ownership of two wheelers in several states including Bihar, Orissa and Rajasthan. Therefore, apart from raising rural incomes, boosting rural infrastructure will help unlock the true demand poten-tial for consumer durables.

Our recent insight titled ‘Sustaining the rural consump-tion boom’, (August 2012), pointed out that rural spend-ing outpaced urban spending between 2009-10 and 2011-12 – for the first time in nearly 25 years. Through our follow-up insight, we explore the inter-state dif-ferences in the two most critical factors, influencing rural demand for consumer durables. These are discretionary (non-food) house-hold spending and access to infrastructure (electricity and road connectivity). While the study uses state-level consump-tion expenditure data available up to 2009-10, we expect similar trends are likely to have persisted in subsequent years too as rural wages have continued to rise at a fast pace.

Discretionary spending of a typical rural Indian household rose to `24,000 in 2009-10, from `14,000 in 2004-05, growing at about 11 percent per year – faster than the inflation rate of near-

ly six percent per year over the same period. Kerala and Punjab bagged the top spots, in terms of the highest discretionary rural household spending, witnessing higher growth over an already high base seen in 2004-05.

However, certain other states that were relatively less well-off in 2004-05, also witnessed a surge in discretionary spending. Among the less well-off states,

discretionary rural household spending per year grew at a high-er rate than all- India average in Maharashtra and Bihar (12.1 per-cent), Gujarat (12.2 percent) and Madhya Pradesh (11.4 percent). In contrast, discretionary rural household spending grew at the lowest rates in Andhra Pradesh, West Bengal and Karnataka.

Rural households saw a rise in their discretionary spend-

ing power between 2004-05 and 2009-10. This helped boost the ownership of consumer durables. During this period, consumer durable ownership grew well over the all-India average, in states such as Bihar, Orissa, Rajasthan, and Uttar Pradesh, albeit from a relatively low base. Even as the ownership of consumer dura-bles has increased among rural households in recent years, it

Braving infrastructure hurdles,

Note: Per year growth is between 2004-05 and 2009-10.Source: CRISIL estimates based on National Statistical Survey Organization (NSSO) data

Rural household discretionary spending, 2009-10

55,22846,337

41,70028,504

26,77225,71725,177

22,19320,793

19,36718,19918,115

16,84614,375

Kerala

Punjab

Haryana

Rajasthan

Gujarat

UttarP radesh

MadhyaP radesh

Tamil Nadu

AndhraP radesh

Karnataka

Bihar

Orissa

West Bengal

Maharashtra

(Rs) Discretionary spending14.5

11.59.0

10.512.1

12.28.7

11.410.3

2.16.87.8

12.110.7

per year growth

10.9

All-IndiaRs Spendingp er year growth

24,287

Dharmakirti JoshiChief Economist, CRISIL Research

Dipti SaletoreEconomist, CRISIL Research

Vidya MahambarePrincipal Economist, CRISIL Research

Auto Monitor

A U T O N O M I C S 2526 NOVEMBER 2012

remains low compared to their urban counterparts. Rural India accounts for about 68 percent of total households, but had only 42 percent penetration in televisions in 2009-10 (against 76 percent in urban), 55 percent in electric fans (91 percent in urban), 14 percent in two-wheelers (33 percent in urban) and mere one percent in motor cars/jeeps (seven percent in urban).

Therefore, if rural income/wages grow at a similar pace, as seen over last few years, these markets should offer signifi-cant opportunity to durable manufacturers.

Even as rising purchasing power of rural households fuelled demand for consumer durables between 2004-05 and 2009-10, the state-wise ownership pat-tern of durables differ markedly, even between states that have a similar level of discretionary rural household spending. For instance, rural areas in Bihar, Karnataka and West Bengal have similar levels of discretionary

household spending, however, Bihar and West Bengal report much lower ownership of con-sumer goods (such as electric fans and two wheelers). Similarly despite similar levels of discre-tionary spending in Gujarat and Uttar Pradesh, ownership of elec-tric fans per 1,000 households is far less in Uttar Pradesh.

This makes it evident that affordability alone is not enough to raise the ownership levels of consumer durables. Poor access to infrastructure is a major deter-rent to raising penetration levels of these goods. This is especially of concern in rural areas where incomes are expected to contin-ue rising rapidly. Improved road connectivity raises demand for vehicles, whereas power avail-ability elevates demand for electrical goods.

Where infrastruture has made a difference

Although access to electric-ity has improved significantly across rural households between

2001 and 2011, several states still have a long way to go. For instance in 2011, only 10.4 and 23.8 percent of rural households had access to electricity in Bihar and Uttar Pradesh respectively. States where rural households have low access to electricity reflect far lesser ownership of electrical goods, relative to states with similar level of discretion-ary spending.

As per CRISIL Research’s esti-mates, loss of potential demand for consumer goods, between 2004-05 and 2009-10 in states with poor access to electric-ity, translates into millions of units. With higher rural elec-trification, almost 5 million additional households each in Bihar and Uttar Pradesh, and about 4 million more in West Bengal, would have purchased television sets during this peri-od. Similarly, lost demand for electric fans amounts to almost 12 million in Uttar Pradesh, 4 million in Bihar and 1 million in West Bengal.

In future, while rural house-holds in relatively poor states could enjoy higher affordabil-ity levels towards purchase of consumer durables, improving access to electricity will play a more critical role in expanding penetration of these goods. This will especially hold in states such as Bihar, West Bengal and Uttar Pradesh where higher incomes, in addition to improvement in infrastructure will be key drivers of potential demand.

Higher incomes and access to infrastructure will create huge potential demand for dura-bles in these states which house nearly 33 percent of rural Indian

households. Considering that an average only 22 to 30 percent of rural households in these states, own a television or an electric fan, rising incomes and improved access to infrastructure, could exponentially raise demand for these items.

Similarly, lack of good road connectivity adversely affects penetration levels of two-wheel-ers and motor cars/jeeps in rural areas. While several factors

rural consumer goes shopping

Contd. on Page 28

Auto Monitor

2826 NOVEMBER 2012

C O R P O R A T E

including availability of finance determine penetration of two-wheeler and motor car in rural areas, an improvement in rural road network would enhance demand for these goods. In fact, an improvement in road con-nectivity in several states (as measured by growth in length of roads under Pradhan Mantri Gram Sadak Yogana - PMGSY) appears to have resulted in a sharp pick-up in ownership of two-wheeler in the last five years. In Rajasthan, Bihar, Orissa, and Uttar Pradesh, although over-all ownership of two wheelers remains low, ownership has more than doubled between 2004-05 and 2009-10.

In times to come, in addi-tion to higher income, improved access to electricity and roads

will be key determinants of demand for consumer dura-bles in rural areas across many states. Access to finance will also be a critical enabling factor as household demand for higher value items sees a pick-up. Rural households in richer states such as Kerala and Punjab are likely to move further up the ladder, and purchase more high-end durables, such as refrigerator, air coolers, four-wheelers, and digital cameras.

(Please note that the views expressed here are those of CRISIL Research and not of CRISIL’s Ratings division. CRISIL Research operates independently of and does not have access to informa-tion obtained by CRISIL’s Ratings Division.)

Volvo is in the process of ramping up produc-tion of the new Volvo V60 Plug-in Hybrid

ahead of first customer deliver-ies in early 2013. After the initial batch of 1,000 model year 2013 cars, production will increase to 4,000-6,000 cars from model year 2014.

The assembly of diesel plug-in hybrid has been successfully integrated on the same produc-tion line as the regular powered V60, V70, XC70, S80 and XC90 models at the Torslanda plant in Gothenburg. This is a remark-able achievement considering that the sophisticated plug-in hybrid technology includes two complete drive trains and a powerful battery that provides a range of up to 32 miles on pure electric power.

“We are first in the industry to integrate a plug-in hybrid in an established production flow together with other car mod-els,” said Senior Vice President Research and Development, Volvo Car Corporation, Peter Mertens. “The integration in the standard production flow gives

the plug-in hybrid buyer the possibility to choose in princi-ple all options available for the standard V60.”

All the additional equip-ment and systems in the plug-in hybrid have led to parts of the final assembly line being rebuilt and modified. The adaption makes it possible to smoothly integrate the assembly of over 300 more parts that are included in the plug-in hybrid compared to an equivalent V60.

The electric motor along with

its drive shafts is fitted on the same station as the final drive on the standard all-wheel drive models. The cooling system and the high voltage cables are assembled on the Pallet, which is used to assemble the car’s drive train and chassis parts. The bat-tery pack is lifted in through the car’s tailgate short side forward. It is then spun a quarter of a turn in the passenger compartment - a manoeuvre that takes 60 sec-onds and carried out with less than 20 millimetres to spare.

The Volvo V60 Plug-in Hybrid is the synthesis of close coop-eration between Volvo Car Corporation and Swedish elec-tricity supplier Vattenfall. The two companies have financed the development project joint-ly. “The V60 Plug-in Hybrid is a unique car, a historic step, not only for Volvo Car Corporation but for the entire car industry. The first year’s 1,000-car batch has sold out even before the car has reached the showrooms and the order books for next year’s cars are already filling up,” con-cludes Mertens.

Contd. from Page 25

Braving infrastructure.... Volvo ramps up production diesel plug-in hybrid

Auto Monitor

T E C H N O L O G Y3226 NOVEMBER 2012

It first started ten years ago with Pre-Safe and contin-ued with Distronic Plus, and in the space of the next

few years it’s due to take motor-ing into a whole new dimension at Mercedes-Benz: comfort and safety merged together as one, opening up all sorts of new prospects for motorists and car developers alike.

‘Intelligent Drive’ - the next generation of the new S-Class will already boast an array of new systems designed to make driving an even safer and more comfortable experience. A dec-ade ago, Pre-Safe ushered in a new era of vehicle safety with the advent of technology that was able to detect the risk of an acci-dent occurring in advance and prepare both vehicle and passen-gers for a possible collision. For the first time, active and passive safety technology worked togeth-er in synergy.

Intelligent Drive“The intelligent assistance

systems of the future will be able to analyse complex situations and recognise potential dangers out on the road with the aid of improved environment sensor systems even more accurately than today,” explains Member of the Daimler Board of Management responsible for Group Research and Head of Mercedes-Benz Cars Development, Prof Dr Thomas Weber.

“Figuratively speaking, the next S-Class won’t just have eyes at the front; it will have 360-degree all-round vision,” he added. Of crucial importance in this respect is the networking of

all systems, or “sensor fusion” as the safety experts call it. The company is continually enhanc-ing the performance capabilities of its assistance systems with the aim of ensuring comprehensive protection, not just for the occu-pants of a Mercedes-Benz, but for all other road users as well.

The new systems hold tre-mendous potential for either preventing accidents or miti-gating their consequences according to Prof Weber, “Take, for instance, the new BAS PLUS assistance system with Cross-Traffic Assist. The results of our accident research based on the data from the GIDAS (German In-Depth Accident Study) indi-cate that it could either prevent or lessen the severity of 27 percent of all accidents at road junctions resulting in personal injury. That equates to some 20,000 accidents a year in Germany alone.”

The safety experts from Mercedes-Benz developed and fine-tuned the new safety sys-tems during countless test runs, but they also proved their effec-tiveness and acceptance with test subjects in the in-house ‘Moving Base’ driving simulator. With its 360° screen, fast electric power system and the twelve-metre-long rail for transverse

or longitudinal movements, the simulator is one of the most powerful of its kind in the entire automotive industry.

Single Light BulbIn addition to this, Mercedes-

Benz is further increasing protection for passengers in the rear with the active seat-belt buckle and the belt bag. In contrast to many other manufac-turers, the seat belts in the rear already include belt tensioners and belt force limiters today.

The new S-Class will also live up to its pioneering reputation when it comes to lighting tech-nology. It is the first vehicle in the world to do without a single light bulb as standard. “With its long life and a headlamp colour tem-perature resembling daylight, LED technology already had a great deal in its favour,” remarks Prof. Weber. “Now, though, our engineers have made great advances where energy efficiency is concerned too, reducing power consumption to a quarter of that of conventional headlamps.” The lighting’s multi-level functional-ity is another world first: out of consideration for any road users behind, the intensity of the brake lights is reduced at night-time or while waiting at traffic lights.

Advanced driving technologies in next generation S class

Distronic Plus with Steering Assist helps the driver to guide the vehicle in its lane and can even follow the vehicle in front in slow-moving traffic automatically. For the first time, the Brake Assist system BAS PLUS with Cross-Traffic Assist is able to detect cross traffic and also pedestrians, and if necessary boost the braking power applied by the driver accordingly. PRE-SAFE Brake can detect pedestrians and initiate autonomous braking to avoid a collision at speeds up to 50 km/h.

Pre-Safe Plus can recognise an imminent rear-end collision, prompting the Pre-Safe system to trigger occupant protection measures. It can also firmly apply the stationary vehicle’s brakes in the event of a rear-end collision to prevent secondary accidents.

With Pre-Safe Impulse, the driver and front passenger are pulled away from the direction of impact by their seat belts at an early phase of the crash before the resulting occupant decelera-tion starts to increase. This can substantially reduce the risk and severity of injuries in a frontal collision.

Active Lane Keeping Assist can detect oncoming traffic and when the adjacent lane is not clear, and prevent the vehicle from leaving its lane unintentionally by applying the brakes on one side.

Adaptive High beam Assist PLUS allows the main-beam head-lamps to be kept on permanently without dazzling traffic by masking out other vehicles in the beams’ cone of light.

Night View Assist PLUS can alert the driver to the potential dan-ger posed by pedestrians or animals in unlit areas in front of the vehicle by automatically switching from the speedometer display to a crystal-sharp night view image and highlighting the source of danger. A spotlight function is furthermore able to flash at pedes-trians detected ahead.

Attention Assist can warn of inattentiveness and drowsiness in an extended speed range and notify the driver of their current state of fatigue and the driving time since the last break, as well as offering an adjustable sensitivity setting.

Features

Auto Monitor

T E C H N O L O G Y3426 NOVEMBER 2012

The new 1.6-l it re i-DTEC diesel engine is the first engine from Honda’s Earth Dreams

Technology series to be launched in Europe. This new engine will make its introduction in the Civic at the beginning of 2013 and offers a class-leading combina-tion of power (120 PS) and torque (300 Nm @ 2000 rpm) with CO2 emissions of just 94 g/km.

“The key focus of our Earth Dreams Technology philoso-phy is to balance environmental efficiency with the dynamic per-formance expected of a Honda,” says Large Project Leader for all Civic models in Europe includ-ing the 1.6-litre i-DTEC, Suehiro Hasshi. “It is important that our cars are fun to drive.”

“This is a new approach from the ground up,” Tetsuya Miyake, Project Leader for the 1.6-litre i-DTEC engine. “There were no benchmarks for us because those targets would have been too low. We were determined to estab-lish a benchmark of our own that our competitors would have to follow.”

“Developing this engine has been all about smart, pure engi-neering,” says Hasshi. “Our motivation has been to make many small detail improvements that, together, make a major dif-ference. That is the challenge and the beauty of the Earth Dreams Technology philosophy.”

The new 1.6-litre i-DTEC engine has been specifically designed for the European mar-ket, to meet growing customer demand for low emission diesel engines. The new engine will be

built at Honda’s European manu-facturing facility in Swindon, UK.

Demonstrating the impor-tance of this new diesel engine to Honda’s sales plans in Europe, a new purpose built diesel engine production line has been installed at Honda of the UK Manufacturing (HUM). This new line is capable of producing up to 500 diesel engines in one day. Operating on a two shift pattern this equates to one engine every 138 seconds. The new line will produce both the new 1.6-litre i-DTEC and the existing 2.2-litre i-DTEC engines. The 1.6-litre i-DTEC diesel engine will also be applied to the new CR-V (also built at HUM) later in 2013, and the Earth Dreams Technology philosophy will be applied to all of Honda’s power trains in the future.

Honda’s new 1.6-litre i-DTEC is comprised of an aluminium cylinder head joined to an open deck aluminium block. It is the lightest diesel engine in its class, weighing 47kg less than Honda’s 2.2-litre i-DTEC engine. All the individual components have been redesigned to mini-mise their weight and size and advanced production techniques have helped reduce weight even further. The thickness of the cyl-inder walls has been reduced to 8mm, compared with 9mm for the 2.2-litre i-DTEC. In addition, lighter pistons and connection rods have been utilised in the 1.6-litre i-DTEC.

Reduced Mechanical Friction

The key target for Honda’s

development engineers was to reduce the mechanical friction of the 1.6-litre i-DTEC engine to the level equivalent of a petrol engine. “All the rotating parts have been carefully optimised to reduce their friction,” says Tetsuya Miyake. For example, a shorter and thinner piston skirt has been used. At 1500rpm, the 1.6-litre i-DTEC has around 40 per cent less mechanical friction than the 2.2-litre i-DTEC.

“This not only reduces emissions and improves fuel efficiency; it also improves the engine’s response, both on and off the throttle, making the car more fun to drive. We have reduced the mechanical fric-tion of the engine to the level equivalent of an existing petrol engine, which is an outstanding achievement.”

Clever TurbochargerThe 4th generation Garrett

turbocharger used on the 1.6-litre i-DTEC engine features an efficient variable-nozzle design and its rotational speed is pre-cisely controlled by the car’s electronics, minimising turbo lag and providing an optimal combi-nation of low- to mid-range pull and high-speed performance. The turbo has a maximum boost pressure of 1.5bar.

Efficient Fuel Injection System

Honda’s 1.6 i-DTEC uses a Bosch solenoid injection system which is capable of operating at a high pressure of 1800bar. A high fuel pressure means that the fuel is injected at a faster rate

and the finer the atomization of the fuel spray. This improves the fuel mixing with the air resulting in a cleaner and more efficient combustion helping to achieve the low emissions and fuel consumption.

Honda’s engineers have also worked to improve the volumet-ric efficiency of the cylinders,

employing a high intake flow and a high swirl head port precisely controlling the combustion pro-cess to reduce hot spots that create unwanted emissions. The engine air flow is managed by using an EGR (Exhaust gas recir-culation) system that operates at high and low pressure to reduce NOx emissions.

Honda 1.6 litre diesel engine to power Civic, CR-V next year

Auto Monitor

T E C H N O L O G Y3626 NOVEMBER 2012

Safer vehicles and the elimination of road acci-dent injuries and deaths are central to Toyota’s

future transport strategy and at its annual Safety Seminar in Japan this week the company has revealed details of new tech-nology to help prevent collisions - both familiar low-speed park-ing accidents and high-speed rear-end shunts.

It also has announced the opening of a new proving ground for testing Integrated Transport

Systems (ITS) that use radio com-munications between vehicles, road infrastructure and pedes-trians to improve safety.

A large number of collisions are caused by drivers hitting the wrong pedal or selecting the wrong gear, particularly when parking. Toyota has come up with two new systems to help reduce the consequences when this happens.

The Intelligent Clearance Sonar is able to detect obsta-cles that are outside the driver’s

line of sight and will automati-cally apply the brakes if there is a risk of a collision. Designed to be useful when negotiating a car park, it will sound an alarm, reduce engine power and apply the brakes.

Drive-Start Control recog-nises if the wrong gear has been selected when the driver is apply-ing the throttle. It will flash up a warning and reduce engine out-put to limit a sudden start or acceleration.

This can help, for example,

when a driver reacts to hitting an object while reversing by mak-ing a quick shift to a forward gear while still pressing the accelera-tor pedal.

Toyota is set to introduce both systems in future vehicles. The company has further developed its Pre-Crash Safety (PCS) sys-tem with a collision avoidance function that can help reduce the consequences of rear-end impacts, even at high speeds. This version of PCS - a technolo-gy already featured on a number of Toyota and Lexus models - uses a millimetre-wave radar to monitor the risk of collision with a vehicle ahead. If it detects an impact risk, it triggers an alarm and warning display to alert the driver to apply the brakes. When the brake pedal is pressed, the system will increase the braking force to up to twice the average

Toyota readies new technology for safer driving

level achieved by drivers. This can slow the vehicle down by up to 37mph (60km/h). If the driver fails to step on the brakes, the system will automatically deliver deceleration of between nine and 19mph.

Toyota’s analysis of traffic accident data shows that more than 90 per cent of rear-end collisions happen when the difference in speed between two vehicles is within 37mph, so it set out to engineer a system based on this intelligence to deliver industry-leading safety performance. Already, the technology is being prepared for use in forthcoming models.

The company has opened a new prov-ing ground to test and evaluate its Intelligent Transport System technology. The site extends over 3.5 hectares at the Higashi-Fuji Technical Centre, creating a simulated city centre road system, complete with traffic signals.

It will allow Toyota to test a system for road-to-vehicle communications using a 700Mhz radio frequency in controlled but authentic traffic conditions. This transmission band has been approved by the Japanese government for ITS use, as it has the right reception breadth and quality to be suitable for connecting with vehicles at junctions and other locations where a driver’s view may be limited.

When the proving ground is fully opera-tional, Toyota will accelerate its research and development of environmental systems to improve fuel efficiency and driver support sys-tems that can help reduce the risk of accidents with pedestrians and other road users in urban traffic. The company is also undertaking R&D of systems that allow for a continuous exchange of road-to-vehicle, vehicle-to-vehicle and pedes-trian-to-vehicle information.

Toyota’s analysis of traffic accident data shows that more

than 90 per cent of rear-end collisions happen when the

difference in speed between two vehicles is within 37mph, so it set out to engineer a system based on this intelligence to deliver industry-

leading safety performance

Auto Monitor

G L O B A L W A T C H3826 NOVEMBER 2012

Mazda has revised its MX-5 sportscar line-up by intro-ducing upgraded

models with a fresh front-end, that the company says has pedes-trian-friendly bonnet, satellite navigation system, side airbags, climate control air-conditioning and a better driving experience.

The new seven-strong range of upgraded Mazda MX-5 sports-cars, which introduces the 2.0-litre MX-5 Sport Tech Nav models, with integrated satel-lite navigation as standard – first time on the MX-5 range, goes on sale in the UK from 1 December priced from £18,495 to £23,595 on-the road (OTR). For six years in a row the Mazda MX-5 has been voted ‘Best Roadster’ by Auto Express magazine.

“W hen developing the upgraded Mazda MX-5, Mazda’s designers were determined to

make the revised roadster even better looking and even more fun to drive. An aggressive new front grille and new bumper design with a bold chin spoiler creates a deeper and wider look

that also improves aerodynamics by reducing drag around the fog lamp and over the front tyres,” comments Peter Allibon, Sales Director, Mazda UK.

As well as giving upgraded Mazda MX-5 a fresh appearance, the new front-end design simul-taneously improves pedestrian

safety. Keeping ahead of tougher EU regulations, the MX-5 is the first Mazda to get the company’s newly-developed active bon-net system. If a collision with a pedestrian is detected, the trail-ing edge of the bonnet instantly ‘pops-up’ to increase the crum-ple zone between the bonnet and

engine, reducing the severity of pedestrian injuries.

Every upgraded Mazda MX-5 continues to offer the Japanese marque’s unique ‘Jinba Ittai’ handling finesse with a rear-wheel drive chassis that delivers perfectly balanced handling and pure driving exhilaration. Now,

MX-5 is the first Mazda to get the newly-developed

active bonnet system. If a collision with a

pedestrian is detected, the trailing edge of the bonnet instantly ‘pops-

up’ to increase the crumple zone between

the bonnet and engine, reducing the severity of pedestrian

injuries

Upgraded Mazda MX-5 on sale from December

the six manual transmission models feature a modified throttle to improve responsiveness and give more linear, nimble acceleration, espe-cially when manoeuvring out of corners. At the same time, Mazda engineers optimised the vacuum brake booster to improve brake return control and thus front-rear load distribution, particularly when braking into bends.

“The Mazda MX-5 enjoys incredible popu-larity in Britain and now the ‘Upgraded’ range offers an even more rewarding sportscar own-ership experience, while remaining unrivalled as an exhilarating drive that can also be used everyday. Together with its affordability, low running costs, enviable reliability, as con-firmed by the 2012 What Car? magazine annual reliability survey, great residual values and our current low-rate finance offers, the Mazda MX-5 is a thoroughly modern sportscar that peo-ple can buy with their heart and their head,” adds Allibon.

The upgraded Mazda MX-5 benefits from enhanced equipment with climate control air-conditioning and glossy dark grey dashboard panel and steering wheel inserts on every model. The Sport Tech and PowerShift models also get an auto-dimming interior mirror, while Sport Tech models also boast an alloy pedal set.

The Sport Tech Nav model features a TomTom satellite-navigation system with a fully inte-grated 5.8-inch touch screen monitor, 4GB SD card based map (45 countries), Live Services, iPod and Bluetooth® connectivity, and com-plete multi-media functionality.

The new range also gets a refreshed pal-ette of colours that include Sparkling Black Mica, Dolphin Grey Mica and Crystal White Pearlescent. Also available is the popular True Red Solid, Aluminium Silver Metallic, Copper Red Mica and Stormy Blue Mica.

The MX-5 will be offered with a choice of three powertrains, all fine-tuned to maximise thrills and minimise fuel consumption – the 126ps 1.8i MZR with a five-speed gearbox, and the 160ps 2.0i MZR with a smooth-shifting six-speed manual transmission or ‘PowerShift‘ six-speed sequential paddle-shift transmission that allows manual control or a fully automatic mode.

Auto Monitor

G L O B A L W A T C H4026 NOVEMBER 2012

BMW Group Academy UK hosted a visit by students and teach-ers as part of Discover

Automotive Retail, an automo-tive industry scheme that will see young people given the chance to experience the diverse range of apprenticeships availa-ble in the UK’s automotive retail sector. Launched this month, the initiative is being co-ordi-nated by the Society of Motor Manufacturers (SMMT) in part-nership with the Retail Motor Industry Federation (RMIF) and the industry’s Sector Skills Council - the Institute of the Motor Industry (IMI).

Deeper InsightStudents and teachers from

schools across the Thames Valley were given the chance to meet current apprentices and see first-hand the broad range of career opportunities the BMW, MINI and BMW Motorrad dealer networks have to offer, as well as gaining a deeper insight into the

national BMW Apprenticeship Programme at the Academy.

“Recruitment and retention of skilled people are critical issues facing the retail auto-motive sector. By providing an industry-leading apprenticeship programme we are confident that we can address this issue and ensure our dealers can con-tinue to deliver the highest levels of customer service. At a time when school leavers face a chal-lenging employment landscape, apprenticeships in the automo-tive industry offer a wide variety of exciting opportunities,” man-aging director of BMW Group UK Tim Abbott,.

WorkshopsDuring their visit to the

Academy, the students and teachers were briefed on a selec-tion of courses which run over a two or three-year period. They met current and former appren-tices and while touring some of the Academy’s 32 workshops and 22 classrooms, got some hands-

on experience of the type of work undertaken on the courses.

This year 110 appren-tices have joined the BMW Apprenticeship Programme. Around 600 dealer apprentices have been trained at the BMW Group Academy UK over the past five years in Service, Parts, Motorcycles and Body and Paint programmes and reten-tion rates are among the best in the automotive sector rang-ing from 94 per cent in 2009 to 100 per cent in 2012. The BMW Group’s UK dealer network has invested around £6 million in training apprentices since 2007 and delivers 7,000 training days per year at the Academy.

Career OpportunitiesDiscover Automotive Retail

builds on the success of the Government-supported See Inside Manufacturing initiative which underlines the impor-tance of the automotive industry to the UK economy and the range of exciting career opportunities

it offers in the automotive manu-facturing sector.

In 2011, the BMW Group sold about 1.67 million cars and more than 113,000 motorcycles world-wide. The profit before tax for

the financial year 2011 was euro 7.38 billion on revenues amount-ing to euro 68.82 billion. At 31 December 2011, the BMW Group had a workforce of approximate-ly 100,000 employees.

BMW Group Academy UK helps students, teachers discover automotive retail

The overall European new car market continues to fall in 2012 but at a slow-er rate, according to the latest analysis from JATO Dynamics.

The European new car market declined by 4.6 percent in October. The UK recorded the larg-est rise in sales out of the ‘Big Five’, with sales up 12.1 percent in October and 5 percent Year-to-Date, Germany also saw a 0.5 percent increase in sales last month. Continuing low consumer con-fidence and high unemployment compounded by the recent increase in VAT have contributed to the continuous decline in The Netherlands.

Among the top ten brands, only Audi and Mercedes recorded a sales increase in October while Peugeot’s new 208 climbed into the top three behind Volkswagen’s Golf and Ford’s Fiesta. Volkswagen’s Golf continues to lead the European new car market in October, as it tran-sitions to the 7th generation model.

Audi, up 9.8 percent in October and 5.5 per-cent YtD, and Mercedes-Benz, up 3.7 percent in October and one percent YtD, are the only brands in the top 10 recording increasing sales. Just outside the top 10 sales of Toyota, Hyundai, Kia and Volvo cars are also growing.

Unpredictable Market ScenarioThe new Peugeot 208 is proving popular

with customers across the region, selling in greater numbers than its predecessor, the 207, did a year ago, despite tougher market condi-tions. Meanwhile the new Fiat Panda is defying market trends in Italy, leading to a 23.9 percent increase in sales in Europe in October. Sales of the Fiat 500, while outside the Top 10, also rose in October, by 15.4 percent.

The Nissan Qashqai continues to prove that older models can still post strong sales given the right marketing and product improvements, with volumes in October 15.7 percent higher than a year ago, and a place in the top 10.

Outside the top ten it was mostly new or recently revised models, such as the BMW 3-Series, Toyota Yaris, Mercedes-Benz B-Class, Volkswagen Tiguan, Volkswagen Up and BMW 1-Series that saw improved sales compared to October 2011.

“The rising sales in Great Britain and Germany show some signs of hope for the European car industry, but the industry must not be complacent. Market conditions are still tough, particularly in southern Europe and the Golf’s dominance remains evident for its com-petitors,” said Vice President, Research at JATO, Gareth Hession.

New vehicle sales in Europe continues to decline: JATO

Auto Monitor

G L O B A L W A T C H4226 NOVEMBER 2012

Jaguar Land Rover and Chery Automobile Company Ltd recently laid the founda-tion stone for their new

manufacturing facility in China. The partners are looking to accelerate plans to build a joint venture manufacturing plant in Changshu, near Shanghai, as part of a 10.9bn RMB invest-ment that will also include a new research and development centre and engine production facility. The project includes the crea-tion of a new partnership brand to assemble models tailored spe-cifically for the Chinese market, including the marketing and distribution.

The two companies recently received formal approval from the Chinese Government for their joint venture and now have a licence to manufacture Jaguar Land Rover vehicles and new models for a partnership brand in China.

“We are delighted to have reached t his mi lestone, achieved thanks to the under-standing and foresight of the Chinese authorities and we want to thank them for rec-ognising the potential of our joint venture in the fast-grow-ing Chinese market. Together, we will now begin working in close collaboration on our part-nership plans to harness the capabilities of our respective companies, to produce relevant, advanced models for Chinese consumers,” said Jaguar Land Rover Chief Executive Officer, Dr Ralf Speth and Chairman and Chief Executive Officer of Chery Automobile Company Ltd, Yin Tongyao in a joint statement.

The equal partnership will be called - Chery Jaguar Land Rover Automotive Company Ltd. In addition to established vehi-cles, the partnership will also produce models for a domes-

tic brand tailored specifically to local customer demand. The two companies plan to com-plete the Changshu facility in Jiangsu province during 2014. Construction of a new engine plant for production of fuel effi-cient engines is also part of the JV partnership agreement.

The confidence of Chery’s partnership with Jaguar Land Rover follows rapid expansion of the Jaguar and Land Rover brands in China, where sales rose 80 per cent in the first 10 months to October 2012. In the 2011 cal-endar year, Jaguar Land Rover saw sales increase more than 60 per cent, driven mainly by the Jaguar XJ and XF models, and strong demand for the fuel-effi-cient Range Rover Evoque.

Chery, the largest Chinese car exporter and one of the coun-try’s most productive automotive manufacturers, has 15 years’ experience in the automobile

industry. The partnership with Jaguar Land Rover signals the start of international expansion and strategic development for Chery Automobile.

Chery Automobile Co. Ltd was founded in January 1997. The com-pany is headquartered in Wuhu, Anhui Province, China. It is also China’s largest vehicle export-er to markets over 60 countries. Its products include passenger cars, SUVs as well as engines and transmissions. In 2011, it record-ed sales of 643,000 units, ranked No. 6 among the passenger vehicle manufacturers in China.

JLR, a wholly-owned subsidi-ary of Tata Motors, is the largest manufacturer of premium vehi-cles in the UK. The company, with a global workforce of around 25,000 employees, sells vehicles in more than 170 coun-tries. The UK, North America and China are its largest mar-kets. In 2005, sales in China accounted for 1 percent of com-bined Jaguar and Land Rover sales. It is now one of Jaguar Land Rover’s main markets and is still growing; sales increased by 80 percent during the year to October 2012.

Jaguar Land Rover will unveil three new luxury models in the US at the 2012 Los Angeles International Automobile Show in late November this year.

“This year’s Los Angeles Auto show is one of the most significant US shows in years for Jaguar Land Rover as we introduce three break-through new products,” said Jaguar Land Rover North America President, Andy Goss. “ The new Jaguar F-TYPE, Jaguar XFR-S and all new Range Rover will all make a major impact, specifically in the United States, which will be the world’s largest market for all three vehicles.”

Making its global debut at the show will be the XFR-S model, the fastest and most power-ful saloon Jaguar has ever produced. This is the second model in the ultra-high performance R-S range and builds on the already acclaimed XFR.

Making its US Auto Show Debut in Los Angeles is the all-new 2013 Range Rover. The world’s first SUV with a lightweight all-alu-minium body, the new Range Rover takes the capabilities of the marque’s flagship to a new level, with greater luxury and refinement. The US specification vehicle with the naturally-aspirated 5.0-litre V8 will be approximately 380kgs lighter than the outgoing equivalent. This new aluminium platform delivers signifi-cant enhancements in performance and agility, along with an improvement in fuel economy and reduction in CO2 emissions. The new Range Rover goes on sale in December, 2012.

Two-seat soft-top convertible sports car built on a front-engine, lightweight alumini-um architecture with rear-wheel drive, Jaguar has engineered the F-TYPE to be a true high-performance sports car. The Jaguar F-TYPE combines low vehicle weight, high power and superb aerodynamics to achieve a pure sports car experience, yet with Jaguar elegance and luxury. It goes on sale in early 2013.

JLR displays new products at Los Angeles International Auto Show

JLR, Chery JV to manufacture China specific, existing model line-up

Auto Monitor

G L O B A L W A T C H4426 NOVEMBER 2012

The Volkswagen Group achieved a 10.2 percent increase in worldwide deliveries from January

to October 2012, handing over 7.5 million vehicles to customers. The Group recorded 14.6 percent rise for the month of October, delivering 788,700 units. “The Volkswagen Group developed very well in October. We again put in a strong performance in North America, China and also Russia. However, market uncer-tainty continues, particularly in Western Europe,” Volkswagen Group Board Member for Sales, Christian Klingler said.

Deliveries on the American continent continued to develop well with the number of vehi-cles handed over in the North America region from January to October growing 25.4 percent to 681,200 (543,000) units, of which 481,100 (360,400; +33.5 percent) were delivered in the United States. The Volkswagen Group handed over 842,200 (777,200; +8.4 percent) vehicles in South America during the same peri-od, of which 644,000 (586,900; +9.7 percent) were delivered to

Brazilian customers.The Group also recorded very

satisfactory figures in the Asia-Pacific region, where 2.56 (2.15; +19.0 percent) million vehicles were delivered to customers in the period to October, of which 2.26 (1.89; +19.6 percent) million units were delivered in China. In India, deliveries grew 3.6 percent to 94,900 (91,700) vehicles.

Group brands delivered 3.10 (3.07; +0.9 percent) million vehi-cles on the overall European market from January to October. As a result of the continued dif-ficult market situation, Europe’s largest automaker handed over 1.57 (1.67; -5.8 percent) million vehicles to customers in Western Europe (excluding Germany). In the home market of Germany, the company grew deliveries to 994,500 (960,800; +3.5 percent). The Volkswagen Group contin-ued to achieve growth in Central and Eastern Europe, where 534,600 (441,500; +21.1 per-cent) vehicles were handed over to customers, of which 262,200 (178,700; +46.7 percent) were delivered in Russia, the region’s largest single market.

Mazda is relaunching its Approved Used Car (AUC) scheme to offer customers a

choice of three additional forms of cover to complement the origi-nal 12 months warranty package. When purchasing a Mazda Approved Used Car, customers can now select from warranty & roadside assistance, warranty & MOT protection or warranty &

key cover (for damage to or loss of keys) - free of charge - as part of the enhanced scheme.

Developed with its partner Allianz Global Assistance, the new programme brings fresh innovations to the Japanese man-ufacturer’s nationwide Approved Used Car scheme, and goes beyond the traditional benefits of most other used car schemes.

“Allianz Global Assistance’s focus on inno-vation ensures that Mazda’s AUC offering remains fresh and competi-tive, bringing our customers the ultimate in value and choice,” said Used Car & Fleet Marketing Manager, Mazda UK, Michael Stewart. “Our partnership with Allianz

Global Assistance is essential to setting us apart from the compe-tition, giving us an advantage in a tough marketplace.”

In addition to the new three-way choice of extra cover, Mazda’s Approved Used Car programme promises buyers complete peace of mind with features that include: techni-cal inspection, vehicle history and mileage check, 12 months unlimited mileage protection against breakdown and repair, 12 months Pan-European roadside assistance, ‘one-call’ accident and theft assistance, use of a replacement vehicle, a 30-day exchange scheme and the promise that all repairs will be conducted by Mazda-trained technicians using only genuine Mazda parts.

Mazda and Allianz Global Assistance have been working together over the last 12 years and these latest developments mark the partnership’s on-going commitment to developing cut-ting edge services that deliver genuine customer benefits.

Michael Cole, Managing Director of Kia Motors (UK) Ltd has been appointed as the Chief Operating Officer at Kia Motors Europe,

based in Frankfurt, Germany, with effect from 19 November.

Cole has been at Kia in the UK since August 2009 and has led the wholly-owned subsidiary to record sales - the company broke its existing sales record from 2010 during October, when it reached a total for the year so far of 57,736 vehi-cles, and is expected to achieve a sales total in excess of 65,000 units this year.

The former Toyota executive will lead the further growth of the Kia brand throughout Europe alongside President Brandon Yea and takes up the role relinquished by Paul Philpott who returned to the UK operation in July this year as the first non-Korean President at any Kia subsidiary in Europe. In the new role he will be responsible for all of Kia’s pan-European opera-tions including sales, marketing and aftersales as well as managing relations with the compa-ny’s manufacturing facility in Žilina, Slovakia.

Cole said: “I have enjoyed a remarkable three years with a great team here at Kia in the UK and I am excited by the prospect of working to con-tinue the strengthening of the Kia brand right across Europe. With a European production facility in Žilina, Slovakia, a European design office and European-focused research and development facilities I believe Kia has a great future amongst value-demanding European consumers who also want the very highest quality and distinctive design and appeal.

Cole, 48, is married with two children and joined Kia after 15 years with Toyota in the UK, where he rose to become UK Sales Director. He achieved a Diploma in Accountancy at Oxford Brookes University and qualified as a Fellow of the Chartered Association of Certified Accountants during his 10 years in the Ford dealer network.

Michael Cole takes over as COO at Kia Motors Europe

VW delivers seven million vehicles up to October

New customer benefits with Mazda’s used car scheme

Auto Monitor

C L A S S I F I E D S 4726 NOVEMBER 2012

Tej Control Systems Pvt LtdPlot No.329/331, Road No.25,

Wagle Industrial Estate, Thane(W) - 400 604. Tel. +91 22 2583 8191 to 98, Fax: +91 22 25838199Email: [email protected], [email protected]

Website: www.tejivs.com

The leading source for automotive parts, components & accessories.

Auto Monitor

4826 NOVEMBER 2012

A D V E R T I S E R S ’ L I S T

Our consistent advertisersFIC : Front Inside Cover BIC : Back Inside Cover BC: Back cover

Advertiser’s Name & Contact Details Pg No Advertiser’s Name & Contact Details Pg No Advertiser’s Name & Contact Details Pg No

ACE Micromatic Group 1, BC

T: +91-80-40200555

E: [email protected]

W: www.acemicromatic.net

Advantech India 31

T: +91-80-23374567

E: [email protected]

W: www.advantech.in

Auroral Sinter Metals Co., Ltd. 46

T: +886-37-542-988

E: [email protected]

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Automach 2013 44

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Automotive Dealership Excellance Awards 46

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W: www.adea.in

Carl Zeiss India (Bangalore) Pvt Lt 15

T: +91-80-43438102

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Delux Bearings Ltd 12

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Dhoot Transmission Pvt Ltd 13

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Ecocat India Pvt Ltd 41

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Electromech Material Handling Sys P 10

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Ferromatik Milacron India Pvt Ltd 25

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Fiem Industries Ltd 20

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Fox Solutions 5

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G W Precision Tools India Pvt Ltd 14

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Godrej & Boyce Mfg. Co. Ltd. 24

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Guhring India Private Limited BIC

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Kalsi Automotive Pvt Ltd 36

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Komet Precision Tool India Pvt Ltd 37

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Larsen & Toubro Limited FIC

T: +91-09967800456

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Mahindra Navistar Automotives Ltd 26

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Makino Auto Industries Pvt Ltd 43

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E: [email protected]

W: www.makino.in

Meiban Engineering Technologies Pvt 11

T: +91-80-26860600

E: [email protected]

W: www.meibanengg.com

Minimatic Machines 46

T: +91-2827-287918

E: [email protected]

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Mipox Abrasive India Pvt. Ltd. 18

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MMC Hardmetal India Pvt Ltd 39

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W: www.mitsubishicarbide.com

Molex Incorporated 21

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Napino Auto & Electronics Ltd. 47

T: +91-124-2290050

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W: www.napino.com

Onassios Auto Limited 29

T: +91-124-4399600

E: [email protected]

W: www.onassiosauto.com

Patvin Engineering (P) Ltd 28

T: +91-22-27780310

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W: www.patvin.co.in

Phoenix Contact India Pvt Ltd 22, 35

T: +91-11-30262700

E: [email protected]

W: www.phoenixcontact.co.in

Productivity Buzz 40

T: +91-80-66246600

E: [email protected]

W: www.imtma.in

Rohan Standox Autolack 34

T: +91-22-65803331

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W: www.spraytec.net

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Sandvik Coromant India 3

T: +91-20-27104725

E: [email protected]

W: www.sandvik.coromant.com/in

Sushma Industries 23

T: +91-80-28397463

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Tata Motors Ltd. 7

T: +91-22-66586195

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TRUMPF India 17

T: +91-9823745435

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E: [email protected]

W: www.tvstyres.com

Ultima Media Ltd 30

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Varroc Engineering Pvt Ltd 45

T: +91-240-2556227

E: [email protected]

W: www.varrocgroup.com

Windsor Machines Limited 32

T: +91-79-25841591

E: [email protected]

W: www.windsormachines.com

World Courier India Pvt Ltd 8

T: +91-80-43438607

E: [email protected]

W: www.worldcourier.com

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