PKC Group plans to tap CV, locomotive market in India
The Finland-based PKC Group, a leading global supplier of electrical distribution systems and electronics for the transportation and industrial sectors, is planning to tap the market for its products in the commercial vehicle and locomotive segments in India. The Group operates in 2 business verticals, wiring systems and electronics. Its customers include the commercial vehicle OEMs like Daimler, MAN, Scania and others. It also supplies to locomotive manufacturers like Bombardier. According to Jyrki Keronen, President, APAC, the PKC Group, which posted a revenue of Euro 908 million in 2015, is keen to increase its revenue as well as reach in the Asia-Pacific region.
The Group employs 22,000 people the world over, 55% of them in the US alone, and the rest in Europe, South America and the Asia-Pacific region. In the less tapped Asia-Pacific market, including India, the focus would be on the commercial vehicle market, Sandeep Nigade, Business Development Director, India, PKC Wiring Systems, said.
“The PKC Group caters to trucks and buses, light commercial vehicles, construction equipment, agriculture and forestry equipment, and engines. A number-one supplier of wiring systems to commercial vehicles in the US, the Group would leverage its global relations for an Indian foray, which is being triggered also by the demand of its global customers,” he said.
For its India entry the PKC group is considering different options. It could be through a green field venture, through the acquisition of an existing business or a joint venture. The Group is said to be in discussion with some players in India for an inorganic entry. “We are evaluating all the routes and would come to a clear conclusion very soon,” Nigade said.
The PKC Group would invest initially Euro 20-30 million to set up a manufacturing facility in the next few years, to serve both the commercial vehicles and the locomotive markets, he said. Its plan is to offer the complete range of its products, mainly for the commercial vehicles. Investing 1% of its annual revenue on R&D, the
PKC Group hopes to achieve good growth in India.” We are looking at gaining 30% market share in the next 3 years, he said.”
The Group is looking at offering wiring harnesses, terminals, connectors and power distribution centres in India with good attention to the increasing need for technology, demand for mass customisation and stringent standards. “Factors like these result in complexity of the customer’s products and processes. This will translate into an opportunity for us. The PKC Group is well aware of the domain changes that are taking place in the commercial vehicle industry. The industry will need a partner as complexity in the wiring harness will increase due to the changes in emission norms”, Nigade said.
The manufacturing plants of the PKC Group spread across the Continents. The electrical distribution systems are produced in its plants in Brazil, China, Estonia, Lithuania, Mexico, Poland, Russia, and Serbia. They find use in commercial vehicles, in truck and bus engines in particular, and for power supply and data transfer. The Group’s plants in Germany and Mexico supply power switching and distribution systems and components, power distribution centres, connectors, routing and retention aids, and sensor wires to truck, bus, agriculture and construction equipment manufacturers. The manufacturing facility of the Group in Mexico offers also insulated and noninsulated wires, multi-conductor cables, and battery cables.
The PKC Group delivers 11 million parts for 50,000 trucks annually. The Group supplies for a typical commercial vehicle platform 810 routings, 2,650 harnesses and 5,200 active part numbers. The Group entered into a joint venture with Jiangsu Huakai Wire Harness Co. Ltd. (Huakai) last year. As part of the deal, Huakai transferred its business of developing and manufacturing electrical distribution systems for truck, construction vehicle and bus segments in China to the JV. Key customers of the JV include Foton (and Beijing Foton Daimler
Earlier this year, the PKC Group entered into an arrangement to acquire the wiring and controls business of Poland’s automotive seating manufacturer Groclin. The Groclin acquisition would also include its subsidiary Kabel-TechnikPolska (KTP) for Euro 50 million.
A major development during the last 2 years, apart from the 2 joint ventures, was the bagging of new business contracts amounting to Euro 30 million from 2 major global commercial vehicle manufacturers. Estimated to be effective by 2018, a major part of the development relates to the manufacture of high current fuse modules and associated EDS routing and retention shields for a light vehicle platform. This would provide economies of scale and strengthen the Group’s partnership with a key customer.
Automotive), Kinglong and Iveco. In 2014, Huakai posted a revenue of Euro 43 million.
Sandeep Nigade, Business Development Director, India, PKC Wiring Systems Oy.