PKC Group plans to tap CV, lo­co­mo­tive mar­ket in In­dia

Auto components India - - CORPORATE - Text: Bhushan Mhapralkar

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.

In­dia foray

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.

Global spread

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.

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