MAN In­dia as Asia hub looks up

MAN Trucks In­dia has re­it­er­ated its po­si­tion as the Asia hub for its prin­ci­pal, the MAN Group.

Commercial Vehicle - - WHAT'S INSIDE - Story by: Ashish Bha­tia

MAN Trucks In­dia has re­it­er­ated its po­si­tion as the Asia hub for its prin­ci­pal, the MAN Group.

Re­it­er­at­ing its po­si­tion as the Asia hub for the MAN Group, MAN Trucks In­dia is look­ing to con­trib­ute 10 per cent of MAN’s to­tal fac­tory out­put over the next three-to-four years. The strat­egy seems to be not so much about achiev­ing higher sales as much as it is about achiev­ing higher pro­duc­tion num­bers. The man­u­fac­tur­ing fa­cil­ity of MAN Trucks In­dia at Pitham­pur has the ca­pac­ity to man­u­fac­ture 9,000 to 10,000 Cargo Line Asia (CLA) range of trucks in the 16- to 49-tonne seg­ments, and front en­gine bus chas­sis mea­sur­ing 12 m in length. Though the name CLA may sug­gest flaunt­ing this that the trucks - are about Asia, they are in fact, ex­ported as CKD kits to a MAN joint ven­ture in Uzbek­istan; to South Africa, and to the neigh­bour­ing coun­tries. To achieve the 10 per cent tar­get, the com­pany is look­ing at in­vad­ing new African mar­kets, the Mid­dle East, and East Asian coun­tries like Malaysia, Philip­pines and In­done­sia. Ex­pressed Je­org Mom­mertz, Chair­man and Man­ag­ing Di­rec­tor, MAN Trucks In­dia, “The tar­get to con­trib­ute 10 per cent of MAN’s to­tal fac­tory out­put over the next three-to-four years will be in­clu­sive of the 50 per

cent ex­port vol­umes we wish to at­tain from In­dia.” Poised to play a piv­otal role in MAN’s global growth strat­egy, the only mar­ket the com­pany is not look­ing at is Rus­sia, which re­quires a op­er­at­ing guar­an­tee un­der ex­treme cli­matic con­di­tions like tem­per­a­ture as low as (-) 51 de­gree centi­grade.

CLA for Asia and be­yond

Plan­ning to widen the scope of Cargo Line Asia (CLA) trucks, which were ini­tially con­ceived for Asia, MAN Trucks In­dia is eye­ing the pre­mium seg­ment too. While the mid-pre­mium seg­ment, the pre­mium seg­ment could be in­vaded with global mod­els like the TGE, TGL and the new Lion. Ac­cord­ing to Mom­mertz, MAN Trucks In­dia is look­ing at the 300 hp mar­ket to de­liver a cer­tain pay­load and fuel ef­fi­ciency. “We want to at­tain the high­est pos­si­ble pay­load and best-in­class fuel econ­omy. It will help us to con­vince our cus­tomers in In­dia of a value for money propo­si­tion,” he men­tioned. Aware of GST in­flu­enc­ing a mar­ket shift to higher ton­nage CVs, Mom­mertz is keen to carve out a greater pie of the Medium and Heavy Com­mer­cial Ve­hi­cle (M&HCV) seg­ments. Both, at the mid-pre­mium and pre­mium level. Stress is upon lev­er­ag­ing the high level of lo­cal­i­sa­tion (of up to 82 per cent) the CVs made in In­dia have come to have. At 2015 Ex­con, the com­pany an­nounced the launch of the Evo range of CVs. They mark a CLA face-lift, and are pow­ered by the D08 en­gine fam­ily. Con­fi­dent of the In­dian prod­ucts re­flect­ing core MAN val­ues of, the MAN Trucks In­dia is up­dat­ing the (CLA) range to bet­ter ad­dress the mar­ket need.

A large chunk of MAN trucks in In­dia is tip­pers as of cur­rent. The higher hp en­gine helps. What is how­ever seem­ing to limit the com­pany’s abil­ity to set the sales charts on fire is the higher price po­si­tion­ing. If the higher price po­si­tion­ing is claimed to limit the play-abil­ity, the thrust of the gov­ern­ment to boost in­fra­struc­ture in In­dia may re­sult MAN Trucks In­dia to in­vade long-haul seg­ments. In In­dia, MAN also op­er­ates in the ODC seg­ment, and spe­cial ap­pli­ca­tion seg­ments like fire ten­ders, garbage com­pactors, con­crete mix­ers, boom pumps, tip-trail­ers and bulk­ers. Last year the com­pany sup­plied a fair num­ber of fire ten­ders and spe­cial ap­pli­ca­tion trucks to the Bri­han­mum­bai Mu­nic­i­pal Cor­po­ra­tion. The R&D cen­tre at Pune is said to help the com­pany to ad­dress such needs. Sell­ing over 25000 trucks till date, MAN Trucks In­dia has come to op­er­ate through a net­work of 64 deal­ers in In­dia, and a dealer each in Bangladesh, Nepal and Bhutan. Ac­cord­ing to Mom­mertz, there is a need to at­tain high qual­ity at com­pet­i­tive costs. De­scrib­ing MAN trucks as high-en­durance ma­chines, Mom­mertz stated, “Trucks sold in 2006 are still in op­er­a­tion in Kochi. They are a tes­ti­mony to the re­li­a­bil­ity of a MAN truck.” We have also had our trucks op­er­ate in sub zero de­gree tem­per­a­tures in In­dia, he men­tioned.

New tech­nolo­gies to in­crease mar­ket share

Of what is pro­duced at Pitham­pur, 40 per cent is ex­ported. This may trans­late into 35 per cent plant util­i­sa­tion Year-To-Date (YTD). The tar­get is

to achieve an out­put of 50,000 units per an­num through a grad­ual ramp up of 3 per cent to 3.5 per cent per year. Trac­tor trail­ers cur­rently con­sti­tute 60 per cent of the over­all busi­ness vol­ume. Their share is ex­pected to rise. Said Mom­mertz, that the regime will ma­te­ri­alise de­mand for long-haul trucks, which trans­lates into a 20 hour duty cy­cle, and 40 per cent higher round-trip ef­fi­ciency.

If the higher horse power and tougher build will make a strong busi­ness case for MAN Trucks In­dia, the talks with sup­pli­ers are pro­ceed­ing as ex­pected ac­cord­ing to Mom­mertz. They are ex­pected to re­sult in the com­pany of­fer­ing new tech­nolo­gies like AMT to its cus­tomers to achieve higher level of busi­ness ef­fi­ciency. The com­pany, said Mom­mertz, is look­ing at lo­cal­is­ing the CLA fire ten­ders. Hav­ing sup­plied them to Mum­bai, the com­pany is con­fi­dent of a good play.

Em­ploy­ing SCR tech­nol­ogy to meet BSIV emis­sion norms, MAN Trucks In­dia, fol­low­ing the Prod­uct Cost Op­ti­mi­sa­tion (PKO) process it has in­her­ited from its prin­ci­pal, is keen to meet the 10 per cent pro­duc­tion con­tri­bu­tion tar­get sooner than later. Hold­ing a key po­si­tion in MAN Group’s global growth en­deav­our, MAN Trucks In­dia, claimed in­dus­try sources, will cre­ate aware­ness about its prod­ucts. It can no longer be sat­is­fied with the amount of mar­ket share – do­mes­tic and ex­port, that it has. Stress­ing upon per­for­mance, pro­duc­tiv­ity and prof­itabil­ity, Mom­mertz said that the prod­ucts the com­pany will of­fer will guar­an­tee low to­tal cost of own­er­ship. Up-time im­prove­ments are be­ing worked upon by re­struc­tur­ing the sup­port net­work, he ex­plained. Of the opin­ion that hard­ware in­vest­ments and the life of a truck are a petty 15 per cent of the over­all op­er­a­tional costs, Mom­mertz said, “Trans­port busi­ness in In­dia is highly com­pet­i­tive. While the short-tomedium fo­cus ar­eas con­tinue to be truck-trac­tor and haulage, our long-term strat­egy en­tails a look at the sub-16 tonne seg­ment.” There is some time be­fore MAN Trucks In­dia for­mu­lates a strat­egy for this, it seems. If the strat­egy will strike a syn­ergy with Volk­swa­gen of which it is a part, or with Sca­nia, which is also a Volk­swa­gen Group com­pany, will be too early to be delved upon. Pro­cesses like com­mon sourc­ing are al­ready in place, and are ex­pected to profit MAN Trucks In­dia as it buck­les up to play a more de­ci­sive role in the scheme of things at MAN Group.

⇧ The Pitham­pur plant is set to play an im­por­tant role as the com­pany looks at con­tribut­ing 10 per cent of MAN’s to­tal fac­tory out­put.

⇩ Je­org Mom­mertz, Chair­man and Man­ag­ing Di­rec­tor, MAN Trucks In­dia.

⇨ Tip­pers may amount for a good chunk in In­dia, MAN is keen to tap on-high­way seg­ments on the ba­sis of reg­u­la­tory changes tak­ing place.

⇧ MAN Trucks In­dia is ex­pand­ing its dealer net­work.

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