CORPORATE
Meritor expands production facility and sets up an R&D centre at Mysuru.
Meritor expansion andR&D centre
Schaeffler REPXPERT
Looking beyond the slowdown weighing upon the auto sector in India, Meritor Inc is invested in growth. The company has recently commissioned a new USD 36.5 million (Rs.250 million approximately) axle assembly facility at ‘Automotive Axles’, a joint venture arrangement with the
USD 25 million Kalyani Group, at Mysuru. Apart from the production facility expansion, the company has also set up a new Research and Development (R&D) centre expected to help the company in better serving the customers. Said to expand Meritor India’s production capacity by 25 per cent, the axle assembly facility is expected to equip the company to better serve customers in the commercial vehicle, off-highway and defense sectors. Together with the R&D centre, the new additions took 18 months to complete. For Meritor Inc., the two initiatives mark a significant step forward given its M 2022 strategic plan.
Confident that the two (axle assembly facility and R&D centre) will contribute to the M 2022 strategic plan, which is about protecting and growing market-leading positions with best-in-class products and services, Meritor Inc. is looking at a considerable uptake in its activities in India. While Automotive Axles, which produces drive and non-drive axles, front steer axles, specialty and defense axles as well as drum and disc brakes, is one company that it operates in association with the Kalyani Group, there is another entity in association with the Kalyani Group, called Meritor Heavy Vehicle Systems (India) Ltd., which manufactures drivetrain solutions for heavy commercial, military and off-highway applications. Expressed Jay Craig, CEO, and President, Meritor, that the two ventures are strong assets that the company has invested in, and will ensure better positioning from a future growth perspective in the region.
Keen to leverage the strong partnership with the Kalyani Group and its ability to generate significant revenue, Meritor is looking at the new facility and the R&D centre to fuel the M 2022 strategic plan in terms of revenue, profitability, manufacturing excellence, and customer satisfaction. To focus on end-to-end testing and validation of domestic and global products of the company, Meritor is looking at serving its customers well. It is looking at responding faster and with better solutions to offers. Doing this, it is confident, will help it to retain the edge that it has gathered. Said Craig, “We lead in the development of market-leading products that differentiate themselves over others. Our global business is growing, and the new initiatives that we have taken in India will support our strategic plan of protecting and growing our positions with bestin-class products and services.” Increasing the independence of the Indian operations to be able to respond to market changes quickly, the R&D centre at Mysuru will test products for both the Indian as well as the company’s global customer universe. Craig further drew attention to the 13x axle of the company. He mentioned that the company is looking at the Indian operations to contribute handsomely to the growth of Meritor the world over. “This axle,” he added, “is made in India and is popular in global markets including the USA.”
Strengthening capabilities
Stating that they are having a solid long-term plan in place, Thimmaiah Napanda, Vice President and Managing Director, India and Australia, Meritor, averred that the two initiatives have enhanced our ability to support customers. Deriving from its long 100 years old legacy, and about providing innovative products that offer superior performance, efficiency, and reliability, Meritor is looking at a healthy business mix in India where both the new and the traditional products are doing well. It was some two years ago that the company introduced the slippertype suspension range for heavy CVs in India. For its induction in the market, the company is working with leading CV manufacturers in India. Expanding to markets like
Sri Lanka, Bangladesh, and Nepal, Meritor is keen to increase its reach in the South East Asian markets. With manufacturing facilities at Jamshedpur, Hosur, and Pantnagar, apart from Mysuru, Meritor has been operating engineering centres at Bengaluru and Mysuru. It has been operating an aftermarket distribution centre at Pune. Looking at a strong growth momentum through customer focus and product innovation, Meritor, which completed its acquisition of AxleTech from global investment firm, The Carlyle Group, recently, is keen to expand its product offering in India in the wake of the changing market dimensions and requirements. Earning Paccar’s 2018 10 PPM Quality Award for meeting or exceeding the rigorous standard of 10 or fewer defective parts for every onemillion parts shipped to the OEM, the US-based company is looking at a sizeable uptake in its operations in India as it changes in its form and function; gathers new capabilities and an ability to serve other markets.
Stating that the new R&D centre will empower the design and development of products that meet the needs of the customers, Baba Kalyani, Chairman of Automotive Axles, and Chairman of Kalyani Group, said that they are determined to deliver the best. “Our philosophy of strong and continued customer focus, innovation in products and processes and determination to deliver the best to customers have been key to our success.” Averred Thimmaiah, “Other than enhancing our customer focus, the new initiatives will enhance our ability to cater to international markets.” Meritor exports products to China, Brazil, USA, and Europe. It does sub-system exports as well as end-customer exports. It also does direct export to OEMs. As a tier-one company that makes sub-systems and aggregates for OEMs, Meritor in India is looking at expanding its footprint to new regions. It is looking at a considerable uptake in the aftermarket space by expanding its reach in regions like Jammu & Kashmir. Of the opinion that the nature of CVs in such regions would differ from that of others due to the terrain and weather (4x4 and 6x6), Kalyani explained that they have the requisite products to address such requirements. It is only that the OEMs should ask for them.
qOf the firm opinion that electric vehicles will not exceed 10 per cent of all the vehicles, Baba Kalyani averred that the R&D centre at Mysuru – the Meritor Technology Centre, would enable the company to offer end-to-end testing and validation for different technologies and products. Drawing attention towards the world-class testing and validation equipment and capabilities, which are at par with Meritor’s global technology centre in the US, Graig said, “Most global forecasting agencies are anticipating 10 per cent battery-run electric vehicles by 2024.” “More than half of them will be in China because they are already leading in certain categories for applications such as transit buses,” he added. In China, around 60 per cent of the total transit bus production is fully electric. Outside of China, this number drops significantly. With an eye on the electric vehicle market, Meritor is developing an axle. It is at the prototype level currently. The company informed a source, is in the process of launching prototypes programmes with many OEMs.
With an ambition to be the market leader in the electrified drivetrain, Meritor is keeping a tab on viability. It wants to offer economically viable solutions. This, it is confident, will enable it to be the leader in the category. Revealed Craig, that there are two major factors. “One is cost and the other is the regulatory norms,” he said. Stating that globally many companies are working to reduce the cost of the batteries, Craig explained that their journey to the leadership position hinges on the ability to control costs and meet the regulatory norms. If the new R&D centre at Mysuru will contribute along with the manufacturing operations, Craig preferred not to divulge details. He instead chose to explain how the company was tapping into its global network to develop new solutions in a bid to stay ahead of the curve. Revealing that the new facility is fully automated, and is Industry 4.0 enabled, Thimmaiah averred, “it is made for higher automation and accuracy.” Investing in upskilling of the manpower as they take to modern machines and technologies, Meritor is looking at upping the operational efficiency at various levels. It is looking at operations where 10 skilled workers will be replaced by one highly skilled worker who will sit back and monitor the entire system.