24/10/2017
PUNE: Schaeffler
India, which is now in the process of merging its two entities, INA Bearings
and Luk India, with itself is drawing up major expansion plan to seize the
emerging business opportunities.
The Indian arm of Germany’s automotive and industrial parts
maker is planning to invest Rs. 250-300 crore per annum over the next two years. “We will
invest this from next calendar year. This will be made in product, capacity and
R&D expansion programmes. These will be only brownfield expansions,” said Dharmesh
Arora, MD, Schaeffler India (formerly FAG Bearings India Ltd) The company will
commence work for second plant at Pune site (INA Bearings’ unit) by December
this year as the current capacity is full. Capacity expansion plans for other
units are being finalised.
The combined entity Schaeffler India offers a full range of
solutions in engine, transmission and chassis segments for automotive
applications. In bearings segment, its range will expand to include needle
roller bearings, linear roller bearings and precision spindle bearings.
The company, which will have total revenues in excess of Rs. 3600
crore with a staff strength of 3000 and four plants, will have about 53 per
cent of revenues in automotive segment and 47 per cent in industrial category,
said Arora.
He expects group’s automotive business to grow faster than
industrial segment in the near term in view of new emission standards and other
changing consumer behaviours in vehicle segment. “Due to change in emission norms, powertrains are being
upgraded by all auto OEMs. There is a big opportunity for us here as the
products we produce will help make engines more efficient and reduce emissions.
Also, there are more opportunities in transmission automation,” said Arora. He
expects that by 2025, about 15 per cent of all cars to have automatic
transmissions.
Schaeffler, which has been present in India for more than 50
years, also sees bigger opportunities in buyer’s shift from A segment to B
segment cars. “The contents per vehicle will be more and it will provide us
good business,” he added.
On the industrial side, the business is stable and mature.
Segments such as railways, metro, steel, mining and construction where the
company has strong presence will continue to provide opportunities in view of
Central government’s infrastructure and manufacturing push.
Schaeffler Group believes
that under one strong Indian entity, there will be a diversified and high growth
product offering both in auto and industrial segments besides significant
revenue and cost synergy potential.
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