Shripad Shidore, Managing Director, Same Deutz-Fahr India

Why have you decided to make the Ranipet operations your global engine production hub? What are the advantages that this location offers?
SDF India is already making the Same brand engines in the Ranipet plant. We have upgraded the facility to cater to Euro-II and Euro-III engine manufacturing. We have a state-of-the-art machining, assembly and testing facility and trained manpower, which makes it natural for us to produce engines here in India. We are also located at a reasonable distance from Chennai as well as Bangalore. Chennai is also a convenient port for us for exports. Certainly, India does have a cost advantage in manufacturing.

You are expanding tractor and engine capacity substantially. What are the main reasons for this?
As you are aware, we have launched the ‘Deutz-Fahr’ brand of tractor recently. As such, we are known as manufacturers of tractors with the latest features and robust machines. By adding the Deutz-Fahr premium brand to our fold, we will further boost our sales in India. We already have good demand for our tractors in the export market. With the introduction of Same, Lamborghini and Deutz-Fahr on the latest platform in 2008, we have seen a robust demand for our tractors abroad. With the added advantage of Euro-II and Euro-III engines being produced in India now, we are expecting good growth in the demand for tractors. As regards engines, we have a very good opportunity for industrial engines, and genset engines in the country. Also, we can supply Same engines for various Group requirements worldwide.

What is the Indian unit’s contribution to overall global operations?
SDF India contributes around 10 percent of the total Group production in numbers and in terms of the turnover it is approximately four percent.

You have introduced the Deutz-Fahr Agrolux which has 85 percent local content. Who are your key component vendors for this model and by when do you plan to localise this tractor to 100 percent?
We have strategic vendor partners for our key components. For example, we have strategically sourced bonnets from a well known Indian vendor, where the latest LFI technology imported from Germany is deployed. As a strategy we have invested in the tooling ourselves and the technology is imported by the vendor. For machining critical components like cylinder blocks, gearboxes and cylinder heads, we have tied up with vendors who have the latest machines like machining centres. We support these vendors for technology as well as in particular cases, even for toolings. We also have prominent vendors for sheet metal in and around Chennai and Pune. In terms of localisation, we may reach up to 95 percent by 2009-10. However, we may not attain 100 percent localisation as it is easier and cost-effective to import certain components.