NGK Spark Plugs India has announced plans to set up an additional assembly facility, spread across 11,000 square metres inside its Bawal plant, to increase its spark plug capacity and also tap upcoming market demand for oxygen sensors.
A wholly owned subsidiary of NGK Spark Plug Company of Japan and a leading supplier of spark plugs, glow plugs and oxygen sensors to many an Indian automobile OEM, NGK Spark Plugs India aims to tap the upcoming surge in demand for these products with the advent of BS VI emission norms in the country from 2020.
The company, which currently has an assembly set up in the Bawal industrial district of Haryana is going to invest 1.7 billion yen (Rs 97 crore) in the facility to double manufacturing capacity by 2018, which is currently pegged at a cumulative 1.5 to 2 million units a month, with spark plugs comprising 90 percent of these volumes.
Construction work for the new assembly unit will begin this month and is slated to get completed by October 2019. The Japanese spark plug major also aims to optimise its global production efficiency with this production capability enhancement at its India operations.
The group envisions India to be one of its key markets in its short-to-medium term growth plan and aims to aggressively strengthen its hold of the aftermarket business from having close to 25 percent market share at present, to 45-50 percent by 2020.
India, being the largest two-wheeler market in the world is set to witness close to 20 million motorcycles and scooters requiring oxygen sensors as they move over to use fuel-injection technology, with the mandate of the BS VI emission norms coming into force from 2020.
NGK Spark Plugs India closed FY2017 with revenues of Rs 300 crore, with major business coming from supply of spark plugs to Maruti Suzuki (400,000 units per month), Honda Motorcycle & Scooter India (600,000 units) and India Yamaha Motor (100,000 units).
The company, which apart from doubling spark plug volumes by 2018, will also tap into this huge opportunity of supplying oxygen sensors for two-wheelers, and is keeping its options open to make further investments as market demand grows.