Auto Shell aims for export growth

The Coimbatore-based Auto Shell Perfect Moulder is in talks with about six Tier-1 companies in Europe, USA and Canada for supply of components. According to Krishnasamy Jeyabal, managing director, if the orders fructify during 2006-07, the company’s turnover (Rs 43 crore in 2005-06) will increase by 30 percent. Auto Shell has recently commenced supplies of rocker arm supports to John Deere plants in Mexico and France. At present, it ships 75,000 pieces per month and is hopeful of receiving orders from other John Deere facilities worldwide. At present, exports contribute around 30 percent to turnover.

The company is also keen to increase focus on the domestic market by getting into the manufacture of sub-assemblies by leveraging its group companies’ strengths in steel casting and CNC machining. Other than Auto Shell Perfect, the Auto Shell Group has Auto Shell Cast which produces steel, stainless steel and nickel-based alloy castings, and Auto Shell CNC Machine Shop that undertakes machining and assembly. The Group is now investing Rs 2 crore to augment Auto Shell Cast’s capacity from 200 to 300 tons per month. Meanwhile, the Group has drawn up a plan to reduce rejections by five percent every year, enhance employee productivity and reduce inventory. It has a two-pronged approach for reducing production cost — improving yield ratio and reducing hidden wastages. It is also working on reducing in-bound inventory. A year ago the inventory level was 15 days and now stands at less than 10 days. Internal rejections too have come down to less than four percent from over five percent earlier.

Another recent development is the introduction of 3D modeling, numerical cordinate generator and CNC machining. This helps the company reduce pattern-making time from over a month before to less than a week. The Group has also developed customised software — Foundry Management Information System (FMIS) — which integrates information on various foundry activities from purchase of raw material till shipment of finished products. Besides helping track the manufacturing process, it also helped reduce inventory substantially. There's also Statistical Process Control (SPC) and Measurement System Analysis (MSA) to control variation between operators in manufacturing as well as inspection.