Hosur-based company outlines aggressive growth plan
Tenneco has also been listed as a supplier to Mahindra & Mahindra’s soon-to-be launched mini-Xylo. Though the size or value of the orders weren’t disclosed, managing director Abhijit Mukherjee says that Tenneco is pumping in enough investments to be aggressive in India.
Mukherjee also confirms that Tenneco’s struts and shocks are part of the Tata Vista (including the recently launched face-lifted model), Manza and Nano, Mahindra’s Xylo, Maxximo and Genio, Toyota’s Etios and Liva hatchback, Ford’s Figo and new Fiesta as well as Chevrolet’s Spark.
The $6-billion global major is also investing $6-7 million for a rod plating facility inside its Hosur plant. The plant is set to become operational by the first quarter of 2012 and is expected to chrome-plate 20,000 rods in a day. “The facility is being constructed because we want better control over the quality and availability of rods. Currently, we are outsourcing this process and once we begin doing it in-house, there will be costs savings as well. We will still continue outsourcing part of this process as 20,000 rods a day will not be enough,” Mukherjee says. In the next two or three years, he expects the requirement to go up to 40,000 rods a day. New lines can be added at the chrome-plating facility depending on the volumes, he adds.
One key feature of this facility, says Ismail Kamal – plant head, is that it will use a chrome-plating technology that is the first of its kind in India. “We are adapting a technology from our plants in Europe. Dynachrome will make the chrome deposition more uniform and the process will also be eco-friendly in terms of its water usage,” he says. Asked if OEMs are welcoming this technology, he adds: “The OEMs know that this is a better technology and since there is no cost escalation for them, they have been very receptive.” The Hosur unit, which was initially a joint venture between Tenneco Automotive and Hydraulics Ltd was fully taken over by Tenneco in 2005. The company’s main unit in Hosur manufactures ride control units (struts and shock absorbers). The plant – with seven weld lines, five assembly lines and nine full assembly lines – has a capacity of 450,000 units a month. The other plants that manufacture ride control units are located in Bawal, Haryana and in Pondicherry. The Bawal facility solely concentrates on churning out struts and shock absorbers for Maruti and supplies systems for models such as the Ritz, the recently launched new Swift and the upcoming face-lifted Swift Dzire. “Our Pondicherry unit is not a full-fledged suspension systems manufacturing unit,” explains Mukherjee. “We manufacture some powder metal parts that we use in our Hosur plant. Even though the Pondicherry unit is mainly for powder metal parts, Tenneco has utilised it to manufacture some 90,000 struts and shocks per month.” The plant manufactures around 15 tonnes of powder metal every month.
Tenneco Automotive also makes exhaust control units in the form of catalytic converters at its 32,000 square feet facility in Pune, which is also used as a just-in-time facility for Tata Motors. Another plant to make exhaust converters is in Chennai. This one-year-old unit will serve Renault-Nissan and eventually Daimler India Commercial Vehicles.
“We also supply parts to Ford India from our Chennai unit and use it as an assembling unit specifically for Ford’s requirements,” reveals Mukherjee. There is also a new facility being built at Chakan, Maharashtra. “We have a small facility in near Pune but since that area is land-locked, we cannot expand there. The unit will be up and running by the first quarter of 2012," says Mukherjee.
The facility in Chakan will attract an investment of $5 million and will cater to Tenneco’s customers in western India including Volkswagen India, GM India and Mahindra & Mahindra. The VW Polo, Vento and the Skoda Fabia use suspension units made by Tenneco. “Globally, we are suppliers to Audi worldwide so if it starts full-fledged manufacturing in India, we might supply to them too,” Mukherjee adds.
In terms of technology, most of the work done by Tenneco’s R&D centre in Hosur revolves around adapting technologies developed by Tenneco’s hub in Europe to Indian conditions. “Likewise, we recently introduced Multi Tunable Valves (MTVs). These are valves which can be tuned easily and much quicker compared to contemporary units. Each shock absorber needs to be tuned for a particular platform and apart from the constrictions of dimension and rod size, the tuning is the variable,” explains Mukherjee. These MTVs have been fitted on to the Toyota Liva and new Ford Fiesta.
Developing a suspension system has its own challenges. Miller Selvakumar, head – engineering, says that a multitude of tests are conducted before finalising the ultimate product. “Based on the design specifications that OEMs give us, we conduct certain tests on dimensions and material tests. A prototype is then made and fitted in our ride test vehicle. Based on spring characteristics, the damper’s characteristics are finalised. Then, a lab validation is done. Various other tests like damping performance, frictional requirements, temperature characteristics, low/high speed durability, strength requirements and fatigue tests are done locally at Hosur.” But some tests are outsourced to either Tenneco’s European plants or Japanese plants.
“Recently, for the Liva, we had the suspension system tested in Europe at minus 30deg Celsius. Normally, nobody asks for this test but if any OEM does, we make it a point to conduct it,” he said. Another important test, Selvakumar adds, is the switch test which measures oil noise flow.
“Most cars in India use gas flow suspension units. When oil flow units are used, there is a needless increase in temperature which affects performance. No such problem is there in a gas flow system. We supply oil flow systems only to the Chevy Spark,” Selvakumar adds. He also says that Tenneco has been insisting on the MTVs and the recent good results on the Fiesta and Liva are working to its advantage when it comes to convincing other OEMs. “Even domestic customers like Tata and Mahindra are keen to try this out,” he quips. Speaking about a possible shift to electronic suspension units instead of the current mechanical units, Selvakumar says that only Suzuki has approached it once with such a request but costs have been an issue. “If any OEM wants an electronic suspension unit, we can source it from our European plants. Depending on the volume and business, we could even set up a facility here in India,” he says.
Two-wheelers in sight
Tenneco does not play a major role in the two-wheeler segment. But the acquisition of Marzocchi, an Italian firm that specialises in manufacturing shocks for two-wheelers, can change fortunes. Selvakumar says, “So far, we supply only to the Scooty Pep models. After we acquired Marzocchi in 2009, we have worked on adapting its technology for India and have recently submitted quotes to Honda, Hero MotoCorp and TVS.” The company is also in talks with Piaggio. Tenneco also supplies heavy duty axle dampers to Ashok Leyland. Tenneco globally had a turnover of around $6 billion in 2010-11 with 64 percent coming from emission control units and the rest from ride control units. USA and Europe account for 40 percent of the business and China, South America and India account for 20 percent.
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