2012 South India Special: Ucal bags Fiat business
Another focus for Ucal is the next-gen non-leaching pumps that draw less power from the engine.
In an interview to Autocar Professional, chairman and managing director Jayakar Krishnamurthy says, “As Hero and Honda are now separate players, getting the Hero business is our goal. At present, we already have 40 percent of the non-Hero business.”
Indeed, Ucal Fuel works with all the major players in the two-wheeler segment in India, apart from Honda which buys its requirements from the local arm of the Japanese supplier, Keihin. Ucal counts Bajaj, TVS, Yamaha and Suzuki as its key clients in the segment.
In the four-wheeler segment, the CMD says the company has developed its own vacuum and oil pumps for both petrol and diesel use. At present, the bulk of the demand is for diesel and the demand swing for diesel cars in the last 12 months has been a boon to Ucal’s business.
While Maruti, through its supplier, Suzuki Powertrain, and Hyundai are key customers, Ucal has now added Fiat to its portfolio and has bagged a contract to supply 20,000 vacuum pumps to Fiat Poland. The Fiat business is a key part of Ucal's aim to be a global player in vaccum pumps. It is also hoping to get business from General Motors.
These products, says Krishnamurthy, were developed in-house. Indeed, Ucal has always tapped its own R&D centre, set up a decade ago, to bring out products designed for the market for both two- and four- wheelers. This ensures that it does not have to depend on outside technology. The Centre has 100 engineers and hires about 30 new engineers every year.
Indeed about two years ago, Ucal Fuel had a tie-up with Mikuni of Japan which helped the company in its push for technology and played a role in bagging Maruti business. However, the Japanese player was not in the pumps sector, which had become an area of focus for Ucal. So the company bought out Mikuni’s stake of 26 percent in what was an amicable split. The split gave Ucal Fuel more freedom to focus on the pumps business for the four-wheeler sector.
Another focus for Ucal is the next-gen non-leaching pumps that draw less power from the engine. The product is generic in nature and can be used across engine families.
Fuel injection for two-wheelers A key area that is on Ucal’s radar is two-wheeler injection systems. “We have been working on it for a while and hope to have it ready in this year,” says Krishnamurthy. However, the introduction of fuel-injected systems for bikes is sometime away given that a change can only be propelled by legislation, adds the CMD.
Needless to say, the scope of such a development has tremendous scope in India given that annual two-wheeler sales are in the region of 10-12 million a year. However, this technology will likely make its entry in a top-end bike but when this will actually happen is not something that Krishnamurthy says he can predict. Eventually, depending on legislation, fuel-injected systems for bikes could account for about 20 percent of the market, but as of now it is still early days. The advantage of injection systems is that there is less variability or scatter between engines.
Even with an estimated 30 million bikes in China, the market for injection systems there has not got a grip and it seems unlikely to happen in India but Krishnamurthy is clear that Ucal wants to be ready for the future. “Our two-wheeler engines are already very lean, every ounce of power has been squeezed from them so the challenge is how make it even more clean,” says Krishnamurthy.
On the R&D front, which is clearly an important focus for Ucal, the company’s spends between three to six percent of sales as a percentage. For Ucal at present, the exports business is not a major factor, according to Krishnamurthy. It has however, set its sights on the US market for carburettors and for now hopes to be able to focus on pumps and even assemble these pumps overseas may be in the US once that market opens up.
Ucal Fuel has a US arm, Amtec, that it acquired just before the global recession of 2008. Ucal then went into soul-searching mode and the arm is now holding its own in a slow market. “As the American economy recovers, we hope things will be better,” says Krishnamurthy. The unit supplies diesel parts for Siemens, Cummins and so is not directly linked to Ucal’s core business. Ucal Fuel has five manufacturing facilities across three locations – three in Tamil Nadu and one each in Pondicherry and Haryana. The facilities are equipped with automated die casting machines, vacuum die casting, sophisticated CNC machining centres, CNC lathe, in-house built special purpose machines.
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