Mann+Hummel's new India growth strategy

The R&D centre is expected to play a key role in the company’s India programme as it will now enable local design and testing without having to send components to Germany for testing.

Like a number of other multinationals in India, the German major has thought it fit to set up R&D operations in this part of the world. Clearly, it is banking on increased growth in India as possibly its growth in other world markets is not expected to be on the same level as it is here. At present it is in close negotiations with almost all automotive and earthmoving equipment OEMs in India and has begun supplies to both Maruti Suzuki and Tata Motors.

Mann+Hummel, which is a development partner and series supplier for the international automotive and mechanical engineering industry, spends around four percent of its total turnover on R&D activities; in 2008, the Mann+Hummel Group recorded a turnover of 1.83 billion euros. It employs around 700 people in R&D worldwide, working exclusively on new development concepts. Clearly, the company expects its new Indian R&D centre to fast-forward product development programmes and also help the company develop products in line with customer expectations in the Indian market.

The new Peenya test lab contains all the requisite equipment to develop, validate and introduce products that meet customer specifications. Facilitated by computer-aided simulation, it will check the feasibility and optimise product design before even prototypes are made.

Furthermore, since development and testing will be local as against being done in Germany, there will be considerable savings in terms of both time and investment. And, its clientele in India too will find it better to work in conjunction on customised products.

According to Manfred Wolf, the Group managing director and member, Mann+Hummel Group, “We are investing Rs 10 crore over a couple of years in this Centre. The design department employs highly qualified designers, specially trained at Mann+Hummel’s head office in Ludwigsburg, Germany. Initially, the lab will employ around 20 persons. The test lab equipment includes a static burst pressure test rig, vibration test facilities, a test bench for oil separation of PCV systems and air clean test benches. The products developed independently will be competitive in the Indian market as the design and testing will be done locally.”

Speaking about the investments made by the company in India, Hans-Georg Hummel, managing director, Mann+Hummel India, said: “We have invested over 10 million euros (Rs 66.5 crore) in India over the past four years. In the next four years, we plan to invest an additional 10-15 million euros.”

Enters the Indian aftermarket

The company also launched Mann-Filter, the Group’s aftermarket brand for automotive and industrial filters. Plans are to introduce the products in South India first, followed by Chattisgarh and then subsequently in the Western and Northern parts of the country.

Mann+Hummel India has been operating from its Tumkur plant near Bangalore for the past three years and has been an OE supplier to several automotive and industrial equipment manufacturers in the country Now the company has launched its high quality filters for the aftermarket sector. Ajit Raj Nair, joint managing director, Mann+Hummel India, said: “The Mann-Filter range will constitute high-quality products but very competitively priced, keeping in mind the cost-sensitive Indian market.”

Mann+Hummel India provides Mann-Filter products for the Indian and most of the imported vehicles available in the country. According to the company, its range of air, oil, fuel and cabin filters is constantly updated and meets most diverse current requirements. Since modern cars demand finer filters with longer service life, its filters and filter elements are designed to meet the most exacting requirements of the automotive industry.

“Mann-Filter will provide a wide range of air, oil and fuel filters in OE-quality for current Indian needs and with forward-looking ideas and solutions for future requirements. Mann-Filter incorporates state-of-the-art as well as the most up-to-date filter technology, maximises engine performance and reduces fuel consumption,” said Wolf.

He added: “While the technology incorporated helps optimum engine protection, the Mann-Filter media for air filters demonstrates particularly high mechanical stability with the intake air filtered efficiently.”

Meanwhile, Hans-Georg Hummel said: “Our quality air filters, when replaced regularly, reduce fuel consumption by filtering out dust, sand, soot, even drops of water from the intake air ensuring only clean air gets into the combustion chamber. Increasing engine performance while keeping fuel consumption low, calls for plenty of innovation in engine building, which is what we at Mann+Hummel focus on.”

The filter manufacturer’s Tumkur plant has been in operation since 2006 and is an OE supplier to several automotive and industrial equipment manufacturers in India. The company also has a joint venture with Bosch India for making aftermarket products since 2005 and is now setting up a second unit at Nalagarh in Himachal Pradesh with an initial investment of Rs 112 crore. The plant will go on stream this September and will employ 100 people.

Mann+Hummel India recorded a turnover of Rs 10 crore in 2008 and has now targeted an ambitious target of Rs 250-350 crore by 2015. It is quite evident that the parent company is now seized of the growing opportunity that the both Asia and the Indian market present and is keen to make the most of it. Also, factors like an improving road network, a growing vehicle population and car owners' growing need for both better engine performance and improved fuel economy will drive demand for filters in India. Furthermore, with international majors like Volkswagen hugely growing their presence in the country, things can only get better. Mann+Hummel is now ensuring that it is well placed to cash in on the demand as and when the economy takes a turn for the better.