Chinese companies target Indian diesel segment

Diesel vehicles segment is the focus area for Chinese component makers too. Many of the Chinese companies, which participated in the Auto Expo, evinced keen interest to expand their presence in India with products such as turbocharger parts for diesel engines. They plan to do so through increased dealerships in the aftermarket. Most of them prefer to operate out of China catering to both the domestic market and exporting surplus to India through dealers with whom they have struck partnerships. The targeted vehicle segments are commercial vehicles and passenger cars.

Most Chinese firms such as Wuxi Shengyi Industry Company that manufactures turbocharger spare parts and kits for diesel trucks and passenger cars participated for the first time in the Expo. This, despite it doing business in India since 2004, supplying turbocharger spare parts in the aftermarket. Aileen Qiu, the company's spokesperson, says that the company is keen to expand its customer base now. Till recently it was quite content to market its products in large numbers in the domestic Chinese after market. Hence its participation in the Expo. The company locates its Indian distributors through the search engines on the Internet though sale price of products is a stickler in arriving at agreements.

ChangZhou SuotoPower Engineering Company, which also manufactures turbocharger parts, was present at the Expo for the second time with an eye on earning a good price for its product range. It has been supplying to India since the last five years. Its general manager Tang Jun maintains that customers have begun to trust the brand. It has a couple of dealers in Delhi and Mumbai and plans to expand further its footprint in the capital.

More and more Chinese players are keen to further expand their presence here. But as competition hots up in the replacement market and affordable cost and good quality score over other aspects, overseas firms are slowly realising that their components have to match the best in terms of quality or lose out to competitors. Till now, Many Chinese component makers scored over their Indian counterparts in terms of lower priced components due to economies of scale, but now that is not so as the Indian auto industry is fast catching up.

Interestingly, most Chinese part makers are keen to supply to Tata Motors; for instance, Shanghai Chief Automobile Parts Company, a first-time participant at the Expo. Though it realises that the Indian automotive market is very large, it is yet to identify the market requirements. It is evaluating its options of striking a suitable partnership for supplying its air compressors to the aftermarket for the truck segment. Aterm Wu, sales manager, says that their products are suited for the European market and now the next target is to become an OE supplier to Tata Motors as well as supply its spare part requirements. He feels that the company will be able to commence supplies within three years and, if successful in bagging the order from the OE, could evaluate options of setting up a manufacturing facility within close proximity of the vehicle manufacturer. Others are targeting new business, customers and new partnerships in the aftermarket. For instance, Ruian JBEC Auto Electric Company Ltd manufactures fan assemblies and motors for passenger car aftermarket needs. It has a manufacturing facility in China and has been already supplying to the Indian aftermarket for the last three years. Impacted by the downslide in the automotive industry, it is assessing ways to turn around its business on the bag of new orders, preferably by supplying spare parts for major OEs in India like Tata and Maruti Suzuki, whose localisation content is very high.

SHOBHA MATHUR