Emcon Technologies in expansion mode

Automotive components manufacturer, Emcon Technologies India has opened its new plant in Chennai recently and plans to set up another plant in Singur, West Bengal, for the manufacture of exhaust systems for the Tata Nano.

Emcon Technologies India is a joint venture between Anand Automotive Systems, which holds 26 percent of the equity, and US-based Emcon Technologies. According to the chief executive officer of Anand Automotive Systems, C S Patel, the companies have invested Rs 7 crore in the Singur plant. "The plant is being set up and is expected to start operations by October this year, and would produce exhaust systems for the Nano," he said.

The Chennai plant, which is spread over an area of over four acres, has state-of-the-art production equipment imported from the UK to produce exhaust systems including catalytic converters, as well as side impact beams and reinforcement panel assemblies for the automotive industry. An investment of US$ 4 million had been made at this facility. The company will be supplying to Ford India and Toyota from the Chennai unit.

Patel is optimistic about the future prospects of the exhaust equipment market, since most automotive companies have big product plans for the coming few years. "Most manufacturers are working on new engines and products with big players in the automotive industry having major launches scheduled for 2010," he said.

Tighter Euro IV emission norms, which will come into effect in certain urban areas by April 2010, require a higher degree of technical expertise.

This, coupled with higher production of commercial vehicles, will provide a boost to Emcon India, according to Patel. The company is also planning to set up a new plant in Pune, which would fructify only after successful discussions with its customers, which are currently underway.

Chennai is fast becoming a sought-after destination for global automobile majors and presents Emcon with the opportunity to grow its customer base rapidly.

With the Nissan and Renault projects set to come up in the southern metropolis, they would provide the company with additional opportunities. The Anand Group already has four plants in Chennai and the city is expected to become one of the largest automotive hubs by 2010.

Lee Gardner, CEO, Emcon Technologies, USA, said India is contributing to one percent of the company's global revenue while China contributed to 3.5 per cent. Further, he said Emcon Technologies had registered an annual turnover of US$ 4 billion in 2007, while Emcon India had recorded US $11 million in the same period.

“Emcon Technologies India is the only emission solution provider having a design facility in India and our vision is to make it the leader in the Indian market,” he said. With the new Chennai plant and the upcoming project at Singur, the company expects to achieve a turnover of US $50 million by 2011.