GKN Driveline sets up precision forge plant

Global driveshaft manufacturer GKN Driveline has inaugurated a precision forging facility in Oragadam near Chennai. With another facility in Pune undergoing construction, the £5.4 billion supplier is bracing itself for a flurry of orders that are expected.

The precision forging facility near Chennai is expected to churn out four million units at full capacity. Currently, it runs at a capacity of 150,000 units. By the end of 2012, the output is expected to be 2.3 million and a rapid ramp up is expected to take place before the end of 2013 when it will reach full capacity.

The Rs 48 crore facility near Chennai will cater mainly to GKN’s southern clients like Ford, Renault-Nissan and Hyundai. This new facility has been built in an existing 15-acre site that also houses GKN’s sideshaft manufacturing facility. The existing facility produces around 1.2 million sideshafts that are supplied to most south-based OEMs. The new forging facility will ensure that the Constant Velocity Joint (CVJ) systems benefit from the forging technologies. The CVJ systems that are found in cars like the Ford Figo for instance, help in effectively transferring torque from the driveshaft to the wheels. The additional precision forging technique will ensure longevity and reliability to this system.

Even though BMW is a client for GKN at a global level, it doesn’t do business with the German marquee in India since the volumes aren’t sufficient. But given the recent increase in localisation by BMW and GKN’s facility lying close to the car manufacturer’s backyard, the day isn’t too far away.

GKN Driveline’s decision to set up a precision forging facility in India was more of an economic one. Following the closure of its two forging facilities in Birmingham when the recession hit Europe a couple of years ago, it was just a matter of time and location before the next facility was opened. “Given how big a market India has become, the choice was natural,” said an executive from GKN.

“This state-of-the-art forging facility is our first wholly-owned forging facility in the Asia-Pacific region. It reinforces our commitment to India and our customers here,” said Marc Vuarchex, managing director, GKN Driveline Asia Pacific. “The 5,000 square metre plant will employ around 60 people, thus taking our total employees in India to around 800,” he added.

From this combined plant, GKN hopes to satisfy orders for OEMs based in this part of the country. The Hyundai Eon, Nissan Sunny and the new Ford Fiesta contain parts manufactured by GKN, Vuarchex added. The Honda Brio, Chevrolet Beat diesel and the new Maruti Swift are also some of the other recently launched cars that find GKN’s parts in them. The company has no plans to export its products as of now as “orders from India are keeping us busy enough,” said Ojha.

“The Tata Nano diesel will also have our parts,” said Ravindra Ojha, managing director, GKN Driveline India. “I cannot comment on the numbers,” he added. Enunciating more on the Nano diesel, Ojha said, “It was a completely different challenge when compared to the petrol version. For starters, there is a difference in the torque output of the car and this varies our engineering to a large extent. The diesel Nano uses a completely new platform and isn’t simply the replacement of the petrol engine with a diesel motor.”

Another client that the company is proud of is the Volkswagen Group. Globally, GKN supplies to almost all brands under the VW umbrella including VW, Porsche, Audi, Skoda, Bentley and Lamborghini. In India too, the VW Group is a major customer with Skoda and Audi notching up some numbers too. Ojha said that talks are on with both VW and Skoda to supply GKN’s parts for the upcoming Up and Citigo cars from those two brands respectively.

“The VW Group is one of our major global clients and it’s only natural that we supply to them in India too. Once the plant in Pune is up and about towards the end of 2012, the process should be easier,” Ojha said. VW, Tata, GM and Fiat are some of the OEMs that the Pune facility will cater to. “Once Maruti’s plant is set up in Gujarat, we will supply to them too,” Ojha said. Maruti accounts for 45 percent of GKN’s business in India, while Tata and Ford make up for around five percent each.

The Worcestershire- based company also manufactures what it calls eDrive systems. This system involves eAxles, eTransmissions, eMotors. “We are working with Mahindra on the new Reva,” added Ojha.

The company aims to invest an average of £50 million every year in its four Indian facilities with an aim to double the total capacity within five years.