Indian market makes sound sense for Kenwood

With more than $ 1.4 billion (approximately Rs 5,600 crore) in global sales, Kenwood Corporation of Japan is currently pursuing an India-specific plan to push sales in the country’s growing communications (wireless equipment) market as well as the car audio business. Kenwood is currently a leading player for car audios in India with 50 percent of its sales coming from the OEM segment. It is also the No 2 player after Motorola for supply of wireless equipment to the Indian defence, para-military forces, police, and the growing taxi segment.

Buoyed by the growing demand for its products, Kenwood is exploring the possibility of setting up an R&D centre and a manufacturing base in India. Toru Kawauchi, president of Kenwood Asia Headquarters, says that as for setting up a production base in India, “this is the next step to consider. Sooner or later, this country is most suitable for setting up an R&D centre.”

“Currently in India we are focusing on communication systems for professional use as well as car audio systems. Our communication systems’ share in F1 racing is around 99.9 percent. These systems are professional two-way communication devices like walkie-talkies. Yes, there is a market for India especially among taxi drivers, police and other departments,” said Kawauchi.

Kenwood has been an official supplier to the Team Vodafone McLaren Mercedes for 17 years. It now focuses on the business of wireless radio equipment, including primarily land mobile radio equipment as well as amateur wireless radios and specially-designated low power transceivers.

Strong on India

Its car audio systems in India are supplied by Nippon Audiotronix Ltd. According to Kanwaljeet Goindi, managing director, “Kenwood is among the top three brands selling in India. We have an equal share between the OE and aftermarket businesses. Except for Toyota, we sell to all other major carmakers in India which include Maruti Suzuki, Tata Motors, Hyundai, Mahindra & Mahindra, Ford and General Motors. We sell our products through the companies’ exclusive dealerships.”

But for Kawauchi, it is the beginning of a new push for Kenwood in the Indian car audio aftermarket. “Now that Kawauchi-san is concentrating so much on the aftermarket, brandbuilding and creating products that are India-specific, we hope to grow significantly. All our products undergo rigorous tests by car companies,” says Goindi.

Kenwood sold 60,000 car audio units in 2006-07 and this fiscal around 75,000 units. It hopes to sell more than 100,000 units in 2008-09. For the current year, the company expects to notch up sales of $ 14 million (Rs 56 crore). Sales for 2008-09 are projected at around $ 16 million.