Smart move will enable speedier goods movement and cut down logistics costs.
The company uses the services of a logistics provider to export parts overseas. The warehouses will be commissioned once it crosses a stipulated level, said S Rudregowda, managing director. Shanthala, which makes spheroidal graphite iron castings, supplies raw castings and fully finished machined components to a host of industries that include compressors, earthmoving equipment, pumps/valves and also automotive.
At present, the auto segment accounts for 10 percent of business but plans are on to increase this component substantially. Shanthala supplies flywheels, bearing cups and manifolds to Cummins India and Caterpillar (to whom it also meets the needs of wheels and carriers). Gearbox covers and clutch rings are made for Automotive Axles in Mysore.
The company supplies four parts to Cummins India on ‘ship-to-use’ basis where they go directly to the assembly line without checking quality. It also caters to Cummins in the US. Once it improves delivery schedules and satisfies certain parameters, Shanthala will attain the ‘preferred supplier’ status from Cummins whose different plants across the world can then directly source components from Shimoga.
The company has also been receiving enquiries from the likes of Tata Motors, JCB, Denso Kirloskar and Kirloskar Systems (the last two mentioned are suppliers to Toyota Kirloskar Motor). While getting ready to meet such commitments, it is planning to treble capacity to 1,500 tonnes by setting up another foundry that can cast 1,000 tonnes each month and meet the needs of the auto segment.
The proposed plant will have automated lines with high pressure moulding machines, sand recycling unit, dust arresting unit and underground conveyors to move sand and castings to optimise space. The total investment for this project is Rs 35 crore and production could kick off next fiscal. Once this new unit is in place, Shanthala hopes its share of exports to Cummins will increase substantially. Global business accounts for 40 percent of turnover.
With growing demand from the automotive industry for fully finished components made of castings, the company floated Shanthala Machining Technologies last January. This arm will be a dedicated supplier of machining services. The patent’s expertise in metallurgy along with the new entity’s domain knowledge in machining will be a win-win situation for both Shanthala and its auto clients who can get finished products at good quality.
The new plant is constructed such that every part manufactured follows the single piece flow method. Their movement is supported by a five-tonne overhead crane keeping in mind that some of them weigh up to 800 kg. A secondary crane is also on its way to help out further.
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