MAN To Develop Competence Centre In India For Emerging Markets

MAN Interaction Competence Centre India
MAN To Develop Competence Centre In India For Emerging Markets

MAN Trucks India, the wholly-owned subsidiary of MAN Truck & Bus AG, is gradually building-up resources to develop its engineering centre in Pune into a global competence centre for products aimed at the emerging markets. At its plant in Pithampur, Madhya Pradesh, MAN Trucks manufactures the heavy-duty CLA range of trucks for the domestic market as well as for exports to Asian, African and CIS countries.

In a recent interaction with Auto Tech Review, Joerg Mommertz, Chairman and Managing Director, MAN Trucks India said it doesn’t make sense to carry out R&D work in Europe for the CLA range, which is made specifically for the emerging markets. While proximity to the market and customers are vital, it also helps because the Indian operations are leaner, thus offering more flexibility with quicker reaction time to meet market demands.

As a strategy, Mommertz said the company is yet to identify any specific area of competence it plans to build here, but “it will be a competence centre for products for the emerging markets, especially the CLA range”. As one of the first important steps towards developing the competence centre, Mommertz said the company has brought back to India an Indian engineer, who had his education as well as experience of working in MAN’s global R&D headquarters.

At this stage, the engineering centre in Pune engages more on application engineering suited to the demands of the Indian requirement. The intention, however, is to be able to contribute more efficient and frugal engineering work for the entire product network of MAN globally. The aim is to do about 80 % of the engineering work for the current and future CLA range here in India, said Mommertz.

The Indian market holds tremendous promise for the company, said Mommertz. Notably, India is the only market for MAN with an engine plant to support production of its trucks. MAN’s engine competence centre in Nuremberg, Germany undertakes the entire R&D work for engines globally. Mommertz is looking at the Indian unit contributing 10 % of the total factory output for MAN globally in the next three to four years.

GLOBAL CONTRIBUTION

India is big on MAN’s sourcing plans, and Mommertz believes there’s potential to develop India into a large sourcing hub for the group – sourcing not just from suppliers as external vendors, but also from MAN India as an internal vendor. The Indian unit already supplies certain engine parts to the engine factory in Nuremberg. “This is also allowing us to prepare our engines for BS VI emission regulations. We will use the same crankcase, cylinder head and other components that are used on Euro 6 or future generation of engines. In all, this helps us prepare for internal sourcing from India,” said the 59-year-old professional.

Sourcing today isn’t significant enough for Mommertz to give us a figure, but he said a purchase department inside the Indian plant is dedicated for global sourcing, as a service provider to Germany. Sourcing, usually is a long-drawn process – while quality is a paramount consideration, the other challenge is to ensure just-in-time deliveries in specific quantities to production facilities worldwide – which in MAN’s case could be in Germany, Poland and Russia. While he is keen on increasing the sourcing for engine parts from India, Mommertz believes exporting the complete engine could also be a possible scenario in the future.

FUTURE OPPORTUNITIES

MAN is part of the Volkswagen Group, which also has two other entities in the commercial vehicles space – Volkswagen Commercial Vehicles and Scania. Scania incidentally competes against MAN in the premium end of the CV market. Mommertz said he is trying to understand what kind of synergies could be possible between MAN and Scania in order to get more efficient and profitable in the long run. For now, both companies compete in the market with independent sales and aftersales operations.

Commenting on future opportunities, Mommertz feels alternative fuels will play a very important role in CVs. The company is well-entrenched in these areas and continues to work on solutions globally, including electrified buses. But adopting these technologies isn’t easy. While the sources of energy and technology solutions are available, it is equally important to have the infrastructure in place.

While there is significant work happening in the area of CNG and e-drive, MAN is also working on improving the efficiency of regular diesel engines. In fact, in the Indian context, Mommertz said it makes greater sense to try and improve the efficiency and performance of existing diesel engines in addition to replacing old trucks.

CONCLUSION

MAN has been in the Indian market since 2006, when it joined hands with the Pune-based Force Motors. It bought over the Indian partner’s stake in the JV in 2012 to become a wholly-owned subsidiary of MAN Truck & Bus AG. In these years, the company has sold over 25,000 units in India. With infrastructure activity picking up and long haul transportation looking promising, MAN Trucks India is hopeful of becoming a significant player in the Indian market in years to come.

TEXT: Deepangshu Dev Sarmah