The Hindu Business Line : Autoline to set up new facility for wheel rims in UAE

Setting up a new facility in the UAE and contract manufacturing are some of the plans that have been chalked out by the Pune-based Autoline Industries Ltd, manufacturer of auto components, for the current fiscal.

Mr M. Radhakrishnan, Director, Autoline Industries, told presspersons the company was setting up a new facility for the manufacture of wheel rims in Abu Dhabi and would be spread over 50,000 sq. ft. area. The commercial operation of the facility is expected to begin by February 2007 and said an investment of Rs 8 crore was being utilised for the new facility.

UAE facility

He said last year, it had set up a joint venture company in the UAE, Union Autoline Spare Parts LLC, with 49 per cent stake held by Autoline and the remaining 51 per cent by an UAE national. He said 50 per cent of the investment would be by Autoline and the rest by the UAE national. He said the facility would manufacture brakeshoes and also provide facilities for cylinder head reconditioning and machining of automotive and marine engine parts at a later stage.

He said the facility, with a capacity to manufacture 18 lakh wheel rims a year, would target the Gulf and the African markets. The wheel rims would be targeted at the after-sales market.

Tie ups

Mr Radhakrishnan said the company has also entered into a memorandum of understanding with Detroit Engineered Products plc to provide solutions in the CAE (computer aided engineering) segment. He said the final stages of the deal, which would give it a stake in Detroit, were being completed. With this, the company would be able to enter the US market.

Mr Radhakrishnan said the company has also entered into an arrangement with Stokota India Pvt Ltd, the Indian venture of Stokota Belgium for supply of tippers, tipper trailers, tankers, cement bulkers and garbage extractors. Currently, Autoline would assemble the tippers and was looking at shipping 35 per month.

By November, this would touch 100 per month, he said. He said that Stokota would do the design engineering and Autoline would take up the mass production sector.

Chakan unit

Looking at the expansion plan of the company, he said it has set up a second mass manufacturing unit at Chakan, spread over seven acres, for capacity expansion of sub assemblies and manufacturing of parts such as door assemblies for passenger vehicles and heavy load bodies for commercial vehicles. He said about Rs 50 crore was being used for the modernisation and expansion programme. The second unit now supplies components for the Tata Ace, Indica, Indigo, Mahindra and Mahindra and Bajaj Auto Ltd. He said it supplies about 400 different parts to Tata Motors, of which for about 130 parts were single sourced supplier. He noted that more than 100 single sourced components were being supplied to Indica and Indigo as also for the trucks. He said about 80 per cent of the company's revenue came from Tatas.

Uttaranchal plans

Asked whether the company would be setting up facility in Uttaranchal for Tata, he said it is not looking at Uttaranchal but would be catering to the Pune unit. He said, however, a facility would be set up in Jamshedpur by next year, which would cater to the heavy commercial vehicle requirement of the Jamshedpur plant.

Mr Radhakrishnan said the company which has recorded a turnover of Rs 111.3 crore for the fiscal ended March 2006 is targeting a turnover of Rs 220 crore for the current fiscal and Rs 470 crore by 2007-08. Of the Rs 470 crore, about Rs 280 crore is expected to come from supplies to Tata Motors.

He said the company, which had recently acquired the Western Pressings Pvt Ltd, manufacturer of formed tubular products such as silencers and exhaust systems for commercial vehicles for a sum of Rs 2 crore is now eyeing acquisitions in the domestic as well as international market. He added that the target for this year, acquisition was one more domestic company and an international firm which might be in US or Germany.

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