The Hindu Business Line : Hyundai to extend quality programme to tier-2 suppliers

(From left) Mr D.P. Padmanabhan, President, Madras Management Association; Mr Gurcharan Das, Former CEO, Procter & Gamble India Ltd; and Mr Subir Raha, Chairman and Managing Director, ONGC Ltd, at the valedictory session of the golden jubilee convention of the Madras Management Association in Chennai on Saturday. — Bijoy Ghosh

Chennai , Feb. 4

HYUNDAI Motor India, which has covered all its 80 vendors under a quality programme, will extend it to its nearly 400 tier-2 suppliers, according to Mr B.V.R. Subbu, President, Hyundai Motor India Ltd.

Under the programme to ensure that its vendors were of global quality standards, Hyundai Motor India launched a 100 ppm (parts per million parts) - that is the number of rejections had to be 100 or less than that for every million parts produced. Almost 50 per cent of the vendors operated at zero ppm and a "very significant number" at 50-100 ppm, he said addressing a session on the manufacturing and engineering industry at the two-day golden jubilee convention of the Madras Management Association, the theme of which was "This India knows no boundaries."

Mr Subbu identified achieving global quality standards as one of the pre-requisites for the Indian manufacturing sector to make a mark globally. The other two were speed to market and cost efficiencies.

On speed to market, he recalled that Hyundai Motor India and its parent, Hyundai Motor Company of Korea, decided to simultaneously work on a new engine for the Santro, a hatchback. The Korean parent said that the Indian subsidiary would become the global hub for small cars if it managed to develop the engine before it. "We managed to beat the Korean parent by 40 days," Mr Subbu said.

He pointed out that Bharat Forge, a leading component manufacturer, was another good example for excellence in speed to market. It showed the original equipment manufacturers in Europe that there were component manufacturers who were faster than somebody on their doorsteps.

Mr Subbu said that the Indian automobile industry was also aggressively going in for exports, with Hyundai Motor India being the leading car exporter. The other two companies were Maruti Udyog and Tata Motors. Going by the rate at which car exports were growing, he was confident that India would export 500,000 cars a year by 2010.

However, he also said that there was no reason to be euphoric. Anybody who has been in the US during the Christmas-New Year period, would have noticed that almost all the gifts were Chinese products. China, Mr Subbu said, was talking in terms of creating 45 million manufacturing jobs by 2010 while he doubted whether India would be able to achieve even a tenth of that figure. "In India, we vacillate between complete euphoria and complete despondency. The reality is that there is a market and the corporates have the ability to do it. But that is not happening," he added.

Infrastructure was one issue that played a major role in the efficiency of the manufacturing sector. For example, he said, the Chennai port charged three times the rate per car exported than that at a Japanese port, "simply because it is a state monopoly." "This is what will impair our competitive efficiencies," he said.

Mr Subbu said issues such as free trade agreements and special economic zones would also affect the manufacturing sector