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Japan’s Hirotec Group, which has unveiled plans to invest Rs 40 crore in its Coimbatore automobile tooling facility, is open to the idea of expanding its manufacturing capacity in India by establishing units elsewhere in the country to meet growing demand.
The company, which globally is into the production of car doors and exhaust systems, has not felt any impact of the slowdown witnessed by the automobile sector.
Responding to questions at a news conference here on Thursday about the company’s plans to establish a facility in Gujarat where many automobile companies are setting up units, James B. Toeniskoetter, President & COO, Hirotec America Inc., said the company was “open to opportunities”. He, however, added that “definitely Coimbatore is our home” which is why it is making its investments here.
Sendtil Parthasarathy, Vice-President, Business Development, Hirotec India Private Ltd, Coimbatore, said the company, which began in a small way in the city, would like to establish itself before taking a call on exploring opportunities in Gujarat.
He said the company has invested about Rs 20 crore in its Coimbatore tooling facility and some of its major clients are Ford, Nissan,Tatas, Hyundai and Volkswagen. Besides, the company also has a sales and support facility in Pune where some of its major clients have manufacturing units. The proposed assembly integration and try-out facilities would come up near the existing unit in Saravanampatti on the outskirts of Coimbatore.
Parthasarathy said the company’s engineers in Coimbatore were also imparted continuous training both in the US and Japan. It planned to ramp up the headcount once the first phase of expansion is ready by April 2014.
Sharon L. Beetham, Vice President of Finance and Purchasing, Hirotec America, expects revenue from Indian operations to be around $25 million in the next fiscal and further growth would depend on the investment made in the second and third phase. The initial forecast for 2014-15 was only marginal growth and the company planned to grow continuously and “catch up with US at some point”. The company cannot continue funding from the US or Japan and expected the Indian operations to generate enough cash to fund its expansion.
Takahiro Hayama, President of Hirotec India, said the company was open to the idea of supplying parts from India to other countries like China.
Katsu Uno, Chairman & CEO, Hirotec America, explained that the company’s strength was the closure products for automobiles. Its operations in India have not been hit by the slowdown in the auto sector. He said the Rs 40 crore investment being planned was to meet the demand for quality tooling solutions by the automotive OEMs in the country and to meet increasing localisation, shorter vehicle launch cycles and to optimise cost.
On whether the power shortage affected the operations, Toeniskoetter said the company was not into mass production and as it was in the tooling market, the engineering services they provided were not as sensitive to power shortage as anyone in mass manufacturing. Theirs was also not a power intensive activity.
The new facility would have a modern machine shop, engineering office to seat 300 engineers, assembly and tool try-out facilities.
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