IAC bets big on India to take global script forward

James Kamsickas believes that everything starts with culture. “How can you run a multinational company otherwise?” the President and CEO of International Automotive Components told Business Line in a telephone interview.

Kamsickas knows what he is talking about. The automobile industry has gone well and truly global over the last decade with manufacturers looking beyond the West at a host of emerging nations such as Brazil, India and South Africa. China is today the world’s largest car market with annual production of 20 million units in 2013.

From Kamsickas’ point of view, these rapidly changing dynamics only reinforce the need to think more ‘culture’ with effective leadership verticals across key regions. This is borne out by the fact that the $5.2 billion IAC group already handles 81 facilities in 19 countries with 22 design and technical centres in its portfolio. It was formed less than a decade ago from the former global interiors divisions of Lear and Collins & Aikman.

IAC is controlled by billionaire Wilbur Ross and headquartered in Luxembourg. A global Tier I supplier of interior systems and components, its core products include door and trim systems, instrument panels, consoles & cockpits, flooring & acoustic systems etc. The customer list comprises General Motors, Ford, Fiat Chrysler Automobiles, Volvo and Volkswagen.

Kamsickas was in India this week to inaugurate two new facilities near Delhi and Pune. Asked if he was concerned about the present slowdown in the auto industry, he said that it was only a matter of time before the market was back on its feet given that this is a cyclical industry by the end of the day. “I am a huge fan of India and am convinced it will continue to prosper,” he added.

The core of the IAC business model is pretty straightforward - it follows its vehicle customers around the world. Thailand and Malaysia were new additions last year and though economists are betting big on Indonesia as the new growth engine of the Asia-Pacific region, Kamsickas said there were no plans as yet to open shop there. "We have to look where the auto hubs are,” he said.

According to the IAC chief, Africa presented interesting business possibilities in the coming years. The auto market evolution here is pretty much on the lines of India where costs play a big role in the buying decision. Nissan, for instance, is already thinking of shipping out the Datsun Go from India to South Africa (where IAC is present) and it could only be a matter of time before this includes countries like Kenya and Morocco.

All this would translate into business for suppliers like IAC which, in turn, would bank on its back-end engineering skills in India to service these new growth regions. “I am a huge believer in India and our strategy is to penetrate all markets,” Kamsickas said.

The new Chakan facility near Pune will allow IAC to better serve its existing customer base in the western region, a list that includes Mahindra & Mahindra, VW, Volvo-Eicher and Fiat. The original facility, IAC Chakan I, is located on the M&M manufacturing campus and dedicated to its vehicle lines for supply of interior and exterior components. Chakan II is a multi-customer facility that supplies headliners, instrument panels, door panels, centre consoles and exterior trims.

The other plant inaugurated near Delhi, Manesar II will complement the current operation, comprising 60,000 square feet between both locations. IAC Manesar produces headliners, flooring, floor consoles and interior soft trim products for big customers like Maruti Suzuki among others.

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