Although the investment plans of the Spanish companies have not been finalised, it is likely to run into many millions of dollars. The companies are likely to enter into joint ventures with Indian firms as well, to bring the latest in technology
Auto component manufacturers from Spain the second-largest maker of auto parts in the world after Japan with total national production worth $18 billion are making a beeline for India, mainly because their biggest customers such as Ford, General Motors, Volkswagen, BMW and Peugeot, have either launched or are planning to introduce their models in the country.
The investment plans of these companies have not been finalised, but it is likely to run into many millions of dollars. The companies may enter into joint ventures with Indian firms as well, to bring the latest in the technology front.
More From This Section
Zanini Auto Group, which is the European leader in wheel covers with 35 per cent share of the market, is looking for a partner to set up a facility in India to manufacture seven lakh units a year. Besides, the company supplies radiator grills, interior trims and steering column shrouds to Volkswagen, Nissan, Ford, Saab, Opel, Skoda and Peugeot.
The company, which produces 14.4 million wheel covers a year and recorded sales worth $65 million last year, is interested in tying up with Telco, Mahindra & Mahindra and Maruti. Initially, it will concentrate on providing technology, design and market development.
Ficosa Internacional, which recently signed a joint venture with Lumax and is supplying components to Mahindra & Mahindra, is slated to announce signing of another joint venture today, which will manufacture its entire range of rear-view mirrors, sun visors, control cables and clutch systems.
In its application to the Foreign Investment Promotion Board (FIPB), Ficosa has proposed an investment worth Rs 20 crore in the first six years.
Another Spanish company with big plans for India is Batz, the auto components arm of conglomerate Mondragon Corporacion Cooperativa (CMC). One among the largest corporate groups in Spain, CMC plans to invest $100 million in various ventures over the next two years. A sizeable part of the investment will be in the auto parts sector.
Batz, which supplies tooling dies, rear axles, pedals, hand brake levers and car jacks to automotive giants including Ford, is in talks for a tie-up with Fords partner in India, Mahindra & Mahindra.
Another Spanish firm, OED, plans to introduce luxury buses in India over a couple of years. Besides, it is in talks with a few automobile companies to provide them design, technology and all things necessary to ensure high quality, said a company official.
Ascamm Center Tecnologic is also looking to transfer technology to Indian companies. It now supplies design and technology to Seat of the Volkswagen group and General Motors German subsidiary Opel. Asked about the amount of investment in India, a company official said: Very high. At least half a million dollars in the first three years.
Comforsa has signed a joint venture with Pune-based Suyaan Transmissions, in which it plans to invest $1 million to start with. It is also submitting an application before FIPB for setting up a subsidiary Comforsa India and has engaged a well-known international consultancy firm. Comforsa now supplies parts and technology to GM, Opel and Nissan.
The Institute of Applied Research in the Automobile Sector (Idiada) is also planning to set up a base in the country to provide support services to auto manufacturers as well as component suppliers.
The services include testing the products to see if they match international safety norms, and reducing the noise level. It also provides engineering consultancy for product development. The companys customers include Volkswagen, Nissan, Ford and Mercedes Benz.
Another Spanish auto parts maker looking for joint ventures in India is Arran-Metalbages, which specialises in engine supports, battery brackets, dip stick tubes, rocker covers and seat frames. All these companies are exhibiting their products, design and technology at Expotecnia being held in New Delhi.
A clearer picture is likely to emerge by today after one-to-one meetings are held organised between Indian and Spanish companies. Spanish auto components exports to India have grown over 137 per cent between 1995 and 1996 from Rs 13.14 crore to Rs 31.15 crore.
The Indian auto components industry, despite the recession in the automobile industry, is expected to grow rapidly with the demand estimated to increase from 854 million units in 1996-97 to over 1,122 million units in 1999-2000. (PTI)