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The company has invested around Rs 18 crore for a capacity of around 5,00,000 airbags per annum and this would be ramped up to 10,00,000 units in next two years, with an additional investment of around Rs 5-8 crore.
Announcing the launch of the new facility in the premisis of the company's seat belt manufacturing facility under the Occupant Safety Division in SingaperumalKoil, Chennai, Harish Lakshman, managing director, Rane TRW, said, "We anticipate exponential growth in the application of frontal airbags over the next decade and we will be well positioned to support both global OEMs and domestic OEMs."
He said that the aim is also to localise some of the components in the airbag system, except the inflator and some other components which are manufactured by TRW globally. Currently the facility would be assembling the airbags in the facility. The localisation over a period of three years could go up to 20 per cent, said company officials. The localisation would bring down the cost of the product.
The company would be offering the driver and passenger airbag modules at present, and currently has two customers - Mahindra and Ford and it would start selling airbags to Renault Nissan soon.
The products would be priced at around Rs 1,800-2,500 per bag, excluding the electronic control system associated to it.
At present, airbags are available in around 30 per cent of the cars in India and this is expected to grow to 50 per cent by 2017 and to 100 per cent by 2020. It may be notes that the government has mandated airbags in all new models coming out in India and in all cars by 2020.
The company is expecting that almost 70 per cent of the capacity of the new facility to be utilised by the end of the fiscal year.
The Occupant Safety Division, which manufactures Seatbelts and now Airbags, caters to key customers including, Ford India, Renault Nissan, Mahindra & Mahindra, Maruti Suzuki India, Tata Motors, Ashok Leyland, Daimler India Commercial Vehicles. The company exports nearly 15 percent of its Seatbelts volumes to Brazil, Colombia, Vietnam and Thailand.
While almost 70 percent of the revenues of the JV are currently from steering systems, the Occupant safety products are growing fast, said the company officials. It is expecting a growth of 25 per cent CAGR till 2020, they added.
