With the automobiles industry losing traction in a slowdown-hit market, auto component makers are now diversifying into other sectors to derisk their business.
With the automobiles industry losing traction in a slowdown-hit market, auto component makers are now diversifying into other sectors to derisk their business.
Now that the roads are no longer reliable, they’ve taken to the skies. With the aviation sector showing better prospects, auto component majors are looking to cater to this industry. Companies such as Caparo Engineering, Sterling Tool Ltd, Sundram Fasteners Ltd, Laxmi Precision Tools, Lumax Industries, JBM Group, Shriram Pistons Ltd and India Pistons Ltd, among others, have already launched into the aviation sector, and others such as Wheels India Ltd are weighing their options.
Krishna Mathur, general secretary of industry body Auto Components Manufacturers’ Association (Acma), said, “Aviation seems like a good area to venture into for auto component makers as there already exists a synergy between the two sectors. There is a good blend of engineering and manufacturing expertise available with auto component makers and they have taken advantage of their existing capacity to cater to the needs of the aviation industry.”
Mathur said India is becoming competent in manufacturing aircraft components. “Aviation giants, especially Airbus from Europe and some big companies from the US, are looking at sourcing components from India due to the low cost offered by us,” he said.
Lalit Kumar Jain, chairman, Laxmi Precision Tools, confirmed that the company has received enquiries from aviation companies in Europe and the US as their existing supplies are limited and they are looking at suppliers from India.
“There are not many players in the aviation fasteners business and we look at this as an opportunity. The aircraft fasteners business requires exotic and high standard material, for which we have almost finalised the technology. We have made a prototype on our existing infrastructure,” said Jain.
The company has spent Rs 3.5 crore on importing machinery for the aerospace business. The process for getting government approval for the aerospace fasteners business is lengthy and the company is required to be not only ISO 9000 certified but also AS 9100.
Sampathkumar Moorthy, president, Sundram Fasteners Ltd, said diversifying into aviation is a logical move as the company deals in fasteners for specialised automobiles, the process for which is the same as that for aircraft fasteners. He added, “For specialised automobiles and aircraft, you need high-strength critical fasteners, in which we already have expertise. We are already in discussions with Airbus and once the technological upgradation of our existing facility is over, we will begin supplying to them.”
Lumax Industries, an automotive lighting solutions company, is in preliminary discussions with Honeywell, an American company producing aerospace systems, to study high-precision aircraft lighting market, said Deepak Jain, executive director, Lumax Industries.
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