After six rounds of Bazaar Talk features reported from different parts of the country, we flew down to Guwahati to discern the business potential of Federal Mogul in the city as part of the seventh leg of the series. With the pace of activities growing steadily in the region, the city has been an important market for the American auto giant’s spare parts offtake.
We had the privilege of interacting with two leading distributors of Federal Mogul India’s aftermarket arm – East India Pvt. Ltd. and Prime Movers Auto Associates Pvt. Ltd. Even though both were cautiously optimistic about future projections, they expressed confidence and satisfaction in the way their principal handles them. With both firms catering primarily to the truck and bus segments, the revival in the CV segment is welcome indeed.
First up, we met Mr. Din Dayal Singhania of the East India Group, a key distributor of Federal Mogul in the region. Mr. Singhania starts off: “I migrated to Guwahati in 1978 from Rajasthan. We became the number one in Guwahati and have been selling Federal Mogul products since 1963. Though it is American company it operates very much like an indian firm, understanding the local requirements well.”
The East India Group primarily distributes engines parts like pistons and rings and gaskets solely for the CV segment. Catering to around 200 retailers in the north-eastern market, it clocks a turnover of around Rs. 15-20 crores annually.
Sharing his views about the overall industry situation, he says: “The burgeoning service centre network run by OEMs where the buyers prefer to visit as the first option is a challenge for the aftermarket. Moreover, roadside mechanics being highly uneducated and untrained might find it difficult to repair the next-generation vehicles. It would be good if our association takes some initiatives to train these people. On a broader scale, we are hopeful of Modi’s way of functioning with all eyes on the GST and coal mining activities in the country.”
Our next visit was to Prime Movers Auto Associates Pvt. Ltd. to meet Mr. N.L. Kothari, Director. Says Mr. Kothari: “I came in Calcutta at 1969 to do Mechanical Engineering. I got into the business in around 1975 and we got ourselves registered in Guwahati in 1975. We became Federal Mogul’s first sub-stockist in the country in 1980, and within six months we sold around 4,000 sets of piston rings for which we were rewarded well. With the passage of time, we are growing along with Federal Mogul with whom we have a long-standing cordial relationship. We started our business in Guwahati in 1988 and started our distributorship for Assam in 1992. We penetrated further in the market and are doing quite well with bright prospects ahead. We look after Arunachal Pradesh, Manipur, Nagaland and Meghalaya with a 9,000 sq.ft. warehouse and operate completely through ERP solutions.”
Prime Movers is into multiple product segments like coolants, liners, pistons, rings, etc., for CVs, two-wheelers and PVs under the Federal Mogul portfolio. “One thing we really appreciate about Federal Mogul is that they listen to our requirements and grievances which not everyone does today. Their products are very good and command around 60 to 65 per cent market share in our region. Our overall business is worth Rs. 90 crores and we expect a 15 to 20 per cent growth this year. We want to be No.1 in the spare parts market and also as far as customer satisfaction is concerned”, adds Mr. Kothari.
On the current business scenario, he states: “The market is okay, but the problems arise only in payment realization. We are growing, but there are a number of challenges to tackle. Firstly, the traders need to upgrade themselves, and perhaps leading brands like Federal Mogul can play a major role in this by providing training for dealers, traders and retailers. They should educate the traders, provide training to the mechanics and can also set up more garages which will further enhance the goodwill of the company. The workshops should also be equipped with next-gen gadgets. Having said that, an overall market recovery is on the cards. Coal mining was stopped and wood business in Nagaland was done away with. If these activities kick start, things will move in the right direction.”
Guwahati might not be a tier I city, but when it comes to the automotive aftermarket, it is bustling with activity and growing rapidly to keep pace with its tier-I counterparts. Having identified this potential early, Federal Mogul has established strong presence in the region and continues to be a dominant aftermarket player with its wide basket of brands and products.