An exclusive feature from MOTORINDIA
Madras Engineering Industries, popularly known as MEI with four decades of proven experience in CV industry, emerged as a global player, with its range of products in air brake actuation components. From a single product status till last year, MEI has emerged into a multi product company and has started diversifying into other products related to brakes and clutch actuation systems.
MEI has formulated a long-range plan to become a system supplier in air brake conventional products. Its vision is directed towards satisfying customer needs. Mr. E.K. Parthasarathy, Chairman & Managing Director, MEI, talks to MOTORINDIA on the company’s progress and future plans.
Excerpts from the interview:
MOTORINDIA (MI): We know Madras Engineering as a slack adjuster company. Can you explain the transformation of your company to the current level?
E.K. Parthasarathy (EKP): Yes, you are correct. Now we cannot claim ourselves as a slack adjuster company due to the fact that we have diversified our business activities into other components related to air brake and clutch actuation systems. In addition, MEI is also developing certain other new products for commercial vehicle applications, which will be shared at the appropriate time.
The success story of MEI started with the introduction of an automatic slack adjuster in commercial vehicles in India in 2007. Even though auto slack adjuster is a new concept in India, the company has been in auto slack adjuster business since last two decades, exporting to various countries.
Auto slack adjuster is a technology product coming under safety / critical category in the vehicle sub-system, and worldwide there are only a few companies in this business, and MEI is one among them. The auto slack adjuster which we have developed for Indian application is not an adopted one but created to suit the Indian vehicle / road condition. We owe our success to all our Indian OEMs who have supported our initiatives in the initial stages and reposed confidence in us in developing such a high-technology product.
MI: What is your present standing in the Indian market, and do you have any capacity constraint in meeting the demand of peak volumes?
EKP: We are supplying auto slack adjusters to all the commercial vehicle manufacturers in India. With regard to our standing in the Indian CV industry, we enjoy a business share of 65 per cent plus, and we are the most preferred supplier to all the existing OEMs and the new entrants in the CV industry.
On the capacity front, our installed capacity for automatic slack adjusters with our three manufacturing units located in Chennai is around 2.5 million pieces per annum, which can meet the entire demand for the CV industry in India today.
MI: At the recent Auto Expo, we could see a number of new products displayed. Could you please touch on the status of these products?
EKP: Out of the few new products displayed at the show, we have already launched clutch boosters and brake lining wear sensors, and they are regularly supplied to Tata Motors. Negotiations are on with other OEMs. We have already augmented our production capacity to meet the expected growth in demand.
MI: Who is your technology partner for these new products? How strong is your design team?
EKP: Like auto slack adjusters, I am happy to say that these two products were indigenously designed and developed by our own engineers to meet quality and functional requirements of vehicle manufacturers, as well as meeting all technical standards. Also, our R&D team is a mix of experience and youth and currently employs 40 technical persons headed by 4 General Managers with a wealth of experience. The R&D set-up is certified by DSIR.
MI: Can you please throw more light on your R&D activities?
EKP: Our R&D facility is located at IIT Madras – Research Park, with a strategy to work closely with IIT professors, students and also to utilize the test laboratories available at IIT. Since our R&D is located at Taramani, we have the additional advantage to use the various Government laboratories located in the area. We are also working on new technologies to meet the expectations of our customers on quality, reliability and on cost. Currently we have four design patents registered both India and abroad and three more patents have been applied for. Our R&D is focusing on continuous product improvements and new product initiatives.
The best part of our R&D team is that they frequently visit the field, meet the end
customers, take inputs and apply them for design improvements. This is an ongoing activity at our end.
We are strengthening our test facilities by adding sophisticated and latest test equipment like brake dynamometer, vehicle data acquisition system from LINK – USA, etc.
MI: You mentioned about lining wear sensor. What prompted you to develop this product?
EKP: First let me say the wear sensor is a technology product which we developed in consultation with the Electrical / Electronics Department professors of IIT-Madras. The trigger to develop this product came from Tata Motors ERC Group, and the amount of support and help extended by them towards validating this product is worth mentioning. Wear sensor is basically an electro-mechanical devise, which indicates when the brake lining is due for replacement. With the introduction of auto slack adjuster, this kind of wear indicator becomes necessary to warn the driver / operator to replace the lining in time. Hence wear sensor becomes an in-built safety devise in the brake sub system in a vehicle.
Similarly, clutch booster was developed as an import substitution and has been accepted well in the market. We have developed 70 dia and 90 dia variants, and two more variants, viz., 76 and 102 dia, are in advanced stage of development. Here again I would like to mention that these products were indigenously developed, meeting all customer requirements / validation.
MI: What is the likely contribution of your new products towards your overall sales five years down the line?
EKP: With regard to auto slack adjusters, our current share is 65% plus in the CV industry, and we are a single vendor to most of the OEMs and the preferred source with regard to Tata Motors and Ashok Leyland. Considering our long range plan with products under development, five years down the line, the contribution from slack adjusters will be in the region of 40% of our total business and the rest from other products.
As a part of backward integration, we are setting up our own green field SG Iron foundry near Chennai. This will cater to our in-house requirement of castings and the spare capacity will be utilized to cater to the requirements of other customers. Our foundry will be an independent profit centre.
MI: You had mentioned that MEI has three independent manufacturing facilities. Can you explain more in detail about the infrastructures available in all these units?
EKP: We have three units in Chennai, located at Ambattur, Maraimalai Nagar and Mahindra World City.
The Mahindra World City unit started in 2007 is coming under the special economy zone and it is fully dedicated for our export business which at present constitutes 30% of our top line. Ambattur is our mother plant which was started four decades ago, and the Maraimalai Nagar unit which was commissioned in 1992 is now undergoing modernization, with automated assembly lines. All our manufacturing units have independent machining centers and metallurgical laboratories.
MI: Nowadays the expectation of OEMs is aftermarket parts and service support. How are you placed to tackle this?
EKP: Yes. We consider aftermarket parts sale and service support is an integral part of our business process, and we are well equipped to tackle this. In our marketing team we have professionals with rich experience at senior levels supported by a number of field engineers posted at all strategic locations throughout the country.
We have 22 field engineers to take care of the requirements of our end customers in the field, and for spare parts support we have 70 distribution outlets, again spread all along the length and breadth of the country.
We are also in the process of opening service outlets in select locations and have been continuously imparting training to all our end users at all levels. We are also paying individual attention to State transport corporations.
MI: As a fast growing and emerging player in the auto component industry, how do you foresee the future of the Indian commercial vehicle industry?
EKP: Though there is a negative sentiment prevailing in the industry today, because of the current slowdown, one thing all of us have to accept is that our fundamentals are very strong. I am hoping that the Government will take corrective steps to revive the auto sector. I can only say the current situation appears to be a structural one and not cyclical. I am hoping for a recovery by early October.