After gaining a considerable presence in the personal vehicle (car and bike) segment, Ricardo plc is now vying for a formidable presence in the booming commercial vehicle (buses and trucks) segment in India. To further its aim, Ricardo’s Indian arm will be launching a suite of solutions to cement its position as a leading multi-industry engineering provider of technology, product innovation and strategic consulting for the domestic automotive industry.
While the British automotive engineering consultant believes that the biggest growth driver would be the country’s fledgling infrastructure and affiliated industries, it is also counting on the implementation of vehicle emission and safety norms as it has the right expertise to meet the requirements of existing and forthcoming OEMs here. Ricardo India has already worked with a wide variety of Indian OEMs supporting them in the development of engines for commercial vehicle applications.
In order to gain a deep insight about its strategies for the Indian automobile market, MOTORINDIA caught up with Mr. Mayank Agochiya, who relocated back from London to India in 2009 to head Ricardo India. He is responsible for Ricardo’s engineering and strategic consulting operations in India.
In an exclusive interaction, he said: “As one of the fastest growing emerging markets and boasting some of the world’s leading industrial companies, India is an extremely important market for Ricardo. The Indian CV industry is in a state of flux at this point. The face of this industry itself is expected to change significantly over the next 5-6 years. If you look at the Indian PV industry in the mid-90s, that was the time when the internationalisation was happening and the face of this industry changed drastically. The Indian CV industry is following the PV industry with a lag of approximately 10-12 years and is witnessing a similar transition as well. All the leading global players have got a presence in the Indian CV industry.
“Furthermore, there are quite a few players still planning to enter the Indian market. Tata and Ashok Leyland have been the traditional dominant players, but the industry has changed in the past 5-7 years. There is Daimler (through Bharat Benz), Scania, Isuzu, AMW, Volvo, MAN, Mahindra, Force Motors, Kamaz, Beiqi Foton, etc. So it is very dynamic at this point of time. All this transition will happen over the next 5 years.”
Mr. Agochiya is an industry expert in product development (performance and emissions calibration) and had his stint with a leading Indian OEM. After working at the OEM’s Japanese and Indian technical centres, he took his MBA from INSEAD. He joined Ricardo, post-MBA, in its management consulting arm Ricardo Strategic Consulting. Here, he has worked in all the major global automotive hubs – China, Germany, India, Japan, Korea, the UK and the US – helping Ricardo’s clients on a number of markets and product strategy projects, restructuring organisations and supporting activities of OEMs and private equity investors.
Talking about the growth drivers that will propel its business in the CV domain, he observed: “This (CV) industry is going through a significant transition. Is it the Tata Prima product yet? Probably not! It’s a mix of old traditional products with the next generation ones. Currently, there has not been a significant pull from the customers when it comes to total cost of ownership, durability, CO2 emission levels, NVH levels, lightweight, maintanence, comfort, etc. But gradually we see some of the advanced products like Bharat Benz, etc., raising the benchmark and elevating the customers’ expectations as well. Everybody has to keep on raising the game and this would be one of the key business drivers for us. Then of course we are developing products which meet the changing requirements of the Indian customers. The quality, reliability, and durability expectations of the CV product will go up with the changing tastes and preference of the Indian customers. Anybody who is looking for an international standard development of a CV will count on us as we can contribute a lot more to it with our western expertise. Another business driver for a technology consulting company like us is the CO2 emission levels. Once there are changes in legislation with reference to upgradation of emission norms or enhancement of safety norms, or there is a requirement for transmission change, we have further business opportunities.”
Established on the November 8, 2007, Ricardo India Private Ltd. is a wholly-owned subsidiary of Ricardo plc. Its first project in India was in 1986 and since then it has delivered over 100 large-sized projects. Clients include all major Indian OEMs, leading Tier-1 and engine makers, public sector companies and private equity investors. Core competencies delivered in India are project liaison engineering teams, strategic consulting and business development.
On the issue of technological levers which will give Ricardo India a massive fillip, especially in the bus space, Mr. Agochiya asserted: “One bet on technology that we did in the last decade was Automated Manual Transmission (AMT) and we were one of the first companies in India to have a very strong focus with the aforesaid technology. We started discussions with clients and began development programmes three to four years ago. And now we are proud to see quite a few of our programmes in the production stage. AMT, I think, has a tremendous future in India for buses too. Under JNNURM, all buses will be equipped with AMT. The differential cost is minimal and the fuel efficiency is pretty similar to a manual transmission. I am sure that AMT will gain more acceptance by 2020 in the CV space. Especially in urban distribution or garbage disposal kind of applications, where you have more of stop-go kind of driving pattern. In some cases, it is govt agencies who take a stand on garbage refusal that we go ahead with the driving comfort of the driver. Or it is on the utility side where there are owner operators wherein they own one or two trucks and drive it themselves. In trucks, hopefully, by 2020 the market should be changing.”
The other next-generation technologies which Ricardo India is actively working on are flywheel for hybridation, Twin Vortex, lightweighting, waste heat recovery system, etc.
Taking about Ricardo India’s journey so far, Mr. Agochiya claimed: “The new company was officially launched on November 2, 2007 which brought us closer to our customers in India and enabled us to offer an improved and more responsive level of service. An integral part of the global Ricardo network of offices and technical centres, we have been able to effectively support our Indian customers as they increasingly aspire to enter regional and global markets. So the journey has been pretty good as we have been significantly expanding our business in India. The engineering consulting has been through its ups and down because when the economy was very good, the investments into new products (by our clients) were also at a very high pace which then had a slight dip in the past one and a half to two years. But now with the good days (under new PM Narendra Modi) in the country, the market is picking up. Our customers are very buoyant and bullish and very positive about the future. So we expect a lot of project opportunities in the future. So I would say a it has been a very positive journey for us.”
Ricardo plc is a British publicly listed company named after its founder, Sir Harry Ricardo originally incorporated and registered as Engine Patents Ltd. in 1915 and since 1919 based at Shoreham-by-Sea, West Sussex. The industries served are in transportation, defence and clean energy. In addition to the Shoreham head office; there are technical centres in Royal Leamington Spa, Cambridge, Chicago, Detroit, Aachen, Schwäbisch Gmünd (Germany), Prague, China, Yokohama, Korea, India, and Russia. Some of the global vehiclemakers it caters to includes Daimler, Volvo, Scania, Navistar, Paccar, Tata Motors, Eicher, et al.
“Over the past 5 years, Ricardo India has been growing at a brisk pace with a continuous double-digit CAGR. Ricardo globally has a sales revenue of GBP 236 million. Going forward, our aspiration is to achieve 5 per cent of the global pie and 10 per cent by 2020,” signed off Mr. Agochiya.