With the Maharashtra government stopping all production activity in the state due to coronavirus, the state's automotive hub of Chakan has gone silent.
24 Mar 2020 | 27299 Views | By Shahkar Abidi & Autocar Pro News Desk
The once-nondescript industrial township of Chakan, 40km from Pune in Maharashtra, which has over the years transformed into a thriving automobile and component manufacturing hub, has gone quiet. The constant flow of trucks carrying heavy goods and the chatter of workers coming out of the factories have almost ceased. Blame ...
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The once-nondescript industrial township of Chakan, 40km from Pune in Maharashtra, which has over the years transformed into a thriving automobile and component manufacturing hub, has gone quiet. The constant flow of trucks carrying heavy goods and the chatter of workers coming out of the factories have almost ceased. Blame the current situation on the spread of coronavirus in Pune as well as the state of Maharashtra. But Chakan going into slow mode can also be pinned to the Indian automotive sector experiencing a prolonged slowdown, the likes of which it has not seen before.
With manufacturing plants across OEMs and suppliers gradually cutting down on production over the past 18-odd months, there has been an adverse impact on the local workforce. Now, with operations shut down, many are looking to rush back to their native places in interior Maharashtra.
Concerned over the worsening situation, the Federation of Chakan Industries (FOCI), an association of companies working in the Chakan belt, has asked its members to take care of their employees and disseminate information of Covid-19. “As a social obligation, support and guide them so that there's no need to go to their native places. Industry will take care of them,” FOCI said in an advisory to its members. FOCI has a membership of around 650 companies from the Chakan belt.
Dileep Batwal, Secretary, FOCI told Autocar Professional that all the companies in the area are closed except those engaged in essential services.
An advisory on March 22, from the office of the Collector and District Magistrate, Pune to the manufacturing units, called upon all enterprises in the manufacturing sector to close down all operations with immediate effect. Exemptions are only for essential maintenance activities, which if closed may lead to permanent damage to equipment. However, this should not involve more than 10 percent of the total workforce of that company.
Chakan: Maharashtra's auto hub
With an estimated manufacturing capacity of 540,000 passenger and commercial vehicles, 20,000 engines and 1.2 million two-wheelers along with a large number of Tier 1, 2 and 3 suppliers, Chakan is rightfully called the automotive hub of Maharashtra.
The area is home to some of the leading OEMs in the country including Mahindra & Mahindra, Force Motors, Mercedes-Benz India and Volkswagen India, who have their manufacturing plants located here. On the two-wheeler side, Bajaj Auto churns out all its domestic and export products from Chakan, with humungous capacity of 1,200,000 units per annum.
New plants are also taking shape. In June 2019, Mahindra & Mahindra broke ground on a new EV powertrain plant in Chakan. The Rs 200 crore investment in the new facility, which will manufacture key components of an EV powertrain – EV battery, motor, transmission and power electronics – with capacity for 50,000 EVs per annum, is part of the Rs 900 crore investment announced last year to expand its overall manufacturing capacity, both at the Bangalore and Chakan plants.
Robust supplier base, home to ARAI tech centre
Proving ample support to OEMs in Chakan is a well-established network of suppliers both home-grown players as well as global majors like Bosch, Mahle, Harman, Bridgestone and others. For instance there's the Panse Group, which manufactures sheet metal parts and assemblies, tubular assemblies and AVS parts for different vehicle segments, and Flash Electronics to name just a couple. Sujan Continental, which manufactures vibration control products and Polyrub CooperStandard, which makes fluid transfer systems, are also located in the Chakan Industrial Belt.
There's ARaymond Fasteners, the 155-year-old family-owned French supplier of non-threaded fasteners which remains bullish about smart growth in India. Or Tenneco Automotive India, which has a massive 13,000 square metre facility in Chakan, located close to key customers in the Pune region including Volkswagen, GM India, Tata Motors and Mahindra & Mahindra. It produces emission control products and systems and supply ride performance products on a just in time (JIT) basis.
Investments continue to be made in the Chakan region. In June 2019, Harman, the fully-owned subsidiary of Samsung Electronics Co, invested Rs 350 crore in its existing Chakan plant to expand capacity 12-fold by 2022. In the next three years, the production of Digital Cockpit Units (DCUs) and Telematics Control Units (TCUs) from the Chakan plant will increase from current 200,000 units to over 25,00,000 units annually. Harman will also double its factory headcount to about 800 employees in the same time period. With this expansion, Harman will be able to manufacture highly complex, customised connected car electronics solutions for its large domestic and global customers including Maruti Suzuki, Mercedes-Benz, Volkswagen Group, Tata Motors and Fiat Chrysler.
Chakan is also home to R&D centres. For instance, Lumax Cornaglia Auto Technologies, a 50-50 JJV between Lumax Auto Technologies and the Cornaglia Group of Turin, Italy, prepared for the BS VI shift by setting up an R&D centre at a new location in Chakan. The targeted product line for the R&D centre have been air intake systems, urea tanks, other automotive tanks, CAC ducts and other blow moulded parts. The centre is aimed at enhancing the local design, development and testing capabilities to provide localised solutions to OEMs.
Chakan, of course, is also known for ARAI and its Homologation and Technology Centre. The state-of-the-art centre is equipped with all the latest equipment and houses comprises a passive safety laboratory, powertrain laboratory, fatigue and materials laboratory and automotive electronics laboratory, among a host of facilities for India Auto Inc.
It's a difficult time for India right now and India Auto Inc, which now has just eight days to go before BS VI and April 1 kick in. With all manufacturing operations mandated to remain shut till March 31, action in Chakan too remains stifled for the moment. Hopefully, fingers firmly crossed, the buzz will be back before long.
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