Pondicherry-based Manatec Electronics is looking to explore new markets in Russia, the Middle East, Latin America and South-East Asia. Exports make up 20 percent of the company’s turnover and the target is to increase this figure to 50 percent within two years. As a strong sign towards achieving this target, the company recently inaugurated another manufacturing facility 14km from Pondicherry with an investment of Rs 15 crore.
The facility, located in a 180,000 square feet plot, employs 250 people and has a manufacturing capacity of 13,000-15,000 machines per annum. Some of the international platforms where Manatec aims to showcase its products this year include Automechanika Argentina, Automechanika Frankfurt and an international suppliers conference in Moscow. At present, Manatec exports to its products to clients in 30 countries.
Banking on innovation
Manatec is also developing three new products to be introduced over the next three years. An indigenously designed and manufactured nitrogen filling station is most likely to hit the market in 2013-14. Two other products – an AC gas charger and a wheel aligner – that use innovative technology are in the development phase. Speaking about this project, M Kalaiichelvan, joint managing director, says: “We’ve just started on this project, so we need to see what kind of investment it needs. I think we can make do with the infrastructure that we have in place right now.”
Manatec’s product portfolio already includes a nitrogen filling station but at present it is an imported product mildly modified by Manatec for the Indian market. “We wanted to design and manufacture our own nitrogen filling station,” Kalaiichelvan adds.
The company is also targeting the heavy commercial vehicle (HCV) segment. “We’ve been keeping a close watch on this segment for around two years now. The awareness levels among the companies have risen tremendously, thanks to the need to modernise,” Kalaiichelvan says. “We thought it would be better to invest in this industry when it is growing rather than when it is at a stage where it is in maturity,” he adds. Manatec sees a lot of potential in the HCV industry and pegs the size of the market for servicing equipment at around
Rs 30-35 crore at present. “This, we think, will increase to around
Rs 70 crore in the next few years,” Kalaiichelvan says.
He attributes this sudden growth in the HCV segment to the arrival of many multinational companies with their big-ticket investments and wide product portfolio. “Daimler, Volvo and MAN are the driving forces for this segment,” says Kalaiichelvan. He adds that Manatec’s current product range can cater to the needs of the HCV segment. “Primarily, our breadwinner – the wheel alignment machine – will see a push from us. Then come the wheel balancers, AC gas chargers, nitrogen filling stations and exhaust gas analyser machines,” he reveals.
Future challenges
If there is a challenge confronting the company and its ambitious plans for the future, then it is a heavy shortage of labour. “We only recruit diploma holders for the shopfloor and provide them training. While the attrition rate at this level of hierarchy isn’t too bad, it is only at the senior and middle management level that we find tough to hold on to our employees,” Kalaiichelvan admits.
However, he says, while there is a lot of interest in Manatec itself, its location is not a preferred one: “Pondicherry isn’t exactly a welcoming option at this level in the hierarchy.” However, the company is going all out to keep attrition levels low. “We’ve signed a contract with a Bangalore-based consultancy company for three years for a TQM initiative. We started this process in December last year,” he says.
The company also joins the chorus of complainants who export their wares from the Chennai port where congestion is at an all-time high. “There’s congestion for, sometimes, even a week. You’ve got your container in but you’re unable to clear it for a week due to congestion, which means we are not able to keep up the delivery times,” says Kalaiichelvan. So, he has appointed a team to study the feasibility of using the port at Tuticorin, nearly 500km to the south of Pondicherry. “There are logistical issues when it comes to the Tuticorin port. Distance is one thing as is the sub-standard infrastructure there. We’d rather have our containers held up for a week at the Chennai port than use the port in Tuticorin. That’s the worst-case scenario,” Kalaiichelvan says. “Of course, the ideal thing would be a port right here in Pondicherry,” he hopes optimistically.
Shifting his focus to what the government could do, not necessarily at the port, Kalaiichelvan says the Pondicherry government would do well to provide interested companies with some incentives to set up their facilities in the coastal town. “There are no incentives, no encouragement from the State government. If this is the case, how will industries come up here?” he asks, genuinely concerned.
In-house strengths
On a positive note though, Kalaiichelvan says Manatec’s recently launched 3D wheel alignment system is notching handsome sales. “We’ve already sold around 100-odd machines. The Auto Expo last month
gave a huge fillip to sales, albeit it’s too early to say if all the attention at the expo has converted into orders,” he adds.
The 3D wheel alignment system is India’s first such indigenously designed and manufactured system that uses this technology. In fact, globally, only five to seven companies design and manufacture all aspects of this system. The entire system was developed at Manatec’s in-house R&D centre. The project that took about two years is replete with innovations unique to Manatec, and some are even pending patents.
The company faced issues with the data acquisition phase of the wheel alignment system. In the existing wheel alignment technology, dubbed a CCD (charge coupled diode), the data acquisition happens the old-fashioned way, using wires connecting the four-mounting plate on each wheel with the centre console. In the new 3D technology, there are no wires. RFID, or radio frequency identification, is used to transfer information from the target plates to the centre console. It was the tailoring of the software bits that proved to be a major challenge for Manatec.
“The camera technology was new too,” says Kalaiichelvan. “We’ve handled cameras at the CCD level, but this was entirely different. We had to customise it in terms of its resolution. We had a big challenge in vision mapping – what the camera observes on the target plate.”
The target plates are also unique to Manatec in that they are squares, not circles or triangles which are the norm worldwide. “We had chosen to use square-shaped target plates. Not many alignment designers in the world use square plates. We were actually the first to use square plates. That’s because we wanted to show the difference. If we’d chosen a triangle or circle, it would’ve meant we copied designs,” says Kalaiichelvan.
All those long hours at the R&D centre have transformed into a rather unique product that is available at Indian costs. “There is a significant cost advantage for us. The retail tyre-shop owner saves upto Rs 1.5 lakh with our system, compared to the imported ones our competitors sell,” remarks Kalaiichelvan. “Besides, we make the spares too and service is available round the clock,” he adds with a smile.
Asked if the sophisticated technology could be utilised to its fullest by roadside tyre-shop operators, Kalaiichelvan clarifies that the machine could even be easily used by someone who’s cleared his 10th standard exam. “There is no language in the interface. This will help in exports too. There are only icons and signs that pretty much show what the operator has to do from step one till the end,” he says, adding that “a typical wheel alignment takes just about five minutes.” Manatec also provides a one-day training programme to the operator whenever a machine is installed.
Tyre majors on Manatec's radar
The company has recently received product approvals from Renault and Apollo Tyres. Tyre majors Bridgestone and Michelin are next on its radar “and we’ll get these orders within a year,” remarks Kalaiichelvan.
Manatec enjoys a market share of around 30 percent in a Rs 300 crore servicing industry in India. “We want to take this figure up to around 40 percent by 2014-15. There are very few organised players in this segment. So given our strong reputation, I’m sure we can achieve this target,” he signs off confidently.
KARTHIK H