Volvo Penta begins production of its engines at its local VE Powertrain facility in India. The new assembly line will enable the company to derive business gains on multiple fronts.
Targeting its April 2017 deadline, Volvo Penta has started production of its D5 and D8 (five and eight-litre) engines at the VE Powertrain facility in Pithampur, Madhya Pradesh. The facility already supplies engines for the Volvo Group’s global on-highway requirements. Local manufacturing of Penta engines is part of the company’s expansion plan in India. Tractors India Limited (TIL) has also begun to source local made D8 Penta engines for its truck cranes.
NBM&CW discusses the company’s India plans with Mr. Jonas Nilsson, Head of Volvo Penta in India, Mr. Giorgio Paris, President Emerging Markets & Asia Pacific, Volvo Penta, and Mr. Peter Hartinge, Volvo Penta, Global Operation.
What competitive advantage will Volvo Penta India gain from the new production line at the VE Powertrain facility?
Demand for engines from the off highway equipment sector is going up in India, backed by firm demand from the infrastructure sector. The new production line will enable us to cut down lead times and logistics costs extensively, as compared to sourcing them from our manufacturing facility in France. Further, local production will insulate us from currency rate fluctuations. We will be able to provide engines built on the global technologies of Volvo Penta, but at lower landed cost for the Indian and foreign OEMs based in India.
As the company has begun to cater to the commercial market as well, what fresh investments has it made in its production facility?
The Pithampur Powertrain facility and the engine platform were designed to meet Indian and export requirements with engine technologies meeting various on- and off road emission levels – from Bharat StageII to future Bharat Stage VI. The plant capacity is expandable to 100,000 units per annum. So, we have not undertaken any large scale investments or installation of manufacturing line on a larger scale, to commercially manufacture and market the engines. We have only extended the basic assembly line with a final assembly of industrial off-road engine variants. This has been synchronized with our global processes & IT systems.
Which business segments will Volvo Penta be targeting in India?
There is a plethora of segments on the radar for marketing our engines. We are looking in a major way for raw material extraction equipment. There is a major fleet of Sandvik equipment that are fitted with our engines, working for underground raw material extraction involving hard rock extraction at Hindustan Zinc’s mines.
We are also looking at dewatering application in surface mining. There is a major challenge of dewatering of mines at a faster rate to resume operations. This is true with quarries as well as coal and other mines in India. With our high-powered engines providing higher torque at lower rpm, the engines will be able to pump out water in larger volumes from surface mines at variable speed with lowest fuel consumption. Volvo Penta is also closely looking at the compressors applied in bore well drilling.
We are actively targeting Indian and foreign crushing and screening tracked plant manufacturers. Crane and material handling is another business vertical we are considering. Tractors India Limited (TIL) has awarded us an order to supply D8 localized engines for their 80- ton mobile cranes. In view of the results, TIL is looking to use our engines in their other models of mobile cranes.
What are the power ratings of Volvo Penta engines?
For raw material extraction, -processing and dewatering, we will offer our 5- and 16-liter engines that have 105 to 565 kw power output.
What about your plans for supplying engines for captive power consumption by larger capacity fixed crushing plants?
It is a very potential business segment for us. We have been making some in-roads into this business segment, and we will be looking for more business opportunities through our channel partners Supernova, Sterling & Wilson, Power Engineering, Rai Prexim and Kohler.
Any plan for tapping the very lucrative Indian excavators market?
No, we will refrain from tapping the excavators market, and will desist from marketing our solutions in segments where Volvo Group has an active presence; excavator business is one of them where Volvo CE has got a strong business positioning in India.
Will you be exporting the engines?
We will not be directly involved in exporting the engines from India for commercial use. The OEMs will be indirectly exporting them by fitting them into their plants and machinery, and they will also be responsible for their servicing.
With Volvo engines now being manufactured in India, will there be any changes in design for more ease of maintenance?
Globally, we manufacture engines with standard design principals. The same will be applicable for Indian production as well. Our engines feature vital design principles for ease of maintenance such as remote filters, alternative oil filling provision, oil monitoring provision, and many more. Crane OEMs will find these features very useful for ease of serviceability.
What about engine installation flexibility?
During the design stage of the engines, we enter into application engineering with the OEMs. This involves a review of OEM design requirements, discussions on suitable optional equipment, packaging study, prototype installation, testing and validation. This is done jointly with our own and OEM design engineers, so as to have installation flexibility and ease of maintenance and service.
What product support will the company offer?
We have in place an elaborate and well-devised service agreement; it comprises our White, Blue, Silver and Gold services and 24x7 Volvo Action Service Support. The service agreements are adaptable to customer needs. Engine condition monitoring and oil sample analysis is also part of our product support. We have a wide after-market network, and we are further strengthening our service touch points. Currently, we are present in 61 locations with 85+ touch points throughout India. Our regional warehouse in Bangalore, for instance, has been delivering timely parts in India.