REPORT 10/NOV/2014: Fait Group\'s Magneti Marelli unit expects strong demand for its lighting, engine control and automated manual transmission (AMT) products in India. It has a joint venture with Maruti SuzukiBSE -0.24 % to manufacture AMT systems - Maruti introduced AMT in February with the Celerio hatchback - which have so far been imported. In an interview with Nabeel A Khan, Magneti Marelli India Managing Director and Country Manager Saju Mookken says it took three years for the company to convince carmakers in India to use the ATM kit, but it is now facing a supply crunch because of huge demand Edited Excerpts. How cost effective is AMT? The most important factor for the Indian consumer is fuel efficiency. In case of AMT, the fuel efficiency is even better than manual transmission, contrary to AT (automatic transmission) which reduces the efficiency by up to 10%. The cost differential between manual and AMT is around Rs 40,000-50,000. AMT offers convenience to (car) manufacturers as they don\'t need to replace the manual transmission, but put up an ad-on hydraulic kit. However, it cannot be retrofitted. Initial cost for the carmaker is not big as he is not working on the manual transmission. Rather he is giving an option on the existing transmission.
There have been major supply constraints. How are you addressing it? The kits which are now being put on the vehicle are imported as CBU (completely built units) from Magneti Marelli\'s plant in Italy but tested and validated here and then supplied to Maruti. There is a challenge in supply chain which is caused by unprecedented demand. Neither the carmaker nor Magneti Marelli had anticipated such a demand in such a short time. We did not have capacity constraints as we manufacture it at three locations - China, Brazil and Italy - but the constraints came from our supplier side which we are trying to address. We are also setting up a new plant in Manesar (near Gurgaon). We may supply AMT to the Asean (region) and Japan from here. What is your plan for investment and technology introduction in India? I have already invested Rs 800 crore with our partners. We are here for the last six years or even lesser. Last year, in India, we have done around Rs 1,100-1,200 crore in revenue and in a four-year time frame, we are going to triple our revenue. It will be supported by investment, but cannot give you an exact number. The next pathbreaking technology that we will bring in India is the low-cost I have already invested Rs 800 crore with our partners. We are here for the last six years or even lesser. Last year, in India, we have done around Rs 1,100-1,200 crore in revenue and in a four-year time frame, we are going to triple our revenue. It will be supported by investment, but cannot give you an exact number. The next pathbreaking technology that we will bring in India is the low-cost fuelinjection system for mass-segment two-wheelers. The first motorcycle (with the technology) will be launched in India with Hero MotoCorpBSE 1.09 % early next year. We will also look at manufacturing another electronic component - e-call (emergency call) system which is a feature like SOS going to be mandatory in some countries. So we will manufacture (the product here) and supply there.
How do you see India\'s automated transmission market growing? Looking at the traffic congestion and increase in young self-driver buyers, it will certainly grow. Currently around 1-2% of total passenger vehicles would have automated transmission, but I expect this to increase to 30% by 2020. It will be mostly commanded by the AMT solution.