The Hindu Business Line : Rolls-Royce sets up Indian subsidiary

ROLLS-Royce has tied up with Bangalore-based QuEST (Quality Engineering and Software Technologies) to outsource engineering work, which will lead to a savings of 25-30 per cent for the power systems company.

At a press conference here on Friday, the Rolls-Royce Plc Chief Executive, Sir John Rose, said the company has set up a wholly owned subsidiary here to manage the growing volume of engineering work that will be sub-contracted in the country.

Initially, around 100 engineers will work on the project and the number will grow to around 200 in two years. Quest itself is investing around $2 million into the new project.

QuEST will work in the area of system and component design for Rolls-Royce apart from modelling, stress analysis, performance, manufacturing and service engineering and technical publishing.

The Rolls-Royce General Manager, Mr Mike Bradley, said this would be the first such outsourcing work given out by the company. "We had an 18-month pilot with QuEST and now we are ready with the main project," Mr Bradley said. He said in March, a Rolls-Royce centre was set up in QuEST's Bangalore facility and the volume of work has built up to require 100 locally employed engineers. Though the cost savings will not be visible initially, Rolls-Royce will start seeing the benefit in another three to four years, a QuEST official said.

QuEST is planning to float an IPO for around $25 million within 18 months. The money raised from the IPO will be used to acquire a company. QuEST expects to increase its revenues from around $25 million currently to $100 million by 2010.

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