The Hindu Business Line : How vendors geared up

Speaking to Business Line the Chairman of Rane Group, Mr L. Ganesh, said when Tata Motors began the project the mandate given to suppliers was to move closer to the manufacturing plant. This was primarily to optimise logistics due to higher volumes, he said.

Regarding cost, he said the margins for the components supplied to the Rs 1-lakh car would be low, however, it would suffice with higher volumesSources from the TVS group companies that make auto components said the challenge was to design the component as the entire car and the engine were being developed afresh, with shorter dimensions for size.

The Executive Vice-President of Lucas-TVS, the company that supplied alternator and starter motor for the Nano, said the project called for real breakthrough approach in designing because of demand in terms of price, size and delivery time.

The challenge was to develop new products at the shortest possible time, he said. The size of the components developed by the company had been reduced by 15 per cent to accommodate them in the engine, he said. According to sources from Bangalore auto component manufacturers, the agenda for the vendors supplying components to engine was to integrate components and systems during the design stage itself so as to optimise cost, space and weight, without compromising on efficiency. For instance the oil pump and water pump were integrated to reduce cost. However, suppliers had been given choice to take up the business based on their viability. Quite a few vendors who had been supplying components to other vehicles manufactured by Tata Motors did not participate in the Nano development due to non-viability. That gave an opportunity for the new companies to get the Tata Motors vendor codes, they added.