MG Group turns OEM

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The MG Group is looking at an exciting time ahead with new projects up its sleeve.

Story by: Bhushan Mhapralkar

Post the launch of tarmac coach Columbus and the sleeper version of Mammoth premium front-engine inter-city bus at Busworld India 2016, Mumbai-based MG Group is looking at tapping growth on various fronts. Keen to turn OEM by ‘productionising’ the Columbus, the Group is increasing its thrust in the OEM business by inking an agreement with Scania to build sleeper coaches on its 14.8 m chassis. Achieving a major milestone of 100,000 buses last year (100,000 buses were built in twenty years), the Group, according to Anil M. Kamat, Managing Director, MG Group, is aiming high. Announcing that the Columbus complies with the tarmac coach manual overall in terms of specifications, dimensions, etc., Kamat mentioned that a lean manufacturing system has been installed to produce the coach. Planning to launch the Columbus in January 2018, the Group is looking at supplying 50 to 60 tarmac coaches a year. “The tarmac coach niche,” explained Kamat, “befits the company’s bandwidth.” We are confident of supporting this product in the market, he mentioned.

Driving the Mammoth

Exporting the Mammoth to Africa, Bangladesh, Nepal and Maldives, The MG Group will soon deliver four Mammoth coaches to KPN Travels. These will be in the sleeper coach guise. Based on a MAN bus chassis (procured as per an agreement with MAN Trucks India), it took almost a year for the Alma Motors business vertical of the MG Group to develop the (front-engine) Mammoth. To attain the status of a premium offering, particular attention was paid to the design and NVH. Both, the MG Group and MAN worked on the NVH of Mammoth. While the 220 hp Mammoth is specific to the Maldives market, the rest of the markets are catered to by the 280 hp version. Competitively priced in the range of Rs.60 and Rs.62 lakhs, the Mammoth helped the Group to bag the Scania venture.

Paying attention to business areas that were not looking lucrative until now, the Group has begun pursuing the STU business with a hope to make it big. This confidence stems from the order bagged from Maharashtra State Road Transport Corporation (MSRTC) for 250 ‘Shivshahi’ mid-premum inter-city AC coaches based on a 180 hp Tata LPO chassis. Stated Kamat that the ‘Shivshahi’ bus has been designed by them. As per the agreement between MSRTC and the MG Group, the design will be transferred to MSRTC, said Kamat. With 55 to 60 per cent of the STU sales originating from Karnataka, Maharashtra, Telangana, and APRSTC, the Group is finding it advantageous with its facilities at Belgaum and Zaheerabad. Strategically situated according to Kamat, the Zaheerabad unit is already catering to Telangana and Andhra Pradesh. The MSRTC buses are being built at the Belgaum plant. Responding to private hire orders from MSRTC, the Group is hoping to close the deal soon. The private hire buses are expected to operate on a BOT basis. Confident that the agreement to transfer the design may not rob it of its advantage of building buses in less time, the Group, according to Kamat is a mass producer of bus bodies. he opined that MSRTC may not be able to match the Group’s body building speeds.”

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Growth from OEM business

Crediting OEMs for the capabilities it has come to possess, Kamat mentioned that the future looks exciting. Supporting OEM clients as they embark on new projects and increase their market reach, it was Scania that identified and certified the Group to partner with them, Anil averred. The MG Group, through its facility at Belgaum, which has been renamed as MG Automotives Bus and Coach Pvt. Ltd. from the earlier Alma Motors, will deliver sleeper coaches on Scania’s 14.8 m multi axle bus chassis beginning January 2018. “There are some other products that we are working upon with Scania, the details of which cannot be shared now,” said Kamat. Marketed by Scania, the engineering and product development of the premium sleeper coaches will be done by the MG Group. The sleeper coaches will be co-branded, and the IPR rights will be owned by the MG Group according to Kamat. Describing the development as a feather in the hat, Kamat expressed that they entered the premium bus market with the Mammoth. The Scania development marks the next phase of the strategy. In-line with the development, the Group has revised its manufacturing footprint. The unit-one at Belgaum is being expanded, refurbished and restructured. It will be dedicated to the building of premium buses, and was recently quality certified by Daimler Buses as well. The unit-two will cater to smaller buses that were earlier being built at unit-one.

Flexibility and versatility

To continue to build buses for fleet operators, the MG Group may build some premium coaches on Ashok Leyland and Tata Motors’ chassis too. Focus would be on MNC business as far as the premium coaches are concerned. It will entail a different style of working according to Kamat. It will also entail a different culture of working, and a totally different manufacturing process. Not a big player in the fleet operator bus building market, the Group, Kamat mentioned, will continue to pursue school and staff buses as its primary business. Growth will come, said Kamat, as OEMs seek to increase their market reach and market share. “As far as the mid-segment AC coaches are concerned, we were never that big. It will not be our top-most priority. We will be concentrating on the premium end of the bus spectrum with the Mammoth, the Scania coaches, and coaches for other OEMs apart from our very own Columbus,” Kamat explained. The expansion of unit-two at Belgaum should enable the Group to build 4000 bus units per annum. In discussion with Tata Motors for their export business, the Group is well aware of the flexibility and versatility that is essential to succeed in the industry. Kamat is confident of working up to the expectations of his clients. He cited an example of the Group building 1500 refuse trucks on the Jeeto platform for Mahindra’s Value Added Products (VAP) business division in a short span of three months. “The VAP division bagged the order under the ‘Swach Bharat’ scheme for GHMC, Hyderabad. We displayed immense flexibility and versatility by developing as well as delivering 1500 refuse trucks in three months from our Zaheerabad plant,” mentioned Kamat. To cater to higher volumes, the Group is expanding its Zaheerabad facility. The plan is to turn out more variants from this plant.

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Growth from allied business

Setting up a modern facility for its business vertical MG Composites vertical at Zaheerabad, the Group is eyeing the advanced composites space. Supported by a R&D center, and technology secured from UK, the Group is keen that MG Composites expands its product portfolio to nasal covers for wind mills and other non-automotive parts. The current product range of the company includes bus front and rear fascia, dashboard, interior trim parts, etc. Expected to be operational by the end of the second or third quarter this fiscal, the new MG Composites facility is expected to reflect upon the change in skill sets that the Group is experiencing. Attention is being paid on team building. Team building is also on at the Group’s MG Grey Engines business vertical. The company will break even this year according to Kamat. Plans are being chalked out to double the turnover. Supplying wiring harness, passenger announcement systems, destination boards, LED saloon lights, and more, the company is developing new products. Like MG Composites, it is also independent of the bus and coach business of the Group. It is free to offer its products to other players, and will soon increase its thrust in the ITS and telematics space. To drive out of red this year, MG Grey Engines will aim higher, and innovate. The company will support the Group’s plan to play a role in connected CVs.

Looking at 100 per cent growth this year on the basis of the STU business, the Group hopes to maintain that mark, and progress at 10 to 15 per cent year-on-year. Currently employing 2300 people, the Group hopes to hire 700 to 800 more people by 2020. With the first Scania bus slated to roll out of the Belgaum plant by January 2018, the Group is looking at launching an electric version of the Columbus tarmac coach next year. It is keen to build electric bus bodies as well.