PUNE, March 22: Magnetti Marelli Automotive Components (India) Ltd (MMAC), a subsidiary of Magnetti Marelli SpA has begun production of electrical and electronic components to domestic four- wheeler manufacturers as well as some "top-of-the-line" two-wheeler manufacturers from January 1998, president and chief executive officer (CEO) Arun Mote said.While Mote was unwilling to comment on investments, it is believed that the Italian parent will not invest more than Rs 100 crores over a two-and-a-half year period.
MMAC, currently located at Chakan, near here, will find a permanent location within a 35 km radius of Pune, Mote said, adding that the final decision could take up to one year. Although he did not rule out Ranjangaon as a destination for the component manufacturer, where Fiat's Palio project is slated to come up, he said they were still to come to a final decision.
MMAC will concentrate on supplying electrical and electronic components, not mechanical, maintaining a balance of about 80 per centelectrical and 20 per cent electronic. It has already begun supplying components for the Fiat Uno.
Magnetti Marelli's global operations target 75 per cent as an OE supplier, of which 35 per cent is to group company Fiat. The after market comprises 25 per cent of Magnetti Marelli's US $5 billion turnover. The Indian subsidiary is expected to maintain this business composition with a 75:25 ratio for the OE and after market, respectively.
Mote pointed out that since Magnetti Marelli is already a component supplier to European (including US car manufacturers in Europe), Japanese and Korean car makers who are in India, the relationship would automatically transfer to operations in India.
MMAC, which began production two months ago, expects to achieve 40 per cent localisation of its components by the end of the year.It is already looking at localising mechanical, machine and electrical components and is talking to various suppliers to develop components for it.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
