Close to one thousand engines were manufactured during March 1999 accounting for a turnover of Rs 77 crore. This has helped the company overcome difficult times and consolidate its position in the engine market.

JL Deshmukh, who was executive vice-president and has taken over as director and vice-president of CIL, says the year-end does witness a spurt but this last quarter performance has exceeded the normal trend.

The company is reaping benefits of several new initiatives it undertook during the difficult times. CIL is expanding at both the lower-end and the higher-end to be able to service the entire market from 40 HP to 2700 HP engines.

CIL manufactures more than 1,000 engines every year and has maintained an 18 per cent growth for the last five years. However, during May-June 1998, CIL started experiencing alarming drop in volumes bothin domestic and export market. Exports which was around Rs 146.28 crore during 1997-98 was slated to go down by 50 per cent.

The company initiated plans to tackle the uncertainties in the domestic market by focusing on exports, introducing new products and drastic cost reduction in the operations.

"Export opportunities were always there and several products were in development stage. We expedited the development process and introduced three new models into the export market," says Deshmukh.

Since 1987, Cummins India was exporting only the V 28 series which was being marketed globally by Cummins USA and UK and sourced only from the Pune facility. Now three more series -- the K 38, the 885 big cam and Qantum series have been added to the exports basket. The new series will also be exclusively sourced from India for the world-wide market, says Deshmukh. Cummins India has worked jointly on the research & development (R&D) project with Cummins USA for developing the Quantum engines. Exports account fornearly 20 per cent of the production.

"We had to overcome the `Made in India tag' for its engines by inviting overseas customers to its plant and see for themselves Cummins' capabilities," says Deshmukh. All this prevented the sure slide in exports.

Cost reduction measures ranged from expense controls to reducing wastage. Another major area of savings came from indigenisation of components and the machine tool spares which had around 50 per cent savings. The Cummins engines now have indigenisation of nearly 70 to 90 per cent. During 1998-99 these measures saved at least Rs 10 crore for the company and more important they will register better savings during the current year.

Deshmukh is quick to add that there was no slow down in investments in technology upgradation and machinery upgradation or R&D. Investments were maintained at around Rs 40 crores.

Additionally, CIL has expanded the engine range in the domestic market. At the higher-end, Cummins expects to sell at least 4,000 to 5,000 engines whichwould get them a 50 per cent market share in this segment. CIL has entered the below 100kv range and has set up a core team to look into this market.

The gameplan is to give compact, ready-to-use engines to the smaller customers who can get started immediately without much outside assistance and build significant market shares in this new area.