| Gearing up
New Delhi, Sept. 24: Canada-based Magna International, the world’s third largest supplier of auto components, has drawn up plans to expand in India.
“We are looking at a couple of greenfield opportunities. We want to set up plants in India for both our Indian and overseas customers in the next 10-12 months. These plants will manufacture components and sub-assemblies. They would be in powertrains and engine components,” said Prasen Agali, executive director-India, Magna International.
Earlier this year, Magna International, which has a turnover of $22.8 billion, had set up a sales and engineering office in Mumbai.
Agali said Magna wants to raise the turnover of its India operations to $120 million within four years.
Magna, which is considering both northern and southern parts of India to set up these plants, is also open to partnerships. The investment in these facilities will be around Rs 100 crore.
However, refusing to divulge Magna’s current investment in India, Agali said, “We will grow six or seven times from our current size in four years.”
In India, Magna will adopt a two-pronged growth strategy. While the company is chalking out plans to increase sales to local original equipment manufacturers (OEMs), it is also eyeing sourcing opportunities.
“We are looking at India as a global sourcing hub. The country has a lot of potential. There are many local suppliers who can supply to Magna’s plants worldwide,” said Agali.
The company is planning to purchase components worth $100 million plus from Indian suppliers for its global operations over the next three to four years, said Agali.
Meanwhile, Magna’s joint venture in India — Lumax Magna Donnelly Automotive Mirrors — is mulling other production opportunities.
The joint venture, which at present makes interior and exterior mirrors for Maruti Udyog, is also planning to produce outside door handles.
“Plans are, however, not finalised. We are talking to our customers (OEMs)”, said Agali.
To expand its operations, the joint venture is in talks with three to four OEMs. According to sources, these include Tata Motors, Honda Siel and Hyundai Motors India.
Agali ruled out the possibility of Magna manufacturing and marketing vehicles under its own brand name in future.
“Worldwide, we operate with a basic philosophy. Since we are the suppliers of components to the automotive industry, we do not want to enter the field of manufacturing vehicles and selling them under our own brand. Then, it will be like competing with our own customers,” he said.
Regarding its concept vehicle MILA, which stands for Magna Innovation Lightweight Automotive Systems, Agali said the company was is talks with two global OEMs to launch this product.
“We are in discussions with a couple of them. It will depend on the OEM to launch the product whenever it finds an appropriate market,” he said.
Magna designs, develops and manufactures automotive systems, assemblies, modules and components and engineers and assembles complete vehicles for original equipment manufacturers (OEMs) worldwide.