Gears Manufacturers Ride Piggback On Automobile Boom

A major concern for this Rs 9,000-crore plus strong industry should be the slow pace of technology upgradation.

The output of auto components rose by 35 per cent to Rs 9,058 crore in 1995-96 (Rs 6,727 crore).

Production of flywheel ring gears, steering gears and systems and gears including crown wheels rose to Rs 525.6 crore (Rs 367.2 crore ) - up 43 per cent.

The share of gears in the total output of the auto components industry grew to 5.8 per cent in 1995-96 from 5.5 per cent in 1994-95.

The share of steering gears and systems to the total output of gears improved to 33 per cent in 1995-96, while that of gears including crown wheels remained unchanged at 64 per cent. The share of fly wheel ring gears declined to 3 per cent.

 

The auto components industry will have to raise its output to Rs 20,000 crore to meet the rising demand from the vehicles industry.

The industry has already geared up for the task. According to Automotive Components Manufacturers Association of India (ACMA) president D K Jain, investment in the auto components industry increased by 41 per cent to Rs 4,800 crore (Rs 3,400 crore) in 1995-96.

In the year to March 1996, seven select gear companies reported an increase of 31.3 per cent in their sales income to Rs 369.4 crore (Rs 281.4 crore). Atlas Gears, Hi Tech Gears and Bharat Gears exceeded the average growth in their sales income.

Operating profit of the seven companies rose to Rs 59.9 crore (Rs 44.2 crore) - up 35.5 per cent, with Atlas Gears showing an increase of 85.2 per cent. Gross profit of the seven companies went up by 48.9 per cent to Rs 41.2 crore (Rs 27.7 crore), while net profit at Rs 20.8 crore (Rs 14 crore) rose by 48.4 per cent.

Atlas Gears and Bharat Gears showed an increase of 294.4 per cent and 101.2 per cent respectively in their net profit.

In the year to March 1996, operating profit margin of the seven companies improved to 16.2 per cent (15.7 per cent), gross profit margin to 11.2 per cent (9.8 per cent) and net profit margin to 5.6 per cent (5 per cent).

Indian companies have realised the importance of incorporating state-of-the art technology to meet the needs of the latest auto models entering the market.

For instance, Sona Steering Systems has decided to manufacture power steering in collaboration with Koyo Seiko, Japan. The company feels that power steering may have good demand from the entry of new cars to India.

The company's major buyer, Maruti Ltd, produced 2.75 lakh vehicles in the year ended March 31, 1996 and plans to produce 3.48 lakh vehicles in the present year. Sona Steering Systems hopes to benefit from Maruti's expansion plans and post a turnover of Rs 160 crore in the current year.

Gears are crucial for the functioning of vehicles. Their future hinges upon the auto industry. Automotive gears have three segments: transmission gears, steering gears and axle gears. A gear is a toothed wheel that transmits the turning movement of one shaft to another.

Transmission gears, including gearboxes, optimise engine power and speed depending on driving conditions.

They also allow engines to turn at high speed, while the wheels turn relatively at slow speed. Steering gears control the direction of the vehicle. Sona Steering, ZF Steering, Rane Madras and XLO India are the main players in this segment.

Steering gears come in two types - mechanical steering gears and hydraulic power steering gears. HPS gears provide greater operational ease and driving comfort than mechanical steering gears.

Buses and trucks use the HPS gears on a bigger scale. A HPS gear is five times costlier than a mechanical gear.

HPS gears makers, who supply to original equipment