Saturday May 17, 02:28 AM
Gap in the rim
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Be a high-end luxury sedan or a 49-tonne truck, it is immobile without a wheel rim. The wheel rim has now caught the attention of producers globally, including India, with the demand-supply gap standing as wide as 10.81 million wheel rims. According to International Organisation of Motor Vehicle Manufacturers, there is a shortage of 6.81 million passenger car wheel rims and four million commercial vehicle wheel rims, worldwide. When the present capacity utilisation stands at 423.67 million, the demand for wheel rims (passenger and commercial wheel rims together) globally stands at 434.49 million. With statistics indicating that low-cost countries like India will make up to 40% or $700 billion of the total components sourced globally, all the arrows are pointing towards Indian auto-component manufacturers. The industry is expected to witness a compounded average growth rate of 17% between 2005 and 2015. In terms of export, India is expected to touch $6 billion by 2009. Realising this potential, Indian wheel-rim makers, including Kalyani Lemmerz Ltd (KLL), Steel Strips Wheels Ltd (SSWL) and the new entrant in the market-Asia MotorWorks Ltd (AMW), are busy scaling up capacities. AMW, a heavy commercial vehicle manufacturer, sees an export market of 70% for passenger car-wheel rims to Europe and US. "We see great export potential for passenger car-wheel rims. For commercial wheel rims there is a huge market within India," said Anirudh Bhuwalka, managing director, Asia MotorWorks Ltd. KLL is expanding its capacity at the Chakan plant near Pune from 1 million units to 2 million units per annum to cater to the demand. "The expansion will be completed by September-October this year," an official from KLL said. Chandigarh-based SSWL, manufacturer of steel wheel rims for passenger cars, utility vehicles, two-wheelers and agriculture vehicles, is also on an expansion spree. The company is setting up a new plant in Chennai for Rs 105 crore. "We are raising money through banks, including Axis Bank, State Bank of India and DEG, the German development bank," said a company spokesperson.
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