Auto Parts Asia — November 2017

AutoPartsAsia | NOVEMBER 2017 | 31

He had worked as purchase head for
SsangYong Motors, based in Korea.
When asked to compare the suppliers
of these two countries, Sikka said,
the major difference between the two
is that the Korean suppliers invest a
substantial part of their revenue on
R&D. Indian vendors still lag behind.
Some of them have started doing
good work but are way behind the
Korean and Japanese suppliers. “Our
suppliers have to do a lot more to
develop facilities and skills for R&D,”
he said. Some of the Tier-1 suppliers
he has visited there have substantially
improved their processes and are
world-class. On the process and
manufacturing side, many Indian
suppliers also have come of age
but they lack in R&D to design and
develop new products.

Owing to the increasing concern
about the consumer attitude and
demands, OEMs are forced to add
more features with the least cost push.
This inflates pressure on vendors.
When asked how does Mahindra
manage this situation, Sikka said,
“India is the toughest market to crack
in the automotive field and the Indian
consumer is the most demanding –
he wants the best products, with the
most advanced features, at the lowest
price. The pressure on OEMs to have
new products is very high. The life
cycle of products is getting shorter

• the refreshes have to come faster,
  with better features, at the same or
  even lower price. The trend is clearly
  there; and that actually makes our job
  very interesting because you keep on
  looking at new opportunities to add
  value to the business. It opens up the
  quest for new frontiers.”

For Dr Goenka, product development
is a continuous and collaborative
process. He said: “I strongly
believe that in today’s disruptive
environment product development

must become a collaborative process

between the primary developer and

its key suppliers. At Mahindra we

are committed towards creating a

sustained competitive advantage

and this clearly flows from our ability

to involve our suppliers in the entire

lifecycle of the product development.

We make them an integral part of

the process, which in turn forges a

stronger link between purchasing and

engineering. We are confident that this

will further raise quality, lower costs

and reduce investment in inventories

through the timely involvement of

our supplier partners in the design

process. Overall this holds us in

good stead and we often receive

external validation for our agility and

commitment to our suppliers.”

Yet another challenge is a combination

of three parameters - cost, variants

and light-weighting, which adds to

cost since it replaces conventional

materials. These three pull OEMs in

different directions. To this Sikka said,

“We want a win-win situation by doing

the right thing for our customers. Light-

weighting, we believe, is the right thing

to do and everybody, right from the

Managing Director to the man on the

shopfloor, aligns with this. For this we

bring new technology. Mahindra is the

only OEM in the country that uses hot

stamping so extensively. In KUV 100

and TUV 300 we have hot-stamped

parts. We are always on the cutting

edge of technology. New technology

without sufficient volumes is costlier.

You are constantly on the lookout

for cost-saving opportunities. This

makes the process very interesting

because despite the weight and cost

challenges, delivering value to your

stakeholders is vital.”