Fiem Industries set for bigger growth

Having inked a ‘License and Technical Assistance Agreement’ with BATZ S. Coop. of Spain for manufacturing of complete Pedal Box Assembly in April this year, Kundli-based Fiem Industries is moving towards developing and manufacturing other products for automotive applications.

The BATZ tie up helped the company bag orders to supply Accelerator Paddle Modules (APMs) to General Motors India for the automaker’s small car scheduled to be launched in 2011. ‘In fact, we are going to be the first supplier of APMs to General Motors India for their Global Small Vehicle (GSV), which is scheduled to be launched in February 2011,’ Senior VP (Marketing), Fiem Industries, SK Bhatia told Auto Monitor.

Pedal Box Assembly is a new product line for Fiem Industries and will add new dimensions in its business diversification policy, the company had stated in its notification to the Bombay Stock Exchange. This is deemed to be a major entry for the auto parts major into the four-wheeler segment.

More recently, the company has decided to start manufacturing wiring systems, both for the domestic and overseas markets. Besides this, the company has also got the approval by many global players for supply of lighting and rear view mirrors, production for which is slated to begin from November-December this year, Bhatia informed.

Bhatia said that the leading manufacturers of automotive lighting, signalling equipments and rear view mirrors would also start supplies for the upcoming models of two-wheeler manufacturers, Honda Motorcycle & Scooter India (HMSI) and Suzuki Motorcycle India (SMIL). The company’s major business comes from the two-wheeler segment of the vehicle industry.

In the meantime, the company is also in the process of developing new product lines, both for two-wheelers and four-wheelers, for products scheduled for launch in 2011. ‘We have already started working on the design and development because lighting products — which are proprietary items — need to have at least two years time to reach production level. Our technical partner Ichikoh (Japan) is supporting us in the process, and hopefully by the next financial year, we will start supplying to HMSI and Suzuki and some of the carmakers,’ Bhatia said.

In the four-wheeler segment, Fiem’s business with Hyundai Motor India (HMIL) has somewhat been limited till date, but that is expected to change soon. The company would soon start supplying headlamps and tail lamps for Hyundai’s upcoming models. To that effect, Fiem has recently signed a MoU with one of the companies in Korea that is a major supplier to Kia Motors. Fiem would start supplying the products to HMIL once the agreement with the Korean company comes through.

Although a major supplier to the two-wheeler industry, Fiem doesn’t have any business from market leaders Hero Honda and second-placed Bajaj Auto. The company is also supplying mirrors for Yamaha’s new products, and would soon develop lamps for the Japanese bike major. Bhatia also informed that in India around 275 companies have registered for manufacturing electric vehicles, and around 175 of them are already with Fiem for their products.

Planned Expansions

To address the new businesses, Fiem has decided to invest in new facilities in Rai and Manesar, both in Haryana. Commercial production at both these plants is expected to begin by the next financial year, informed Bhatia. ‘Besides land, investment in these plants would be around Rs 50 crore (Rs 40 crore in Rai and Rs 10 crore in Manesar) by June 2009. The Manesar plant is exclusively being set up for HMSI and SMIL. Unlike in the past, Fiem would supply plastic parts and sub-assemblies directly to the customers from the Manesar plant.

The Rai facility — for anti-glare mirrors — is being