Our intention is to be a mainstream not a fringe player

Could you detail the product strategy of MNEL and MNAL for us?

RK: We would start with a product in the low volume, high speciality 25-49 tonne space by next month. Within a year, you would see us extending the range with two new products, with a foray in the 7.5-16 tonne space. The LCV range at Zaheerabad would then get a tech-boost to make them export-ready, followed by a rear engine bus platform in 18 months. We start with an aggressive localisation policy of up to 95 percent for all our products. Talking about the engines, we would start with a localised content of 70 percent and extend it to over 90 percent in a year’s time.

DK: In fact in a couple of years, we are talking a market-share of high teens, with exports on stream.

What were the existing businesses inherited by the JV and what is your exports strategy?

RK: The LCV lines at Zaheerabad along with a buyback arrangement of components by Navistar International are already in place. We export components worth $25-30 million already and are likely to double that in a couple of years.

DK: We also have the option of incorporating one of our smaller Acteons in the LCV range and export it independently. The scope of the JV is massive. Barring a couple of markets, where M&M and Navistar have a conflicting interest, the entire global marketplace is an opportunity for us. We could start with exports of engines in a year’s time and trucks shortly after that. The way this JV is structured, we own our IPR independently and don’t need to consent with our parents on such matters. The prospective markets for the first phase of exports cover Pakistan, Nepal, Laos, Sri Lanka and Vietnam.

How important is the Indian market for Navistar and how do you see the manufacturing cost structure, compared to other markets?

DK: From the strategy perspective, India is a fairly significant market for us; we look up to India and China for exponential growth in our international presence and revenues. The cost structure of engines and trucks in the US and EU is far higher than those in Brazil, which in turn is a shade higher than China and India. So, in effect we could leverage on a competitive advantage offered by the manufacturing processes here, along with our partner, with whom we see several synergies. In our experience, a player or two cannot corner the CV market unless there is insider trading or some other malpractices. So, we are confident of bolstering our market-share sooner in India to about 20 percent.

What is your emission strategy as we go forward?

DK: Our emission strategy is clear; we don’t want to leave anything to the end-user, either the driver community or the transporters. We believe that we (OEMs) should be entirely responsible for the emissions and a resolution to minimise them. For now in the US, we are aggressively pushing our patented exhaust gas recirculation technology and are completely opposed to selective catalytic reduction with the use of urea. For we know, no end-user would care to replenish urea levels and availing an infrastructure for pure urea is a challenge best not attempted. So we are clear that we do not want to do anything that requires anyone on the road to replenish levels of anything besides clean fuel, to minimise our carbon footprint. As far as alternative powertrains are concerned, we a have fleet of on-road and production-ready hybrids already in the US, and would bring to India appropriate technology