Bharat Forge expands forging capacity, sets sight on Europe

Auto-components major Bharat Forge Ltd, the flagship company of the Kalyani group, inaugurated its second 16,000 MT Weingarten forging press line on March 27.The addition of the new line raises the company's capacity for forgings from 70,900 MTs to 1,00,000 MTs, making it the largest single-location forging plant in the world, and only one of two companies in the world having two such large forging press lines installed.

The new forgings press line, installed with an investment of Rs 145 crore and requiring a low additional manpower of 40 to 45 people, promises to be a "very productive piece of equipment," according to company chairman and managing director. Baba Kalyani."The new line will also give BFL customers additional assurance against breakdown," he adds.

The new line is an identical facility to the earlier one installed in 1991, and uses identical dies and toolings, but is more advanced in terms of technology and automation robotics. "In the forging business worldwide, the biggest problem is breakdown of equipment which results in supply disruption," says Kalyani. "With the addition of an identical facility with interchangeable toolings, we have created conditions to cater to any demands of capacity, peak demand, or accelerated needs. Thus, BFL provides a unique advantage of backup insurance facility to its worldwide customers." 

The new facility was inaugurated by Meritor chairman and CEO, Larry Yost. Meritor is BFL's largest overseas customer, to whom BFL supplies front axle beams and steering knuckles for heavy trucks. BFL is the number one supplier of auto-components to the US, with a 60 per cent market share in front axles for heavy trucks in that country.

After making decisive inroads into the US auto-component markets, the company now proposes to increase its thrust in the European market, where it has begun supplying auto-components to automobile producers like Volvo and Daimler Chrysler.

Bharat Forge will be supplying 40,000 front axle steering knuckles to Volvo's trucks, and already supplies 350,000 camshafts annually to Daimler Chrysler for its A class series vehicles. "Our exports in 1999-2000 to the European markets were to the tune of Rs 10 to 12 crore, out of total exports of around Rs 115 crore. This figure will grow substantially," says Kalyani. "The European market is as large as the American market, but what was lacking was marketing.  Europe has been a conservative region with vertically integrated practices. Now all the US business practices are percolating into Europe. We have the technology, the competitive edge and the knowledge."

The company expects to close fiscal 1999-2000 with a net profit of Rs 62 crore and a profit before tax of Rs 70 crore, on a turnover of around Rs 600 crore.