Clutch Auto settles dispute with Tata Motors

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Clutch Auto settles dispute with Tata Motors

Clutch Auto has settled its dispute with one of its key patrons Tata Motors, informs its vice chairman and managing director Vijay Kishan Mehta.

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Clutch Auto has settled its dispute with one of its key patrons Tata Motors, informs its vice chairman and managing director Vijay Kishan Mehta. "We were regularly supplying to Tata Motors," he said adding, "There were no legal issues with Tata Motors."

He also informed that the company has bagged two additional projects from Tata Motors.

Here is the verbatim transcript of his interview with CNBC-TV18's Udayan Mukherjee. Also watch the accompanying video.

Q: I believe you have commenced work with Tata Motors again after sorting out of the legal issues. Can you take us through which products you are beginning to supply components to them?

A: We have been regularly supplying to Tata Motors-there was no stoppage. Any new business or any increase of share of business, all over the world in the automotive industry, is squarely the prerogative of the vehicle manufacturer. So we had no legal issue with Tata Motors but whenever you have business dealings, there could be some misunderstanding here or there.

We have been supplier to Tata Motors for the last 35 years. They have been kind to us and we have been doing good business with them. But in between there was a little slowdown in diversification of our business range, which has again picked up in last month or two. We have been a very loyal supplier and vendor to Tata Motors. And with our in house base and our competitive cost pricing, technology base-we will be able to do a good service to Tata Motors.

This has what has given us some good opportunities now in the high volume segment-both in the lower tonnage range as well as the higher tonnage range, which were to two areas, which we were not contributing or catering to earlier.

Q: So you are seeing more order traction, can you just quantify it from the commercial vehicle front on heavy duty trucks have you seen order flows pick up?

A: Post Bharat Stage III, Bharat Stage IV there would be a substantive change in the vehicle engine designs and fuel emission norms. Post October this will give a major fillip to the volumes in commercial vehicle industry and upgrading the basic configuration. This is the area we are getting in and we have edge on product. With service life, we can say it would be better than anybody else-at least 50% could be 100% and with new technologies that are coming our way, we are targeting minimum 100% more life on clutch in Indian conditions, which are the most rigorous conditions and not replicated anywhere else in the world.

This is the kind of service that we can render to Tata Motors and in turn pay for a long-term business because once the customer is satisfied we do get a sustained business.

We are looking for some good volumes. Tata Motors alone could be substantive and along with them Ashok Leyland and Volvo Eicher would be the backbone of our commercial vehicle business segment in the original equipment and in the spares market across the board for all segments.

Q: What about exports have shipments started to Navistar and can you give us an update there?

A: For Navistar, the FESO (Final Engineering Sign off) has been already granted for the entire range and the fitment trials have been carried out on two plants already. About three more are to be done and then they start picking up and maybe in the next month or so, we are building up some stocks in the US, they may go for an extensive launch in the service set up which will cover not only the Navistar trucks but the agreement covers all mix of class VII and class VIII heavy duty trucks.

The service parts business should start in the next month or two and fitment, after this next three plant trials, will start gradually as individual fleets business they can commit for our designs of clutches.