Pune-based Kinetic Engineering, which is one among India’s oldest automotive component and vehicle manufacturing companies, is eyeing growth in its business with the burgeoning demand in the electric two- and three-wheeler segments in the country. The company has earmarked to invest Rs 54 crore into a new subsidiary Kinetic Watts & Volts that will manufacture EV components such as motors, axles, frames, controllers, and batteries. Ajinkya Firodia, Managing Director, Kinetic Engineering, outlines the company’s plans in an e-mail interaction. Excerpts below:
What market opportunity does Kinetic Engineering see in the EV component segment?
Kinetic Engineering (KEL) envisions a significant market opportunity in the electric vehicle (EV) component segment, driven by the burgeoning demand for electric two- and three-wheelers. To capitalise on this trend, KEL strategically established a subsidiary with a maximum capital Rs 25 crore, where the company maintains a controlling 51% ownership.
Within the EV component market, KEL has meticulously identified key products for development, including electric two-wheeler frames, axles, electric three-wheeler chassis, and gearboxes for electric two- and three-wheelers. By focusing on these critical components, we aim to position KEL as a major player in the rapidly expanding market for EV parts and assemblies.
Furthermore, encouraged by the anticipated surge in the market for electric two- and three-wheelers in the coming years, KEL underscores the need for swift action to seize new opportunities. This strategic move reflects our commitment to innovate and adapt to market trends, aligning with KEL’s history of revolutionising the two-wheeler sector and evolving into a prominent manufacturer of auto components. With a forward-thinking approach, KEL is poised to play a pivotal role in shaping the future of the EV component segment.
Has the company shortlisted any products that it intends to manufacture? Will it be foraying into components that allow it to exercise its existing competencies?
KEL has a top-driven mandate to explore all potential avenues of being successful in the EV product range. Accordingly, the board has approved the formation of a new company – Kinetic Watts & Volts – as a subsidiary of KEL. This subsidiary shall explore the market, and strategise KEL’s entry into the EV segment, depending on our strengths and market forecasts. KEL has already identified EV axles, gearboxes, and chassis, as well as other body parts and may add further products for a strong and sustainable future.
What investment does Kinetic Engineering earmark to diversify into EV components?
We have allocated over Rs 54 crore for strategic investments in EV components through KEL’s newly-formed subsidiary and through self-investing. This decision was approved during the recent board meeting, where the company outlined plans to source capital from various channels, including promoters and the sale of non-core assets, the process for which is currently going on.
Is tapping into export opportunities also part of the plan?
Certainly, tapping into export opportunities is a critical part of the plan for Kinetic Engineering. We adopt a 50:50 strategy, allocating equal importance to both domestic and export markets. This deliberate approach underscores our commitment to global expansion and capitalising on export prospects.
Our highly-diversified electrification component portfolio, spanning across electric- and hybrid vehicles, alongside a range of automotive parts, exemplifies our proactive stance in exploring international markets. Kinetic Engineering’s dedication to financial resilience, adaptability in addressing challenges, and embracing technological advancements further solidify its strategic outlook, positioning us to not only navigate uncertainties but also excel in the competitive global manufacturing landscape.
This holistic approach ensures that KEL remains well-positioned to seize export opportunities while maintaining a strong presence in the domestic market. We are also in discussion with various of our existing customers to include us in the EV plans and they have committed for us to do so.
Is the company in talks with potential customers for its EV offerings?
We are actively engaged with potential OEM customers for our EV solutions. Under the Watts & Volts umbrella, we aim to offer integrated solutions for our EV customers. Some of the key components on offer will be e-motors, controllers, and batteries. Furthermore, our objective is to serve potential EV customers, both smaller and larger ones, by providing a one-stop solution for these crucial EV components.
Notably, we have secured partnerships with prominent names like Kinetic Green, E-blu, and E-fill, and have completed a dedicated manufacturing facility for Mahindra & Mahindra. Therefore, we are closely eyeing the market, and gearing up as per the evolving needs of the electric mobility market.
In terms of technology upgradation, what roadmap does Kinetic Engineering have to augment its efficiency, capacity, and quality?
We are strategically poised to leverage technological advancements to enhance efficiency, capacity, and overall quality of our products. We aim to prioritise the upskilling of our workforce in automation, IoT, and cybersecurity to effectively harness these technologies and tackle emerging challenges. Emphasising the importance of diversifying its sourcing channels, Kinetic Engineering aims to mitigate potential disruptions in its supply chain.
Furthermore, the integration of IoT-driven predictive maintenance measures is aimed at minimising downtime and optimising operational efficiency. Recognising the transformative potential of 3D printing, IoT, and AI within the electric two-wheeler sector, we aim to leverage these technologies for rapid prototyping, predictive maintenance, and enhancing customer experiences.
The strategic alignment of IoT, 3D printing, and AI in analytics facilitates optimised production processes, inventory management, and quality control measures. This integration drives innovation and efficiency across Kinetic Engineering’s manufacturing operations. By embracing Industry 4.0 principles, the company is committed to adopting automation and robotic process automation (RPA) to further enhance operational efficiency and productivity in the evolving manufacturing landscape
For quality enhancement, KEL has various initiatives such as the 5S championship that started last year. Moreover, KEL has started organising monthly Kaizen awards, where improvements and poka-yokes are recognised.
We have also implemented auto-gauging for our customer – American axle. One is already in production and 4 more equipment have been ordered. This equipment automatically conforms to all the parameters important to the customer before marking it green and allowing us to despatch the part. If the part is found non-conforming, it does not allow checking on the next part till this part is put in the rejection bin. We are also in the process of upgrading our machinery, and restoring and confirming accuracy of all our machines to meet the stringent quality requirements of international & domestic OEMs.