Text: Gaurav Nagpal
The Indian Machine Tool Manufacturers’ Association (IMTMA) recently organised the first edition of the Delhi Machine Tool Expo 2015 (DMTE). The event aimed to cover the entire spread of metal working machine tools for metal cutting, metal forming, automation, tooling systems, production aids, accessories, and other technologies for manufacturing needs, with a special focus on small and medium enterprises (SMEs). The event was spread over an area of around 10,000 square metres and saw participation from nearly 200 exhibitors from 8 countries including China, Taiwan and USA.
Speaking at the inauguration, the Chief Guest Ambuj Sharma, Additional Secretary, Department of Heavy Industry, Ministry of Heavy Industries and Public Enterprises, Government of India, spoke of the high priority accorded by the Government to IIMs, defined as Investment, Infrastructure, and Manufacturing, which was a key objective of the Make in India campaign. He believed that the DMTE would allow regional players to bring forward their products as well as share information and work towards the future. He spoke highly of the importance of the machine tool industry, which he felt a place of pride for the department and the department had been interacting with the IMTMA as well as industry players to work together for the growth of the sector.
Speaking on the occasion Sharma deciphers 4 policies the government is working on, which includes, Automotive Mission Plan (AMP) for 2016-26 will focus on the automobile and auto component industry. The 2022 mission plan for electrical equipment industry envisages growth from US$ 25 billion in 2010-11 to US$ 100 billion in 2022. The mission plan for electric and hybrid vehicles, targets 2020 as their cut-off which involves significant technology and efforts towards clean and green transportation. A composite and consolidated mission plan is expected very soon for the policy of capital good sector.
These 4 policies would be in effect before the end of 2015, and would serve as a synchronised effort towards the growth of the capital goods sector. The government expected a 7-8% growth in auto components along with a similar growth in the GDP, and if the monsoon would be good and the GST would be rolled out, the capital goods industry, the machine tools industry in particular would be in an advantageous position.
The exhibitors clearly felt a positive vibe and were encouraged by the policies and positive spirit of the government. Automobiles as a sector contributes about 50% of the turnover of the machine tool sector, with the share going as high as 90% for some players. Other sectors of significance include aerospace, defence, energy, and heavy engineering.
This significance and interdependence also meant that the machine tools sector felt the pinch from the overall slowdown in the automobile sector, with commercial vehicles slowing down and only passenger vehicles and 2-wheelers showing some encouraging signs. In particular, Tier 1 and Tier 2 vendors, key customers of the machine tool industry, had cut down on their production and could not fully utilise their existing capacities, which meant they could not buy new machines and would spend largely on replacement and repair work only.
Most companies said they were able to tide over the situation for the time being by pushing their efforts in other sectors, with defence and heavy engineering proving to be strong performers. However, considering the overbearing significance of automobiles, they were likely to face flat to negative growth if the situation would not turn around soon. The expectation was that sentiment would improve and some growth would happen towards the end of 2015 or in the first half of 2016.
Low cost automation was among the measures being discussed in the industry, with some players suggesting that it could be the way forward, especially for automobile components. The majority were of the opinion that automation itself would work only in the case of small components that were manufactured in high volumes and thus could not be implemented across the board. Appropriate levels of automation would allow control on the ever-rising cost of labour along with an improvement in productivity and more consistent quality of output and this could see growth in the next 2-3 years.
Another topic of discussion was the choice of multitasking machines (MTM) versus single-operation machines (SOM). As of now, MTM was not expected to see much growth in the automobile sector and particularly in auto components, as many component manufacturers did not feel there would be returns commensurate with the investment required. Also, MTM would limit the volumes of output and would thus work only for small-volume components or those requiring multiple operations. MTM overall would in fact be more suited to a sector such as aerospace, oil and gas, or where there would be high value addition; in automobiles though, it could find wide use in job shops or in development of prototypes, especially because the automobile sector is highly dynamic and necessitates the use of low value high performance machines that are flexible towards design changes.
