Udit Sheth
Clutch major Setco is firing on all cylinders to achieve ambitious revenue targets by expanding reach in the aftermarket and other areas. “In the next 5 years, we want to take our turnover to $500 million,” said Udit Sheth, MD and CEO, Setco Automotive. “We believe that is very viable through more products and backward integration.”
Setco is setting up a new foundry which is expected to be operational next year. “The construction has started and the team is in place. We hope that over a period of four years, it will become 80,000 tonne per annum,” informed Sheth. The company has a plant in Baroda where it manufactures 600,000 covers and a million discs a year.
Setco at present manufactures clutch systems for medium and heavy commercial vehicles. “Our market share in India is nearly 90% in the OE space. The ambition now is to get 90% even in the aftermarket,” said J S Gujral, Vice President – Commercial, Setco Automotive. “We expect to pick up 20% share in first 24 months of our aftermarket service,” he said talking about the company’s immediate goals. Due to major presence in the OE market, its absence in the aftermarket was glaring. “Since we were not there, that space was filled by companies which were not purely clutch manufacturers. So the customer was getting shortchanged,” said Gujral.
To expand its presence in the aftermarket, the company has planned an elaborate approach spanning both ‘push and pull’ marketing strategy. Setco will put a distribution network pan-India starting September this year. It will start with 27 distributors with 48 distribution points. “Under these distributors, we will develop a retail network. In the last six months, thousands of multi-brand retailers have decided to work with us and sell our products as well. This is the push strategy,” explained Gujral.
As far as the pull strategy goes, Setco is starting a garage activation programme where it will be engaging with garages that service the trucks. Training the mechanics, giving them tools and certifying the facilities are part of the programme. It has also planned a Mechanic Quality Programme in which nearly 800 garages have enrolled. Engaging garages and mechanics has helped companies build a stronghold in the aftermarket. However, Setco is not putting all eggs in one basket; it is directly reaching out to the end customer – the truckers and fleet owners.
The clutch manufacturer was one of the associate sponsors of the recently concluded Tata T1 Prima Truck Racing competition. This was the first the time the truck racing event was held in India, modelled on the more popular British Truck Racing and European Truck Racing championship. The company provided clutch systems to all the 6 teams (2 trucks each) that participated in the race. “We started selling our products under our brand six months ago. This event happened at the right time giving us the opportunity to connect with the end consumer. Over the years, we believe it will help us get some of our designs and concepts onto the truck race,” opined Gujral. Apart from strengthening its aftermarket share in India the company is planning to focus on LCV and the tractor segment. Though the company has a presence in developed markets like Europe and the US, it has not been operating in top gear. Setco has not participated in OE programmes in Europe for the last 10 years. The company is trying to get nominated to global platforms. “There is a whole world to go and sell to. Part of our strategy is to get into OE programmes in Europe and US and a lot of market seeding has been done this year for exports. So we are doing a lot of business development work which will pay dividends in the near future,” said Sheth. ACI
Story : J Srikant
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