Setco Automotive and FTE Automotive have entered into a joint venture to manufacture hydraulic clutch actuation systems
Setco Automotive and FTE automotive GmbH (FTE) have announced a Joint Venture (JV) to manufacture and supply clutch actuation systems in India. The joint venture company, FTE Setco Automotive, would manufacture products such as hydraulic clutch actuation systems and components for passenger cars and commercial vehicles. Manufacturers of vehicles employing hydraulic clutch actuation system are at present importing them. Maruti, for example, is importing hydraulic clutch actuation systems from FTE for its Swift, and so are others. The joint venture is therefore expected to serve those manufacturers that are importing hydraulic clutch actuation systems and cater to those who are developing vehicles with such systems. Aiming to serve the passenger car, SUV and LCV markets, and eventually specialised markets like tractors, the ratio of investment by Setco and FTE is 51:40. With a few crores to be invested in the joint venture in the first few years according to Seth, the company is expected to start manufacturing by the end of 2008. Out of the two locations, Maharashtra and Gujarat, the latter, according to a company source, is said to be the preferred one, as it would help establish good synergy between its existing plant near Vadodara and the proposed new venture. The source also added that if the company could manage JIT supplies from the existing plant to clients like Tata, which has got facilities at Pune, Jamshedpur and Lucknow, there is no question that the new joint venture facility would have difficulty meeting the JIT requirements. Speaking on the eve of the announcement, Harish Sheth, CMD, Setco Automotive, said, "Setco aims at being a full range clutch system manufacturer. This JV will further strengthen our position in the medium and heavy commercial vehicle segment and at the same time help us to penetrate the LCV, passenger car and farming equipment segment with new products". Klaus Glocker, CEO, FTE automotive, added, "Setco is a perfect company to partner with in India. It is a well-managed company, with premium quality products and having deep insight into the emerging needs of the fast evolving Indian Automotive market. The Indian market is growing at a tremendous pace with Indian companies going global and a lot of our global clients are also entering India." According to Seth the joint venture will see an investment of a couple of crores in the few initial years. FTE Automotive is Ebern (Germany) based manufacturer of hydraulic brake and clutch systems for passenger cars and commercial vehicles, as well as a competent partner for ABS solutions designed for motorcycles and scooters. Setco Automotive at the other end is a manufacturer of premium quality Lipe clutches for heavy and medium commercial vehicles in India. The company employs more than 600 people globally and is a tier 1 supplier of clutches to all major Indian commercial vehicle manufacturers with a customer base inclusive of prominent names such as Tata Motors, Ashok Leyland and Eicher Motors among others. Setco has strategic global footprint with 4 manufacturing facilities globally, 2 in India, and 1 each in UK and USA, with its corporate base in Mumbai, India. Setco's R&D base is in the UK.