The Hindu Business Line : `We are fully geared to take on global challenges' — Dr Albert Hieronimus, Managing Director, MICO

THE new Managing Director of MICO, Dr Albert Hieronimus, took over from Mr Andreas Nobis last year at a time when the company was going through a rather difficult period because of labour problems and slowdown in production.

But, all that is past now with the company hoping for a 20 per cent growth in next fiscal, says Dr Hieronimus, in an interview with Business Line.

2003 was a bit of a turbulent year for MICO. Your Jaipur plant couldn't take off, you had to slowdown production for various reasons and then the plant was hit by labour problems. How will the New Year be in view of the fact that the automobile sector in India is booming?

I agree 2003 was not exactly a good one for us. But that is behind us now. We have dealt with each case successfully. We have lot of things lined up for the next fiscal. Our Jaipur plant's production is going full steam. We expect vehicle manufacturers in India to start looking at CRDi equipment much more seriously. The labour problem has been resolved successfully. We do not expect more labour issues to bog us down this year.

As Indian automobile manufacturers are becoming key global players, MICO is fully geared to meet the challenges. We are continuously upgrading our infrastructure and knowledge base to meet the demands of our customers, be it in technology, emissions or performance.

What's happening to the production at the Jaipur plant?

Now that the Government has given a go ahead for new Euro emission norms, our investment of around Rs 250 crore in the Jaipur plant will be revived. The plant has been set up to manufacture fuel injection pumps for both diesel and petrol. As you know we had delayed the production because the Government was yet to make up its mind on new emission norms. These pumps were designed for new emission norms and to increase fuel efficiency. The Jaipur plant is currently operating on full capacity of one-lakh distributor pumps. We expect to double the production to two lakh units from next year.

We recently achieved a milestone with the roll out of our 10 millionth inline fuel injection pump. The inline pumps were first manufactured in 1956. We still have to tap the full market potential even though we are the market leaders in this segment. MICO has constantly been upgrading its processes and technology base to meet the challenging demands of the global customers. MICO and Bosch have the capability to provide diesel injection systems, which can fulfil Euro III and Euro IV emission norms.

What is the status regarding CRDi (common rail direct injection) equipment. Have you received enquiries from Indian car manufacturers?

Let me clarify one point here. We are yet to make any investment plans for producing CRDi system and electronic diesel control system. There is a huge demand for them in Europe and the US. But it is yet to catch up in India. We are of course ready. We are in fact studying all the options for manufacture of CRDi equipment in India. We could either manufacture the entire equipment or some of the parts and source the rest from other Asian countries where Bosch has its plants. It does not make economic sense to manufacture the entire equipment in India. Bosch is setting up manufacturing facilities in China and Thailand shortly that would take the number of plants in Asia to five. Bosch has so far sold 15 million units of CRDi equipment worldwide.

There is however, a possibility that there could be a drop in sales for inline pumps. In 2005, there could be a major drop in sales but we have already decided to make them for off-highway vehicles like tractors. We do sell a good number of distribution pumps for some vehicle manufacturers but with the introduction of CRDi pumps, they would give far higher fuel efficiency, more drivability and less noise.

What about ABS (anti-lock braking system)? When do you think they will become part of standard equipment of Indian cars?

MICO is ready to launch the ABS in India, though car manufacturers are yet to incorporate it as standard equipment in their models. Currently, car manufacturers import ABS for their models sold in India. All the cars in Europe are fitted with ABS as standard equipment. Indian carmakers may find it difficult to export their cars if they do not fit ABS in them.

Have the labour problems been resolved?

The labour problems have been resolved successfully. The labour union is happy with the settlement and we do not expect any more problems.

What kind of growth MICO expects during the next fiscal year.

We plan to grow 20 per cent over the current year. Some of the major customers for fuel injection pumps in India are Tata Motors, Mahindra & Mahindra, Eicher and Escorts apart from Ashok Leyland. We will continue to add to that list as we go along.

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