Scania Picks MG Group for Bus & Coach Building

By T Murrali :

A prominent place with an ancient history, nestling high in the Western Ghats in Karnataka and connecting Goa and Maharashtra, is Belagavi or Belgaum as it was till recently called. On the road from Goa, at a place called Desur Village, about 15 km before the town, which was earlier known as the Bamboo village, is the MG Group’s plant, MG Automotives (Bus & Coach) Pvt. Ltd. that has been building a variety of buses and coaches since 13 years. Bus and coach building converts bare chassis to bus or a coach; it is similar to constructing a house where every bit is designed for structural strength, load bearing and aesthetics. A coach, in fact, is a home for passengers; even those who travel long distances should feel at home in it.
The quiet but subtle operations of MG Group have attracted Scania, a global manufacturer of vehicles for transporting people and goods. With its headquarters in Södertälje, Sweden, Scania has identified MG Group as its partner for building premium buses and coaches for its wholly owned Indian subsidiary. The company that operates from the birth place of Björn Borg, one of the greatest tennis players in the history of the sport winning 11 Grand Slam singles titles, has shortlisted MG Group for its inherent capabilities and robust manufacturing processes in building high quality buses and coaches for almost all OEMs in India. Like the objective in the game of tennis is to play the ball in such a way that the opponent is unable to strike a valid return, Scania wants MG Group to build buses and coaches that no competitor can strike a better return. MG Group will be designing buses exclusively for Scania. Daimler India Commercial Vehicles is also in talks with the Group. Customers prefer the MG Group for its aspiration to handle complexities, wide variety of product portfolios and its stunning design and product development capabilities.

The commercial vehicle manufacturers such as Mahindra, Ashok Leyland, VECV, Tata Motors and MAN, though diverse in technology, capacity and applications, have one thing in common. They all have bodies built by the MG Group, India’s largest privately-owned bus body-building company with a workforce of over 2,300. The Group that completed 20 years in the bus building business last year, has built 100,000 buses since inception.
One of the key strengths of MG Group is its capability to provide total solutions to its customers, from concept-to-market with the shortest cycle time, even by developing new products. The group is passionate about meeting the consumers’ three-fold needs of Complete Commitment, Detail-Driven Concepts, and Quality Output. MG Group stands out for its involvement in understanding the customers’ requirements and meeting it to the minute detail.
“To be the largest bus building company in India,” is the vision of Anil M Kamat, Managing Director of MG Group. The implication of this vision is more than quantitative, which the company already is, as the largest privately-owned bus building company in the country. But for Kamat the vision of superiority is more about handling complexities with the biggest clientele and partnerships, having the largest variety of products within a single group. “We want to differentiate from others by continuing to produce a whole range of products built on every chassis available in the market. Our operations should be much more complex and challenging for the variety, product-mix, and diversity of applications. We have laid the foundation to achieve our vision, though, I think, we are still about three years away. We hope to achieve our vision by 2020 and then probably revise our vision statement to something more befitting then,” he told AutoParts Asia.
How will the company accomplish this goal? Kamat says that many things are happening in the bus industry and there is going to be a definite surge in demand as mass transportation solutions are the need of the country. The company is gearing up to meet this with appropriate capacities and infrastructure. “Most importantly we are focusing a lot on team building – we have a young, dynamic and aggressive team that is highly competent and aligned with our goals. We want to strengthen this team further, especially in the engineering space, with different skill-sets, in order to realise our vision to be the largest bus building company in India. We have 55 designers and engineers already working in four locations at Zaheerabad and Belgaum, for manufacturing support and product development, and in Mumbai and Goa, for strategic and confidential operations.”
The MG Group has almost all the OEMs as its clients. Then what is the driving force and scope for the company to expand on the lines of its vision? Kamat believes that there are many unexplored market segments. The market is constantly evolving; customer expectations are changing and aspirations are rising. Several multinational foreign companies are coming to India. They set up factories to tap the domestic and export markets. In India, the bus penetration is less than one for 1,000 people, while in the US and the European countries it is between 14 and 16. The bus industry in India is sure to boom.
“We have been very fortunate that our strength and capabilities have been recognised and appreciated by our current OE customers. Our relationship will grow and become even stronger as we move forward. There is a big emerging market for premium coaches and buses out there which we want to tap, to meet our vision,” he said.
MG Group has made an impressive and convincing entry into this vast premium segment with ‘Mammoth’, the bus launched at the Bus World Expo in Bengaluru last year. It is MG Group’s flagship product on a MAN chassis for the premium segment, completely designed, engineered, developed and built by the group and certified by MAN, Germany. “Most of our customers, most importantly Scania, were impressed and convinced by the design and build quality of Mammoth,” Kamat said.
The ‘Columbus’, a special application coach, fully designed, developed and engineered by MG Group for the airline industry is another spectacular product. ‘Columbus’ has a rear engine, offering total flexibility. ‘Columbus’ and ‘Mammoth’ are made in India to international standards.
‘Mammoth,’ being a front-engine ladder frame based coach, gives only limited freedom and flexibility in body design. The biggest challenge is to give the passenger a saloon space in the coach, and make the inside ambience very attractive, without revealing the position of the engine.
The chassis from MAN, Europe’s leading commercial vehicle manufacturer, is rugged and robust, which caters aptly to the Indian operating conditions with increased driving safety, while significantly reducing body movements for best ride-comfort. With eight emergency exits, the coach has various other safety measures such as no sharp corners, seat belts for every passenger and the ‘EM – Secure’ Rear Emergency Exit, which is patented by MG as the world’s first. The reason behind keeping an emergency exit behind the vehicle is that in an emergency, it would be difficult to break the glass panel of the emergency window. Besides, jumping out of the widow, which is about five feet above the ground level, would be traumatic and may cause injuries.
For the ‘Mammoth’ project, the concept-to-product cycle time was nine months, which was one of the key factors for Scania to choose MG. The company is exporting the ‘Mammoth’ to Africa, Bangladesh, Maldives and Nepal. The first four coaches for the Indian market will go to KPN Travels soon.
MG Group developed ‘Columbus’ to commemorate 20 years of its operations. For building its own coach for the first time, it made sense to go in the monocoque route as it offered flexibility in packaging the aggregates. Besides, monocoque made the interior designing flexible. MG Group’s acumen is proved in the ‘Columbus’, which has a wheel-base of 7,450 mm. It was intentionally given this expanse to optimise the passenger capacity. Equipped with the latest technologies such as ECAS, ABS, and CAN bus systems, the new coach complies fully with the regulations of the Airport Handling Manual. “By January 2018, we should be able to start promoting the product in a big way to begin sales. There is a lot of interest from export markets also,” Kamat said.

Scania Venture

According to Kamat the venture with Scania is really big for the MG Group. “It is a matter of great pride for our company to be recognised and partnered by a renowned global commercial vehicle giant like Scania. Our plant has also been audited and cleared recently by Daimler India Commercial Vehicles and we hope to start working with them soon,” he said.
On the partnership with MG Group, Mikael Benje, Managing Director, Scania India said, “India is a fast evolving market and Scania’s strategy in India is to stay at the forefront of the bus and coach industry with new and sustainable product offerings keeping with the current market dynamics. MG Group, a leading and established bus body building company, fits well into the Scania strategy giving us the required bandwidth, speed and flexibility for us to achieve our business objectives. We look forward to this association which we are sure will ultimately benefit our customers and the market as a whole.”
Scania offers a complete range of buses and coaches for public transport operators and coach companies. Its intercity buses provide a competitive advantage to bus operators. The vehicles’ stylish exterior attracts attention, and passengers always remember the comfort inside, even over long distances. Scania Commercial Vehicles India (SCVI) builds two models of Coaches, 13.7 and 14.5 meters, under the Metrolink brand. MG Group will build specific application buses and coaches for Scania.
Scania, which is celebrating 126 years of global innovation, is a leading manufacturer of premium commercial vehicles – heavy trucks, buses and coaches, as well as industrial and marine engines. The company offers world-class service network and dealership in the markets and sells a broad range of service-related products and financial services.
In India, the company has made its presence felt in the mining and construction segments since 2007 through its partnership with Larsen & Toubro (L&T). In 2011, Scania established the company, Scania Commercial Vehicles India Pvt Ltd., to strengthen its presence in the segment for buses, trucks and engines. Scania has two manufacturing facilities in India – one for trucks, and one for buses. The company has more than 1,700 trucks and over 600 buses registered in the Indian market. It has a current production capacity of 2,500 trucks and 1,000 buses.
Social, environmental and economic sustainability is at the core of Scania’s offerings. All its vehicles have the capability to run on alternate fuels. The company has world-class experience in mobility solutions, which run on biofuels, and it has brought this unique offer to India. The Swedish company handed over the first ethanol-run Green Bus in India to the city of Nagpur in August 2014. The company sees itself as a partner to the Indian Government’s ambition of building sustainable urban mobility solutions for Smart Cities.

Why MG Group

The strong and compelling reason for Scania to sign a pact with the MG Group was its design, engineering and product development capabilities combined with dynamic team work and a proven track record. “Scania found us competitive in terms of cost. We will be designing, from scratch, special application buses and coaches for Scania, for which the IPRs will be owned by us. The entire product design is purely in MG’s scope and we are going to come up with revolutionary products for Scania,” Kamat said.
The coaches to be built for Scania may need some components specific to the models, and for this MG Group is working on developing suppliers. “We are geared up for all platforms but in this partnership we are looking at Scania’s 12 metre and 14.8 metre platforms,” he said.
The group is modifying its Belagavi Plant -1 and creating an installed capacity of 800 premium buses and coaches a year. This unit will be dedicated to the premium segment of the market. “We hope to utilise 80 percent of our installed capacity by the third year. This plant was earlier called Alma Motors Pvt Ltd; we have changed it to MG Automotives (Bus & Coach) Pvt. Ltd. as we want to focus on coaches also,” he said. This unit will be dedicated to premium bus and coach manufacturing, mostly for European clientele and the Indian customers interested in this segment. Currently the Plant-1 makes all varieties of buses for its OEM clients in batch production and this will be moved to a state-of-the-art dedicated Plant-2, which is just next door.
As part of the expansion plan the company will set up a separate test track. After a coach is built, it would be run for some time to see if any issues crop up before handing it over to the customer. Though track testing is done by the OEMs that manufacture the chassis, MG Automotives (Bus & Coach) plans to carry out field test on its track to ascertain the quality post coach building and address issues if any. This will become one of our USPs in the premium bus and coach industry, Kamat said.

Coach Building

Coach building is very different from the mass production of economy buses. The production of economy school and staff buses is highly seasonal and about 60 percent of the volume happens within four to five months of the financial year. Labour retention becomes a serious challenge. “Our biggest nightmare year after year is addressing the seasonality issue. The premium or coach segment requires a huge shift in manufacturing culture and process. For example, in the current market we cater mainly to school and staff buses, and we are forced to follow the batch production system. But for premium bus and coach building, we have to implement the line production system. So batch to line is a massive shift that has to take place; it calls for a higher level of tooling and different skill-sets. For example, the buggy chassis has to be cut to separate the front and rear modules before building the coach on it. It entails a big transformation at our end in terms of human resources, layout, line flow production and infrastructure.”
“The bus and coach industry is highly customised. Most of the transport organisations have their own applications that we have to look into and consider, compared to the fairly standardised mass production of economy school buses. Of course we cannot standardise to such an extent that we end up killing our own flexibility and versatility, which are our key strengths to cater to a large target group. We should be able to customise to meet the demands of our customers. For example, we got an order last year from Mahindra’s VAP (Value Added Products) business for 1,500 garbage tippers that had to be made on the Mahindra Jeeto platform within three months – development to delivery. We did it. So you understand how important it is to be flexible for us to be able to cater to customer requirements like prisoner vans, troop carriers and many other vehicular forms of transportation. That is why the design and engineering team is our core competence – they are the heart of our organisation. The challenge is to do everything fast to meet delivery schedules with the shortest concept-to-market cycle times. Deliveries range from three to nine months depending on the complexity of the required models. The industry average here is about two years while it is roughly three years for the European manufacturers,” he said.

Electronics

MG Group makes some parts of the products that go into the Intelligent Transport System (ITS) like LED destination boards, passenger announcement systems, and LED saloon lights that fit into buses as well as wiring harnesses. Also, it makes a unique product called backlit destination board which is an automotive compliant replacement for the crude solutions currently being used, with a life of 50,000 hours. “The plan is to offer complete solutions for ITS and have the whole system developed in a year or two; that is the vision,” Kamat said.
Would MGA allow the customers to customise aggregates, as in the case of developed markets? Kamat states that this is a capability he wants to develop. “Columbus was our first initiative and the attempt has been successful in terms of completing what we had envisaged as a design; needless to say that the market will take the final call about its capability. The trend is moving to a point where customers would want to select the engine and other driveline components but it is very futuristic as of now. I think it will take eight to ten years for the industry to mature to that extent, which would give us enough time at least to build that capability in-house, in case the market desires such application building.”

Exports

MG Group directly exports to SAARC countries and Africa and does deemed exports with OE partners, like Ashok Leyland, Mahindra, and Eicher, to more than 20 countries. “We have manufactured more than 10,000 vehicles for our OEM partners for export markets. Until last year we had not focused on the STU business; that is a key focus area as nearly 40 percent of the bus market caters to STUs. We have bagged an order of 250 A/c coaches from MSRTC and are in talks to build KSRTC buses; we are already working with APSRTC and Telengana SRTC. So the STUs will be an important part of our business, from now on,” Kamat said.

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