PTI – TG Minda business is planning to enhance the production capacity at its main plant at Neemrana to meet the growing demand for airbags as safety regulations become stricter in India, CFO Sunil Bohra said, adding, driver and passenger side airbags for frontal collisions are also increasingly equipped on vehicles in India.
Auto components maker Uno Minda Ltd will invest Rs 175 crore to expand its facility at Neemrana in Rajasthan to meet the growing demand for airbags ahead of mandatory norm of six airbags for passenger cars and SUVs coming up in October this year, according to its group CFO Sunil Bohra. The company, which has a joint venture with TG Japan – TG Minda, that is into automotive safety system, fuel cap, weather strip and sealing parts, already has confirmed orders of around Rs 350 crore for airbags, Bohra told analysts.
TG Minda business is planning to enhance the production capacity at its main plant at Neemrana to meet the growing demand for airbags as safety regulations become stricter in India, he said, adding, driver and passenger side airbags for frontal collisions are also increasingly equipped on vehicles in India.
The use of side and curtain airbags to protect vehicle occupants during collisions is also mandatory and the company has already received large orders for curtain
airbags from one of the Japanese OEMs, he said without divulging details.
“To meet the accompanying growth in demand, TG Minda India will expand its Neemrana plant and install airbag tools and equipment. The board has approved a capital expenditure of Rs 175 crore for the said expansion. The commercial production of the expansion is expected to start from December of 2024,” Bohra said.
When asked what kind of incremental opportunity the company sees with the mandatory six airbags norms kicking in from October 2023, he said, “…the confirmed order in hand is around Rs 350 crore. And that is why we are expanding these facilities. Some of it we can achieve through our existing capacity, but definitely, it will need a lot of investment…”
On whether the company would lose out on opportunity as the commercial production of the expansion at Neemrana plant is expected in December 2024 but the norm will come into effect much earlier, he said the planning has been based on the demand guidance of its customers.
In case customers ask the company to advance it, he said, “We’ll be happy to do that because it’s not that we will need two years to set up these equipment and start supply….but as of now, the December 2024 timeline is what we have been given by our customers linked to the SOP (standard operating procedure) of their models.”
