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Doing good in Dixie Land

Doing good in Dixie Land

Pune’s Dixie Auto Electric India operates in the niche segment of making alternators, starter motors and generators for off-road equipment but has kept a low profile because up to 95 per cent of its stock wings its way to Canada

At times it’s nothing more than a chance meeting that can flag off a new enterprise. In the case of Pune-based Madhu Nair, this happened when he met a representative of Dixie Electric Ltd, a Canadian manufacturer of alternators, generators and starters, at an exhibition in Frankfurt. “Till then,” he recalls, “I was working as an engineer with PMP Auto Components Private Ltd, an Ashok Piramal Group company that was engaged in manufacturing and marketing of automotive electrical components for OEM, replacement and export markets with a product range that included alternators, starter motor kits, windshield washer pumps and oil pressure switches. Since I had the right kind of experience, Dixie Electric offered me an opportunity to head an export-oriented unit (EOU) for them in India.”

doing2.jpgThat was in June 2003. Thirteen years down the line, Dixie Auto Electric India Private Limited has not only proved itself to be an extremely cost-effective supplier for the parent company but has also forayed into the domestic market with its wide range of alternators and starters that are primarily used for off-road heavy-duty equipment and vehicles such as backhoe loaders, excavators, construction and mining tractors, pavers, etc.

“While 95 per cent of the alternators and starters are exported to Dixie Electric in Canada, the rest are being sold in India. We have also entered into an agreement with Bosch India for some of our products,” Nair informs.

The plant has a capacity to make about 10,000 alternators a year and as Nair puts it, the capacity can be ramped up to match the increasing demand without the need for investing in additional resources like land and machinery.

The parent company, Dixie Electric, was established in June 1968 to service the Toronto area with re-manufactured generators and starters. Over the years, the company has earned the reputation of combining superior service and support with high-quality charging and starting products and also has a manufacturing set-up in China.

doing3.jpg“Dixie Industries (Shanghai) Ltd., was established in 1994 and sells heavy-duty products to OEMs and to the after-market. Detech, Dixie Electric’s facility in Lianyungang, Jiangsu, China was established in November 2002 and re-manufactures automotive products for the North American after-market. Essentially, both China and India have now become significant contributors to the growth of Dixie Electric in terms of volumes and cost,” Nair says.

Apart from the use of alternators and starters for off-road equipment, the alternators are also used for buses and coaches, marine equipment, military vehicles, mining equipment, transport refrigeration, and so on. “In India, there are not too many companies that manufacture these products for the simple fact that the volume turnover is not so huge as to justify large manufacturing set-ups and investments. We therefore find ourselves operating in a niche category with more or less assured growth,” Nair states.

doing4.jpgHaving posted a turnover of Rs 6 crore in 2012, Dixie Auto Electric India is hoping to pass the Rs 8 crore mark this year with projections of reaching Rs 12-13 crore over the next couple of years.

This is not to say that there aren’t any challenges. “The recent ban on mining has affected our sales in India and so has the laggard movement in the infrastructure and construction sector. Hopefully though, the good monsoon this year will boost the agricultural sector which is also one of the major consumers of our products,” Nair says.
Meanwhile, an additional vertical that the company has started is the import of automotive components which is managed by a sister concern called Indel Distribution Company Private Ltd. “Most of the off-road heavy-duty equipment used in India is manufactured by foreign companies such as Hyundai, JCB, New Holland, Caterpillar, etc and there is a dearth of component manufacturers that can provide quality supplies immediately. We therefore operate through a chain of retail vendors in India to supply armatures, bearings, drives, field coils, rectifiers, regulators, rotors, shift levers, solenoids, stators, etc. at short notice so as to help users prevent lengthy and costly downtime of the equipment,” Nair informs.

doing5.jpgAs for keeping pace with product and technology developments in this industry, Nair says that the research is taken care of in Canada. “Our feedback is of course important for further development of the products but our main job begins only after a new prototype is sent to us,” he adds. As for using the spare capacity to tap markets in neighbouring countries, Nair seems to be in no hurry. “Let us first get an inkling of the requirements. For now we are doing well with our current portfolio,” he says.

(Dixie Auto Electric India Private Limited, Pune Tel: 020-26811585. Email: m.nair@dixie-electric.com)

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