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| Tuesday, 13 May 2003 |
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UMLL, TVS Lanka in joint venture to import vehicle spares by Ravi Ladduwahetty A United Motors Lanka Ltd (UMLL) joint venture with an Indian automotive spares giant will import vehicle spares to Sri Lanka, claiming that it could provide a quality range at competitive prices, using the principle of seven day inventories. TVS Lanka (Pvt) Ltd, a Rs. 100 million joint venture equally shared between United Motors Lanka Ltd, and the giant TVS Group of India have grouped together to form TVS Lanka Ltd, which has joined another major Indian player- Motha Investment Corporation (Pvt) Ltd to form TVS Autoparts (Pvt) Ltd. The joint venture company will have very good prospects in Sri Lanka for added sales as the product range is very good. The striking feature about Sri Lanka's road transport is that this country has a large number of vehicles coupled with bad roads, UMLL Chairman Mahendra Amarasuriya told the Daily News yesterday, following a media briefing. We will adopt the " Just In Time" method that we adopt in India and we are confident that we will have a 30 percent market share in Sri Lanka, which we estimate at Rs. 300 million, TVS Group's Executive Director R. Dinesh told the Daily News. Amarasuriya said that the prices will be very competitive in Sri Lanka due to the minimal inventory costs, which otherwise have a bearing on the sales prices due to the bank interest component also being added to the cost. Earlier, addressing the media, Dinesh said that TVS will initially aim to supply vehicle parts to the Indian manufactured vehicles in Sri Lanka and later supply parts to the Japanese manufactured brands which are operative in this country. While we will be aiming at 70 percent of the spares market for the Indian manufactured products and 15 percent of the product range which is manufactured for the Japanese made vehicles. Over 30 percent of the TVS range which is manufactured in India is exported which is a three-pronged marketing strategy. The first is the trishaw industry while the other components which are manufactured for the automotive industry which are for trishaws and the commercial vehicles. The third is the distribution aspect, Dinesh said. He said that the distribution network in India was so effective that the spares could be made available to a retailer within 24 hours based on the seven day inventory system. The inventory costs which was originally 5-6 percent of the total cost, is now less than 0.5 percent, he said. The entry of other worldwide acclaimed manufacturers such as General Motors and Benz into India has not deterred the TVS Group's operations in emerging as the premier vehicle parts manufacturer and supplier in India. It distributes 35,000 items procured from over 70 suppliers through a distribution network of over 15,000 dealers in India. Motha Investments Corporation (Pvt) Ltd, Managing Director Dinesh Motha said that a study done on the Sri Lanka's spare parts market two years ago, had revealed that the product range hitherto imported somewhat obsolete and lacked the required quality and that the TVS Group was in a position to fill in that void. |
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