— Richard Cotterell,
Managing Director, Perkins India
UK-based Perkins is a group company of Caterpillar Inc and has
been in India for close to 30 years now, supplying engines for
generators and power backup.
Richard Cotterell discusses the
activities of Perkins in India and also shares the company's plans of
putting up a greenfield manufacturing plant with an investment of
$150 million. With 8-10 per cent growth in the electric power
sector, India will be a key market for Perkins' 4000 Series engine,
asserts Cotterell. An interview by
Venugopal Pillai.
What is your view on India's dependence of fossil fuels and the
slow but steady evolution of renewable (inexhaustible) energy
sources like solar, wind, etc?India has traditionally relied on fossil fuels to generate much of
its power and while this is still the case, more investment is
being made in alternative sources of energy. Though these are
environment-friendly and sustainable resources, the projects
are in their infancy, although a number of solar power
applications are finding their way into India.
Indian power grids typically face a dual problem of inadequacy
and also instability. What is your opinion?
Investment is and will continue to be made in infrastructure to
meet the national demand, but as this takes place the gap can
be filled with efficient stand-by and prime power solutions to
keep industry and commerce running and growing.
In view of India's growing and largely unfulfilled energy needs,
how do you see the market for gensets?
The Indian generator set market is a well-organized and highly
competitive space with a lot of growth potential in the future.
This market has and we believe will continue to create a lot of
opportunities for engine manufacturers, as demand for reliable
sources of power are expected to grow considerably. Perkins is
one of the world's leading providers of diesel engines into the
construction, agriculture, industrial, material handling and
electric power generation markets. We expect growth in all
these segments. With eight to 10 per cent growth in the electric
power sector, India will be a key market among the Asian
countries for our 4000 Series engine which we will
manufacture out of our facility in Aurangabad.
While we appreciate that gensets are efficient stand-by power
generators and can stand in for brownouts, what is your view
on the cost efficiency mainly in the Indian context?
In India, fuel efficiency and power density are the most
important factors we have observed, as well as having
appropriate environmental controls over how power is
generated. It is our intent to build world-class products
providing the very best operating costs to those that use them
while at the same time meeting the stringent emission
standards.
Do you think that with perceived improvement in gas
availability and also due to high crude prices, there will be a
change in equations for gas- and diesel-based generators?
We have already seen changes starting to take place in
other countries where gas powered generator sets are
increasing in numbers and we would expect to see gas
powered generator sets becoming more prevalent in India in
the future.
In the Indian context, gensets tend have a different role as
compared to that in developed countries. Can you
elaborate?
Standby power in India is very different to that in a more
mature market, with generator sets in standby mode
running for eight or more hours a day when brownouts
occur; a much longer period that normally associated with
that mode of operation. From a technological point of view
that means the engine, which is at the heart of a generator
set, has to overcome the challenges posed by its application,
its location, its installation and its ongoing maintenance.
Reliability is a key requirement and that is why mechanical
engines are so predominant. These engines offer simplicity
yet are extremely robust and capable of withstanding the
challenging environment and conditions often imposed on
them, while being technologically advanced.
We have undertaken a great deal of work on our 4000
Series engines to improve its operating criteria with
markets such as India's in mind. Our most recent engine, the
4016 Series, which will be built at our new facility in
Aurangabad, delivers 10 per cent more power than its
predecessor while the package size has remained the same,
so effectively increasing the power density (kVA/litre). This
has been achieved without having to increase the size of the
cooling pack; instead we have moved to an air to water
charge cooled system that in itself offers greater flexibility
as it can be located remotely.
Tell us about how Perkins maintains environment consciousness
in its gensets.
For 80 years we have worked with generator set
manufacturers to bring light, warmth, protection and peace
of mind to thousands of people. Our range of small, medium
and large diesel engines provides clean efficient power from 5-2500kVA and for gas engines from 300 - 1000 kWe.
As it stands India is anticipated to lead the world when it
comes to imposing regulations for stationery power
applications. In July 2013 the legislation will mandate that all
generator sets under 800kW will need to achieve EU Stage 3A
equivalent emissions levels while generator sets above that
threshold will most likely need to achieve EU Stage 2 equivalent
emissions levels.
While some may view this as yet another hurdle at Perkins
we treat it as an opportunity to improve on what we already
have. It will inevitably take some work around the combustion
and fuel injection processes to arrive at the solution but we
believe we will have the appropriate technologies in place
when the time comes.
The important thing here is that electricity will be able to
be produced more cleanly and with less impact
on the environment.
Early this year, Perkins had
announced plans to set up a
greenfield manufacturing unit
in Maharashtra. What is the
current status?
The manufacturing facility is a
$150 million unit located in the
Shendra Industrial Area in
Aurangabad. Work to level the site is
currently underway with construction
work set to start in mid October. The facility is targeted to open
in mid 2013.
We have already hired our key appointments and continue to
grow our employee base for the plant, as we focus on setting up
a strong team in Aurangabad, lead by a Facility Manager who
will overlook all our operations at the plant.
Initially the facility will have the capacity to produce around
3,000 engines per year with the capability to increase to 5,000
units. The new India plant will serve the growing demand from
the Asian markets. This investment is an excellent opportunity.
We have a really engaged team focusing on delivering the start
up. The first engine from the facility will be manufactured in the
middle of next year. The facility will generate employment not
only in the Aurangabad region but also across the supply base.
What is your business outlook for Perkins gensets in India and
what would be the key business drivers?
Our strategy for growth in India builds on the good work that
we are already undertaking today in partnership with our
valued customers. Working closely with our customers and
providing high quality products are critically important factors
for us. The new India plant will help us manufacture closer to
our customers and serve the
growing demand from the Asian
markets. In addition to
manufacturing our 4000 Series
engine in Aurangabad, we will
continue to offer and make available to
our Indian customers, our wider range of
diesel and gas engines which currently
power more than 5,000 different applications
in construction, agriculture, materials
handling, general industry and electric
power, around the world. We will also be
investing in our brand to support our future growth
plans.
Our initial focus will be to make our plant fully operational,
with construction work starting very soon and an ongoing
recruitment plan to secure our team in Aurangabad. We
continue to focus on and invest in our product support
capabilities in territory and are working with our distribution
network for local media exposure. We will increase our product
offering, relationship building and brand building in the coming
years. By 2016, we expect half of the number of 4000 Series
engines manufactured at Aurangabad, to be exported to the
South East Asian market.