Rane Engine Valves rethinks on Vizag EOU

18 Nov 2005

Chennai: Engine valve manufacturer Rane Engine Valves Limited, which was recently awarded the Deming Quality Medal, is keeping its options open on setting up a new 100 per cent export oriented unit (EOU).

The company had earlier announced its intention of putting up a new plant, estimated to to be at an investment of Rs30 crore in Visakhapatanam. The company had also announced a Rs20-crore expansion to increase its existing capacity by 8-million units to 38-millon units.

According to managing director and the Rane group vice chairman L Ganesh, the company has yet to finalise the location of its new plant. Meanwhile he expressed satisfaction with the company''s first half performance. According to him the domestic market for passenger cars, heavy commercial vehicles and light commercial vehicles - excluding the Tata Ace- has softened a bit.

While he is slightly perturbed by the imports of wheels and some engine components from China, the free trade agreement (FTA) with Thailand has not impacted the domestic auto ancillaries.

Speaking about the Deming medals won by Rane Engine Valves and Rane TRW Steering Systems Limited, Ganesh said that the TQM journey that started in 1999 in the group has reached a major milestone in the form of Deming medal. (See: )

According to him the Japanese Union of Scientists and Engineers (JUSE) has advised the two companies to track the cost of new product developments at the time of awarding the medal.

When asked by journalists he too wondered why not many Japanese companies were taking up the Deming challenge these days. He, however, reiterated that the TQM process had helped the group immensely.

"The customer returns in the case of Rane Engine Valves measured in parts per million (PPM) has come down to 139 in 2004-05 from 1,524 in 1999-2000 the pre TQM period. In the case of Rane TRW Steering Systems, the customer line rejections has come down to 171 PPM in 2004-05 from 1,766 in 2000-01." This coupled with other aspects like reduction in scrap, machine down time, product change time has resulted in cutting costs in a major way.

"From command and control management style, we have now consultative and participative work culture. This has resulted more involvement in the goal setting and its achievement on the part of workers," he remarked.

Adds S Srinivasan, president, "The implementation of TQM showed the difference between our perception of where we stood vis a vis the actual status."