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Belagavi Aerospace Cluster manufactures components with least carbon footprint
Articles- Jan 29,24
Founded in 2006 and nurtured as a unique, diversified contract manufacturing company, Aequs, provides vertically integrated product solutions across the Aerospace, Toys, and Consumer Durable Goods industries. Rohit Hegde, President, Consumer Verticals, Aequs in this interview provides insights on company’s sustainable manufacturing practices.
How is your company contributing to the growth of the Indian manufacturing sector?
Manufacturing in India has been growing impressively promising a tremendous boost to the economy. The government's Make in India and Atmanirbhar Bharat campaigns and other policy initiatives aimed at promoting domestic manufacturing have been a signal to the world that we are open for business.
Speaking for Aequs, making in India for the world has been the core philosophy for the company. Set up in 2006, Aequs Manufacturing started the Aequs Aerospace SEZ, India’s first notified precision engineering SEZ, in 2008 in Belagavi. Today, Aequs counts itself among the largest Aerospace supply chain companies in the country. So much so, we have a saying at Aequs: Every airliner has some part made at Belagavi. The company, with its end-to-end manufacturing value chain, accounts for over 3000 parts manufactured at its facilities. Aequs counts global Aerospace OEMs like Airbus, Boeing, Collins and Safran among its customers. Our focus has always been incremental in-country value addition on the parts and components we make. Beginning at 20 per cent in-country value addition, today I am proud to say the aerospace components manufacturing has over 90 per cent value addition. Aequs has been instrumental in growing and maturing the aerospace supply chain capability in the country over the past many years.
Driven by our success in the Aerospace industry, Aequs ventured into the consumer industry in 2016 with manufacturing toys for global brands. Still in the realm of precision engineering, Toys manufacturing is a complex activity, but with low skill requirement and a huge potential for employment generation. Today Aequs exports to over 56 countries, making it one of the biggest toy exporters from India. More recently, Aequs also set up India’s first toy manufacturing cluster, the Koppal Toy Cluster (KTC), opening avenues for creating more jobs in the most backward district of Karnataka.
Further, Aequs ventured into Consumer Durable Goods manufacturing in 2021, making kitchen appliances for several global brands. It also set up the Hubballi Consumer Durable Goods Cluster (HDC), again a first in India, to create a global ecosystem for manufacturing consumer durables.
The common thread in all three clusters is that they are ecosystems seeking to create all the infrastructure, supply chain and engineering capabilities required by manufacturers across the three industry verticals. This is a step change in the Indian manufacturing scenario.
Companies (including your customers) across industries are emphasising on sustainability. How is your company helping them meet their sustainability goals?
The global aviation sector has set itself the target of being net zero by 2050. While this objective is sought to be met by switching over to sustainable aviation fuels, given the huge target, aerospace OEMs have set in process measures to contribute to it. As a result, they are now focusing more on process and material efficiencies among their suppliers, including Aequs. Having said that, the very basis of Aequs’ Ecosystems of Efficiency® value proposition, ab initio, is predicated on sustainability. Typically, any aerospace part would have to move over 5000 kilometres between each production process. However, given that its cluster approaches no part moves more than 500 metres within the Aequs SEZ which provides integrated and collocated facilities for an end-to-end manufacturing capability. As a result, Aerospace components manufactured at the Belagavi Aerospace Cluster have the lowest carbon footprint compared to anywhere else in the world.
Likewise, in its consumer verticals, Aequs works to global standards that require the highest attention to safety and sustainability, be it in the production process or materials used. At the same time, Aequs’ three campuses adhere to all environmental norms employing green technologies and energy efficient equipment.
Could you please highlight on some of the Green Engineering solutions offered to your customers in the industrial sectors?
World over there is an increasing realisation that sustainable manufacturing is integral and essential to good and successful business. The emphasis is on creation of products through economically-sound processes that minimise negative environmental impacts while conserving energy and natural resources and enhancing employee, community and product safety and wellbeing.
As such Environmental, Social & Governance (ESG) practices at Aequs are seen as part of long-term business strategy. As explained above, given its ecosystem approach, the Aequs operating model is built for sustainable manufacturing ab initio. The Belagavi Aerospace Cluster (BAC), which houses 30 plus manufacturing units, is the most ecofriendly manufacturing campus anywhere, especially for Aerospace components, by virtue of offering collocated facilities for end-to-end capabilities. Likewise, in our consumer businesses the focus is on environmentally friendly manufacturing processes with the utmost attention to product safety and durability. Our shop floors on the other hand, are quickly moving to an Industry 4.0 framework where interconnected machines deliver optimal processes and operational advantages that lead to more sustainable manufacturing.
What are some disparities in the manufacturing setups of India and other countries? Is there any special quality standards or certificates which are needed for these setups?
India is increasingly seen as an alternative manufacturing destination as global conglomerates continue to adopt a China plus one strategy and in some cases even looking at relocating entirely from China. At the same time, the addressable markets being global in nature, including the domestic market in India, the emphasis on product quality is increasingly becoming uniform. Having said that, whether India will be able to compete with other countries on manufacturing across sectors depends on pricing, which in turn is dependent on scale. This is something that India lacks currently in many sectors. For instance, in toy manufacturing India can compete with Chinese companies on input costs and quality. But the scale of operations and government subsidies they get, put Chinese manufacturers at an advantage compared to Indian companies. Aequs is seeking to address the issue of scale and supply chain maturity through its Ecosystem, there is a case for more nuanced support from the government. For instance, PLI for toy manufacturing is a long pending ask from the toy manufacturing industry which would level the playing field to a certain extent vis-à-vis the Chinese manufacturers. As for quality standards, given that we are catering to the global OEMs across our industry verticals, all certification requirements across the world are uniform.
Speaking of our export operations, while in aerospace we export 100 per cent of our output, in toys also it is predominantly export oriented though recently we have started looking at the domestic market in India through our Original Design Manufacturing (ODM), initiatives. Likewise, in our consumer durable goods operations, it is a mix of exports and domestic output.
How do you plan to scale up your business in the near future?
Where Aerospace is concerned, 2023 was exceptionally good returning to health from the Covid-19 debacle. The good tidings are expected to continue in 2024 with the surge in demand for aircraft, because of increasing air travel. Aequs is well geared to meet this increase in demand both in terms of capacity and workforce. Likewise, in our Toys and Consumer Durables verticals, we have enough capacity to cater to emerging demand for contract manufacturing from OEM and ODM customers. Recently, we ventured into a new industry vertical, Advanced Technology Products (ATP), aiming to tap into the fast-growing potential for precision machining for consumer electronics products. R&D is a continuous effort at Aequs and the Aequs Innovation Centre (AIC), set up in 2022 conducts cross-vertical product and process development across the group. Currently, it is focusing on a few programs for our Consumer Durables and Toys verticals.
Belagavi Aerospace Cluster
Rohit Hegde
Aequs
Aequs Aerospace SEZ
Make in India
Atmanirbhar Bharat
Airbus
Boeing
Collins and Safran
Karnataka
Koppal Toy Cluster
Hubballi Consumer Durable Goods Cluster
Original Design Manufacturing
Advanced Technology Products
Aequs Innovation Centre
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