Setco Automotive, one of India’s leading clutch manufacturers, has undergone a significant transformation in recent years, evolving into a cutting-edge technology company.
Speaking to Mobility Outlook, Udit Sheth, Vice Chairman, Setco Automotive, said the journey was not without its challenges, particularly during the COVID-19 pandemic, which brought financial turbulence and disrupted operations. Despite these obstacles, the company managed to emerge stronger, fuelled by fresh capital from IndiaRF and a renewed focus on systemisation, talent-driven growth, and cutting-edge technology, he said.
Transitioning To A New Era
Under the leadership of its entrepreneurial founders, including significant contributions from the founding family, Setco has transformed into a more systemised and institutionalised entity. The focus on enhancing internal systems and processes has resulted in a streamlined organisation that is more efficient and better equipped for long-term growth. The company implemented advanced IoT systems to optimise manufacturing processes, making it a very different entity compared to five years ago, he said.
Market Growth & Brand Perception
Over the past two and a half years, Setco has achieved notable growth, capturing a significant share of the Medium and Heavy Commercial Vehicle (M&HCV) clutch market. In a strategic move, the company expanded its distribution network to over 100 distributors across India, the Middle East, Africa, and SAARC regions. A comprehensive market survey further revealed the company’s strong brand perception, with mechanics, garages, and fleet owners placing high trust in its clutches, he said.
According to Sheth, the company’s clutches have gained a reputation for durability and reliability, a crucial factor given the Indian driving conditions characterised by frequent stops, starts, and overloads. With a design focus on failure optimisation, its clutches offer a suitable solution that enhances vehicle longevity and performance, making them suitable for a variety of Indian terrains.
Technological Advancements, Product Diversification
Setco has evolved from being just a clutch manufacturer to a comprehensive provider of automotive solutions. The company’s R&D efforts have led to the introduction of innovative products, including BS-VI compliant clutches for vehicles with higher horsepower and load-carrying capacity. The design ensures optimal performance, even in demanding terrains like the Mumbai-Pune ghats, where clutch failures could lead to significant operational setbacks.
The company’s focus on innovation extends to product diversification through the launch of Setco Allied Products (SAP), offering a broader range of automotive components such as clutch bearings, lubricants, brake linings and flywheels. It plans to foray in to a few more products to complement the existing range, he said. Moreover, the ‘Drive Rewards’ programme further strengthens customer loyalty, enhancing aftermarket engagement.
Embracing Technological Upgrades
Setco’s focus on technological advancements is evident in its investment in IoT and automated manufacturing systems. The company’s manufacturing capabilities include in-house casting, press shop, heat treatment, and surface treatment units, supported by automated foundries and vertical machining lines. Additionally, it operates design and testing centres in multiple locations, including Chennai, with a strong emphasis on engineering innovation, he mentioned.
The company has also ventured into “smart clutches,” incorporating electronics and algorithms to enhance driver information systems, reduce clutch wear, and optimise fuel efficiency. By integrating prognostics - predictive maintenance features, it aims to improve vehicle uptime and overall fleet performance, he noted.
New Ventures
Setco has recently forayed into the agricultural sector by introducing the dual clutch for tractors. This technology allows farmers to operate both the tractor and its implements efficiently, addressing the labour challenges in modern agriculture. The company is also gearing up to expand its presence in other off-road and agri-equipment sectors, with plans for series supply to original equipment manufacturers (OEMs) already underway.
Building A Resilient Business Model
Setco’s strategy to diversify its offerings and maintain a robust aftermarket service has insulated the company from the cyclical nature of the automotive industry. By balancing OEM demands with aftermarket services, the company ensures a steady revenue stream even during market downturns. This strategic approach enables the company to adapt quickly to changing market dynamics, he pointed out.
Supply Chain, Employee Engagement
Unlike many Tier-1 companies, Setco has set its focus on mentoring and hand-holding suppliers long ago. Talking about this initiative, Sheth said, the company’s success is deeply rooted in a strong supply chain network as it maintains close relationships with suppliers, emphasising continuous improvement, value engineering, and timely payments. This approach not only fosters a collaborative ecosystem but also strengthens its operational backbone, he mentioned.
Employee engagement, the company believes, is another pillar of its growth strategy. It recently conducted an employee satisfaction survey, revealing high levels of dedication, loyalty, and independence among the workforce. This positive culture is a driving force behind the company’s ongoing success, as the team is focussed on achieving growth targets over the next three years.
Navigating Future Mobility
As the automotive industry evolves towards electric vehicles (EVs) and alternative fuel technologies, Setco is positioning itself to remain relevant. While the EV market poses challenges for clutch manufacturers, the company sees opportunities in hybrid and hydrogen ICE vehicles, where clutches still play a vital role. The company’s R&D efforts are focused on developing products that cater to both internal combustion engines (ICEs) and emerging powertrains, ensuring its presence across segments like M&HCV, LCV, and SUVs, he said.
Looking ahead, the company aims to catalyse its focus on innovation, quality, and customer satisfaction, to get itself positioned as a leader in the evolving automotive industry. With a strong foundation in manufacturing excellence, a diversified product portfolio, and a proactive approach to emerging technologies, the company is well-prepared to navigate the challenges and opportunities of the future mobility landscape. The company’s focus on sustainable growth, backed by a dedicated team and strong supply chain partnerships, sets the stage for continued success in the years to come, Sheth added.
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