Massive Make in India success! India becomes world’s second largest mobile phone producer in three years

Most of the window air conditioners are manufactured in India - a dying business as margins are dwindling . Very soon as is visible in the west and other nations , most companies will cease manufacturing Window ac's altogether . Which brings up another irony . Window ac's consume lesser power as split ac's , are easier to maintain and enjoy longevity .
Why are split ACs preferred then? I thought Split ACs came in fashion because of apartment complexes where apartments didn't have enough clearance to install a window AC. And why is it hard to manufacture a split AC if one is already manufacturing window AC?

Compressor remains the same. I though compressor is the heart of the AC unit.
Indoor unit is essentially a very simple piece of machinery. A remote receiver, intake and pipes, fans and motorized blades. Whats so hard in manufacturing them?
 
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Very true. Same is the case in the ITES where giants like Infosys, TCS, Wiprol et al are simply SLAVE labor suppliers with extreme CORRUPT acts. There is Zero Intellect and Risk involvement by these exploiters. They are the Shame champions of India.
Why? They give more than average salaries. Opportunities to learn in form of subsidized education opportunities by tie-ups with universities. Opportunities to travel abroad and gain cross cultural experience. A climate controlled office. Benefits in terms of insurances etc. TCS even gives rebates in TATA owned shops for employees. Whats to hate about them? How are they slave labor suppliers? Many of their associates actually leave them and join companies abroad on their visits to on-site opportunities. How are they slave suppliers then?

Heck from what I know, Infosys even trains employees when they start out of college because they don't trust colleges to teach them useful things.
 
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Being from the HVAC industry , I can understand what you're hinting at . Most of the Air Conditioners out here are imported from China ( indoor units of Split AC's ) . The first company to set up manufacturing out here for such units was a Chinese CO - Midia in collaboration with Career. Most of the central air conditioning plants are imported or if they're assembled here , the compressors , controls and PCB's come from China or Taiwan . None of the Indian major companies dedicate a sizeable chunk for R&D . On the contrary , in order to claim tax breaks from the GoI , they inflate the no of employees on their payroll under the R&D head . With such an approach is it any wonder that foreign companies are ruling the roost in the Consumer Durable & the HVAC sector in India .
How are Kirloskar, Voltas, and Llyods doing?
 
Why are split ACs preferred then? I thought Split ACs came in fashion because of apartment complexes where apartments didn't have enough clearance to install a window AC. And why is it hard to manufacture a split AC if one is already manufacturing window AC?

Split Ac's came into effect primarily for two reasons - the noise factor ( owing to the fact that older generation compressors created quite a racket and were an integral part of a window ac) & aesthetics ( instead of having an ugly box blocking a quarter of a window, who wouldn't prefer an artfully designed indoor unit located anywhere within a room without hampering the interiors and enhancing it's aesthetic appeal)


Compressor remains the same. I though compressor is the heart of the AC unit.
Indoor unit is essentially a very simple piece of machinery. A remote receiver, intake and pipes, fans and motorized blades. Whats so hard in manufacturing them?

The dies & tooling cost a lot. And the existing Indian giants of the day were like what HAL is today. Content with assembly lines, low productivity with highly militant unions and zero investment in R&D. The company I worked for then had GET's serving in R&D fresh out of college where their job was to strip imported indoor units down to catalogue the parts & see possibilities of RE headed by a man on the verge of retirement ( he was an alumnus of IIT - Kharagpur) and was shunted there due to office politics.

I'm referring to a period 10-20 years ago where economies of scale prevented the setting up of such plants given the overall high taxation on consumer electronics ( approx 30-32℅ excise + 15-17℅ sales tax + 4-5 ℅ octroi/ local body taxes & transportation).

By the time, economies of scale happened, it turned out to be cheaper to import than go thru the hassle of manufacturing, what with the attendant problems of acquisition of land, dealing with labour, other compliances, etc plus the fact that China became the undisputed leader in manufacturing such machines. Add the FDA with Thailand & Malaysia to the mix. One could also add a certain myopic vision & lethargy on the part of the leading ac manufacturers of the time. This would be around 2005-7.

Today, believe it or not the only plant manufacturing such indoor ac's in India is Midia( OEM from China) in a JV with Career who cater to their own in house requirement as well as serve as OEM's to third party brands.
 
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How are Kirloskar, Voltas, and Llyods doing?
Kirloskar had moved out of Split Ac's a long time ago. They're fringe players in the Chiller segment basically catering to the government sector and people with low budgets but major players in the Commercial Refrigerant market namely low temperature refrigeration in the hydro carbon sector.

Lloyds has sold off to Havell. They're focussing on niche areas like AHU's, Rail coach Air conditioning & defence.Voltas is leading the window & split ac market in spite of the bitter competition by the Koreans primarily and other Japanese & western MNC's. In the commercial air conditioning segment, they still are by far the largest HVAC contractors for EPC projects but their performance in the products business in commercial air conditioning is dismal.
 
How much do dies and tooling cost? I cann't be in hundreds of millions dollars.
The window & sac market in India isn't more than 10 - 12,000 crores.Compare this with the size of the Chinese market and the sheer nos they export and the consequent market share they command.

You'd have to do data mining on your own as I'm logging in to this forum vide a mobile. Hence quoting statistics and data from relevant sources is a bit cumbersome.

You can try JARN - Japanese Air Conditioning & Refrigeration News. It's like what the Jane's Defence News is to defence enthusiasts.
 
Why? They give more than average salaries. Opportunities to learn in form of subsidized education opportunities by tie-ups with universities. Opportunities to travel abroad and gain cross cultural experience. A climate controlled office. Benefits in terms of insurances etc. TCS even gives rebates in TATA owned shops for employees. Whats to hate about them? How are they slave labor suppliers? Many of their associates actually leave them and join companies abroad on their visits to on-site opportunities. How are they slave suppliers then?

Heck from what I know, Infosys even trains employees when they start out of college because they don't trust colleges to teach them useful things.

All of what you described is needed to turn these young and brilliant talent into useful slaves, some of them being sops. It is because the leaders themselves are averse to risk. They simply exploit cheap labor of India as a tool to offer cost savings to high costs regions of Europe, Japan and NA. Once they get a foothold in the organization they adopt corrupt practices to slice and dice, and stretch the work to multiple folds, sometimes greater than what the Org incurred before partnering with them, thus destroying the myth and illusion of saving any cost. Such are the corrupt practices, it would put the Indians babus to pride for their work.

I have personally dealt and very keenly observed for several years the practices of these companies. They are baniyas who only believe in profiteering. And the main reason for this is politics of power and money, and instant gain.

The real heroes are someone like this guy Mohali engineering student’s UAV proposal has MoD, college excited – Indian Defence Research Wing

It is simply that such giants are not interested in spotting talent and move on a path of innovation and leadership. People at the helm have absolutely sick mentality of doing the back-office support work. They do not want to lead form the front - to invest in innovation.
 
All of what you described is needed to turn these young and brilliant talent into useful slaves, some of them being sops. It is because the leaders themselves are averse to risk. They simply exploit cheap labor of India as a tool to offer cost savings to high costs regions of Europe, Japan and NA. Once they get a foothold in the organization they adopt corrupt practices to slice and dice, and stretch the work to multiple folds, sometimes greater than what the Org incurred before partnering with them, thus destroying the myth and illusion of saving any cost. Such are the corrupt practices, it would put the Indians babus to pride for their work.

I have personally dealt and very keenly observed for several years the practices of these companies. They are baniyas who only believe in profiteering. And the main reason for this is politics of power and money, and instant gain.

The real heroes are someone like this guy Mohali engineering student’s UAV proposal has MoD, college excited – Indian Defence Research Wing

It is simply that such giants are not interested in spotting talent and move on a path of innovation and leadership. People at the helm have absolutely sick mentality of doing the back-office support work. They do not want to lead form the front - to invest in innovation.
From what I have seen, Infosys and likes recruit grads from whole gamut of Indian colleges. From the best of the breed IITs to the lowest rung Lovely-Professional-University --I kid you not, that the actual name. Likes of Infosys even train these folks, who were neglected by their own college professors. A few motivated of the bunch go further and do higher studies: like Masters in engineering and MBAs.

I have a sense of appreciation and respect for these organizations. They turn the kids rejected by the government colleges and exploited by the private colleges into decent skilled professionals. Whats more, unlike foreign-branded companies, some of these desi-tech companies even operate in non-metro, non-hyderabad-bangalore-pune-noida towns like Lucknow, Jaipur etc.

All this while, they are also answering to their stakeholders and making profit. Its not a business's job to uplift masses or to focus on national progress. They still contribute more than any super-innovative company does.

Before they came into being, ie before 1990s, do you think India was oozing with innovation? From what I hear, unemployment was a massive concern, even for ppl with engineering degrees. People would either get the government job or nothing. These IT companies have given a lot of folks a stab at decent quality of life.
 
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From what I have seen, Infosys and likes recruit grads from whole gamut of Indian colleges. From the best of the breed IITs to the lowest rung Lovely-Professional-University --I kid you not, that the actual name. Likes of Infosys even train these folks, who were neglected by their own college professors. A few motivated of the bunch go further and do higher studies: like Masters in engineering and MBAs.

I have a sense of appreciation and respect for these organizations. They turn the kids rejected by the government colleges and exploited by the private colleges into decent skilled professionals. Whats more, unlike foreign-branded companies, some of these desi-tech companies even operate in non-metro, non-hyderabad-bangalore-pune-noida towns like Lucknow, Jaipur etc.

All this while, they are also answering to their stakeholders and making profit. Its not a business's job to uplift masses or to focus on national progress. They still contribute more than any super-innovative company does.

Before they came into being, ie before 1990s, do you think India was oozing with innovation? From what I hear, unemployment was a massive concern, even for ppl with engineering degrees. People would either get the government job or nothing. These IT companies have given a lot of folks a stab at decent quality of life.

I do not disagree with anything you have written. But, I am trying to put a different point here, which is how have they put India on the leadership map for Software or Hardware products?
 
I do not disagree with anything you have written. But, I am trying to put a different point here, which is how have they put India on the leadership map for Software or Hardware products?
I have a question, why is leadership so important? Why is innovation so prime?

They are businesses and that is all. Their goal in life should be to make money within the framework of Indian, and whenever applicable international or foreign laws. Thats all. Now, if their business model becomes obsolete, they have to change. If they cann't they will perish and new businesses will rise from their ashes.

Already, likes of Infosys are changing their business models. Previously, they used to provide labour and technical services to their clients, in India or abroad, now they provide infrastructure IIRC. As in office space and other requirements. They had to do this because their profits in the service space were dwindling. So, new enterprising businesses will hire their infrastructure and run their businesses out of their office complexes. There may be more such instances of what they can bring on the table. If someone has an innovative idea, they can possibly form a core team of their talents, make a prototype, secure funding or boot-strap and then hire their infra and may be some fixed price IT services --like setting up printers, network etc and launch their business out of their office spaces without committing capital to this expense. This is what their place in the ecosystem at-least in India.

There is one key point in business which is often misunderstood and forgotten, it is that of scale. These guys started business in a time when scaling in the foreign market was primarily limited by the supply of people. That was their opportunity. The made a business model around it and that model was extremely successful as evident by their sheer growth. They did their job in that front. And they did it well.

Next stage is to do innovation. Should they be end all and be all of Indian IT? I don't know. Its their business model how they want to run it. I believe in a diverse ecosystem where companies come, make profit or fail fast. I don't usually like 'Standard Oils' of any industry OR IBMs. They become too bloated to move. Neither I like 'Sony' Incs, they become oligopolies, the usual Kairetsu or Zaibatsu model of Japan. A decentralized economy with lots of failures and attempts ensures that idea are tried. Utilities may make sense to be centralized but applications are best decentralized. I see Indian software industry moving there.

'God' is in his heaven, All right with this world. :)
 
I have a question, why is leadership so important? Why is innovation so prime?

They are businesses and that is all. Their goal in life should be to make money within the framework of Indian, and whenever applicable international or foreign laws. Thats all. Now, if their business model becomes obsolete, they have to change. If they cann't they will perish and new businesses will rise from their ashes.

Already, likes of Infosys are changing their business models. Previously, they used to provide labour and technical services to their clients, in India or abroad, now they provide infrastructure IIRC. As in office space and other requirements. They had to do this because their profits in the service space were dwindling. So, new enterprising businesses will hire their infrastructure and run their businesses out of their office complexes. There may be more such instances of what they can bring on the table. If someone has an innovative idea, they can possibly form a core team of their talents, make a prototype, secure funding or boot-strap and then hire their infra and may be some fixed price IT services --like setting up printers, network etc and launch their business out of their office spaces without committing capital to this expense. This is what their place in the ecosystem at-least in India.

There is one key point in business which is often misunderstood and forgotten, it is that of scale. These guys started business in a time when scaling in the foreign market was primarily limited by the supply of people. That was their opportunity. The made a business model around it and that model was extremely successful as evident by their sheer growth. They did their job in that front. And they did it well.

Next stage is to do innovation. Should they be end all and be all of Indian IT? I don't know. Its their business model how they want to run it. I believe in a diverse ecosystem where companies come, make profit or fail fast. I don't usually like 'Standard Oils' of any industry OR IBMs. They become too bloated to move. Neither I like 'Sony' Incs, they become oligopolies, the usual Kairetsu or Zaibatsu model of Japan. A decentralized economy with lots of failures and attempts ensures that idea are tried. Utilities may make sense to be centralized but applications are best decentralized. I see Indian software industry moving there.

'God' is in his heaven, All right with this world. :)
Leadership and Innovation gives you the strategic edge in the world, whatever the field. Else your dependence on other countries for strategic items like high end hardware, software, military and defence related items, space, nuclear fields, energy, consumer electronics - all of these and many more put an extreme burden of foreign exchange on the country - which can be made to work like a slow acting poison. Recent events of the rupee slide and rising gas prices are a witness to this act. You can also reminisce the recent past when crude was pushed down which destroyed economies and currencies of Venezuela, the Brazilian Real as well as Russian Ruble.

Why do you think most innovation always came from the first world and China is also moving in that direction by eliminating the technology gap - by hook or crook - beg, borrow, steal.

It is this stupid thinking of Nehru to take a moral high ground of non-alignment and make people build dams with brute labor is absolutely idiotic. He was interested in self aggrandizement driven by his idiosyncratic choices. Ruling India, and not Serving India, was a means to achieve it. This is how critical a Leader is. He/She has the power of designing the destiny of the entity he/she leads.