Tata Bearings reports production volume up 14%

Operation now running 80% of capacity, future under Tata still cloudy. Tata Steel (Tisco; a division of Tata Group, India) reported bearing division sales for the fiscal year ended March 31, 2003. Tata is a diversified conglomerate with over 80 major companies operating in 7 business sectors. Tata Bearings Ltd., an operating division of Tata Steel, reported bearing production hit 20 million sets in the fiscal year, up 14% from 17.6 million sets a year ago. Located in Kharagpur, Tata Bearings was acquired as a very small operation from Metal Box India in 1983. From initial capacity of less than 5 million, the plant today has capacity to produce 25 million bearings each year. Nachi Fujikoshi provides technical assistance and expertise, while most of the production machinery is from Izumi. Tata Bearings was the first Indian bearing manufacturer to be ISO9002 and QS9000 certified. In 2001, Tata Bearings acquired the Antifriction Bearings Company plant in Gujarat. • article: Tata acquires ABC plant While Tata has had an on-again, off-again attitude toward its bearing manufacturing operations, recent sentiment expressed by Tata's senior management has been strongly downbeat on bearings. Meanwhile, Tata Steel is in the midst of a major restructuring effort, its capital reduction plan is scheduled for a final court hearing in early May. The company is especially wrestling with employment separation costs. Tata Steel, founded in 1907 and with 13% of the market in India, is continuing an employment reduction scheme begun in 1995. Then, out of a total target reduction of 33,065 employees, the company 22,460 applied for the Employee Separation Scheme. Cost effects of the ESS are impacting the company's capitalization to the point where the restructuring must now be officially approved. Tata Steel is in the middle of that process. As part of the restructuring, management has reportedly warned that the bearing operation is not considered a core component of Tata Steel; however, eBearing has heard from several key managers that there is no active effort at this time to divest Tata Bearings.