In what could be termed an interesting and informative exercise, leading industry brands joined forces to educate about the potential harm that fake and counterfeit parts pose to the transport industry. The programme – held on 18 May 2023 at Courtyard Marriott in Setia Alam (Malaysia) – consisted of presentations and interactive sessions. Some 100 participants attended and displayed much eagerness to learn more about the fake and counterfeit parts. 

Identifying Fakes
Part of each presentation by the supporting brands was to elaborate on how one could identify genuine and fake or counterfeit parts. In particular, the packaging is a significant component of any product and users would be able to spot a dodgy part just by looking at the same. For instance, a fake or counterfeit product may only be supplied in a brown carton, whereby the original would be in a colourful box with high-quality livery printed on it. QR codes are also an important tool that can help users to identify original parts and components. 

Label and Packaging
However would a package look like the original, there are tell-tale signs of it not being original. There are some obvious differences, however minute. For instance, the logo may not be correct. There will a difference in the name or letters. Regarding logo, there could be a close imitation of it. It is termed as a ‘Passing off a mark’ very often and is commonplace in counterfeiting and constitutes a trademark infringement as well as poses a risk to the buyer of an expected failure. The company that sales original parts often changes the packaging of its products to avoid any chance of counterfeiting. It is essential that buyers of spare parts and consumables familiarise themselves with the look and feel of the original package. If in doubt, as sometimes there could be older versions of the original packaging still in circulation, a call to the principal will clear up any doubts. 

Not the right price
When an item is offered at a price that seems much less what seems like less prize, there is a reason to be vigilant. If something is too good to be true, then it is likely not. If a product is offered at half the price of what it usually is or what the same product would cost from other suppliers, then there’s something wrong with it, quite likely. Discounts maybe offered from time to time, there is no way the distributor and principal would slash prices to levels that seem unbelievable. During the seminar, an example was given of a filter at half the price. It was swapped regularly and the fleet operator saved some money. Of inferior quality, the filter did work as it should have and led to engine failure. It would cost far more in repairing the engine then it would to purchase a genuine filter. 

The Right Partner
Typically, spare parts and consumables are sold via dealers (seldom directly from the manufacturer, but the same idea put forward applies). Original Equipment Manufacturers go to great lengths to ensure that they have appointed a trustworthy and dedicated dealer. They will list all the appointed dealers on their website. If someone is offering a part or consumable, the buyer can easily check on the OEMs website if the dealer is listed. If not, chances are that the dealer is not appointed or is selling knock-offs. In addition, many OEMs issue certificates to the dealer which he would have to produce upon request. These certificates are usually limited to one or two years. The inability to produce a valid certificate would also indicate something is wrong. 

It is also recommended that beyond market prices, buyers should also make themselves familiar with brands that they use. The question one could ask in assessing a part for authenticity is if a brand would be offering that kind of product. If a brand suddenly offers a part that is not aligned with their philosophy (quality level for example) or product portfolio, it might be worth checking if the product is offered by the OEM. 

Touch and Test
Counterfeit products can be of high quality with no obvious tell-tale signs. They are thus hard to identify without taking them apart. It may be a good idea to spend on an extra part to understand how it is constructed and know what makes an original part. An air filter, for instance, could be bend or cracked. If it has a crack, it is most likely of a lower quality and fake. The number of pleats, the folding of the pleats and how the filter material is connected to the end caps is also an indication of whether it is genuine or spurious. As a general rule, a fake product would always be one that uses less material or inferior material. 

Stickers and Numbers
Utilising the internet, buyers of parts and consumables can also check online if their purchase is legit. The product labels can now serve as a quality seal, with distinguishing features such as holograms. In addition, QR codes and other identification numbers can be fed into online portals that verify a part to be genuine. 

Production Quality
When companies offer multiple years of warranty on their products and promise superior performance, then they do so as their components are manufactured to the highest standards. Gears, piston rings, shafts and rods may look like they are original, but a closer inspection may reveal a fake: non-treated surfaces easily scratch, holes may not be chamfered, and logos may only be printed on the parts. 

Mixing oil
With the exception of highly complicated assemblies, such as a complete gearbox, not much is safe from imitation or tampering. That includes lubricants and other fluids. Mixing cheaper fluids into high quality grade fluids is one method applied by fraudulent sellers. Old fluids could be mixed in with new liquids or packaging swapped to sell low grade products for a higher price. The two remedies to prevent fraud are again to know the supplier and to be familiar with the product. A fake lubricant may smell different or feel different than the genuine item. 

Too Complex to Fake
Modern components and parts may be highly complex as many suppliers have taken the strategic approach to become solutions providers. Those wanting to make a quick buck by copying products would do so by offering simpler, easier to copy products. As these components also require trained and qualified staff to sell them to the market, OEMs nowadays work with reputable distributors and dealers, which can typically be identified via the brands’ websites. Those fraudulent suppliers would simply not have the motivation to create a complex product or appearance.

Damage to the Industry
A fake or counterfeit product may pose a threat to the lives of those on the road. For instance, unscrupulous individuals may offer brake pads that use sawdust as filler, this putting people at risk. In case a non-genuine part is causing harm to a transporter, the damage is not limited to metal and plastic: one’s reputation is also at stake and authorities may rule that a company may have to be shuttered as it may be deemed unsafe. In addition, fake parts, as they are typically cheaper, also rob governments of revenue. In this context, under-declaring the value of parts upon importation also causes the government losses. Meanwhile, fake or counterfeit products take away jobs from those that are offering genuine parts. 

To illustrate the severity of impact of using fake or counterfeit parts, Malaysian industry insiders referred to a case in 2014, whereby insurance companies had to pay out a whopping RM 600 million. Only two automotive brands were involved in repair claims. According to World Trademark Review, the estimated global economic cost of counterfeiting in the automotive industry could have reached USD 2.3 trillion by 2022. In Europe, it is estimated that Euro 2.2 billion is lost annually to counterfeit tyre sales alone, while counterfeit battery sales effectively steal Euro 180 million from OEMs. The impact of fake or counterfeit products is severe. It amounts to loss of lives, loss of income, loss of tax income and a threat to the existence of genuine parts manufacturers. 
 

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Mumbai-headquartered automotive major Mahindra & Mahindra has announced an ambitious growth plan for its commercial vehicle (CV) business, thanks to the recent strategic acquisition of a majority stake in SML Isuzu. The company aims to leverage this acquisition to accelerate its ‘Deliver Scale’ strategy across segments where it believes it has a strong ‘right to win.’

Dr Anish Shah, Managing Director and CEO, Mahindra Group, emphasised that the group’s disciplined focus on capital allocation remains intact. "We have seen significant growth across several businesses, and now, as we enter our third phase, the focus is on delivering scale," he said.

Shah also noted that Mahindra has turned around its CV business, once under scrutiny five years ago, and sees the acquisition of SML Isuzu as a strategic opportunity to cement its position further.

Today, Mahindra is the market leader in SUVs with a 23 percent market share and ranks fifth in the CV segment above 3.5 tonnes with a 3 percent share. Through the acquisition, Mahindra aims to become a more formidable player in the CV space.

"We are targeting a combined market share of 10-12 percent by FY2031 and over 20 percent by FY2036," said Rajesh Jejurikar, Executive Director and CEO – Auto and Farm Sectors, Mahindra & Mahindra. He acknowledged that Mahindra’s CV share, which stood at around 4-5 percent in FY2020, had dropped due to the impact of Covid-19. However, with renewed focus, especially in the LCV and ILCV segments, Mahindra is planning an aggressive recovery.

SML Isuzu brings strength in the intermediate LCV bus segment, holding a 16 percent market share. Mahindra expects that, combined, they could command a 21 percent share. "The synergies are substantial across cost structures, platforms, aggregates, supplier networks, and operations," Jejurikar added.

Growth, Not Cost-Cutting

Mahindra leaders were clear that the SML Isuzu acquisition is not about cost-cutting, but about building scale. "This deal is about growth, not about taking costs out," stressed Amarjyoti Barua, Chief Financial Officer, Mahindra Group. He highlighted that SML Isuzu will remain a separately listed entity and that Mahindra has no plans to rebrand it under the Swaraj name, even though it sees potential for the Swaraj brand in certain export markets.

Financially, Mahindra believes the deal makes strategic sense. Shah pointed out that the SML Isuzu business will be self-sustaining in generating cash for future investments.

The company sees SML Isuzu's operations as a ‘well-run and frugal factory,’ with most future investments primarily required to ramp up capacity.

Vinod Sahay, President - Aerospace & Defence, Trucks, Buses & CE, Mahindra, underlined how the product portfolios of Mahindra and SML Isuzu complement each other. SML Isuzu, for instance, is at an advanced stage in developing electric buses for school, staff and executive coach applications, an area where Mahindra's electrification expertise can add substantial value.

Sahay further highlighted how combining Mahindra and SML Isuzu’s supplier ecosystems will strengthen bargaining power, especially in critical areas like tyres, batteries and key aggregates. While Mahindra boasts strong sourcing power in tyres and batteries, SML Isuzu has an edge in CV parts.

Product synergy is another opportunity. SML’s strong CNG product line and Mahindra’s newer Furio and Cruzio models – offering 8-10 percent better fuel efficiency – will allow the combined business to offer compelling choices to customers across the LCV, ILCV and M&HCV categories.

With over 200 dealers and 400 touchpoints between them, Mahindra plans to optimise and expand network coverage for a wider reach.

While Mahindra is bullish on growth, Shah made it clear that there are no immediate plans for further acquisitions. "Now the business must prove itself," he said, reiterating the company’s strategic belief in building businesses that have a clear right to win, strong financial metrics and differentiated products.

Looking ahead, Mahindra is betting that a stable yet evolving CV market – especially in buses and light trucks, which the management stated will provide the runway needed for long-term growth, as the group consolidates its position as a dominant player across automotive categories.

Mumbai-based automotive major Mahindra & Mahindra has announced a bold move to strengthen its position in the commercial vehicle (CV) market with an agreement to acquire a 58.96 percent stake in SML Isuzu (SML) at INR 650 per share, representing an investment of INR 5.55 billion.

Following the acquisition, Mahindra will also launch a mandatory open offer to acquire up to an additional 26 percent stake from public shareholders, in compliance with SEBI's Takeover Regulations.

This strategic acquisition marks a major step forward in Mahindra’s ambition to expand its footprint in the >3.5-tonne CV segment. At present, Mahindra holds a modest 3 percent market share in this space, compared to its dominant 52 percent share in the <3.5-tonne light commercial vehicle (LCV) market. With the addition of SML’s capabilities and brand strength, Mahindra expects to immediately double its market share to 6 percent, and is aiming for 10–12 percent by FY2031 and over 20 percent by FY2036.

Founded in 1983, SML Isuzu is a listed company with a all-India presence and a strong legacy in the trucks and buses segment. It holds a leading 16 percent market share in the Intermediate Light Commercial Vehicle (ILCV) buses category. For FY2024, SML reported operating revenue of INR 21.96 billion and an EBITDA of INR 1.79 billion, showcasing profitable operations, frugal manufacturing and strong engineering capabilities.

Mahindra sees the acquisition as an opportunity to unlock significant value through synergies across cost optimisation, network expansion, brand integration, manufacturing efficiency, talent pool strengthening and complementary product portfolios. Mahindra states that its Trucks and Buses Division has already made notable advances in technology, design and innovation by leveraging its broader automotive capabilities – strengths that will be further enhanced through this deal.

The transaction structure involves Mahindra acquiring the entire 43.96 percent stake held by Sumitomo Corporation, the current promoter of SML, as well as a 15 percent stake from Isuzu Motors.

Dr Anish Shah, Group CEO & MD, Mahindra Group, said: “The acquisition of SML Isuzu marks a significant milestone in Mahindra Group’s vision of delivering 5x growth in our emerging businesses. This acquisition is aligned with our capital allocation strategy for investing in high-potential growth areas that have a strong right to win and have demonstrated operational excellence.”

Rajesh Jejurikar, Executive Director and CEO, Auto and Farm Sector, Mahindra & Mahindra, added, “SML brings a strong legacy, a loyal customer base and a credible product portfolio that complements Mahindra’s existing offerings in the trucks and buses segment. This acquisition is a pivotal step toward our ambition to become a full-range, formidable player in commercial vehicles by enhancing market coverage, unlocking operating leverage through platform consolidation, a unified supplier and network base, and better plant utilisation. Together, we are well-positioned to scale rapidly and drive profitable growth.”

In what may come as a welcome push for road safety in India, the Ministry of Road Transport and Highways (MoRTH) plans to launch a new safety assessment rating for trucks and commercial vehicles on the lines of the Bharat New Car Assessment Program (BNCAP).

The announcement was made by Nitin Gadkari, Union Minister of Road Transport & Highways, while inaugurating a two-day workshop of Vehicle and Fleet safety jointly organised by the Global New Car Assessment Program (GNCAP) and the Institute of Road Traffic Education (IRTE).

“The idea is to encourage manufacturers to improve the production quality, making vehicles safer. Similarly, the government is already working on standards and a safety assessment system for battery-operated e-rikshaws in the country, as they suffer from safety issues. The safety improvement in e-rickshaws will improve their quality and generate more employment. India accounts for the highest number of fatal road accidents with 4.8 lakh road crashes each year resulting in 1.8 lakh deaths. The government’s top priority is on road safety, expansion of safe highways and vehicle safety and bolstering electric vehicles. The ministry is also working on reducing logistics cost to 9 percent in the next couple of years from the present 14-16 percent, as the automobile industry plays a key role in India’s economic growth.”

He further added that MoRTH was now also working on a law to determine the working hours for truck drivers. At present, many truckers continue to drive vehicles for 13-14 hours a day, as the country is facing a shortage of truck drivers.

The government also plans to set up 32 state-of-the-art driving institutes across the country. Air conditioning of driver compartments has already been made mandatory by the ministry. Advanced Driver Assistance System (ADAS) to assist drivers has also been made mandatory”, the minister added.

It was just a few days back government introduced road safety as part of the school curriculum for students of classes 1-12, the modules are expected to be introduced in the current academic year.

David Ward, President Emeritus, Global NCAP, said, “Consumers in India with most vehicles having GNCAP and BNCAP assessment ratings have a better choice of safer vehicles. It is a good moment towards the UN objective of road safety by 2030.”

Dr Rohit Baluja, President, IRTE, added, “The two-day workshop will review progress in vehicle safety worldwide and in India since 2000 and the priority actions needed to achieve further improvements by 2030 and beyond. In particular, the meeting will examine efforts to improve automobile safety worldwide by reviewing the progress made by the G20 major economies, including India, to implement the Global Plan vehicle safety recommendations and feature special sessions on fleet and motorcycle safety.”

Montra Electric’s e-SCV (small commercial vehicles) division, Tivolt Electric Vehicles has inaugurated its first e-SCV dealership in Jaipur, Rajasthan, which also is its first in the region.

The new channel partner Ensol Infratech has a state-of-the-art 3S (sales, service, spares and charging) facility to provide a comprehensive buying and aftersales support.

The dealership was inaugurated by Jalaj Gupta, Managing Director, TI Clean Mobility (Montra Electric) and Arun Sharma, Managing Director, Ensol Infratech, in presence of Saju Nair, CEO, Tivolt Electric vehicles, Sunil Kataria, Director, Ensol Infratech and key stakeholders, including dealers, customers, suppliers and other guests.

With this Montra Electric’s Eviator e-SCV will be available in Jaipur. It comes with a claimed certified range of 245 km and a real-world range of 170 km, 80 kW motor and an 300 Nm torque. The company currently offers an extended warranty of up to 7 years or 2.5 lakh km.

Jalaj Gupta, said, “Montra Electric has been at the forefront of India’s EV transformation, and we are excited to inaugurate our first dealership in the state of Rajasthan. Eviator is India’s first TRU-EV, setting a new benchmark in mid-mile and last-mile mobility with its advanced design, powerful performance, and exceptional durability. The launch of this dealership facility is a testament to our vision of delivering cutting-edge, high-performance e-SCV in the region.”

Saju Nair, added, “Rajasthan is an important market for us, and we are thrilled to mark our entry into the state with our first dealership in Jaipur. At Montra Electric, we are driven by a strong commitment to innovation and sustainability in clean mobility. This launch is a significant milestone in our journey, enabling us to get closer to our customers and deliver high-performance electric small commercial vehicles (e-SCVs) that meet their evolving needs. Our partnership with Ensol Infratech further strengthens our ability to provide customised solutions and outstanding service across the region.”

Arun Sharma, shared, “We are delighted to join hands with Montra Electric in setting up this new dealership. This collaboration marks a significant step in strengthening Montra Electric’s footprint as a leading EV brand in the region, while improving customer access to dependable, high-performance electric small commercial vehicles. Together, we look forward to expanding our reach and delivering tailored mobility solutions that cater to the evolving transportation needs of our customers.”