TORONTO -- Magna International Inc., Canada's largest auto parts maker, is in talks about becoming a supplier for India's Tata Motors Ltd. and Mahindra & Mahindra Ltd., president Mark Hogan says.
India "ought to be growing at a rate that either equals or surpasses China" within a decade, Mr. Hogan said in an interview yesterday. He said he doesn't expect an announcement for at least 60 days.
Supplying Tata Motors and Mahindra would give Magna access to India's biggest car and truck maker and the country's largest manufacturer of tractors and sport utility vehicles, respectively.
Magna is expanding in the faster-growing economies of Russia, China and India to offset sluggish demand in the United States. The Aurora, Ont.-based parts maker expects East and South Asia to account for 10 per cent of sales by 2010, from less than 4 per cent last year, Mr. Hogan said.
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In Russia, Magna has added ventures with the country's biggest auto maker, OAO AvtoVAZ, and No. 2 OAO GAZ, which is controlled by Russian billionaire Oleg Deripaska. Mr. Hogan said no decisions have been made on whether Magna would supply those companies with parts and expertise, or assemble complete vehicles. Magna is the only auto supplier that builds cars.
"Is there a need for us to become an assembler? That's still an open question," Mr. Hogan said. "We're certainly capable of doing that, but there's nothing concrete yet," he said.
Mr. Hogan said Magna is "certainly open" to a partnership in Russia with Chrysler LLC, which also seeks to expand non-U.S. sales. Michael Manley, Chrysler's executive vice president of international sales and marketing, said Sept. 11 that such a tie-up was a "potential option." Mr. Hogan wouldn't comment further yesterday.
Magna is also looking at acquisitions in the United States, Mr. Hogan said. Any prospects would have to be affordable and offer new technologies or clients, he said.
"There is a pretty interesting array of opportunities that fit those criteria," he said, declining to comment further.
Tata Motors parent Tata Group is bidding for Ford Motor Co.'s Jaguar and Land Rover units.
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