Environmental sustainability is no longer just a buzzword: Gurmeet Singh

Topics Sustainability | AC

Gurmeet Singh, Chairman & managing director, Johnson Controls-Hitachi Air Conditioning India
Environmental sustainability is a big concern for leaders while formulating business strategies. What have you done to reduce your emission footprint — both for the products you sell and in the operations/production processes?

Sustainability is not just a buzzword. It is a practice that makes a business more environment friendly and more profitable. Hitachi has always believed in being sustainable and has adopted environment friendly practices in its operational DNA. Right from procurement to product development and composition to manufacturing practices, we have consciously made an effort to make environment friendly and future sustainable choices. For instance, Hitachi air conditioners use environment friendly gasses and innovations like inverter air conditioners help in conserving electricity. Our manufacturing facility has been designed and updated to become more sustainable over time. We have a strict e-waste management system in place and adhere to all the guidelines in this respect at our manufacturing facility and the new Global Development Centre (GDC, inaugurated last week in Kadi, Gujarat). We abide by EPR (extended producer responsibility) under the e-waste guidelines and believe it is the responsibility of manufacturers to review their practices and make sure they are environment friendly.

Since you mentioned the GDC, which are the three key areas where you see it providing impetus to your India local and export strategy? 

The GDC will play a significant role in the brand’s growth story. It will be a key value add to the company’s product development capabilities, particularly in commercial package air conditioning and residential air conditioning systems. The facility is located adjacent to the Johnson Controls-Hitachi Air Conditioning India factory to maximise synergy with the manufacturing teams. The Centre will allow us to further advance our product development capabilities. The GDC welcomes customers at its customer experience zone to provide them first-hand experience of our latest innovations and technologies.

The company has invested $22.5 million (nearly Rs 157 crore) to set up this state-of-the-art facility. The new centre is spread across 21,042 square meters. It is equipped with research and testing facilities including reliability labs, APF labs, EMC labs, electronics labs and semi-anechoic labs to maximise the potential of the local engineering talent. By the end of this year, 18 such labs will be operational. The new facility has a capability to accommodate up to an additional 40 high-tech labs.

Our India-made products have good acceptance in markets such as West Asia, Sri Lanka, Africa and other SAARC countries. We have already started exporting our room air conditioners from India to markets that include West Asia, Sri Lanka and Bangladesh, and acceptance of our room air conditioners have been very good. The GDC in India will work closely with our R&D teams and other GDCs around the world to deliver enhanced cooling solutions to our customers across the globe. 

What has the good monsoon this year meant for retail AC unit sales, especially in regions where extended summers also pushed sales in the previous years?

Our growth will be driven by our strong push in south and east this year. Our strong focus on inverter type air conditioners last year has given us a very strong footing in this high technology product.

The air conditioning industry in India in the last couple of years has seen weak growth, but we expect that trend to turn around. Overall, growing disposable incomes, increasing electrification, growing urbanisation, the year-round air conditioner usage trend and easy access to financing 

schemes have been a few key factors driving the growth of our industry in India. We expect considerable growth in India’s promising MSME (micro, small and medium enterprises) sector.

There is a perception that millennials do not want to own things and prefer to rent. What are the ramifications of this for consumer electronics businesses? And do you foresee a future where companies will offer some kind of limited period subscription model?  

Though there is a trend among millennials to rent than own, this trend is quite small right now and does not have any major effect on the industry. We still need to see how this trend matures before the industry considers addressing it.

Your growth has been better than average industry growth. What were the key factors responsible for this?

Our aim is to become one of India's leading air conditioning brands by 2021. We have tried to offer an innovative product range and great post sales service experience. We have earned a strong loyal consumer base and have successfully seen that base grow over the years because of the value consumers see in our products. 

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