Keelakaranai Village, Malrosapuram Post, Maraimalainagar
Chennai, Tamil Nadu 603204
Telephone: (+91) 44-3747-3700
Fax: (+91) 44-3747-3737
Web site: http://www.comstarauto.com
Employees: 600 (est.)
Sales: $70 million (2017 est.)
NAICS: 336320 Motor Vehicle Electrical and Electronic Equipment Manufacturing
Based in Chennai, India, Comstar Automotive Technologies Pvt Ltd. is a designer and manufacturer of automotive parts, focusing on starting and charging systems. Besides traditional starters, Comstar makes starters for micro- and mid-hybrid vehicles using the latest “go-green” technologies. Its charging system products include three models of alternators, which are used to charge a vehicle battery and power the electrical system when the vehicle is running. Comstar also supplies starter subassemblies that include two principal components: the solenoid and the armature. Comstar is a Tier 1 supplier to several major automakers, including the Ford Motor Company, Renault-Nissan, Jaguar Land Rover Limited, Aston Martin Lagonda Limited, Ashok Leyland Limited, and Tata Motors Limited. Comstar also manufactures aftermarket starters and alternators, which are carried by a network of auto parts providers across India and Europe. Besides its operations in India, Comstar maintains an assembly plant in Tecumseh, Michigan, and subsidiaries in Gothenburg, Sweden; Hangzhou City, China; and Irapuato, Mexico. Comstar is owned by The Blackstone Group L.P., a hedge fund based in New York City.
Comstar was originally a unit within the Ford Automotive Products Operation, a subsidiary that the Ford Motor Company created in 1996 to house the various parts suppliers it owned. A unit was established in Chennai, India, in 1999, and the following year a plant opened and began manufacturing starters and alternators for Ford's European operation. In June 2000 Ford spun off its parts subsidiary as Visteon Corporation, an independent company based in Dearborn, Michigan. Ford was essentially following the lead of the General Motors Company, which previously spun off its automotive supplier as Delphi, which became the world's largest automotive supplier. Visteon became Delphi's closest rival.
In 2007 Visteon's Chennai plant added a domestic business. It began supplying starters and alternators to Tata Motors. Originally a manufacturer of locomotives, Tata became involved in the production of commercial vehicles in 1954 through a partnership with Daimler-Benz AG. In 1991 Tata introduced its first passenger vehicle, and in 1998 it introduced the Indica, the first fully indigenous Indian passenger vehicle, which quickly became a bestselling car. As a result, a Tata supply contract was a major win for the Chennai plant.
In the meantime, the Visteon Corporation launched a restructuring effort to focus on key products and core technologies and thus improve profitability. As a result, it sold several of its noncore assets, one of which was Visteon Powertrain. In 2007 the company was sold to Adyar River Ltd., which was a joint venture between Argyle Street Management Limited, a Hong Kong–based hedge fund manager, and Leticia Investments Corp., an investment vehicle for Manu Chandaria, a Kenyan who was chair of the Comcraft Group industrial conglomerate. Argyle and Leticia each owned a 50 percent stake in Visteon Powertrain.
Now an independent enterprise, Visteon Powertrain changed its name to Comstar Automotive Technologies. The transition alone was challenging, but a global economic downturn created further complications. However, Comstar found ways to cut costs without having to reduce its workforce or take on further debt. During the two years following the departure from Visteon, Comstar became a major supplier of Tata's Indica and Safari passenger car models. In 2009 it won a supply contract with Ashok Leyland–Nissan, a joint venture to produce passenger vehicles in India. At the same time, the company continued to maintain its core export business, in particular providing parts for Ford cars around the world.
In 2010 Comstar prepared to supply Ashok Leyland–Nissan, Tata for its new Nano (a compact-sized car), and Volkswagen's plant in Maharashtra, India. The Nano and other subcompact vehicles increased the pressure on Comstar to invest in product development to launch next-generation, price-sensitive solutions to remain competitive. The following year Comstar began supplying Volvo with next-generation start-stop starters. When a vehicle stopped at a traffic light, the system turned off the vehicle's engine without loss of power to other systems. The engine was immediately restarted when the driver released the brake or clutch pedal. Startstop starters provided improved economy and other benefits.
In August 2011 Comstar had to contend with a strike when 425 workers in the Chennai plant walked off the job demanding recognition of their union and negotiation of a new contract. The previous wage agreement had expired earlier in the year. The workers submitted more than 30 other demands and lodged objections over the suspension of four workers for distributing union materials and Comstar's filing of false assault complaints to the police against some workers.
Although production quickly fell to about 25 percent of normal levels, management refused to meet with workers, who arrived each morning at the plant to protest. Comstar, according to the workers, hired more than 150 trainees, who along with apprentices became involved in actual production, activities that were prohibited by law. After Comstar failed to attend three conciliation meetings with workers, the Tamil Nadu labor department issued a summons to the company, compelling its attendance at a meeting in August 2011.
With production returning to normal, Comstar announced it intended to focus more attention on its home market, due to new growth opportunities in India. With only 10 percent of its starter motors and alternators sold to Indian original equipment manufacturers, Comstar remained very much dependent on its export business. Besides supplying Volvo with start-stop starters, Comstar won one of the largest contracts in its history: supplying 600,000 starter motors a year to Ford's North American operations. In January 2012 the components began arriving in Comstar's warehouse near Detroit. They were then assembled by Ford for North America and other countries to be used in the Ford Taurus, Flex, Edge, and Flex vehicle models as well as by Ford's Lincoln division. Comstar also began developing a start-stop starter for the Nano. Production began in March 2013, and later in the year production commenced on a starter for a Nano model with a larger engine.
To better serve the North American market, Comstar opened an assembly plant in Tecumseh, Michigan, in April 2013. The starter motors it produced were slated for the Ford 6.7-liter diesel engine used in F series super duty trucks, which were built in Ford's Louisville, Kentucky, plant. Comstar hoped the Tecumseh plant would serve as a template for the construction of satellite assembly plants in countries such as Brazil, China, and Russia. That same year Comstar signed an agreement with a Chinese Tier 1 vendor to manufacture starter motors and alternators for Volvo Geely passenger vehicles, as well as for Ford and other automakers making vehicles for the Chinese and Taiwanese markets. Comstar held a 49 percent minority interest in the resulting joint venture. Production commenced in 2014.
By year-end 2013 Argyle Street Management and the Comcraft Group were ready to cash in their investment in Comstar. The Kotak Mahindra Capital Company, and Indian investment bank, was hired to find buyers. According to press reports, advanced talks were underway with the Mitsubishi Group. However, a deal was never reached, and for the time being ownership remained unchanged.
Comstar continued to expand on multiple fronts. In 2015 it won a contract with Renault-Nissan. The following year it unveiled the world's lightest starter motor. At 1.5 kilograms, it became the first-ever sub-2-kilogram starter motor developed for passenger cars. Plans were also underway to build a new plant in Mexico, which opened in late 2017 and began producing conventional and start-stop starter motors. Comstar hoped to eventually use the plant to manufacture an integrated starter generator system for hybrid vehicles it had under development. By combining the starter and generator functions, significant fuel savings could be achieved. Comstar also opened a manufacturing facility in Hangzhou City, China, in 2017 to supply starter motors to Volvo and Geely passenger vehicles. Alternators were also supplied, but from Chennai.
During the summer of 2017 negotiations were launched to sell a majority stake in Comstar to the private equity firm CX Partners of New Delhi, India. Once again, however, the talks failed to bare fruit. In October 2017 press reports indicated that The Blackstone Group L.P., a hedge fund based in New York City, was on the verge of acquiring a majority interest in Comstar and had entered into a final phase of negotiations. Blackstone was familiar with India's automobile parts industry. In 2013 it had acquired Agile Electric Sub Assembly Pvt Ltd., India's largest manufacturer of direct-current motors. Two years later Blackstone exited the investment, selling the business to Japan's Igarashi Electric Works Ltd. and India's MAPE Advisory Group Pvt Ltd. Comstar had become an especially attractive property because of stricter new emissions controls that were scheduled to be imposed in 2020. Hybrid and electric cars appeared to be the wave of the future and Comstar, with its integrated starter generator system, was well suited to meet the needs of these next-generation vehicles.
Comstar Automotive LLC USA; Comstar Automotive Technologies, Europe.
Prestolite Electric Incorporated; Remy International, Inc.; Robert Bosch Starter Motor Generator Holding GmbH.
Bajad, Kiran. “Comstar Unveils World's Lightest Starter Motor, to Open New Plant in Mexico.” Autocar Professional, June 13, 2016.
“Comstar Automotive Tech Bets Big on Domestic Market.” Economic Times, February 19, 2011.
“Comstar Automotive Workers Resume Duty after 54-day Strike.” Indo-Asian News Service, October 4, 2011.
“Comstar Bags Rs 125 Crore Ford Business.” Autocar Professional, February 29, 2012.
“Comstar Turns Focus on Domestic Market.” India Business Insight, October 31, 2011.
“Visteon Opens US$10m Technical Centre.” just-auto.com , September 27, 2006.