With four plants and 19 sales offices, Schaeffler - the German manufacturer of rolling element bearings for automotive, aerospace and industrial applications - has significant presence in India. Its three major product brands - FAG, INA and LUK - are well represented in India. Schaeffler also has dedicated engineering and research and development support based in India to augment the product teams. According to Harsha Kadam, President - Industrial Division, Schaeffler India, the company plans of investing close to Euro 40 million (about Rs 3210 million) for expanding capacities, bringing new products and enhancing its R&D capabilities in the country. In conversation with Rakesh Rao, Kadam says that Schaeffler sees big opportunities in the country in areas of automotive and other sectors like wind energy, railways, steel, etc.
How has the Indian industry evolved over the last few years? Are you seeing any radical changes in the industry?
India is one of the fastest growing markets in the world. We particularly see big opportunities in the country in areas of automotive including two wheelers, agricultural tractors, wind energy, railways, steel and other infrastructure related sectors.
There is definitely a shift happening in terms of technological advance and refinement. For years people thought India is a cost-conscious market, so let’s not touch it. Today, the operator model is changing. Now we have fleet operators who own from 50 to 100 trucks; in the past it was not so with owner-drivers managing maybe one to five trucks. Fleet operators are a lot more professional focusing on turnaround time, uptime and such parameters; they require different kinds of service solutions. The market is changing; the way business is run is changing. New companies are bringing in new solutions which have been working well elsewhere. Once the operators get a feel of it, they push other OEMs to follow suit.
India has also been adopting and enforcing the emission standards in a phased manner. The implementation of advanced norms is a critical step as we are the world’s third largest emitter after China and the US. The emission leap requires a significant technological jump, especially in diesel filter technology & in optimisation of selective catalytic reduction technology. Meanwhile, it is an opportunity for Indian companies to create an ecosystem for advance emission technology.
Schaeffler is regarded as the number one specialist in products that contribute to the reduction of CO2 emissions and help protect the environment. The innovative & light weight design of the Schaeffler gives significant advantages in terms of space, weight and fuel consumption.
How will the new emission norms (BS VI by 2020) trigger changes in the Indian auto industry?
Governments around the world are pursuing more stringent norms on emissions & fuel economy to continually improve air quality in urban areas. India too has announced the implementation of BS VI norms by 2020 and soon will adopt CAFE (corporate average fuel efficiency) norms, which require cars to be 30 per cent or more fuel efficient from 2022 and 10 per cent or more between 2017 and 2021. It is our belief that the efficiency of ICE can continue to be enhanced using new technology solutions.
Schaeffler has the necessary technologies and solutions available having a profound impact on helping engines to consume less fuel and comply with increasingly stringent performance and emissions standards. For example, we have developed a technology demonstrator car which shows that by applying our range of technical solutions a 10 per cent fuel efficiency can be achieved.
Due to emission effect, auto companies are looking at launching more of petrol variant than diesel. Are you looking at this as an opportunity?
Schaeffler is regarded among the leading specialist in products that contribute to the reduction of CO2 emissions and help protect the environment. The innovative & light weight design of the Schaeffler gives significant advantages in terms of space, weight and fuel consumption. Some of examples are bearings, light weight differentials, etc. Our product range offers maximum benefits to our customers - extended operating life of their vehicles via highly-developed components and assemblies with durable materials; reduced fuel consumption and increased cost-efficiency through weight optimised products and systems.
From an engine point of view, Schaeffler is into combustion technology. We are into improving the combustion efficiency in the engine. Dual-mass flywheel is one solution, pendulum based flywheel is another. These are solutions we can bring in to make the engines more efficient.
There are several technological products with Schaeffler which compensate thermal efficiency losses and it also enhances the efficiency with higher reliability. The products like – hydraulically or electrically actuated variable cam timing system, UNI-AIR system help to improve thermal efficiency.
With electric vehicles gaining traction in India, how well-prepared is Schaeffler for electrification?
Electric mobility as a whole – including fully electric driving as well as hybrid solutions – will be defining mobility of the future. Electrified powertrain architectures are shaping the future of automotive progress, confronting the automotive industry with major challenges.
Beyond electric mobility, there are equally important dimensions such as generation and transmission of power which is needed for electric mobility. Experts refer to ‘well-to-wheel’ when taking the entire energy chain into account. It is a method that makes it look at total amount of CO2 emissions produced in the entire chain of locomotion – from the production and storage of energy through to its conversion into kinetic energy. Sustainable mobility can only be achieved if the primary energy for locomotion comes from renewable sources such as wind power, solar power, hydropower or geothermal energy. Schaeffler contributes technology and know-how to the consistent expansion of these energy sources.
We have solutions for full range of electrification, starting from P0 (mild hybrid) to P4 (electric axle). We are already working with global manufacturers in Europe and China to provide advanced solutions for fully electric vehicles and hybrid technologies and as India adopts the technologies, we are ready with our solutions for our local customers.,/p>
Could you please elaborate more your investment plans?
In terms of investment at an India level, we have been investing around Euro 20 million for the last 3-4 years and we plan to double the investment in the coming years. Over the next 3 to 5 years, we will continue to invest in expanding our plant capacities, our product portfolio and engineering capabilities in the country. We are going to invest in our distribution network and all the logistics areas which will provide us substantial benefits in the long run.
We have also announced expansion of our operations at INA Bearings in Talegaon, Pune. The expansion will include a new manufacturing facility and a new R&D facility within the existing premises. We are investing Rs 200 crore for this expansion. The new production facility will be operational by the end of 2018 and will manufacture engine and transmission components, serving the domestic and exports markets. The R&D facility, which will be operational by mid-2018, will focus on enhancing product development and engineering capabilities driving innovation for customers. The Pune plant, currently running at full capacity, employs 700 people and with the new facility it is expected to generate additional employment in the future as our operations grow.
What are your growth plans for the company in India?
We have a strong local organisation that is well integrated and supported by the Europe region. Our product range is very diverse, offering complete systems and solutions for our customers in the industrial and automotive markets. Particularly for the automotive industry, our product range includes components and systems for conventional internal combustion engine as well as hybrid and electric vehicle applications.
Schaeffler, with its global strategy of ‘Mobility for Tomorrow’, is establishing the course for future sustainable and profitable growth. The entire strategy is developed by keeping in mind the growing customer demands in all forms of mobility. The strategy is based on four highly important mega trends - climate change, urbanisation, globalisation and digitalization. The company’s attention is centred upon eco-friendly drives, urban mobility, inter-urban mobility and energy chain. Schaeffler is progressing towards all the four focus areas through its research and development activities and is also playing a crucial part in the field of innovation and technology.