‘We plan to make our India operations a sourcing hub for ZF’s global portfolio.’
In his first media interview, Suresh KV, the new Country Head of ZF in India and also Head of ZF India, tells Sumantra B Barooah about the company’s India growth strategy and catering to the passenger car and CV segments.
In his first media interview, Suresh KV, earlier executive director of ZF India and the newly appointed Country Head of ZF in India and also Head of ZF India, tells Sumantra B Barooah about the company’s India growth strategy, catering to the passenger car and CV segments, and optimally utilising the combined technology platforms of ZF and its recent acquisition, TRW Automotive.
What are the key short-term and long-term goals in your new role?
In the short term, we will pursue with the actions which have been taken to establish and expand in line with the needs of the automotive industry. Our endeavour would be to align with the government’s vision of promoting green mobility solutions in India and make our operation in India as a sourcing hub for our global portfolio. ZF will work on introducing and promoting the range of global products such as our hybrid transmissions, electric axles and fuel-efficient EcoLife automatic transmissions for buses.
As for our long-term plans, we would like to be well prepared for the future mega trends – from increasing fuel efficiency and reduction of CO2 emission, lightweight designs, electrification and networking to autonomous driving. Many of these segments are already being served by ZF with its production-ready technology. The R&D teams in ZF are also working on providing concepts and studies which will be tried and tested as we continue to evolve.
What are the top three growth areas for ZF in India now?
- Increase presence of existing ZF technology in the domestic market.
- Material sourcing from India through the Global Purchasing organization.
- Bringing innovative global mobility solutions to help evolve the mobility landscape in India.
How much has the revival of the M&HCV industry helped ZF?
The M&HCV industry is an allied industry which rides on the growth of the automotive sector. The past few years have belied the growth projections made by automotive industry experts. Therefore, although we were optimistic about 2015, we were also very cautious.
The government’s impetus on expediting stalled infrastructure projects and focus on working towards economic recovery has upped the hopes of revival in 2015. The sales growth in commercial vehicles and passenger vehicles is assumed to enter the positive trajectory, driven by expected moderation in interest rate, fall in ownership cost and improvement in economic activity and consumer sentiments. With the fortunes of the Indian auto components industry directly linked to those of the OEM industry, prospects of the industry for the second half of 2015 and beyond look better, as accelerated vehicle demand would translate into increased revenues for the components industry.
As for ZF, we have a diverse product portfolio that caters to the auto and industrial segments. This diversity has somewhat helped cushion us from harsh market conditions, especially in the commercial vehicle and passenger car segments. We have always been a market leader and will continue to be bullish in this market.
What are the benefits that have come out of the integrated facility at Chakan?
ZF has been operating for over three decades in the Indian market. Currently, ZF’s presence in India consists of nine plants spread across Pune, Pantnagar, Gurgaon, Chennai, Coimbatore and Madurai.
With the investment in India, ZF has been able to considerably scale up its strength in India and is prepared to face the challenges in this growing region, head-on. We have invested around Rs 150 crore towards the newly built multi-divisional plant in Pune which is a good starting point for further expansion of ZF’s business in India. Some of the benefits are that the coexistence of multiple divisions and business units in one location can develop synergies and also flexibility of resources.
ZF is relatively stronger in CVs in India. What steps are you taking to enhance your presence in the Indian passenger vehicle industry?
ZF considers the passenger car and commercial vehicle categories equally important and we have a strong product portfolio for both the segments in India. With an expected double-digit growth the passenger car segment in India, the segment will be crucial for ZF’s growth in India.
The passenger car segment is of prime importance for ZF in India. We have a strong presence in the luxury passenger car segment through different product offerings ranging from powertrain to chassis systems. Through our JVs, we have an extensive presence also in the domestic range of vehicles. Additionally, we have recently commenced the production of ZF clutch systems in the Chakan facility and are already witnessing a very positive response from the OEMs. We will be happy to continue to expand our technology for this segment as the market grows.
Apart from this, we are also present in the independent aftermarket with OE-quality products and complete technical support. For the high-end passenger car segment, ZF Services has introduced a host of products including clutches and shock absorbers from Sachs as well as rubber-metal parts and steering components and we are constantly innovating products for the passenger car segment in India. For the popular mass passenger car segments, the company has a broad range of spare parts including 74 new steering and suspension components from Lemförder for leading OEMs.
Has there been any benefit for ZF in India after the TRW acquisition? If yes, can you share any example? How do you see the TRW acquisition effect evolving in the coming years?
With the recent acquisition of TRW Automotive, ZF will join the top 3 in the global automotive supplier industry. It will thereby supplement its competency portfolio as well as its worldwide market presence in order to serve the global megatrends better. This acquisition will enable ZF to optimally utilize the technology platforms from both companies to better address megatrends such as fuel efficiency, increased safety requirements and autonomous driving.
India is a growing and strategically important market for us. The Indian economy is expanding and many of the future trends that we have observed will have a part to play. The combined company has a 100- year track record of customer benefit and value creation and a strong complementary product portfolio of leading technologies.
The portfolio now combines the powertrain and chassis technologies including e-mobility solutions and electronics of ZF with the safety, steering, braking and autonomous driving technology of ZF TRW. Furthermore, we diversify across industries, spanning from passenger cars to utility vehicles such as trucks, buses and tractors and includes in addition construction machines, marine, railway, wind power and industrial technology. We see this merger will provide the power of 2 to our existing and future customers.
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