Shandar Alam, Managing Director, Vehicle & Hydraulics, Eaton India talks about its positioning in India, customer’s demands in the evolving market and the one megatrend that will drive the future.
How would you assess Eaton’s positioning in India as a supplier of transmission systems to the automotive industry compared to the existing local competition?
For Eaton, India is a very strategic market. In the overall (growth) strategy, India forms a very critical part because of the opportunities that it offers. Globally, for more than 100 years, and for over a decade in India, Eaton’s Vehicle Business has been providing leading-edge technologies and components that enhance power and fuel efficiency and make transportation safer and more reliable. Eaton’s Vehicle business is about a decade old (in India).
The Ranjangaon facility was our first greenfield plant (in India) from where we started our transmissions business with many leading OEMs – with whom we are engaged even today. At our Ranjangaon plant we make medium- and heavy-duty transmission systems and some of the other parts for commercial vehicles such as the clutches as well.
Eaton’s Vehicle business in India has seen significant customer engagement in these 10 years. From a market share standpoint, you will agree that many OEMs do their own transmissions. But when it comes to being materially integrated, Eaton is the largest shareholder of the transmissions market. Today I can proudly say that Eaton has more than 100,000 transmissions present on the Indian roads, all made here at the Ranjangaon plant. This is a great achievement for us.
Over the past few years, Eaton’s share has gone up significantly and the reason is rather simple, which is we understand the market needs. With new regulations, you need more reliable, robust and efficient products and that is where Eaton plays a very important role. With so much of action happening in India around axle load and increasing horsepower, the power requirements gain tremendous focus and that is where we offer value to our customers and the end-users.
Similarly, on the automotive front, Eaton has two manufacturing plants for engine air management products, where we engage with passenger cars manufacturers and supply valves and valve actuation products. These products are fully compliant with the current norms and help OEMs design their engines in compliance with the incoming BS VI emission norms.
Driven by the emerging industry trends and pathbreaking changes in the regulatory framework, Eaton is surging ahead on its technology-led innovation journey and building solutions that can potentially shape the future of mobility in India.
What is the kind of growth you are looking between now to 2020 in the wake of the BS VI and axle load norms? How are you preparing to take on customers’ demands in this evolving market?
The megatrends are positive, with the infrastructure development phase, urbanisation, the growth in population; so the fundamentals are strong.
With all these changing regulations and thus environmental improvements, it is good for a company like ours — which believes in technology, have products and capabilities — to really meet the requirements of the industry. Therefore, as regards a five-year strategy, we see a pretty strong growth trajectory with solid profitability. Of course that comes with a lot of improvement work that we have laid out for stronger operational efficiency and customer engagement in the front-end as well as back-end. We see pretty strong growth going forward and we have a list of actions for product improvement on operational efficiencies. We also have to get ready as per the new norms and regulations coming in the market — just like the axle load norms change that happened very recently, albeit it was more of a surprise to the industry.
By design, our product was already capable of taking that kind of extra loads, so these axle load norms helped our reliable, robust and efficient transmissions. From an overall standpoint, I am really pleased to share that Eaton is growing above the industry standards.
How critical is the Pune-based R&D centre in Eaton’s global scheme of things?
They are largely working on Eaton’s global products. We have a team dedicated to electric mobility globally. Likewise, we have a set of people in Pune working exclusively for the e-mobility specific requirements in India.
In Pune, we have our global R&D centre that supports the global projects as well those for India. Our e-mobility team in India was set up and began operations earlier this year (2018). At present, we have around 40-45 people working on e-mobility, and the team continues to expand. We are reporting e-mobility as a segment on Wall Street.
Of all the anticipated megatrends that are driving the major advances in automotive globally, which ones are driving or will drive the business for Eaton in the future?
Eaton’s strategy revolves around environmental sustainability. So our core focus is on managing power, be it mechanical, hydraulics or electrical. All our technologies and solutions are about efficiently managing power so as to help our customers manage power more reliably, safely, efficiently and sustainably. Globally, there is a lot of work going on and there are strong engagements on the automotive side as well. Eaton will always be engaged with any technology change in any of our focus areas that will impact the environment and the lives of people.
(This interview was first published in the November 1, 2018 issue of Autocar Professional)