ZF looks at partnering Indian OEMs

Rudi von Meister, president, Asia-Pacific, ZF, speaks to Sumantra B Barooah on how the company plans to enhance its business in India.

Is ZF strengthening its focus on India?
Our traditional focus has been on supporting our European customers. However, we now have the opportunity to diversify and grow with new customers who are at different stages in their business and product lifecycles. As we expand our customer base, there is much to learn as do business in a different culture.

Can you elaborate on your ‘design to market’ strategy?
ZF’s traditional customers may say: “Make me this. Here are the specifications and here are the design requirements and this is what you need to know.” With the new customer, he or she might say “help me understand what I need in order to close that (uses the example of capping a bottle)”.
In the industry we are in, we have companies that have been making cars or trucks for decades. We also have companies that are within the first decade or two of making complete vehicles. That constitutes the most difficult and complex challenge an organisation can face. When companies undertake to do their own vehicle programme from scratch and not depend on foreign technology or partnership, then you are learning. So we move from just ‘tell me what you want tell me the specs and we will do it’ to a position where ZF can provide a solution.

You have said that in a decade or so, over 50 percent of your business will come from outside Europe. How much will be India’s share?
We are not talking about incremental growth. We have seen growth in factors of 10 and 20 percent. While China is doing well, India’s sales growth has nearly doubled. As we kick off our new facility in 2015, we hope to serve new customers.

How is ZF addressing the cost challenge in India?
We are doing this by not compromising but finding solutions for cost reductions in the product. The mindset that people from North America of Europe bring to foreign markets may have misconceptions. Many of these preconceptions are formed by serving those markets with all of the regulatory requirements and safety needs and the competitive scenario and customer expectations prevalent there. Now in India Tata Motors brought out the Nano and many markets globally that may need a car like that at that price point.

Will your new Rs 150 crore facility (to come up in Chakan, Pune) to be an inflection point for ZF’s business in India?
It is a demonstration of our commitment to the market, to closer collaboration between our various divisions so that we come together, share a common facility, common services, R&D, administrative, purchasing, materials management and allow us culturally to better serve the needs.