German multinational Norma is preparing to enter the Indian market via an 80:20 joint venture with the Taurus Group, a domestic manufacturer of automotive tubes and hoses with bases in Jamshedpur and Pune. Norma Group is the leading global supplier of quick connectors and clamping products for air induction, engine ventilation, charge air, and exhaust systems.
The joint venture, likely to be named Norma Group India Pvt Ltd, will be headquartered at Taurus’s Talegaon campus near Pune and begin manufacturing operations by mid-2008.
The Indian automotive market is growing 10 times faster than those in Western Europe, and the group accordingly views it as one of its most important customer bases in the future, Bernd Kleinhens, MD of Norma Group Holding GmbH, told a select gathering of prospective customers in Pune last fortnight.
“We are on a mission to help global automotive OEMs meet future emissions regulations. I believe your tasks in the Indian automotive sector are not much different from those in other markets. The Norma Group would like to help you meet these requirements of the future by providing services like engineering and testing,” he said.
Pointing out how critical clamping and connecting technology is for customer satisfaction, he cited the finding of one J.D. Power survey that 25 percent
of quality rejections in
the EU in passenger cars are caused by leaks/blowoffs in turbocharger intercooler joints.
“I don’t believe that the driver of a truck or car makes a distinction whether his vehicle fails because of a transmission failure or because of a hose blowoff. He will be dissatisfied in both instances. We will try to help you minimise these risks of creating customer dissatisfaction in future by providing services around clamping and connecting technologies, rather than only selling one component.
Sixty percent of Norma Group sales of € 500 million worldwide are to the automotive industry. Its brands for this market are Norma, ABA (following its recent merger with the eponymous 100-plus-year-old Swedish group), Breeze (clamping products, US), and Torca (exhaust systems, US).
It has an extremely diversified customer base of more than 900 automotive OEMs and suppliers of which the top 10 account for only 30 percent of sales, Kleinhens said. Among
the few companies that purchase clamps but
are not classified as big
customers are Honda, Nissan, Ford, and GM.
Although the truck
business presently accounts for one-quarter of the € 300 million in automotive sales, the business plan for the Indian joint venture envisages the majority of revenues coming out of trucks to begin with.
“Right now, because of the knowledge of our partners, which is more based in the truck rather than the passenger car industry, we have a much better understanding of trucks and their requirements,” he pointed out. “Of course, as soon as we are here, we’ll make sure that all our passenger car customers are equally well served.”
And while the Norma Group does not presently deal with air brake hoses or tubes, it does make a small number of connectors for this application. Taurus already covers this market with its air brake coils for trailers, but Kleinhens indicated that if Taurus gets requests for this type of product from Europe or the US, the JV company will probably look into this development as well.
Products for India
The joint venture will
introduce products from the NormaClamp, Norma Connect, and NormaFluid product families. Norma is the market leader worldwide in worm-drive hose clamps and swing-back clamps, which are used on joints with rubber hoses. It produces 800 million of these a year in fully automated plants in Europe, and given their small size and ease of shipment they will be more cost-effective to import rather than manufacture in India.
According to Kleinhens, exhaust systems are a major field for future growth. Here, NormaConnect pipe connections seal exhaust systems against leakage. With emissions regulations kicking all over the world, Norma has the broadest product and solution portfolio to meet these requirements, he said. “We have, together with some of our customers in Europe and the US, already specified a lot of NormaConnect exhaust products in order to reduce cost, weight, and leakage.”
The NormaFluid fluid systems are its biggest product line for automotive, accounting for 50 percent of sales. These consist of NormaFlex smooth and corrugated plastic tubes, which are used together with NormaQuick quick connectors or NormaClamp to provide a complete transfer system for fluids (water, oil, fuel), and air.
Norma pioneered press-fit fluid line connectors 20 years ago and has led the paradigm shift in the global automotive industry away from standard clamping and connecting towards this smarter technology.
“This shift happened for a very good reason, associated with the total cost this generates. Here you’re not just looking at the component price as such, but if you take elements like assembly time into the equation or reduction of warranty costs, you quickly realise that outside the component cost we add a lot of value with this new type of technology by reducing the failure risk, reducing the assembly time, and making the joint more robust, furnishing it with a higher integrity.
“In other words, the global cost reduction included a steep reduction in the warranty cost associated with the introduction of quick connectors. Also, in areas where the accessibility into the very tight engine compartment is difficult that you really save a lot of hassle and a lot of assembly time by utilising quick-fit connectors,” Kleinhens said.
Today Norma is the global leader in quick connectors, producing 150 million of these a year, and continues to pioneer the way into this new technology. “None of our competitors has the same track record, introducing something completely new into the industry,” he pointed out. “We are very proud to help our customers from the very first day on, design and develop and test the solution we are providing in our own engineering centres.”
One key “value driver” for the fluid systems business is that the materials that go into these products are developed entirely in-house. “A lot of our tubes and quick connectors don’t use standard thermoplastic materials. We have our own chemical innovation team within our engineering groups that’s enabling us to develop, right from the material grade, the right product for your application,” he said.
“Our specialists in the materials engineering
and design department will always find the right material grade to meet the most stringent test and field requirements possible for a lot of applications where we are pioneering products in the automotive industry.”
And to the OEM and Tier-1 supplier representatives in the audience, he had these words of further reassurance: “If you go for some new development for the very first time, you fear your supplier isn’t taking your product or process seriously enough, which could result in issues in the field that you only realise down the street.
“We fully understand this fear, particularly as a newcomer in India. But we would like you to know that we never forget, right from the material all the way through to engineering
and testing and production, that we have a very critical mission to ensure your success.”