ZF Group to Position India as Key Global Manufacturing and Export Base

ZF Group India is accelerating its plans to position the country as a central hub in its global manufacturing and export strategy. The company aims to double its existing production lines over a five-year horizon. With the consistent rollout of one new plant each year, ZF has 19 manufacturing facilities across India.

Globally, the German auto component giant operates 161 production locations in over 30 countries. India has been gaining increasing importance in this network. ZF maintains 75 locations in Europe, 35 in North America, 26 in Asia-Pacific (excluding India), 19 in India, eight in South Africa, and four in Africa.

“We are now actually inaugurating one plant per year. But we have, in several locations here in India, the opportunity to grow the facility itself. So (for instance), in Oragadam (in Chennai), we can mirror it and double it… And then we have to investigate further where we are going,” said Dr. Peter Laier, Member of the ZF Group Board of Management, Head, Commercial Vehicle Solutions and Industrial Technology.

Dr. Peter added, “That's why I cannot tell a number, but I can tell you it (manufacturing facilities) will be remarkably more than now.”

In 2024, the company posted global sales of Euro 41 billion, down from Euro 46 billion in 2023. It invested Euro 2.3 billion in property, plant, and equipment, and Euro 3.6 billion in research and development.

ZF Group produces high-end technology solutions in India across various vehicle segments. This includes active and passive safety systems, steering, clutches, axles, and suspension components for commercial vehicles, along with transmission and axle systems for trucks and off-highway equipment.

The Group’s total revenue comprises 73% from passenger and light commercial vehicles, 19% from commercial vehicles, and 8% from construction and agricultural machinery, marine, rail, and wind power solutions.

The company identifies India as a key export hub, particularly in light of the UK-India Free Trade Agreement. It is also closely monitoring the ongoing Free Trade Agreement discussions between India and the European Union, considering them crucial for future expansion.

The company indicated that India would serve as a critical supply base for Europe and North America. It believes that upcoming trade agreements would significantly strengthen its export-oriented strategy.

Dr. Peter highlighted India's ambition to increase auto component exports from $20 billion to $100 billion and ZF’s own vision. The company intends to contribute to this effort by ramping up manufacturing and enhancing global distribution from its Indian operations. “India’s workforce offers high-quality engineering talent at a much lower cost than Europe,” added Dr. Peter.

Dr. Peter noted, “This began with engineering—Indian teams already handling global projects independently. These are not just support functions but fully accountable engineering divisions managing end-to-end product cycles.”

Andreas Moser, Executive Vice-President, Industrial Technologies, ZF Group, however, stressed the importance of building more regional decision-making power, drawing parallels to ZF’s operations in China. He explained that localization is about much more than manufacturing: “It also requires authority, responsiveness, and product-level understanding at the local level.”

Company officials also stated that India has already started supplying more products to global markets, and this would gradually bring additional strategic and organizational responsibility to its India operations. They see this as a step-by-step evolution, but one that is certain to take place.

Andreas said the Indian engineers are working on the local application work and talking to suppliers. “The next thing will be that they do local adaptation of some components so they can get into the design mode,” he added.

In an earlier conversation with Autocar Professional, Aakash Passey, President, ZF Group, had stated that the next five years belong to India and that localisation efforts in India could begin on a smaller scale and be scaled up gradually to 100%.