Signalling change

Q & A

Ravi Pisharody,

Executive Director – Commercial Vehicles, Tata Motors

Interview by: Bhushan Mhapralkar

& Anirudh Raheja

01 Mr. Ravi Pisharody pic 3 copy

Q. How do you look at the FAME outlay in the wake of hybrid and electric CV proliferation?

A. The government has pushed the FAME outlay up slightly, but for a bus that costs nearly two crore rupees, it is not easy to pick up steam. Consider the financials involved in electric buses, and it does not look easy. Electric buses have a made a splash in China because of the near 100 per cent subsidy they get. It is unbelievable but true. Right now, we are not really getting tied down by that, but unless volumes build up, costs coming down is a distant dream. We are going to make 20 electric vehicles, put it all over India to create public awareness. We already have one bus running on alternate media, but that is a hybrid. It ran at different places including Delhi. It ran in the BEST (Mumbai) territory two years ago. We already have an order from MMRDA (for Bandra-Kurla Complex in Mumbai) to supply 25 buses.

Q. How is the response from transport undertakings to such vehicles?

A. To be frank, they are also looking out for directions. In Jnnurm II, BMTC (Bangalore) actually raised a demand for 25 buses, but when we shared the costs they conveyed that only 30-35 per cent of the costs were being borne by Jnnurm II scheme. So the amount that they had to shell out was still more than a crore rupees. The same may change quickly because of the pollution related problems. Especially in the hilly areas. Himachal Pradesh, I think, has placed an order for an electric bus. The volumes may be small but the idea of being futuristic is already there.

Q. You have launched the Signa range of trucks. Is it an upgrade of the LPT range?

A. We are moving into brands, which includes the Ace, Magic and the Prima. The Prima was followed by Ultra. In our main segment, we felt that the cabin needed a major uplift. The product had to be ready for the next 10 years. So rather than selling it as a 3118 and a 4923, we have decided to bring them all under a brand. The numbering like 3118 and 4923 will remain. So, if you see the cabin of the Signa, it may not be as good as the Prima, it will however equal or be better than most of the cabins available, and at a nominal cost increase. The powertrain will not change much and will be similar to what our 3118, 4018 and 4923 models carry. Additionally, it will be fitted with telematics as a standard feature.

Q. Would the Signa cannibalise the Prima?

A. Sales of the Prima LX are increasing and we are focusing a lot on tippers. Multi-axle trucks are still going slow. Exports are giving us 200 numbers. It was decided three years ago that the current cabin should be upgraded so that it looks as modern as the other new products. Many of our competitors are new but we have been in the market for six decades. The Prima’s cabin has got more weight and is much more sturdy. People might not buy Prima because of the cost of operations, and not because of the vehicle cost. The Prima will be very useful for those who want to transport heavy duty loads or cover a six-day trip into a three day trip. And, even if the Prime is successful, we cannot look away from our main range. It is necessary to acknowledge the fact that a lot of cabin sales are from the 3118. That is the segment that will move over to the Signa.

Q. There were no LCV launches in 2015 except below 3.5-tonnes. How do you look at this?

A. We launched Ultra range last year – the 812, 912 and 1012 models. We have launched the Ultra 1518 model at the Auto Expo 2016. It will be the first vehicle in the ICV range with a sleeper cab. It will be a complete walk through flat cabin with an extended load body. We will also have a narrow Ultra in the four-tonne and seven-tonne range. For the SFC 407 or LPT 407, we did not make big changes. There’s been no launch therefore. We showcased them at the last Auto Expo. The Ultra narrow truck on a four-tonne platform will be launched in FY17. We felt that a narrow cabin on a high vehicle will not look good, so we had to lower the wheelbase. The hierarchy will be Ultra, Signa and Prima. This is how the 9- to 49-tonne segments will be covered.

Q. The Ultra platform looks highly versatile. How far will it extend?

A. If you ask me, we can take the Ultra up to 25-tonne platform. We may not do that since the cabin will become too small. We are therefore looking at a B-cab design. The Prima range is already available with a B-cab design, which is typically used in a multi-axle truck. For a 25-tonne truck too we will be looking at a B-cab design. There will be a certain overlap for co-existence between the Signa and the Prima range. For deep mining applications they would certainly need the Prima.

Q. You showcased four construction trucks at Excon 2015. How do you think the industry segment is moving?

A. Last month, we grew by 20 per cent, which has come in after three years. While the M&HCV segment was growing, LCV was struggling. Now LCV is 12 per cent, M&HCV is 40 per cent and tippers are also growing. It think this quarter we will grow by 20 per cent. If we focus on the numbers, one of the developments in the last four months has been the growth in construction tippers. If you look at the M&HCV growth (which consists of tippers) till September, it hovered around 30 per cent. Tipper growth was zero. Consider the last 18 months up to October, and the tipper growth was zero. All the growth came from the cargo segment. Now, tippers have started to grow. We can also see a government effort on infrastructure and construction where road contracts are being executed, mining relaxation is gradually happening. I think that the next one year will be strong in terms of tipper sales. Like cargo, there was a pent up demand, which suddenly came in. The government is aware that the next wave of growth will come from public spending and not from private spending.

Q. When could we have Tata CVs with Automated Manual Transmission (AMT)?

A. There are two programs right now. We are currently working on an AMT for the Ultra range. I think it will be more useful in the start-stop kind of environment; in cities where short haul transportation happens. AMT may come on the Ultra platform buses first. This is because buses is where the maximum urbanisation is happening. We are also looking at automatic transmission for Xenon because of rising demand from our export markets like Thailand and Australia.

Q. Would Tata Motors also introduce start-stop technology in CVs?

A. Start-stop technology was introduced in the Tata Ace Ex. There was no demand for it. We decided to not put an extra cost when we saw that the market is not absorbing it. We pulled out. With focus on AMT, we will re-visit the start-stop technology later.

Q. With every new development at Tata Motors globally oriented, does the Signa hold export potential?

A. We are exporting close to 5000 vehicles every month, out of which 1200-1500 units are trucks. If you look at the Signa, from the outside it might look as an earlier cabin, but it has got better fit and finish. It has a new dashboard, and is more safer. We are starting with the 4923 tractor, 4018 and 3118. Once all the tractors migrate, we will stop producing the existing one. The Signa will replace the current LPS and LPT range. Then we will move to tippers and then we will move to 25 and 31-tonne multi-axle trucks. Over a 12 month period, Signa will be the mainstream range and Prima will be the upgraded range. Initially it will be the domestic market (for about 12 months). Exports will follow because the numbers here are pretty large.

Q. Do you see a future for hybrid trucks in India?

A. Not in the near future because of the higher cost of the vehicle. Such a technology will not be good enough to compensate the 10 per cent increase in (fuel) saving. Hybrid technology largely depends on regenerative braking, and in long distance vehicles, braking does not happen that often as compared to a city vehicle. Hybrid buses for city operations is the best; it has to brake at every signal. Because the bus stops often, regenerative braking is high. This could be an option for Xenon. Migration will however take time.

Q. When could we see the 40 hp version of the Magic?

A. The segment that the Magic is in has been struggling for sometime. This is where the nexus of financing default and low financing has hit the most. Financiers are not ready to give more than 70 to 80 per cent loan. Whenever a permit is involved, such things can happen. When defaults started happening, people just left the vehicles and walked away. Financiers are more cautious. Cargo still carries a positive reputation, and despite less business. In the SCV segment, I think, we have hit the bottom. Sales have started increasing. We will launch the Magic Mantra in this quarter(FY16 Q4). It will not suffer so much. It is a very good option for a school bus because it is a higher powered vehicle. Magic’s limitation today is its 16 hp engine with a top speed of 55-60 kmph. Magic Mantra will soon get a closed body version. The Magic today comes with a soft top. When it comes to carrying people in a city, students or staff, the Magic Mantra will fit the bill nicely.

Q. Is India a friendly market for the one who would like to become an entrepreneur?

A. Four years ago, it was too friendly when the financing was easy. The penalty for not paying installments on time was weak. India is still a business friendly market. As the economy improves, the loan availability will increase. If you ask me, Tata Ace was launched in 2005, and the M&HCV market saw correction in 2008, 2009 and 2010 and again in 2012, 2013 and 2014. The Ace saw the first correction after eight years. We had by then sold 1.5 million units already. In India, vehicles don’t disappear. They continue to be resold, which I think is still fairly encouraging.

Q. What about permit issues pertaining to public carriers?

A. Wherever passengers are involved, a permit is applicable. Permit is applicable even for a private bus. The situation, I think, will ease up as we move forward. A lot of state transport undertakings are willing to deploy more buses, but they don’t have the money for it. They are tying up with private partners even as they face issues like getting the requisite parking space. Bigger buses will see some revival because of the need to have better public transport. Smart cities will need public transportation. Smaller vehicles are more or less state driven. As the financing environment returns, this segment will pick up again. It is like a share taxi market. In Kerala, four-wheeler segment is more strong. It is like a taxi that is hired to go from one place to another. We sell close to 800 units every month, which is more than three-wheeler sales. We have already overtaken Piaggio. Our dialogue with the government continues to give legitimate results.

Q. The emission compliance goalpost seems to shift. How do you view it?

A. The BS IV emission compliance will be made mandatory nationwide in April 2017. Of the India permit trucks on the road hardly any is BS IV emission compliant. There’s is a lot of pressure on this. The Ministry of Road Transport & Highways (MoRTH) also took us into confidence. We also had a meeting at SIAM, and came to the conclusion that there is no sense doing BS V for two years. All the platforms have to be in production, and have to be tested. By skipping BS V we will actually save a lot of investment and time. Petroleum ministry has said that we will have the fuel by 2020. We have asked the ministry to supply fuel at least a year in advance. BS VI is a sophisticated technology and needs critical testing and validation. They are time consuming. Also, one cannot sell any fuel lesser compliant than BS VI once BS VI vehicles are out in the market. The country has to move 100 per cent to BS VI. We will start building BS VI compliant products by April 2020. We have asked for a permission to phase out products over a period of two years. The same was also done in Europe. What it means is that we have taken a huge challenge for investment, technical capabilities and testing facilities.

Q. How will that go down with customers where an SCR system could cost as much as an engine?

A. It is difficult to zero down on the costs for now, but there will be at least 25 per cent escalation. The move up to BS IV calls for a 10 per cent increase in the vehicle cost. Bigger BS IV trucks need after treatment whereas smaller ones don’t need it. For the next one year, we will see good demand for BS III vehicles till April 2017. The following year will be dull. As we will approach 2020, people will start advancing to BS IV vehicles.

Q. Will the Indian duty cycles differ from markets that have already graduated to BS VI?

A. The view that foreign companies are making BS VI in India and exporting is not right. For selling the vehicle in India, the technology cannot be copy pasted. A lot of software work is involved. It is going to be quite challenging.

Q. How are you looking at the van market that has the Winger? Would you introduce a new product?

A. A new vehicle will take time. In the case of the current Winger, we have recovered our investment. Over 7000-8000 units are selling every month. It is very popular as an Ambulance, and has overtaken the Force Traveller as an Ambulance. Traveller is selling more of 17 to 18-seater versions. They are the market leaders in that segment.

Q. Would vans play a crucial role as feeder service vehicles?

A. The customer in India still seems to prefer a semi-forward look. Van has a box-type look. The segment will not become as big as it has been in Thailand and Indonesia where you see vans transporting 6-7 people.

Q. Which alternate fuel do you think will be the most sustainable? Would it provide a better passage to BS VI?

A. Rather than ethanol, I think LNG is a good option. At the 2014 Auto Expo, we showcased a LNG powered tractor trailer. While CNG is there, for long haul trucks, we believe LNG could be a good option. Whether it gives a better route to BS VI, I cannot comment on. Diesel has not gone off completely from any country and for long distance transportation it will still be viable. When you move to BS VI, data will show that the performance of diesel as compared to that of a petrol is equal in some parameters and slightly inferior in some parameters to petrol. This is not the case with BS III diesel. As you keep going up, the question of diesel being called a bad fuel does not arise if you discuss it scientifically.

Q. Diesel vehicles are under scrutiny; are looked upon as polluting.

A. Today, new (diesel) vehicles have been banned. I think this is defeating. Delhi is already at the BS IV emission norms level. In the discussion we had with the ministry, they have accepted this. My view is that they are already working on a notification for which they are consulting a lot of people; to finalise the incentive for scrapping and other things for which they are actually looking for experts to advice them.

Q. How are the suppliers and dealers looking at the move up to BS VI?

A. It is not too much of an issue with the dealers. There will be a lot of changes at the after service. On board diagnostics, I think, will come in a phased manner. In Europe, OBD implementation was phased over two years. We are running a big transformation at the dealerships. We are encouraging them to invest into hi-tech and better reception facilities, to give a better consumer experience. With the vendors, suppliers involved with engine and after treatment like Bosch and Delphi, will have a major impact. Some enterprising vendors can actually take the lead, for which OEMs will be happy to outsource rather than try to do everything in-house. They can also sell the product to many OEMs, which would give them the chance to reinvent an engine.


If you look at the Signa, from the outside it might look as an earlier cabin, but it has got better fit and finish. It has a new dashboard, and is more safer. The Signa will replace the current LPS and LPT range.

We are running a big transformation at the dealerships. We are encouraging them to invest into hi-tech and better reception facilities, to give a better consumer experience.

Growth oriented

Q & A

Vivek Kamra,

President, JK Tyre & Industries Ltd.

Interview by: Deepanshu Taumar


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Q. How do you look at the industry growth? Commercial vehicle growth especially?

A. Commercial vehicles will continue to grow as new norms are coming into play next year. It will lead to pre-buying. Seeing the budget announcement on infrastructure, it is clear that a hike in the activity of transporting sand and cement for infrastructure development will act as a growth catalyst. Mining is the other sector whose growth is long overdue. A lot of policy issues have been dealt with; have been settled. The mining sector is also driven by the overall demand for coal and iron-ore. So, to that extent, mining has been largely subdued. In the last quarter however, we have seen some movement in resource prices. Let us see of it goes up. If it does, it will provide a big boost to the commercial vehicle industry and positively influence tyre consumption.

Q. What products for the commercial vehicle industry do you offer?

A. Our best performing tyres are the JDE. We have also introduced tyres like JUH 5, which is a ribbed tyre for the front axle. We are receiving good response. We are also working on tubeless tyres for commercial vehicles. These tyres will be made available in the coming years. We have different programs for all segments, and we will come up with many tyres with different features.

Q. Looking at commercial vehicle growth, how do you expect the OE and aftermarket to evolve?

A. Imports continue to be a challenge. The market is moving towards radial tyres in the case of commercial vehicles. As far as JK Tyre is concerned, we are banking on best-in-class manufacturing. Our Chennai plant is a best-in-class manufacturing facility. We are taking over the Kesoram tyre facility from Birla in Haridwar. The acquisition is at the final stage. At Kesoram, we would be manufacturing 60,000 tyres per month. Our current capacity stands at 200,000 per month.

Q. Is the expansion of your Chennai plant over?

A. Yes, the expansion of the Chennai plant is over. We can make 3300 Truck & Bus Radial (TBR) tyres per day for commercial vehicles. For passenger vehicles we can produce 12,000 tyres per day.

Q. Supplier to many vehicle platforms in India, how does JK Tyre find working with vehicle manufacturers?

A. We do new product development for passenger car radial tyres mainly, and have designed tyres to match the need of the car. Having designed at least three tyres for Maruti platforms to match the way the car runs, things are different when it comes to commercial vehicles. We are the leaders, and manufacture a tyre on the basis of the market requirement. We give it to the OEM, and customise it marginally based on the demand from OEMs.

Q. How does JK Tyres’ involvement in motorsport help with the development of tyres?

A. When we innovate a product we learn from it. We use this learning for future product development. Our knowledge for tyres increases. Consider the tyres used in Tata Prima T1 racing trucks, and they are specifically manufactured for the truck race. They are lighter and cannot withstand heavy load. On the contrary, the tyres we manufacture for the trucks are heavy; have a heavy tread thicknesses. They have to withstand high load and tackle different road conditions. The tyre used in a race are different as they are subjected to standard load conditions at high speeds; are subjected to high turning forces and therefore need to have high strength on edges. While negotiating sharp bends a tyre has to cushion the impact and not lose its shape. When our engineers check the tyres after the race, there’s so much they can learn from. They add new compounds. Do so many new things. The learning in tremendous.

Q. Have the tyres for the Prima T1 race truck changed for Season 3?

A. Over the last three seasons, the Prima T1 racing trucks have improved a lot. To match the change in performance, the tyre has also undergone changes. Through the three seasons we have enabled the tyre to support speeds of up to 160 kmph. At the rear we have changed the tyre marginally. We are using two different set of tyres – one for the front and another for the rear. The front tyres enable manoeuvrability, handling and quick response. The rear tyres provide grip. The front tyres are used to manage the vehicle whereas the rear tyres keep the vehicle firmly on the road. Running on a hot surface, the tyres have to withstand the heat as well as the rigorousness of the track. The tyres have evolved, and one needs to understand that there are driver expectations. The body weight has reduced and the tyre weight has gone down too. To enable the truck body to be lowered substantially, we have changed the aspect ratio of the tyre from 80 to 70. The change in the aspect ratio enables better handling on the track. We have used a different compound for the rear tyre which enables it to exert better road grip.

Q. You spoke about compounds. What factors influence the design and development of a tyre?

A. There are certain factors that go into the designing of a tyre. One is a need for the tyre to remain cool. It has to have a low rolling resistance and less friction to be able to support higher speeds. It should also have maximum grip to keep the vehicle from leaving the track. A tyre designer plays with three factors essentially – wet condition, rolling resistance and cooling. When you make tyres which have lower rolling resistance the mileage goes up. All the designers play with these factors. On the race track one or two seconds make a difference. If you give a tyre, which gives you a three seconds lead, the race driver would want to use it.

Q. What is JK Tyre’s R&D facility like?

A. We have three R&D units in Faridabad, Chennai and Udaipur each. The Udaipur unit is in Kankrolli, and called the Hari Shankar Elastomer Institute. We are also coming up with a R&D facility at Mysore with an investment of Rs. 40 crore. It is expected to be commissioned in May 2016. Exporting around 10-15 per cent of the total tyres produced, our Tornel plant in Mexico, which we acquired in 2008, has its own development centre. We do product development in India and align the tyres to their market needs. Our technology and R&D run from here. We supply to all the major markets as of now. Our main focus is on markets like the United states, South America, South-East Asia and Australia. In Europe we are very small. We would however want to focus on US first and then Europe. We would like to focus on the aftermarket in these regions. We are already supplying to some OEMs in US from the Tornel facility.

Q. Your outlook on Chinese tyres?

A. Nearly 40 per cent of the replacement tyre market has been taken over by Chinese tyres. We are not against Chinese tyres, what we are of the opinion is that there has to be some sensibility about the price at which you can produce a tyre. Good tyres do not come cheap. While there are some opportunistic companies which will last for two or three years and fall off, good tyre manufacturing companies will stay. In the US, if the import market share increases by 2 per cent one can file for import restrictions. Chinese tyres market share in India grew by 25 per cent in 2015-16. It has now grown to 40 per cent. The feeling is that the tyre manufacturers are not losing money. It may not be right to look at the issue only after the manufacturers start losing money. Authorities cannot peep into the accounts of manufacturers to see who is making profit. Companies make profit for the value they provide to their customers. They should be however concerned about fair play of business. The response one gets is not right; is not well thought out. There will be some policy restriction on Chinese tyres, and I am convinced that it may take up to six months or more. The prices at which Chinese tyres are being sold are just not real.

Q. As a leading manufacturer of tyres in India, how would you define growth at JK Tyres?

A. We will continue to grow across all segments. In the commercial vehicle segment we will grow substantially in the coming year. Last year we grew faster than the industry average. The revenue numbers may show that we have grown less than 5 per cent. The number of tyres sold will however show that we have grown more than the industry. On the exports front, except OTR tyres, the export of tyres dropped. Any drop in performance in the domestic market was due to a sharp price cut and the emergence of Chinese tyre competition. Growth has been firmly lead by passenger cars and truck tyres. We have grown substantially in both the segments. Our growth in segments like M&HCVs have been more than 25-27 per cent, which is the industry growth in new vehicles. In replacement tyres, it has been a flat year because of the influx of Chinese tyres. Bias tyres growth is dropping. Confident of sustaining growth in the coming years, we are ambitious and have been chalking out expansion plans for all our plants. We are planning further expansion with more capacities at Vikrant, Mysore, for all steel radial tyres. Investments will keep flowing in the coming year.

Q. Will the replacement market post good growth in the next one year?

A. I expect radial tyres to grow. Especially in commercial vehicles. Bias ply tyres growth will dip. A conversion is underway, slowly and steadily.

Q. How strong is your dealer network?

A. We have around 400 dealers. Next year we will be expanding our dealer network to 5000 numbers. We have 25 truck wheels. We have 150 steel wheels for cars. The number of truck wheels will go up to 40 and that of the steel wheels will go up to 300 by next year.

I expect radial tyres to grow. Especially in commercial vehicles. Bias ply tyres growth will dip. A conversion is underway, slowly and steadily.

Future of electromobility

Akash-PasseyQ & A
Akash Passey, Senior Vice President – Business
Region International, Volvo Buses.
Interview by: Anirudh Raheja

Q. How is Volvo Buses employing technology and resources to enhance safety?
A. The economy is now moving in a better direction which is good for business. It is expected to continue moving in a better direction for the next three years. For Euro VI emission compliant products, we have introduced dynamic steering with which one could manoeuvre a bus with one finger. To introduce technology is not a problem for us. We have already introduced city braking systems in India as road accidents in India is a serious challenge. For this we have put in place Volvo Engage. It is a road and vehicle safety program, which in India is a very dis-aggregated effort and often carried out as part of Corporate Social Responsibility (CSR). There are certain education forums but continuity is missing. A larger momentum is required, and we will catalyse partnerships in a number of areas. We are also looking at the road and safety bill; it addresses areas like vehicle specifications, spare parts, driver training, licencing, database and insurance. So we believe there are number of areas in which various industry stakeholders like NGOs, government bodies, road safety bodies, technical institutes, operators are active. We would like to assimilate from them, what are their thoughts. We would like to know what is existing in the industry and what needs to be done. All this can work together for a concrete output. In Sweden, it is called as ‘Mission Zero’, and is about having zero fatalities on the road. It is not for the lack of will, but for the lack of coming together. There is a need to mobilise the stakeholders to form an uniform opinion around specific areas.

Q. Having sold 2200 electric buses across the world since 2010, what are the plans for India?
A. As a Group, Volvo has always been very focused on electromobility. We have been among the leaders in this league since 2007. Our products have been running around the world and we have been going steady. Quality, safety and care for the environment have always been our core values at Volvo. Electromobility fits in very well. In India, we have already sold a hybrid bus in 2011-12. It was a global product that has been running successfully. In the first half of next year, we will start a pilot project based on our hybrid bus, which is made in India. This will be for the Navi Mumbai Municipal Transport (NMMT). We expect this project to help promote eco-friendly vehicles in India.

“We are closely involved with the Ministry of Heavy Industries for various initiatives”.

Q. A big chunk of electricity in India comes from coal, which is known to pose an environmental challenge. How do you look at this?
A. If you have buses that are creating pollution, it is spread across the city. When you are moving to electric buses, you need power. Power is sourced from coal, which sends the source of pollution outside the city. That does not mean it solves the problem. A power plant has its own regulations and treatment solutions before the smoke is given out. Once it is given out and is centralised, emissions are centralised. They are at one place and create the need to treat them at one place rather than at different places with different products. Undoubtedly coal is more polluting. The Government is however taking steps to move away to other technologies which will take time. What we are doing therefore, is to introduce hybrid buses, which have no connection with the coal plant. In the hybrid bus, an electric motor is coupled to a smaller diesel engine and the batteries get recharged while the bus is moving and when the brakes are applied. The engine is smaller as it is not used all the time. The bus gets into the electric mode when picking up passengers. Creation of pollution is avoided where the possibility of it being created is the most.

Q. What will the hybrid bus be like? What will be the local content?
A. It will be a normal, 12 m low entry bus that is customisable as per the customer specification. We are aiming at the first half of 2016 to launch the pilot bus. The body will be localised. It will be built at our plant.

Q. Government recently announced 100 smart cities. What are your thoughts on FAME and AMRUT?
A. I think electromobility is on the list of every global country including India. Most of them have already taken various measures including subsidies to encourage development and deployment of electric buses. China is one of the biggest electric bus markets in the world. India, I think, is also following through. The Faster Adoption and Manufacturing of Electric Vehicles (FAME) program deserves appreciation. It includes private institutional investors to bring in products which are in the range of electric mobility, and are not limited to buses. We are closely involved with the Ministry of Heavy Industries for various initiatives. Globally, we have moved on to semi-electric and pure electric buses. These buses have an external battery recharge source. Whatever the next step India needs to take, or takes, we are ready. It needs to be noted that Delhi and Beijing are at similar levels of pollution.

Frugal engineering

N Saravanan, Senior Vice President – Product
Development, Ashok Leyland Ltd.
Interview by: Bhushan Mhapralkar & Bhargav TS

Q. From a technology point of view, how would you describe the CV roadmap to the future?
A. One aspect is clean air and green vehicles. The second aspect is safety. A classic example when you speak about a green vehicle is a hybrid vehicle. The one that we have developed is a serial hybrid and uses ultra-capacitors instead of Lithium-ion batteries. Ultra-capacitors have the ability to charge and discharge faster. This technology would work well with frequent start-stop usage such as in a city bus. The diesel engine can be replaced with a CNG or a LNG engine. The ultra-capacitors help the engine to operate in the most efficient way. In various test installations we saw a significant improvement in the city cycle. About Euro VI, and we have a truck that we would want to help develop a technology not at European costs but the one that would make it the right product for the Indian market. To highlight safety, we could look at the school bus we have developed. It looks at small things like the lower height first step for easy and safe ingress of pupils. Meeting roll over is not mandatory for a school bus. School bus accidents are mostly caused by a blind spot. In our school bus, we have ensured that the driver has superior visibility on the co-driver side. We have put a collision warning system. We utilised technology to come up with an anti-bacterial seat fabric. Understanding customer perspective is important.

Q. At Ashok Leyland how do you look at frugal engineering?
A. By frugal engineering, most think of it as cheap. I look at frugal engineering as amalgamating more value to the customer than the cost. A good example is, when we developed the school bus we decided to give it a lower step height. To me it means good frugal engineering. Even the seats of the school bus could be a good example. They look nice and are done in a simple manner. They are made without wasting material and contain anti-bacterial fabric. I look at it as as good frugal engineering example. In every bus or truck it is not about one big frugal engineering but small bits – a lot of small ideas that define frugal engineering. It is not about doing it cheap, but about doing it better. The SCR system on the Euro 6 truck is from our sister company Albonair, which already supplies parts and systems to others. We focused on how the system could be more robust, and offer the right feature set. The right dosing system for India rather than offering what is being widely supplied. Such frugal engineering would be about cutting the cost of the entire system. The antibacterial application in the school bus is more of innovation than frugal engineering, but hints at frugal engineering.

“I look at frugal engineering as amalgamating more value to the customer than the cost.”

Q. As a bus market leader, what new technologies do you think will play out in buses?
A. With so much emphasis on pollution, and on smart cities, I see intra-city buses moving towards partia zero emissions or zero emissions. I see a move towards hybrid and electric buses. Demand for diesel vehicles will continue to be there as the move up to BS VI takes place. Everyone is jumping on the electric hybrid bandwagon because of the FAME outlay. There are other technologies that are promising too. Technologies like hydraulic hybrid where hydraulics is used to store the energy. It may not be subsidised, but is relatively cheaper. With the need for hybridelectrics going up, we will see innovation playing a part. Efforts will be made to get the cost down in terms of process technologies and localisation. There are other hybrid technologies to look at like the flywheel hybrid technology. A high-speed flywheel stores energy. Multiple things are going on. Once volumes build up, many technologies will come into play.

Q. What role could India play in the area of new technologies?
A. Look at hybrid technologies, and it is difficult to say what is Indian and what is not. Lot of work is collaborative. For example, if I had to buy Lithium-ion batteries, I would look at China. Nobody makes cells in India, they make it in China. They are a mass produced commodity. Innovation comes in such that how do I make these cells operate in the most efficient manner. The key therefore lies in the battery management system. It is my bigger value addition. As the demand increases a lot of IPR will be seen to be controlled by the Indian OEMs. We may buy a motor from UK, the motor controls are with us. The way the motor works, is controlled and the way it links with the engine makes a bigger IPR than the motor. A lot is already happening in India.

Q. Back to buses, and what technologies do you see coming into the inter-city segment?
A. This market will continue to grow steadily. We are also looking at entering this market in the near future. Its a tough market, but in the next twelve to eighteen months you will see us there.

Q. How has the response been to the Neptune engine?
A. We launched the six-cylinder Neptune engine with 360 hp. The market did not move towards higher powered engines. We are therefore supplying this engine to some of our defence vehicles and marine applications. By the time the market moves to BS VI, a segment of the market will move towards higher horsepower motors. Work will start on Neptune N6 for Euro 6 compliant vehicles. The N4 version will be seen on tractors and tippers in the next six to eight months.

Q. What challenges do you foresee as the industry moves to BS VI?
A. There will be significant challenges. When you look at reduction required from the NOx reduction perspective, which is 1/8th of what it is now, and from the particulate matter perspective, which would be a 50 per cent reduction, the challenges are significant. The output of the tail pipe will be cleaner than the input. If Delhi runs these CVs, the air will be purified; that is the level of purification required. BS VI will also spring significant challenges in terms of service. The way the customer uses the vehicle, the way the engine behaves over time, and the way the aggregates work. Challenge is not just technology, it is also about validation. For validation, we need fuel by 2018 if the market were to move up to BS VI by 2020. The validation run will have to be for at least a million kilometers if not for 10 million kilometers.

Q. With product lifecycle shrinking, how are companies like Ashok Leyland tackling the challenge?
A. What used be typically a waterfall product development cycle due to concept design; due to detailed design, mockup followed by some sort of production schedule, is today about doing it in less time. The investment in Dassault Systemes platform was done to do a lot of it virtually. To do digital modelling and cascading through to production. Suppliers are also involved. Lot of things are going virtual – virtual modelling and virtual validation for example. Also concurrent engineering, internally as well as externally. All these (processes) help to do things faster.

Q. How much of your engineering efforts would be diverted towards hybrid from IC engines?
A. The market is going to be 99 per cent diesel engine oriented. And, even though its one per cent (hybrid), we are spending a lot of effort towards hybrid and other technologies. The effort that goes for this one per cent is 30 per cent. We are putting such an effort is because we believe a significant volume coming from these technologies (hybrid, electric, etc.) in the future.

Q. Does the defence part of the business make for a highly innovative effort?
A. We are involved in the vehicles. Vehicles carrying troops, missiles or guns. We don’t see a big challenge in terms of technology. When we get into more advanced weapons system it is a different ball game. Right now, it is about vehicles, and that is our forte. Talking about vehicle applications, we may have some technology partnerships. In fact, there are cases where we have done something with the partner, and the partner is so happy that he is exporting it back.

Q. How quickly is the electronic content in vehicles rising?
A. I think the electronic content in vehicles is rapidly increasing. Look at the hybrid bus; it is working with an engine, motor, generator and a battery pack. How to make these things to communicate. Go to Euro VI, and the whole brain is there. Its getting more and more complex. Electronics is going to be essential to have a fine control over important functions; to control emission levels. In hybrid vehicles, electronics play an important role in imparting seamless switching over functions. We are seeing rising emphasis on telematics, diagnostics and prognostics. Being able to say what fail mode is coming up. Electronics may be a silent thing in the background, it will however play a critical role. In the Euro VI mode, the engines will be electronic. Presence of telematics and diagnostics will go up. At the inline pump level of BS III, the electronic content may be zero. Over environmental conditions, the challenges with rising electronics will be to make the technician understand; to make the customer understand. Any failure cannot be seen but will make the vehicle fail. We are starting a training process for our dealers starting with the BS IV itself.

Everyone is jumping on the electric hybrid bandwagon because of the FAME outlay. There are other technologies that are promising too.

The positive effect

Harrie-SchippersQ & A
Harrie Schippers, President, DAF Trucks NV
Interview by: Gianenrico Griffini

Q. How was the year that went by for DAF Trucks?
A. The year 2015 was a year of growth. With a growing 2015 heavy duty market share in Europe, we are on track towards our mid-term objective of 20 per cent. And also outside Europe where we will further expand our presence with focus on demanding markets with modern emission standards..

Q. Does the reduction in diesel price hold a key to growth?
A. Customers are benefitting from the low diesel price, and interest rates are low. That makes it attractive to invest in new Euro 6 trucks, with 5 per cent better fuel economy, proven reliability and higher resale values. All customers I spoke with recently have already completely switched to Euro 6 or are in the process of doing so. That is good for all parties as well as for the environment. All incentives that we can come up with in Europe that help people replace older trucks with newer trucks, have the biggest impact for the environment.

Q. How has DAF benefitted from the growing market?
A. DAF has benefited from the larger market. Over 30 per cent more orders were received by DAF last year for the CF and XF models compared to 2014, the highest number since 2007. To meet the high demand, production in Eindhoven (Netherlands) was increased in just four months by 50 per cent. Production has never risen so quickly, and it is a great achievement therefore. In the last three months of the year, a total of 11,500 trucks were produced in Eindhoven, which is a new quarterly record. We produced almost 41.000 CF and XF trucks last year and around 9,700 LF vehicles.

Q. To what extent has your market share in Europe risen?
A. European market share in the over 16-tonne class rose from 13.8 per cent in 2014 to 14.6 per cent last year. Our market share grew in almost all main markets in Europe. We grew more than one per cent in the United Kingdom and Czech Republic; one per cent in Spain, and we gained almost a full per cent in the Netherlands and Poland. Very important is the progress realised in Germany, where our market share grew to 10.8 per cent. Germany is by far Europe’s largest truck market and we need further growth there in order to achieve our objective of 20 per cent heavy duty share in Europe in the mid-term. The CF and XF were successful and contributed to the rise in market share. Both these truck became an additional 5 per cent fuel efficient thanks to engine innovations and new technologies such as predictive cruise control, predictive shifting and eco mode. New silent versions allow transport operators to continue distribution in areas where noise restrictions apply. Helping our customers to achieve the highest yield per kilometer, totally in line with the philosophy of DAF Transport Efficiency, our trucks currently are the most fuel efficient ever. They are also of the highest quality ever.

Q. What about emissions and the costs involved?
A. What we try to explain in Brussels is that we as an industry don’t need legislation to reduce CO2 emission. It is directly linked to fuel consumption. We simply deliver the lowest fuel consumption automatically because our customers ask for it. On top of that, more and more people in Brussels start to understand that it is very complex to make general legislation, and also because every truck is different. The Vecto tool to be introduced in 2018 gets a lot of attention now and the way we are going to declare CO2 emission on a comparable, auditable and verifiable basis will further strengthen market forces and make all manufacturers run even harder. The industry will invest enormously in future to make trucks even more fuel efficient and cleaner. Nevertheless, it is good to question whether we should spend so much efforts and cost on reducing CO2 emission from trucks. All future technologies needed to take the next step will cost our customers in the region of Euro 300 to save one tonne of CO2, whereas on the free market you can still buy emission rights for only Euro 6 per tonne. There’s a need to think about that.

“In line with the philosophy of DAF Transport Efficiency, our trucks currently are the most fuel efficient ever, and also of the highest quality ever.”

Q. Beyond Europe, what are the markets where you are marking your presence?
A. Last year, DAF entered the Malaysian and Colombian markets. In Taiwan, our partner Formosa opened a new assembly plant to double production capacity. With a market share of 17.8 per cent DAF is the largest European truck brand in Taiwan. In Brazil, the plant in Ponta Grossa will soon ramp up production. Although the economy is in a severe recession and competitors are reducing their production, we are working on further growth. It is difficult to forecast sales in Russia. The Ruble is very weak and that makes European trucks very expensive in Russia.

Q. How do you look at the DAF footprint as of current?
A. One has to be realistic. First and foremost, we apply a stepby- step approach and aim for sustainable growth. You cannot enter all marketplaces and be successful in all of them in one go. For DAF, good markets are the markets with a professional transportation system and modern emission standards. We closely monitor developments in China and India but we all know that there is no focus yet on total costs of operation like for instance in Brazil, South Africa, New Zealand, Australia and Taiwan. Truck prices in China and India vary from Euro 30 to Euro 40,000. We closely follow the developments there.

Q. How do you look at 2016?
A. This year, the recovery of world economy is expected to continue cautiously. Growth of the European economy is expected to be almost 2 per cent. Despite the unrest in the Middle East, oil prices remain at a low level. With the economic recovery, transport volumes are likely to remain at a good level, with a slight growth in the truck market as a result. For 2016, it is anticipated that the European market for heavy trucks will be between 260 and 290,000 units. The year 2016 could be the best market since 2008. And yes, the market is at a sustainable level, at or even above what under normal economic situations would be a replacement market. However, I don’t have a crystal ball, and it depends very much on how the economy develops.

Q. Will good growth come from
rigid and tractor segment?
A. Despite how the market
fares, our ambition is to grow in
both the tractor and the rigid
segment. In tractors we enjoy
a very strong position indeed.
In the last quarter of last year,
our growth in the rigid segment
was stronger. I always say that
the first 2.5 m of tractors and
rigids are same, and 80 per cent
of the value is there. In markets
where we are the market leader,
our market share in rigids is
higher than in tractors. Many
new markets, like Poland, Czech
Republic and Hungary are real
tractor markets. Tractors are used
for international transportation,
in which competition is the
most severe. I’m proud that DAF
performs best here. We have
many programmes in place to
further grow in rigids and we
are making good progress. But
when we are at 20 per cent
market share in Europe on the
mid-term, we will still be stronger
in tractors. Our objective for this
year is to carve out a 16 per cent
share in the heavy-truck class.

Q. Is the capacity expansion continuing in 2016?
A. We are having a large number of investment projects running in 2016. These include the construction of the new cab paint shop in Westerlo (Netherlands) involving an amount of Euro 100 million. In addition, tens of millions will be invested in Eindhoven for the production of new gear wheels; in a new large press in the sheet metal components plant, and in a new production line for cylinder blocks and cylinder heads. All these major investments illustrate confidence in the future of our factories in Eindhoven and Westerlo. All these investments are done to be ready for the future. I have strong confidence in the future, thanks to the best and most efficient trucks we have come to offer, that we have developed, manufactured and marketed. The trucks have been developed manufactured and marketed by over 8,000 dedicated DAF employees, and by over 1,000 dealers in Europe and across other markets.

Q. As a Paccar Group entreprise, what synergies are you looking forward to? There’s also the Kenworth and Peterbilt brands?
A. I will not be able to give you an example. Think about electronics and driver assistance systems. Sharing a cab is difficult as legislations differ across continents. Driveline synergies are possible only up to a certain level. You are aleady aware that 40 per cent of the Kenworth and Peterbilt trucks in North America are running with the Paccar MX engine, developed by DAF in Eindhoven. We have just launched the MX-11 engine in the US, and I expect this to become as successful as it is in Europe.

For DAF, good markets are the markets with a professional transportation system and modern emission standards.

Growth and alternate fuels

MikaelBenjeQ & A
Mikael Benje, Managing Director, Commercial Operations,
Scania Commercial Vehicles India Pvt. Ltd.

Interview by: Anirudh Raheja

Q. How do you look at the Indian market now that you have moved from Indonesia to India?
A. Anders Grundstormer, Ex MD may be moving back to Sweden, he has however set the stage for Scania. He has set high standards. Taking over from Anders, I will be responsible for the business unit as we call it. We will be participating in the journey of renewable fuels with more thrust on reaching different states. We already have people all across the the country. They are in dialogue with different states regarding what should they focus on; what can they introduce, and can implement to their part for the environment. We will then try to understand as a company what we could offer before implementing different projects. Once we are done with that, we would have a clear roadmap for the country with respect to demands from different states, and move forward quickly. One of our important milestones is the start of green bus in Nagpur in August 2014. Our 55 buses are already plying on the roads of Nagpur. We wanted to show that buses can run on waste which might be a household waste, agricultural waste or sludge. We have done that.

Q. How does India fare in terms of a CV market rather than just a bus or a truck market?
A. The demand for quality products in India is picking up pace. We currently hold 35 per cent market share in the premium commercial vehicle space. We have already sold close to 220 Metrolink buses in India. We aim to take the number up to 400 buses this year. Market potential therefore is not a problem. We have delivered buses in Kerela, Karnataka, Tamil Nadu, Andhra Pradesh, Maharastra, Gujarat, Rajasthan, Punjab and Delhi NCR. We are also in talks with Lucknow, Mumbai, Pune and Bangalore for such buses. I am of the opinion that incentives can also prove to be a driving force for implementation of such buses running on (different) alternative fuels. For the truck segment we are working predominantly in the mining segment. We are now seeing a growth of up to 700-750 units. We also see a lot of potential in the on road segment as well. We will be targeting this segment of roughly 100 units. So overall, we are already targeting a potential of 1100 units this year.

Q. What is the current operational capacity of Narsapura plant? And how many people are employed at the plant?
A. The installed capacity of our Narsapura (near Bangalore) plant is 1000 buses. We are currently operating at 40 per cent of our capacity. Last year we rolled out 280 buses , this year we will be rolling out 400 buses. As far as the demand is concerned, we are fully ready to address it. We will not need to put much effort even if we think of doubling the capacity from our current capacity. If we decide to produce 2500 buses and 5000 trucks annually by the year 2020. Close to 850 people are already working at our bus factory, which I think is quite a quick growth. We aim to increase this number to 1,200 employees as the demand goes up.

“The demand for quality products in India is picking up pace”

Q. Scania buses are 70 per cent localished. Scania trucks are 40 per cent localised. What are the plans to reach 100 per cent localisation?
A. I think 100 per cent localisation will never be possible in India as we are not planning to develop engines here in India and would continue to import them. We are looking at some export markets that would want to buy products from India that are localised. In such a case, we will need to reduce the costs. I think, we have an year ahead of us, to really get down and increase the localisation of different materials in Scania products developed in India. I think this can go up to 45-50 per cent for the truck segment where as for the buses, we have not done so much on the chassis. We already have 80 per cent localisation in the body, which we can take to 100 per cent. We only need to find the right suppliers to match up to the Scania’s quality standards, which is a big problem. In the truck segment we have localized rims, tyres, mirrors, panels in the cabs; we have also localised axles since these are metal things. For an engine, you can break down and localise some parts of it. The engine can be built locally. All this will however take time. In the bus segment, I really see a scope to increase localisation in the bus body.

Q. OEMs are leveraging their Indian operations to source components and products for their locations the world over. What plans does Scania have?
A. I feel that we need to work on a broader perspective. India is country where there is shortage of electricity already. Whatever electricity is produced, the major chunk of it comes from burning coal. When it comes to biofuels we have always regarded ourselves a partner to India and our endeavour is to provide sustainable transport solutions. We are the only one who already has different fuel alternatives which can be implemented in different cities to reduce the emission levels. For Scania to export out of India, the prime target markets will be Asia, the Middle East and Africa . Countries like Turkey and Indonesia. However, as indicated above, we have to sort out things in the local market first. And I don’t think 2016 will be a year for exports therefore. I think, the year 2017-18 could see Scania exporting out of India. We have to be realistic. We are already running around on different projects. My priority will be to work on them, get them sorted before newer things can be thought of.

Q. What is it that you are looking at sorting out before you think of new developments like exports?
A. I think we are doing well in terms of body but we need to work more upon localisation of the chassis. If we are able to do that, we will be able to cut down costs drastically. We should also not underestimate the cost of logistics. To take a bus from our Narsapura plant to any state will involve much cost but to send it to Turkey will undertake huge logistic charges. So we need to figure out how much its costs before we can think about exports.

Q. There is a talk of GST and BS V emissions. What do you think about the two?
A. I think it is a good move by the government to introduce BS VI earlier than the set time line. There has to be a more collaborative effort which brings together policy makers and the private sector. We are already planning to introduce more green buses that can accelerate the pace of sustainable transportation in India. In the case of GST, the overall commercial vehicle sector will benefit a lot from its implementation. It will be beneficial for us in the on road segment where localisation is still at the level of 25 per cent. We have to pay an import duty of nearly 40 per cent, which is a huge burden and takes a toll on the overall cost of the truck. India is a price sensitive market and we have to address the expectations of our customers.

When it comes to biofuels we have always regarded ourselves a partner to India and our endeavour is to provide sustainable transport solutions.

Global approach


Q & A

Kartik Ramanan, General Manager – Global Bus Engine Business, Cummins Inc.

Interview by: Anirudh Raheja

Global approach

How does a variation in technology implementation take place at Cummins?

We do ‘fit for market’. Many years ago, we used to develop the technology in US, and then roll it out in other areas. But this approach does not help us any longer. What we have consciously done in the last few years is to enhance our understanding of the markets, which is why we have organised our bus business, which we did not have earlier. Today we have a complete team which looks after our bus business globally. We have people in India, China, US and Europe as well. There may be things that we do like stop-start technology where we cannot just take it off the European shelf and apply in India. So we may take it to the application engineering level in India and see what the constraints are. What constraints are particularly there for the Indian market and adapt it accordingly. But that is just one part. The other part is, we do products exclusively for India. In fact, we often bring it back to the advanced markets. We have already started; we are already running in that direction. If a product made in US can be used in India, why not a product made in India find use in US. One has to adapt.

So, will India be a potential start-stop technology hub and market?

Typically, we have a launch in one area and we always look to leverage the technology in other parts of the world. India is one area where we are actively looking at stop-start technology. Traffic in India is a major problem in various cities. There are still a few things from which we have to weave our way through. Transmissions for example. As to how it (start-stop tech) can mesh up with correct transmissions. Whether stop-start versus manual or stop-start versus automatic; it will take sometime for us to get through.

Many parts of India are moving to Euro 4. How do you look at the implementation of stringent emission norms?

The issue is more about execution, than about capability. I think capability is there. It is difficult for me to say how it will go through but the jump from Euro V to Euro VI is significant. And moving from Euro IV to Euro VI will be a bigger leap. As far as execution is concerned, it will be in two levels. First of the two will be the infrastructure. Infrastructure needs to be ready. The second of the two will include the markets. Markets need to be ready to accept the kind of jump that will be needed. It is a huge jump in terms of initial costs, and it will come down to a decision, that will it be worthwhile putting the economy or market in jeopardy or in peril? If you don’t have buyers, then the new technology is of no use. In my opinion, there will be practical limitations for the implementation of Euro 5, but from the support stand-point we will support it.

There are three injectors working instead of six in start-stop technology. Doesn’t the pressure on injectors increase?

It is true that we have three injectors instead of six in start-stop technology. We are however also looking at a technology which can give infinite start-stops. In a market like India where traffic is a huge problem, it can be a kind of hybrid. Currently we have an SCR solution and EGR solutions as well. But SCR has a better life-cycle for the better (life) part of the engine. So, it all boils down to the initial costs involved.

What role does India play in terms of new product development at Cummins?

What we are working on is power density and making the engines more compact. Moving on from six cylinder to four cylinder engines will happen, but we need to be more careful. In Europe, we have already done that from 9-litre to 7-litre engines, and now from 7-litre to 4.5-litre gradually. There are some duty cycles which can support that trend. A potentially plain area can take that kind of technology easily, but for a hilly terrain, a six cylinder engine has its own benefits. There are specific challenges in India, Return On Investment (ROI) specifically. I think there is a lot of technology that you can put into India, but diversification in geographical conditions alter the approach to a big extent.