Story by: Bhargav TS
ZF Friedrichshafen AG has commissioned a new shock absorber line in its existing facility at Chakan, Pune, with an annual installed capacity of 0.7 million units. As part of the Group’s regional operations, the new line is expected to ramp up capacity over the next few years. It is expected to rise to three million units in the next three to four years. Set up in response to the government’s thrust on local manufacture under the ‘Make in India’ theme, the new line will manufacture a comprehensive range of shock absorbers for CVs. The line will also produce shock absorbers for cabins and axle architectures. A part of an exercise by ZF to further enhance its manufacturing capabilities in India, according to Suresh KV, President, ZF India, the new line would contribute to ZF’s role in actively shaping the three megatrends of safety, efficiency, and emobility in India.
A result of the dynamic business environment of the country and initiatives like ‘Make in India’, according to Suresh, the new line is expected to further elevate the company’s CV product portfolio, which is said to be already quite wide. Claimed to be completely localised, the new production line in the existing multi-product facility of ZF India will offer operational synergies with the current set-up. It will help the Group to optimally utilise its resources as part of its Asia-Pacific operational structure. To follow the same manufacturing processes and standards that the other lines of ZF follow in other parts of the world, the new shock absorber line for CVs will tap into the demand for modern CVs; value CVs. Said Fredrik Staedtler, Global Head – Commercial Vehicle Business, ZF Friedrichshafen AG, that the rapid development of India’s infrastructure, implementation of new norms for emissions and new vehicle loads, as well as the electrification of vehicles and scrappage policy, are all set to trigger a demand for the upgrade of commercial vehicles.”
Well set to play a significant role in the growth of the Indian CV sector as OEMs seek to introduce the latest technologies to their CV portfolio, Staedtler opined that they have been increasing their focus on the Indian market with the introduction of innovative products like the nine-speed manual transmission for CVs. Drawing attention to the nine-speed transmission technology for CVs thus, he averred that it is very encouraging to see the developments that are taking place in the Indian market. “In India, we will focus more on the six-speed and nine-speed manual transmission systems. We will work with the supplier base to increase our production capacities,” he revealed. Opining that they expect the new shock absorber line to surpass their expectations, Staedtler said, “It is part of our strategy to localise chassis components.” “We want to localise and manufacture at Pune various aspects of the chassis and drivetrain,” he added.
Global thinking, local approach
Offering an extensive range of CV components in India like transmissions, axles, chassis components, and steering systems, ZF is banking on the rapid changes the CV industry is experiencing. As an active stakeholder, it makes steering systems with JV partner Rane TRW Steering Systems Limited, and Anti-lock Braking (ABS) technology with JV partner Brakes India Private Limited. Following the developments in the Indian economy and how the auto industry is evolving in a framework of regulations and changing market requirements, ZF is working closely with its clients to help them comply with some of the most far-reaching regulations ever. It is looking closely at BSVI emission regulations that are set to come in force in mid-2020. With plans underway to replace a large fleet of commercial vehicles (and other passenger vehicles) older than 20 years from the roads under a scrappage policy, ZF is in discussions with OEMs so that it can address any surge in demand.
Looking at expanding the airbag and seatbelt capacity in India, the Group is anticipating 2020 to be a year of demand for auto transmissions in trucks after the BSVI emission norms are implemented. Said Staedtler, “The stringent BSVI emission norms that India will shift to in 2020 will call for highly efficient drivelines. At ZF, we are looking at working closely with our clients to help them upgrade. We are also looking at helping them to upgrade from manual transmission systems to automatic transmission systems.” To do so, the Group is taking stock of its back-end operations. It is investing to upgrade them; to upgrade the manufacturing facilities and more. Focusing on the Pune facility, which has enough area for expansion, ZF in India, according to Staedtler, is looking at increasing the scope of its existing businesses as well as the new businesses. Stating that he is looking at a significant uptake in the seat belt and air bag business due to the upcoming safety norms, the Group in India is in discussion with its OEM clients to optimise costs through large scale operations.
Achieving cumulative exports of components worth Euro 100 million this year, ZF is also looking at a secure supply chain from India. Doubling its target to Euro 200 million, the Group has invested in a purchasing hub at Hyderabad, Pune, and Coimbatore. The Group has also aligned the purchasing hub with Europe such that it can draw more and more components from India. With cost pressures continuing to exist as OEMs look at streamlining their operations and incorporate new technologies at highly competitive costs, ZF in India is discussing with its suppliers to find a new way to address the requirements of its end clients in various parts of the world through competitive sourcing in India. Said Staedtler, “We are having a lot of discussions with our Indian suppliers.” Acknowledging the importance of Indian market, and the local competency levels, ZF is looking at a significant rise in components and material sourcing from India to increase its reach in the advanced markets of Europe, US and others. Exploring new technological avenues like Blockchain to streamline its activities, ZF is already indulging in an arrangement where parts from India are delivered at the doorstep of many manufacturers in the advanced markets. “In many cases, we have delivered parts from India to the US, Germany, and various other locations. To ZF, India is a very important market,” concluded Staedtler.
