Auto Sector Getting Innovative

Auto component sector started localization with reverse engineering in 80s. I had opportunity to work with General Motors, Vauxhall Motors, Isuzu Motors, and Mitsubishi Motors for various projects. Development of components was difficult as it used to a proprietary item of the vendors of the OEMs. Indian component manufacturers used too ask for sample parts and did the best to duplicate it. Naturally over the years, the component manufacturers have mastered its product. As a new trend, even small and mid-sized auto parts manufacturers in the country are trying to supply a totally sub-assembled or fully assembled units that go straight in car assembly.

Design engineers of even tier II auto component companies today can be seen engaged in analyzing, designing and testing auto components on high-end computer-aided design and engineering component ‘morphing’ tools. A company without a capable and strong design team can’t improve and innovate the products and processes to be and remain competitive. Many big such as Bharat Forge and Amtek Auto or even small companies too are trying to acquire design firms in developed countries to get strongly placed fast into the innovation business. Many are trying to build on own locally.

Autoline, an Rs 200-crore vendor of several leading automobile companies bought Detroit Engineered Products, an American design firm, for $15 million (Rs 60 crore), and is now heading to be a global ancillary.

RSB Transmissions is an Rs 600-crore auto ancillary firm in Pune. The CEO claims “to have even advised original equipment manufacturers (OEMs) on why a component has to be designed in a particular way.” To give such advice, the design team has to be capable of going a step beyond the OEM’s component specification. RSB, for instance, designed a propeller shaft 10 kg lighter than its original weight, which, coming as it did from an Indian ancillary, surprised the OEM. RSB has invested Rs 12 crore in R&D, and has also acquired Michigan-based Miller Brothers, a precision machining company, for $19 million (Rs 76 crore). RSB’s ‘i-Design’ team is a separate entity working with OEMs on component quality, weight, design and pricing.

SRF Ltd has made innovative modifications on some old machines combining two processes of twisting and cabling with a lot of saving. Anand Group has brought about innovations in car ACs making it cheaper. Sona Steering under the able leadership of Surinder Kapur has enhanced its R&D budget by 15%. As reported, Sona has developed a steer-by-wire technology that may be showcased in coming Auto Expo 2008.

Medium-sized ancillaries have also been spending more on R&D over the past three years. Importantly, foreign majors such as Toyota who are noticing the rise in defect rate among their vendors, find Indian ancillaries a viable source. Clearly, a capable design teams can add a lot of value. It gives the ancillary company freedom from the OEMs.

However, design talent is expensive and scarce requiring a lot of nurturing from the top management. It is not easy to direct the engineering capability into R&D. IT today attracts the best brain. However, it is not difficult to build a great design team, as it requires picking up the right kind of people who may, on their own, may not like to join IT, because of their interest in design.

Many foreign firms are trying to set up its R&D wing in India because of a great pool of talent. Eaton Corporation, a US-based $12-billion (Rs 48,000-crore) firm, has already created a ‘professional services centre’, comprising 500 engineers dedicated entirely to R&D to focus on clean technologies for the Indian and global automotive sector.

As announced recently, General Motors Corp, global automakers is setting up a new Collaborative Research Lab (CRL) in partnership with the Indian Institute of Technology, Kharagpur to carry out research in areas of electronics, controls and software. It had already an R&D center in Bangalore. GM has also opened its India Design Lab in Bangalore, which will comprise 100 professionals involved in styling cars.

CII too has undertaken “Mission for Innovation in Manufacturing” since May 2006. The best part is that many globally reputed management consultants are helping in its endevour to Indian manufacturing sectors globally competitive.

Many a times I feel every person in any profession must learn the basics of the art and science of innovation techniques at stage of education.

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