Continental Automotive Prepared To Support Indian Auto Industry Ramp-Up

By T Murrali

In the recent past there has been a recalibration by global players on what to expect from the Indian automotive industry, especially in terms of vehicle production, and now there is a more realistic view of the Indian market. This was after the expectation that the Indian market would be the next big thing after China. Obviously that didn’t happen; not only did it not grow like China but the market and the global industry actually went through a setback. In the past, not just the Indian automotive market but the Indian economy itself has had a tendency to over-promise and under-deliver.
“With this recalibration combined with what is happening in terms of the government intervention, management of the economy and so on, we are now looking at years of stable and attractive growth of the automotive industry which may be in double digits in the future. This is how we are looking at vehicle production in India. There could be periods when the market grows slowly but our expectation is that, barring an earthquake in the global economy, India is poised for consistent growth,” Claude d’Gama Rose, Managing Director, Continental Automotive India, told AutoParts Asia.
Continental Automotive expects to have a steady and attractive growth in India, though not as explosive as that of China. This expectation is based on the growth in the domestic market and also exports.
“As the Indian vehicle standardises, in line with those sold the world over, the attractiveness of India as a manufacturing hub is bound to increase. Even now a substantial portion of the production of passenger cars is exported; this could increase further. For Continental Automotive, being primarily an electronic supplier, we see an increase in the electronic content of vehicles. We have seen this in passenger cars but are disappointed that it does not happen sooner in commercial vehicles (CV). With BS-IV in vogue now, and CVs also going in for BS-VI in 2020, we are sure this gap in electronic content, as compared with the rest of the world, will be closed,” he said.
However, for Continental Automotive, the two-wheeler market is very significant. Now it has volumes in the 20-million range. “While the instrument cluster was perhaps the only significant electronic component in the two-wheeler earlier, we now see legislation and ABS coming in for two-wheelers above 125cc, and Electronic Fuel Injection (EFI) mandatory by 2020 for all two-wheelers. With production volumes going up across vehicle segments, it is the increase in electronic content that is of interest to us. We have already seen the first wave driven by safety legislation; a significant portion of our growth is coming from the safety side. As we approach 2020 it will then be the consequence of BS-VI,” d’Gama Rose said.

New Market Segments

In India Continental Automotive has not gained a foothold in areas like electrification. Though there is a lot of interest among the OEMs there has not been any major initiative. “But it should fall into place soon. I think we are getting into a phase where change will not be linear, it will be pretty sudden. The gaps which the Indian industry has with other markets will reduce considerably, and electrification is one area where we believe this will happen. At this point in time there are companies going in for electrification on an accessory basis, for mobility services. Going forward, mobility services will be very important for Continental globally. The first steps with respect to mobility services in the vehicle will be connected with the use of the mobile phone; it will definitely be an area that will contribute to our global growth,” he said.
Continental Automotive expects the behaviour of the Indian market to change when automated driving comes into the country in a big way. It may take some more time owing to the infrastructure problems. But assisted driving will come in, particularly for parking of vehicles. There could also be specific services connected to mobility and automated processes in the vehicle – it will come sooner than later.
The process for supporting the Indian automotive industry to be BS-VI-ready by 2020 is under way. “We would support customers across all vehicle segments. We are very active with the two-wheeler OEMs as it is completely new to them, moving to EFI and with it the norms for BS-VI. Basically, we have the competence in our global organisation with people in our off-shore teams who have worked with the relevant software – I think we are more ready than the OEMs,” d’Gama Rose said.

Electric drum brake

AMP 2026

With regard to technology and the access of transportation looked at in AMP-2026 Continental Automotive is well placed to support the Indian industry. With the arrival of BS-VI, the global giant expects to have sufficient volume to consider localising a number of products that are required both on the propulsion (electronics for gasoline and diesel) and after-treatment (sensors, SCR systems). There would be a lot more value addition in development and manufacturing that Continental would bring to India, which would help AMP-2026 realise its revenue and employment targets.
“Continental sees the market developing very positively, not least because of the increase in the electronic content but the fact that Indian vehicles, in terms of technology and capability, will resemble the vehicles we have across the world. We inaugurated our Tech Centre in India in 2009 and have already doubled the space we started off with. Continental Automotive is really committed to development in India. However, I am sure that the growth we visualisecannot be captured within the existing infrastructure. To capture a larger market share we have to expand and that would certainly include these facilities,” d’Gama Rose said.

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