The US-based Stanadyne along with its Indian partner Amalgamations has launched a new diesel fuel injection system for the off-road segment. It was developed in India mainly for Indian and similar environment. The new fuel pump will allow manufacturers to develop engines with reduced emissions in the 2017 timeframe without much impact on cost of ownership or service. Dr John Pinson, President and CTO, Stanadyne, and Sanjay Chadda, Managing Director, Stanadyne India, in an interaction with T Murrali, explained the process of development of the new fuel pump and how it would be an Indian product of Stanadyne and how India would be its global manufacturing hub. Edited excerpts:
Pinson: We will speak with some examples. We can speak specifically about the product we have launched from India, the new fuel injection pump. We did extensive study with our customers and tried to understand the challenges they were facing. We asked them, `if there were to be a new product what attributes should that special product fulfil’? We spent lot of time gathering information over the course of a year and half. We went back to our design studios and created some concepts. We went back to our customers, showed them these key concepts. There were lot of criticism. We took them back to the design process and now we have this product and we feel that there is tremendous excitement in India, China and other places around the world.
Q: What was the mood when the product was ready?
Pinson: This gave us the confidence to make the capacity expansion and go forward. That is a typical way of our working and it is something unique about Standyne. Because of our size, we are able to develop customer solutions like this. It is what makes us competitive. We are more than willing to respond to customer needs which make good economic sense for them and for us.
China was desperately in need of pumps which will have extreme durability in very harsh fuel environments. Technology really suffered when it was introduced to emerging markets because of fuels. So we introduced purpose-build pumps for the low-density fuel markets and that gave us a lot of opportunity in China. We are producing 60,000 units today and are in the process of producing 100,000 units. And then in India we are in the process of investing.
Q: Serviceability is a much more important issue here. OEMs speak only of technology. Are you addressing the serviceability aspect?
Pinson: There are some issues in India and the biggest one is pollution in the cities. The most serious pollutant is the diesel particulate matter. Emissions of the off- road engines also are very high. The new product we are launching will reduce to a great extend the emissions of the particulates by the off-road engines and help the environment without any significant cost increase. Second thing is when we are designing a new product, the foremost criterion for us is the fuel- saving. Eight percent fuel saving should translate to almost Rs 14,000 to Rs 15,000 saving on average in a year for a farmer. It is a big saving, a game changer. When we bring this new technology we bring new patented design and help the farmer save substantially every year and also help the environment.
Q: How do you reach the market?
Pinson: We have now large number of distributorship, though we cannot match the network. We are replacing fuel pumps in the market. We are supplying to many customers, mainly to the OEMs like Ashok Leyland, Cooper, John Deer, Fiat and others. In Turkey we are supplying to everybody.
Pinson: We have designed a product that should fulfil three principal objectives. One is 50 percent reduction in emissions of particulate, the second is up to eight percent fuel economy and the third is the benefit from the user perspective from the flexibility of the engine calibration.
This is a machine made especially for India. The off-road emissions are nearly 40 percent of the particulate emissions in the environment. If you consider the regulated on-road and unregulated off-road emissions, the vast majority is off-road. We have been looking at it. We have been applying our technology very successfully on agricultural and industrial tractors and gensets. In India there are so many of these engines and it is a tremendous opportunity. If we want to make meaningful change to the off-road emissions in this county, we need to do something about them.
Q: Is the non-automotive focus, a conscious decision?
Pinson: Yes it is non-automotive, I think some excellent solutions are emerging from our modules but the off-road industrial genset segment in India needs a bridging strategy from the technology, from BS II to BS III the way to BS IV and if are waiting for BS IV, we are missing a big opportunity to improve the environment. As we look at this segment we believe that the market needs some implementable solution in the mid-term to make a large reduction. This is the concept.
Q: Any plan to set up any new facility?
Pinson: Our basic mode of operation is that as we are able to reach a critical mass in a region we will start with local assembling and test and move on to engineering and manufacturing. Recent examples are in India and China. Both of these investments started with existing products, but now are flourishing on new products.
Q: Do you have application engineering or R & D facility here in India?
Pinson: Yes we have product development and testing capabilities and several people are actively involved in these.
Q: How does the R & D work? Is it linked to other centres?
Chadda: The mechanical rotary pump could meet the requirement of 50 hp engines. Based on the feedback from the market and on the customer requirement we created this new concept which would address the cost of ownership including that on maintenance. So those things were conceived from this location and we put up a plan, an overall kind of sketch elaborating this, what we needed to develop and started the work over here. We were linked to multiple locations through our ERP and design tools that are commonly located. We have a global release process for the control of developed materials and cost. So there is nothing like work in isolation. It is a global effort.
Pinson: Yes we do have. Right now India is the centre of excellence for rotary pump expertise. There is no question about that. The new product we are introducing (new fuel pump for sub-50 hp diesel engines) is an India product. It is developed by our India team though it is supported by the global team. We have centuries of experience among our various centres around the world. They work very closely together, through direct communication or through video conferencing.
We can have two things. One is, we can have a consistent standard approach to introducing new products, because always companies will learn from their mistakes. We want to make sure that India does not make the same mistake that some other market made last year and vice versa. The second point is that we are able to work concurrently 24×7 for our products. As the US day is ending, India starts with the work with the briefing from the US team. So the product reaches the market very quickly. Thus India is a centre for excellence for the new product, the fuel pump for engines of sub-50 hp and above. India is also the centre of excellence for mechanical and mono-block rotary pumps. The India centre will own these products, and release these products. I think eventually there will be world-wide application for the new product.
Q: Will this product be manufactured only in India?
Pinson: As the demand grows, it would become more cost-effective to replicate it in some other locations, beginning with assembly and testing, and as the operation grows we will take up manufacturing. In the beginning India will be the sole supplier of components.
Q: Are you also sourcing components from China?
Chadda: Yes, we have a global best source policy so that for all our large products we set up global banks of materials and with that we prepare best sourcing globally. There will always be some cases of heavy or complex parts that you need for a particular region.
Q: What are the major development trends in Stanadyne globally?
Pinson: We are engaged both on-road and off-road products. The trends are similar but slightly different. For on-road we have very large programmes like gasoline direct injection especially for large fashion cars in United States. The major driver there is fuel economy.
The off-road segments are concerned with robustness, particularly to fuel conditions. Fuel quality varies widely around the world. So the international manufacturers struggle to release a single product to the market. Second is emissions; technology is essentially chasing the new emission standards around the globe. Each market is taking on a character of its own because of the specific market conditions. We are meeting emission standards with robustness along with some fuel economy benefits.
Q: Globally almost all the components manufacturers are working on technologies to improve fuel economy. What are the avenues of opportunities for you to enhance fuel economy?
Pinson: There are three primary grounds to improve fuel economy. One is to reduce the overall process of the system which can be the drivetrain, in the engine operation itself and the third aspect is to tune the engine operations to upfront the fuel pump. The primary driver for that has been fuel injection system which enables the engines to work more efficiently, and to improve the engine friction itself. Efficiencies of today’s engines are significantly higher than the old ones. Fuel injection systems are the primary driver for that. If we can release fuel more efficiently we can enjoy big benefits.
Q: What are the Stanadyne’s solutions that help the OEMs achieve fuel economy?
Pinson: Our gasoline direct injection fuel pump enables our large customers to achieve fuel economy benefits based on just the implementation of the direct injection technology. But they were also able to implement other interesting fuel economy measures because they had the traditional fuel economy possibilities.
In India when we add sophistication to fuel pumps; with the ability to enhance the calibration flexibility of engines, there will be significant fuel economy benefits. So in this market the fuel pumps we have introduced can give you up to eight percent fuel economy. It has combustion-enhanced calibration and it has flexibility.
Q: The challenges in India are fuel quality and the cost of ownership; the low quality fuel affects the engine and finally the serviceability. How do you overcome these issues?
Chadda: Fuel quality depends on the source of supply. India has introduced low-sulphur fuels and quality fuels for gasoline engines. This is one important aspect. The other is the contamination of fuels – often deliberate mixing of diesel with kerosene or other related chemical substance. When we speak of robustness of global fuel market, generally we know what happens to the fuel after its distribution. So this is something we are aware. Every pump we see must be made robust to the quality measures.
Q: Will you not lose efficiency when we focus on robustness?
Chadda: We have special packages to run the pumps clear of kerosene. Therefore, there is no loss of efficiency. In Indian conditions where there is a mix of kerosene with diesel, there is absolutely no damage. We have been operating for nine to 10 years in India. It is not kerosene which is damaging but the dye. Dye is the only problem.
Q: When you develop a pump from the robustness point of view you cannot develop a pump for all the market as there is no standardisation. If at all there is any standardisation, can you let us know to what extent it is applicable?
Pinson: The latest fuel pump was introduced first in the US and the product was gloablised. Our most challenging market was South America; India and China were the next. We developed the product for them. We are developing a product for the first time for the worst known market; and it actually helps us. We are designing a new product for the worst case. We get more affordable economies of scale.
Pinson: The components / child parts are very heavy and so shipping to far off places from the factory is difficult. In component manufacturing, each country is manufacturing for itself. Our primary focused markets are China and India. We are planning large expansion for India.
Q: What are the plans for India with regard to the gasoline and diesel engines, especially common rail diesel engines?
Pinson: As we are preparing appropriate technology for these engines we are also preparing for transition from BS II to BS IV standards. Between today and 2020 there will have to be a bridging standard and this will be an opportunity to do something faster.
Q: Tell us about your India operations.
Chadda: India operation is worth about Rs 190 crore today and there are about 450 people working in the plant. About 55 percent of the production is supplied in India and the balance is exported, mainly to Europe and Turkey. With the new investments we have lined up, and the new products we are launching, we are taking an aggressive position in India. In the next two to three years we hope to make an additional investment of about Rs 100 crore and with that the turnover is expected to go up to Rs 500 crore. The current installed capacity of 45,000 units and after the investment, the capacity is expected to more than double. The investment is also for backward integration; we are bringing in some manufacturing lines from elsewhere. The new products we are launching are from additional capacities.
Q: At present how many models or varieties of products you make in India?
Chadda: We make mono-block and the DB-4 and different varieties of mono-blocks injectors. We export specialised high technology components needed for the fuel injection pumps to the US. Some of the products are very capital-intensive. We localise them and produce them in India.
Q: What is the current localisation level and target?
Chadda: It is very difficult to say. Since our components are of high-technology, localisation is not easy. It depends on the product, may be, there will be around 40- 45 percent localisation. We have new programmes and the localisation and backward integration will increase.