‘Innovation in the automotive sector key to defying downturn’

Batteries are very expensive, yes, but other components, such as wiring harness also become two times the cost of a normal wiring harness.

By:February 13, 2020 5:25 PM

At the Auto Expo Components 2020, ANAND Group has announced two collaborations. One is with Mazaro, a Belgium based company for the development of transmission without Gears or Belts, enables automobiles to transmit power more efficiently to the wheels – either Internal Combustion Engines or Electric Power Trains, by replacing the gearbox. The technology has the potential to reduce consumption of energy in ICE and EVs by up to 18%. The second tie-up is with Far-UK for the development of carbon fibre composites that are aimed at making vehicles lighter by 50 per cent while at the same time maintaining the required structural strength. On the sidelines of the same, Express Drives had a detailed interaction with Sunil Kaul, Group President, Innovation & Technology and Excellence in Manufacturing, Anand Group. Following are the edited excerpts.

Apart from a battery pack, what other components involved in electric vehicle manufacturing are playing a part in increasing the prices of the end product?

When we talk about electric vehicles, the electric motors are also not very cheap. Even wiring harnesses are quite expensive. Right now, leaving two-wheelers and three-wheelers aside, the moment you go to a four-wheeler that offers a reasonable range, the voltages go-beyond 300, one has to decide what type of wiring harness you need in order to ensure safety. Batteries are very expensive, yes, but other components, such as wiring harness also become two times the cost of a normal wiring harness. Also, connectors will also become more expensive, because you are talking about high-voltages and there are lot of electronic components which are there which are increasing the voltage, reducing the voltage, converting the voltages as well as currents. But the battery per se is very expensive. Somewhere it is $50 per kWh somewhere it is even $100-$120 per kWh

How was the festive season 2019?

It has been a very difficult time for the auto component industry. For some of the companies, the turnover has gone down by 20 per cent in the last year. The Indian economy is not used to it. We never, in the past, had our top-line going down, especially in the car segment. Even during the 2008 slowdown, the passenger car segment was doing a reasonable 5-10 per cent growth. So this shift, all of a sudden, it has caught us on the wrong foot. We are used to inflationary market. We build in cost to the next year. We have to give increment. In addition to this, the rent goes up. So, we have inflation going up, but the sales are going doing. How do we manage this then? The current situation is forcing us to look at the complete structure of the organization. So that the fixed costs are lower so that you manage lower sales. Last year has been bad, this year doesn’t look to be any good. In January, we saw no growth. Even February and March, does look anything great. As a result of this, there is always this scepticism, will it further go down. So, we are not seeing any scope of going up, only worried that is should not further go down. If it still stays stable, at least, you will be able to put some more efforts and cross the water.

How is the current situation when it comes to jobs?

Well, if we talk about Anand, we are not hiring. We have never worked on a contractual model, we have a different model, an OE model. So we didn’t have to let go of people. We have a model which has a little bit of attrition in-built. At the moment, all intention is that we stop hiring. And I think, this will continue because we are not seeing any upward trend.

Is new innovation the way forward in these challenging times?

The new tie-ups that we are talking about, the one with Mazaro and Far-UK, are pure innovation. If you look at these two products, that we will be developing under these tie-ups, before this we have never ventured into this territory. Today the market has opened up for innovation. If I was to bring these products 10 years back, I would have been doubtful and these products might not have been accepted by the customer. But today’s environment is of accepting new things of innovation. Hence, I have more courage to bring them at this time in the market.

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