ZF operates in India through 14 entities including one joint venture and 10 global engineering centres. Besides catering to the automotive market, the company supplies gearboxes for the wind turbine industry and forayed into construction equipment production.
Entry into passenger car segment:
The group officially inaugurated its Electric Park Brake (EPB) production line for its passenger car business at the Oragadam manufacturing facility in Tamil Nadu. It marks an expansion of its advanced braking footprint for passenger cars in India. The Oragadam multi-divisional facility is central to ZF’s India growth roadmap. Designed for scale, the new line has the capacity to manufacture 800,000 units annually at peak. ZF’s EPB systems are already being supplied to leading Indian OEMs and are integrated in most electric passenger vehicles. The EPB line, will reach 80-90 per cent localisation in the next 2 years from the current level of 40 per cent.
Betting big on India
“The passenger car market, especially SUVs, are growing. We are clear technology leaders in this segment in China, Europe and North America. Therefore, we think it’s now the right time to heavily invest in India,” said Dr. Peter Holdmann, Board of Management member at ZF and head of Division Chassis Solutions. He pointed to India being the new China (where it was 10-15 years ago).
Globally in passenger car market, only two markets India and China or Asia are growing. North America is a bit damp while Europe has not returned to pre-covid volumes. “Our challenge is that we have over capacities in Europe. But we need more capacities in India and China when compared to our headquarters. So that is the shift we are currently managing,” highlighted Holdmann.
In these six decades of operation, the company’s presence was quite fragmented but now it has undergone a major consolidation. In 2020, Wabco India Ltd became a part of ZF Group following a global acquisition and was renamed ZF Commercial Vehicle Control Systems India. Post Wabco’s acquisition, ZF sold its entire 59 per cent stake in Brakes India to its Indian joint venture partners in 2021. In 2021, ZF became a majority shareholder in Rane TRW Steering Systems, a joint venture from the Rane Group.
“Of course, earlier we have been a little bit fragmented with each of our businesses operating on their own. But over the last few years, we have put together our one ZF set up. And then after putting that, of course, we have put some good aims for ourselves for the future as well as collaborating with each other with a lot of synergies within our businesses and divisions,” Akash Passey, President, ZF Groupo India,” said Akash Passey, President, ZF Group India.
“For me, India is the most important region right now. A year ago, we inaugurated construction machinery production. We have started rail gearbox transmissions manufacturing and got our first orders. With the upcoming infrastructure programmes in India, I think we will see a major boost here,” said Andreas Moser, Member of the Board of Management for the Commercial Vehicle Solutions and Industrial Technology Divisions and the India Region.
“The company also has a system measuring the state of the wheels on the tracks and have also got the first order for that. This shows that India, in some areas, is ahead of advanced countries. When it comes to advanced mobility, I think step by step we will also see this region as a hub for engineering when it comes to electrification,” he pointed out.
In the commercial vehicle side, ZF India has 80 per cent market share in braking systems and it has good traction in gearbox for wind energy and also in construction equipment business. “Passenger car business is our largest business worldwide. In India, we are extremely focused on going ourselves in the segment. The key reason for that is that the Indian passenger car market is undergoing a change. Therefore, a lot of new technology items are coming with the government introducing new norms on the regulatory front,” Akash Passey highlighted.
The total investments made by ZF Group in India through both its wholly owned subsidiaries and joint venture entities is 200 euros over the past three years