Vitesco Technologies – formerly the Continental
Powertrain Division – offers a range of products such as electronic controls,
sensors and actuators as well as solutions for exhaust after-treatment.
Besides, it aims to develop innovative, efficient electrification technologies
for all types of vehicle. In conversation with Rakesh Rao, Anurag Garg,
Managing Director & Country Head of Vitesco Technologies, India, discusses
the impact of COVID 19 on the auto industry, and the company’s plans for India.

COVID
19 has put a brake on auto sales in India. How did Vitesco prepare for this
challenge?

COVID has been a major challenge for all the
industries, not just in India, but globally. We have already seen almost three months
of lockdown period and now, people are really coming out of it. The
business is still not as usual, but at least we are trying to ramp up. Definitely,
it has brought in some concerns, but, at the same time, certain opportunities,
also. 

Being a global company has helped us in navigating
the situation (during lockdown as well as while resuming production) better as
we could adopt learnings from the other Vitesco units across the world.

How is the market scenario at
present?

We supply to two-wheeler and four-wheeler segments
of the industry. The demand is growing steadily since we re-opened on May 5.
Two-wheeler sector is ramping up production much faster than passenger cars. If
we compare May and June, volumes are definitely on an improving trend on a
month to month basis.

Are there indications that the demand
will rise further?

Yes. In passenger car, this month the industry
was operating at about 30 per cent of their overall capacity in a normal
situation. As the festival period arrives, we expect activity to pick-up and
further ramping up of capacity to a better level.

What
changes are you anticipating in the Indian auto industry due to COVID?

At present, companies are slowly ramping up
production because of various reasons like lack of demand, constrains on
supplier side, etc. The supply chain – starting from tier 1 to the last
link in the chain – is interlinked and everybody will have to work in sync to
ramp up production in tandem to the market requirement. So, the ramp up is
going to take a little longer. People who had gone back to their original
villages are already started coming back. These things are really going to
impact as far as the overall market is concerned. It is a new normal and
we will have to learn to live with this situation.

In the time to come, people will have less fear and
will start joining the work, which will definitely help the automotive industry
to ramp up faster.

Could you brief us about Vitesco’s new
greenfield project in Pune?

In January 2019, we had the ground-breaking
ceremony for the new state-of-the-art technology plant, which is spread over about
20-acre land. The production at the plant started this year.

At present, we are focusing on all BS VI related
products at this plant. Later, once the electrification starts, we will
definitely be supporting that business also from this location.

In electric vehicle segment, what is
Vitesco currently focusing on in India?

At present, we remain focused and committed to BS
VI product line from the new Pune plant. Parallelly, we will keep working on
the electrification because it is the future of mobility.

We will definitely start working on EV products once
the market stabilises post COVID 19 and electrification picks up.

In general,
governments across the world have become stringent on environment related
issues. What does this mean to Vitesco? 

As said earlier, we are mostly into products which
are required for all BS VI applications. While today we are talking about
BS VI, Real Driving Emissions (RDE) will become mandatory from April 2023. Corporate
Average Fuel Economy (CAFE) norms are also likely to be changed in 2028.

The overall restrictions will be going up, where in
the people will have to ensure real drive experience or average fuel consumption
(under CAFE norms) has to go down further. All our products will be able to
help the industry to meet all those legislation in time to come.

What are the emerging trends in auto
industry?

The focus right now is on BS VI. The
next focus will definitely be moving more towards electrification. Industry 4.0
is already in place. These are some of the trends, which we are focusing on.

What are the challenges before
electric vehicles industry?

Question is how fast we can do the localization. We
would really like to create supply chain that is more dependent on the local
suppliers than across the globe. And that would be one of the
challenges. India will go for phase-wise electrification of auto industry.
We are one of the largest producers for electric three-wheelers. The next cycle
in the chain is two wheelers, and then it will pick up in the passenger cars. So,
the next market that will definitely take a quantum jump towards electrification
is the two wheelers.

How do you see market going from
here?

The overall anticipation in the market is that
the global auto industry will take 3-4 years to reach the same volumes of
2019-20. In India, being a growing country, we should not take such a long
time to recover as we have the potential to grow much faster. But we really
need to wait to see how the market shapes up. But overall, considering the
trends in the last two months – again it is too early to say – the shared mobility
is going to fade for the time being because the people are not comfortable in
traveling in hired vehicles. So people will be really looking for more
independent travel arrangement either two-wheelers or passenger cars.

Once we are little stable, the fear factor is gone,
the overall market should start growing and the focus would be again more on
the two-wheelers and then on passenger cars.