Today automotive industry is going through many transformations like BS VI, fuel compliance, electric vehicles and so on. Amid this, primary focus is on making vehicles more environment-friendly and to reduce emissions. Among general trend of lightweight vehicles, preference over lighter components is set to increase. Thus, diversification in the existing business, export to the developed nations, coupled with focus over R&D initiatives will grow businesses. This article discusses new way ahead and current market scenario of the rubber components market.

Rubber components accounts to a small
share with the advent of plastic and engineered plastic components. Even though, rubber components are used in some critical function areas like belts, hoses and seals. Rubber can be easily molded into different shapes. The demand for rubber that comes from the automotive industry accounts for approximately 80 per cent of the world’s total rubber production.

Silicon rubber growth

Silicon rubber delivers the strength, resistance and performance. Automotive manufacturers rely heavily on the quality and performance of rubber materials and with increasing head present in the new vehicles, silicon rubber comes into its own, offering perfect solution.

Due to the temperature rise, there has been an increase in silicon usage in the new vehicles as ethylene propylene diene monomer (EPDM) gets replaced, due to its inferior temperature performance of maximum upto 140 degree C.

With extreme temperature resistance from -60 to 230 degree C and outstanding weathering
properties, silicone rubber can extend the service of automotive assemblies. Resistance to rain, wind, salt, abrasion, ultraviolet radiation and chemicals, makes silicon the material of choice in the automotive sector.

It is widely used in air bags, ignition cables, HT cables, grommets,
radiator seals, performance hoses, vibration dampening, spark plug boots, ventilation flaps.

Focussed export

Exports will be always beneficial to any Indian manufacturer to gain knowledge and understanding of the global economy and global trends. Some lucrative market for rubber components is still in Africa, South America and some of the Far East regions. These regions will be good market to export as the mass level adoption of passenger cars is yet to happen. Finished cars have been reaching this market from long. Due to availability of land and labours, automotive manufacturing is growing which shows opportunities.

Vipin Dixit, Director-Operations, Tirupati Engineered Products “Witnessing an annual turnover of RS 1.8 crore in 2016-17, we scaled up our business owing to better performance in 2017, expanded our product range of polymers like Nitrile (NBR), EPDM, Poly ACM, Silicon, HNBR, Viton and Neoprene (B-30). Our products are extensively used in automotive and electrical segments. Around 70 per cent of the rubber moulded parts we produce is consumed in India. “

“We have been able to create our foothold in both the domestic as well as the global market through our premium quality products. Our clients are spread all over the world including the major regions of Canada, Middle East, Italy, Mexico, Germany & Kenya. With quality being our main aim, we manufacture products in accordance with the international quality parameters and have received ISO 9001 certification,” adds Dixit.

Market today

To stay in the current market, which offers one of the highest growth rates among various industries, one of the most lucrative options open to the companies is to get into the business of manufacturing of moulded plastic components for the automobile industry. With the inherent advantage of being in a related field of operation, the companies can plan out this strategy with much confidence. Such a venture would be more profitable if it is jointly floated by collaborating with foreign component manufacturers.

Diversify into the field of other lightweight components for the automobile industry. Companies should explore the foreign market. It may be the case that
Indian manufacturers will always have an edge over the local manufacturers, owing to the low labour costs and better availability of raw material in the South East Asian
region. “Due to presence of almost all global automakers in India, exporters can have knowledge of their standards and can route their rubber components to other developing nations like us,” believes Rajnish Pahiuja, Director, Aarpee Rubbers.

The Indian business environment has changed radically in the last decade. There are greater opportunities and at the same time greater competition. With innumerable long-term opportunities available to the company, high growth seems easily achievable. However, the weaknesses of industries, if not overcome, may hinder its smooth growth towards the optimum level. In any situation, one can look at the threats or the opportunities it offers.

The Indian mindset often tends to see the threats first. But, the right approach would be to start looking towards the opportunities without losing sight of the threat.

N Srinivasan, President, Taylor Rubber, says, “In the last one year we have developed more than 150 new products of rubber, Pplastics and metal for automotive applications like trucks, commercial vehicles, LCV and for the oil exploration, solar and wind energy, electrical & electronic as well as consumer durable industries. Of all the above, automotive sector is much promising in the CV segment, especially due to the demand from the replacement market as commercial vehicles need huge rubber components.”

“Due to the recent amendments in the axle norms,
carrying capacity of the trucks have improved, which invites regular maintenance. Thus, CV will be our prime focus, while we are expecting that the automotive market will pick up slowly by Jan 2020. If passenger car market improves to just 5-10 per cent from the current level, it will see demand rise.”

He also believes that BS VI will open new opportunities from the
OEM perspective.

EV affects demand

With EV, the demand is set to come down. In an EV, rubber functionality is very limited as engineered plastics takes over such rubber components due to lighter weight. Apart from tyres, there are very less components inside an EV. But it will happen gradually.

As the EV’s begin to proliferate, rubber parts usage will change — the absence of many hydraulic systems reduces the need for many seals and hoses, and the lack of an exhaust
system eliminates the need for rubber muffler hangers.

On the positives, new developments in light weight components will help to keep business in the market with demand for your products.

Automotive sector is much promising in the CV segment, especially due to the demand from the replacement market as commercial vehicles need huge rubber components.”

N Srinivas, President, Taylor Rubber

“75 per cent of the global natural rubber production is used to make tyres”

Rubber components in the automotive industry have intrinsic significance. Their preference is when steel or plastic does not suffice the need of the function. Rubber components have higher applications in the internal combustion engine (ICE) vehicles across the globe and are preferred for noise reduction and flexibility features. Manav Kapur, Executive Director, Steelbird International talks about rubber components significance, its demand and its way ahead.

How significant are rubber components for
automotive industry?

We can say that the automotive industry is driving the rubber industry today. Tyres are major consumer of rubber; more than 75 per cent of the global natural rubber production is used to make automotive tyres. Other components that use rubber are such as air bags, wiper blades, seals, engine mounts, belts, hoses, etc.

Rubber is lighter than a lot of other materials such as steel but a bit heavier than plastic. So, it comes in between. Rubber is more durable, cheap and flexible material as compared to plastic, the other lighter material, and thus rubber is extensively used in automobiles.

Rubber is an important component as rubber can be mouled in any shape and is lighter and durable.

Tell us about how raw material availability has effect on the rubber component manufacturing.

It is easily available in India but the cost varies according to international market. The situation becomes difficult when it comes to passing the increased cost to the customers. Increasing cost of rubber, which has been an increase of around 23 per cent, since January 2019, and stagnant demand of tyres due to slowdown is complicating the situation further. Demand is weak in the replacement segment not only in India but also in the European market, and thus it becomes difficult to pass on any cost hike.

Tell us about your exports.

We export to countries such as Nepal, Sri Lanka, Bangladesh, Germany, Italy, Columbia, and Brazil. Our total export of rubber components is around 10 per cent of our total production.

What are key trends in the automotive rubber components today?

A lot of newer engineering materials are coming in. In EV the rubber consumption will come down as rubber components helps to reduce noise, vibration and harshness in a vehicle and EVs does not have all the three factors.