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Innovation assuming greater importance

Innovation assuming greater importance

A global phenomenon, innovation in the automotive industry is increasingly finding its way to India

The visibility of Ford’s new EcoSport is growing on Indian roads. Unknown to many, India played a crucial role in the development of EcoSport apart from the Latin American markets where the first generation EcoSport was born out of the Fusion. With presence in India dating back to 1996 when Ford entered the market in collaboration with Mahindra & Mahindra to manufacture the Escort, Ford has had good success with the Figo small car in recent times.

Keen to commission the new plant at Sanand in Gujarat, Ford has hinted at turning its Indian operations into a global production base for small cars. Sources in the Indian auto industry claim that Ford’s global production restructuring plan places greater responsibility on India rather than its bases in Europe and other parts of the world. They also draw attention towards the development of new small car platform codenamed B562 by Ford. This platform will spawn no less than three new models – a small hatchback, a sub-4 metre sedan and a midsize compact sedan. The launch plan is said to be set for the next two to three years.


Having sponsored 2 lifetime chairs at the IITs, Chennai and Delhi, at an investment of Rs 95 lakh, for R&D in automotive environment and safety, the company is expected to increase its R&D thrust in India over time.

If the depreciation of Indian Rupee has suddenly turned the auto components industry into a lucrative sourcing destination the world over, automakers are warming up to the thought of designing a vehicle from the ground up for the Indian consumer, and then add features for consumers in the developed world. Tuned to global endeavours, automakers are slowly shifting their focus to Indian with the view of driving R&D activities.

For instance, though sold only in India, the Eon was developed through a collaborative effort of engineers from South Korea and Hyundai’s R&D Centre in Hyderabad. Set up with an investment of Rs 184 crore, the 200,000 sq.ft R&D Centre is working towards further accelerating local content development and enable Hyundai to respond even more quickly to changing customer needs across the world. The R&D Centre will further facilitate the development of India as Hyundai’s global hub for manufacturing and engineering of small cars. General Motors has retained full
control of its Bangalore R&D operations despite selling 50 per cent stake in its marketing and sales operations to its Chinese partner, Shanghai Automotive Industry Corporation, underlining the importance of activities carried out by the Indian centre.

Bold enough to set up a design centre at Mumbai, Renault, it is claimed, entrusted the task of designing the Pulse to it. Last month, on the eve of the world premiere of Datsun Go, Mr Carlso Ghosn, CEO and Chairman, Renault Nissan, announced that Renault-Nissan Alliance is developing all-new vehicles to meet the specific demands of new car buyers in the world’s fastest growing economies. The announcement marks the first all-new program developed ground-up by Renault SAS and Nissan Motor Company, teams working side by side from inception. If this reflects the fact that automakers are turning to India for innovation, the program, internally named CMF-A, covers the most affordable category of cars in the Common Module Family, Renault-Nissan’s unique modular system of vehicle architecture.

The CMF approach, defining vehicles as five essential modules: the engine bay, cockpit, front underbody, rear underbody and electrical/electronic architecture, includes compatible parts that can be assembled into hundreds of possible configurations, for maximum efficiency and brand differentiation. Production of vehicles within the CMF-A scope will begin in 2015 at the Renault-Nissan Alliance plant in Chennai. Renault and Nissan will reveal additional details, including pricing details and product volume, closer to the start of production.

Tata Group, having spent around US $2 billion on R&D in fiscal 2013 while introducing and implementing 1,305 innovative ideas across its 70 companies worldwide, was one of the few commercial vehicle manufacturers to introduce a light commercial vehicle in the form of Ace a few years ago. It later went on to launch an even smaller and lighter commercial vehicle called the Ace Zip. A first-of-its kind front-cabin micro truck, the Ace Zip embodies two innovations enabling it to optimally serve its cost conscious customers. It has an integrated monocoque body structure combining the frame, cab and load body with independently suspended axles against the conventional chassis frame and load body construction. This has reduced its weight by 24 kg, improving its fuel efficiency. It incorporates a new process of sub-assembling of the engine to ensure that the drive shaft angle conformed to tolerance limits compatible with its monocoque structure. This innovation eliminated the issues faced in the prototype versions of the Zip.


Yet another company that is investing in India is Daimler AG. The German auto major commissioned its R&D centre, Mercedes-Benz Research and Development India (MBRDI), at Bangalore recently. With 1,200 employees, MBRDI is the largest Daimler research and development centre outside Germany. Figuring high in the company’s global research and development (R&D) plan, MBRDI is engaged in substantial R&D work relating to cars in India. It will also include a R&D team for trucks. Not just automakers, more and more global corporations are making a beeline to establish engineering research outfits in India. The reason for setting up offshore engineering R&D centres called captives denotes the availability of talent at relatively low cost, and a deepening of relationship between India and advanced market regions of US, Europe, Japan, etc., in the technology space. If the trend makes more sense with Rupee devaluation, what makes it even more interesting is its reciprocative nature. The increased interest in India as a destination for captives is happening alongside a rising Indian technology presence the world over. A relatively less known company based out of Mumbai has been catering to the engineering design requirements of many world auto majors including Ford, M&M, and John Deere. Also catering to tier suppliers like the TACO Group, this company specialises in IT and engineering design services with design centres in the UK and US. Indian companies such as Infosys and Tata Consultancy Services are making inroads in newer markets of the world, even as automotive component suppliers like Varroc acquire business verticals of well-established players like Visteon. Others like RSB Transmissions, which acquired business in USA some time back, have struck technology sharing agreements with those operating in the advanced markets of Europe and USA.

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