Federal-Mogul | Investments Plans Unchanged Despite Market Slowdown

Federal-Mogul | Investments Plans Unchanged Despite Market Slowdown


Federal-Mogul Sanjeev K Singh ATR Mar14Federal-Mogul SGPNaidu ATR Mar14Federal-Mogul Vinod Kumar Hans ATR Mar14

The slowdown in the automotive industry has resulted in most companies changing investment plans and research and development (R&D) budgets, or even completely freezing investments. But diversified global supplier Federal-Mogul says it has kept its investments plans on track and will continue to address technological and innovation challenges as it did in the years before.

The company is investing mainly on technology upgrades and to some level on capacity enhancement as well, said Andreas Kolf, Vice President and Managing Director, Federal-Mogul India. He said the profitability and income of Federal-Mogul have fallen during this period, but the company sees this just as a dip in the economy. However, Kolf remains optimistic, and said the company expects this downturn to end soon, with growth being seen before 2015.

Federal-Mogul is in fact using this slow period to further stabilise the organisation by launching new programmes, like pistons for Ford and research of coating technologies for piston rings. The main reason for carrying on investments in new technology and products during this slowdown is to be ready when the market gets back on track, Kolf said.

Aftermarket Range Expansion

Federal-Mogul's aftermarket division has recently been adding on to its entire portfolio of the braking product line. The company launched an expanded range of Ferodo HCV Linings for the aftermarket. With the extension of the product range, the company now covers about 90 % of the HCV segment requirements for brake linings, said Sanjeev K Singh, Director, Aftermarket India, Federal-Mogul.

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The brake lining is made from non-asbestos material, in line with the aim of producing greener, cleaner and safer products. Special formulations developed at Federal-Mogul global R&D facilities are part of the product in order to cater to the Indian conditions. These Ferodo HCV Linings are presently being manufactured at the company's new Greenfield facility in Chennai. The company has also re-launched Ferodo brake pads, which are now available across all segments of cars in India. The company also recently introduced brake fluids with added features, as part of its aftermarket line-up.

OEM Products, Technologies & R&D

Founded in Detroit in 1899, Federal-Mogul launched its seventh and newest product line in India recently, covering sealing and gaskets, with localisation activities looking to be employed soon, said Vinod Kumar Hans, Director, Sales India, Federal-Mogul. The company is undertaking R&D work on technologies within this product line. Development work is also being undertaken for new lead-free bearings that offer low wear and high load capabilities, pistons with mono-steel designs and corona ignition technology, Hans said. However, all these technologies are a bit ahead of what is currently employed in the Indian automotive industry, but is being developed by Federal-Mogul in case a need arises for them.

The company has a technological centre in Bangalore, which is globally networked to all other tech centres of Federal-Mogul, said SGP Naidu, Director, Application and Engineering, Federal-Mogul India. This tech centre undertakes all activities of design, analysis and simulation, specifically concerning pistons and rings, thereby enabling Federal-Mogul to develop its own products locally. Federal-Mogul's focus, while developing components, is in offering reduction in the consumption of oil, as well as lower friction, Naidu said.

The company set-up an R&D laboratory in Bhiwadi, Rajasthan last year, which has capabilities of testing and homologation of formulation for new materials. The company's global tech centres also play a supportive and collaborative role in developing products. An example of this is the brake linings mentioned earlier, whose formulation and materials were predominantly developed at Shanghai, keeping in mind the specific requirements of Indian conditions.

Challenges While Developing Products

Federal-Mogul attributes the task of keeping costs down as its biggest challenge while developing products. The task of merging low-cost requirements with the usage of appropriate materials for products, keeping in mind the local road and driving conditions is another major challenge. Developing a new resin-based material instead of asbestos for brake linings is an example of a recent product development that faced a number of challenges, the company said. The move to make all bearings produced by the company lead-free is also something it has worked on, in order to conform to global requirements.

Another challenge that the company faces is with regards to alternate fuels like compressed natural gas (CNG) becoming popular. These engines require a lot of changes in components, and need the company to either re-develop or sometimes completely develop new formulations, Hans said. Requirements like these make the company work to provide newer solutions to customers and also keep the environment clean.

Text: Naveen Arul