The International Automotive Components (IAC) Group made its foray into the Indian market in 2008, roughly two years after the company was built from the former global interiors divisions of Lear and Collins & Aikman in 2006. Clearly, India was right at the top of IAC's global agenda from the word go.
Seven years since then, the company has made significant inroads into vehicle programmes for manufacturers across segments, and counts India as a market with the most solid fundamentals for future growth. The market may have been subdued for the last couple of years, but the signs of revival are visible, said Gajanan Gandhe, Executive Director India and VP South Asia / Africa, IAC in a recent interaction in Mumbai. For IAC, and for that matter any other company that wishes to grow in India, the trick is in being patient, he said.
Most of IAC's customers in India have been doing well, despite the economic challenges of the last few years. Its newest plant in Chakan, which was inaugurated in 2014, is nearing capacity utilisation and the company is contemplating further expansion to accommodate new programmes. Its second plant in Chakan and the two plants in Manesar are catering to good volume demand, thanks to the popularity of the SUV range from Mahindra, and the success of Maruti's Ciaz and S-Cross models. The CV segment though has been quiet for long, and Gandhe hopes the turnaround isn't too far.
A Tier I supplier of door & trim systems, instrument panels, consoles & cockpits, flooring & acoustic systems, headliner & overhead systems, and interior & exterior components, IAC is present in over 100 locations in 22 countries, and is the largest automotive interiors components and systems supplier in the world. It has been growing at a frantic pace globally, with its sales growing over 10-fold in the past seven years to $ 5.9 bn in 2014. Although this is largely a result of acquisitions the company has done in North America, Europe and Asia, IAC's growth has also come through substantial investments in innovation and technology development.
The biggest concerns for the industry as well as consumers today are either driven by consumer requirements or by regulations, said Gandhe. And hence, a lot of focus is on developing solutions to address safety, comfort, aesthetics and lightweighting.
In fact, most of IAC's products are developed with an objective to save weight for its customers, Gandhe said. One of the key changes that have become quite standard world over is replacement of metal with plastic. A lot of metal structures behind the dashboard, for instance, are being replaced by plastic structures. And so are metal structures behind door panels. On the other hand, components used to cut down NVH (noise, vibration and harshness) add a significant amount of weight to the vehicle, whether they be the car pads or the acoustics components behind the hood. IAC has developed technologies that allow for reduction of up to 60 % of the weight of such components.
Beyond plastics and composite materials, IAC has in its portfolio products made using natural fibres such as Jute. Interior linings for commercial vehicles, for instance, have been made using jute, making them substantially lighter than many polypropylene woodstock-based products. The only additional component that these require, Gandhe pointed out, is some sort of fabric or vinyl covering to protect an occupant's feet from the coarseness of natural fibres.
To cater to the ever-growing demands of weight reduction and efficiency, IAC has also developed a hybrid technology, combining natural fibre and injection-moulded plastics. "Natural fibre products are compression-moulded, which means you're unable to integrate attachments into them. Attachments are required to be glued or welded to the part. In the technology we've developed, the part can be compression-moulded, which is then put into an injection moulding tool, and the attachments are injection-moulded on the back side," explained Gandhe. The hybrid technology is yet to be introduced in India, but Gandhe said this might find acceptance in areas such as pillar trims and doors.
IAC's technical centre in Pune makes a substantial contribution to the company's India business. The centre undertakes the complete designing and engineering work of IAC's products for India. In addition, it also supports the global engineering requirement for North America, Europe and Japan, primarily in the areas of design, finite element analysis (FEA), computer-aided engineering (CAE) and geometrical dimensioning, among others. The centre also uses some of its human resources to work on basic R&D for both the Indian and overseas markets.
Gandhe is very optimistic about IAC's future in India, but refused to give us any growth projections. India today is like the China of the late 90s or early 2000s, he said. "The thumb rule is to maintain a good business in India at this stage, and the future will be good," he concluded.
Text: Deepangshu Dev Sarmah