Magna Optimistic About Indian Market’s Pockets Of Opportunity

Magna Optimistic About Indian Market’s Pockets Of Opportunity

Magna International Optimistic Indian Market Pockets Opportunity General Motors mobility technology company
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Notwithstanding the negative impact Magna International has had this year owing to the global automotive meltdown and a fairly long worker’s strike at General Motors – its largest customer in the US – the Indian business of the mobility technology company is in a fairly good shape

During the announcement of its third-quarter sales in November this year, the company informed that it has lowered its financial outlook for the current year, with an estimated revenue impact of $ 500 mn for 2019.

In one his recent visits to India, Auto Tech Review spoke to Deval Desai, Vice-President and Country Head, Magna India and Executive Director, Business Development, Magna International, for his perspective on the market, and opportunities for future growth.

INDIA POTENTIAL

Despite the current slowdown, Desai believes India continues to possess strong buying power, and with the median age of 25 years, there will continue to be demand for automobiles in the near-to-long term. For now, the focus is on “hunkering down, controlling what we can, and doing the right things”, said Desai.

Desai’s confidence on the India operations stems from the fact that the company has planned well for this market, and that it continues to find pockets of opportunity in an industry that is witnessing one of its deepest slowdowns in decades. Manufacturing was one of the key pillars in Magna’s India strategy – it has 12 manufacturing/ assembly units in India at present – but it has also been steadily growing its engineering capabilities in this market, which boasts of a strong engineering talent pool.

The company now has four engineering centres in India, including one for Magna Electronics in Pune. In less than a year, this engineering centre has grown to house 160 engineers, who work on advanced driver assistance systems (ADAS) and other electronics related programmes. Desai confirmed the centre will recruit more engineers this calendar year. The seat development team is now 210 engineers strong, and the exteriors team continues to grow promisingly as well.

There are two clear benefits from an engineering perspective, explained Desai – one, India produces good engineers with good basic computing skills, software writing skills and math skills. Secondly, Magna has ensured development continues 24/7 by using a time compression method – when an engineer in Troy goes home, he stores his work in the server for the Indian team to pick it up and take it forward.

In the current scenario, OEMs can sustain good sales only when they have frequent refreshes of its products. The ability to be able to refresh the exterior look or add more features more frequently helps them keep their products in sync with market expectations. So, when a 36-month product development cycle is to be completed in a 20-month time frame, time compression really makes a big difference, said Desai, who believes time compression would be a key tool in the future.

POCKETS OF OPPORTUNITIES

India’s quest to introduce stringent safety norms offers Magna interesting opportunities in the areas of auto-dimming mirrors and rear view cameras. Some of the solutions or technologies might be imported owing to relatively low volumes, but there is good opportunity to localise them, should OEMs decide to introduce such technologies in the market.

Desai spoke of the infinity mirror as an example. The infinity mirror essentially replaces the traditional bezel around the IRVM’s (inside rear view mirror) perimeter with a highly polished, precision-ground glass edge. Compared to a conventional mirror, the elimination of the bezel reduces forward obstruction by decreasing the overall mirror size by 24 %, while the buttons commonly located in mirror bezels are replaced with touchscreen style buttons on the glass surface.

The other solution Desai feels consumers in India certainly needs is the rear view camera, yet another solution that Magna supplies to Honda. Addressing blind zones is yet another pocket of opportunity for Desai. The camera mirror system (CMS), for example, is a concept that could catch the fancy of many OEMs in the near term. Earlier this year, Honda had announced that its ‘E’ electric vehicle will be fitted with cameras instead of door mirrors on every variant. Similar solutions can be found on the Audi E-Tron electric SUV (virtual door mirrors) as well as some Lexus models.

The challenge, however, is with the displays inside the cabin, said Desai. That’s an area that continues to be developed and explored. In the meantime, camera and mirror systems will continue to see a lot of changes. They will continue to get smaller, miniaturised, offer more fidelity, build more capability to see at night, try to mitigate dust & snow, and build further surround view capabilities.

ROUND-UP

In recent times, the company has been able to diversify and acquire new customers in the Indian market. Magna’s next big target is Maruti Suzuki and Desai confirmed they continue to have discussions with the country’s leading car manufacturer. In the meantime, it continues to build its engineering capabilities in the market with an objective of delivering solutions for the global automotive markets.

TEXT: Deepangshu Dev Sarmah