TE Connectivity | Domestic Demand Driven By New Norms

TE Connectivity | Domestic Demand Driven By New Norms

TE Connectivity Ltd, a connectivity systems and solutions provider, is presently looking at diversifying within the automotive sector by developing new applications for more OEMs, as demand is being driven by safety, emission norms and content-based requirements. These requirements arise from upgrades being done to vehicles, said S Vishwanath, Director, Automotive, TE, who talked to us about various developments taking place in the industry and the company.

With the recent changes in the two-wheelers segment, be it in the introduction of new products, the changes in the applications of existing products, or the awareness of OEMs to the norms of quality and safety of products, TE has got the opportunity to develop more applications, and sees high potential in this sector. While catering to a large number of manufacturers, Bajaj and TVS are the biggest customers of the company, said Vishwanath.

As for the sale of products manufactured in India, about 50 % are consumed by the local market, and an equal part is exported, mainly to European countries like Germany, Poland, the Czech Republic and France. Only 20 % of products consumed in India are manufactured locally, while the rest are imported. Although the company produces parts for almost all OEMs in the country, it works extensively with Mahindra & Mahindra and Tata Motors.

PERFORMANCE, CHALLENGES & FUTURE

The company has a R&D facility in Bangalore with more than 100 engineers and a small team in Pune as well. Both these set-ups predominantly support TE’s European engineering organisations through a small delivery team that supports the Indian localisation plans.

Recently, the company launched a two-position sealed fuse box for anti-lock braking system (ABS) applications for two-wheelers, which is designed to withstand harsh outdoor environments, including water and dust. The fuse box is designed and manufactured locally by TE and is claimed to be one of the few sealed fuse boxes offered in the market. Talking of upcoming technologies, Vishwanath said the newest application that the company is working on is the substitution of copper with aluminium in cables, to achieve cost-efficiency and lower weight.

2_Position_fuse_box_TE_Aug13

A simpler yet similar example of such a product is the NanoMQS range of terminals and connectors. The range follows the philosophy of miniaturisation of components to reduce vehicle weight. The product range enables a reduced printed circuit board size for electronic components along with smaller wires and a reduced total connector package. The product is claimed to offer a reduction of up to 50 % terminal weight and up to 55 % housing weight and package reduction, compared to conventional solutions. The direct result of this is reduction of weight along with carbon emissions.

TE follows a different fiscal which begins from October, and output for the current fiscal is expected to grow about 10 % from last year. Some of the main contributors to growth are the sale of electronic equipments in the two-wheeler sector and sales driven by vehicles that receive upgraded electronic systems. Sales figures achieved by the company are directly related to the numbers of vehicles sold, as well as new trends in safety, emissions and infotainment systems.

The company plans to employ certain strategies to develop its business, beginning by working closely with global OEMs that are expanding their footprint in India. The second step is to produce parts according to the changing emission norms, and third is providing complete solutions of designing, manufacturing and offering lifetime support of parts, with localisation being the major criteria.

Shorter lifecycle of products in the country, meanwhile, poses a big challenge for the company. Deficit of raw material suppliers has forced the company to import raw materials, thereby adding to cost. There’s also the issue of local vendors not being able to bring out design elements into final products. Complex tax structures and fast increasing competition from global and local players, also adds to the challenges considerably, said Vishwanath.

The company primarily deals in electro-mechanical components in the passive state. It designs and manufactures parts for equipments that connect and protect the flow signal or power. While the company is broken down into four main segments – transportation, industrial, network, and consumer – transportation brings in more than 40 % of the total revenue.

Text : Naveen Arul