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Georg Graf

Regional Representative

Freudenberg Regional Corporation Centre India

1 Rating

AUTOMOTIVE India offers huge market opportunities

May 21, 2019

…says Georg Graf, Regional Representative, Freudenberg Regional Corporation Centre India, in this interview with Juili Eklahare. He shares his thoughts on how the company strives for local production and how electro mobility is inevitable. Excerpts…

Can you share with us Freudenberg’s journey so far in India? What are the key growth drivers in India as well as globally?

Freudenberg is good at developing lasting solutions for its customers based on technology and values. The company has been serving Indian customers since 1920 and has 16 production sites in the country today, employing around 3,000 people. We have been growing at 20% annually in the last five years in India. We have never looked at India as an off-shore manufacturing base. We produce quality products and our objective in the country is long-term.

You have 7, out of your 11 global business groups, in India. You plan on bringing the remaining groups to India in the next 2 years. Could you tell us your strategy for this?

Our company supports more than 30 market segments with 1,000s of applications worldwide. It is a preferred supplier into the automotive market and 50% of the sales are associated with this vertical, globally. 45% or so of the share is OEMs and suppliers, & 5% is aftermarket business. But in India, it is more than 60% (from the automotive vertical). On the other hand, some key technologies and markets are not available in India as against the markets we see in other parts of the world. If one sees the contribution of the automotive market in India, it will grow faster than the rest of the world. So, the Freudenberg Group in India and Asia will be more focused on automotive than the rest of the world. Also, Freudenberg Medical is still not present in India with a local structure, which could be initiated in the coming years.

Why do you think that the Indian government’s vision to bring electric vehicles to India by 2030 is bound to not happen? What is Freudenberg’s vision for itself in the e-mobility market, if such is the case?

Our view is that electro mobility and autonomous driving will happen without a doubt. However, the question is how fast will this change take place? By 2030, a third of the vehicles would be electric, either plug-in hybrid or fully battery-driven. Our approach is to be ready and support our customers regardless of the powertrain they have. Besides hybrids, we will also support fuel cell technology.

Which are the markets that excite you right now?

India, with more than 600 million people under 25 years of age, offers huge market opportunities. We serve most industries in India, from automotive and energy & chemical to plant engineering and consumer markets. Our vision is to have one third of our business in Europe, Asia and Americas.

You once said in an interview last year that you want to be the best supplier in India, and India, as a part of Asia, will be a defined focus market for Freudenberg Group. How has this long-term goal worked out for Freudenberg? Can you also tell us about your further plans
for expansion in the country?

Globally, Freudenberg had undertaken a project which examined business opportunities for the company in 2050. The project findings, which are now being integrated in the strategy process, will culminate in long-term innovation initiatives. Besides, our upcoming plant in Chennai for seals will support the Indian market in the hub of Chennai. As we have production facilities in all the continents, we want to strive for local production to minimise risks, transportation, etc and to get the value chain into the country. We have already started some exports in our business groups in order to support Asian countries. In truth, some of our filtration products are also serving some export markets.

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