A comprehensive visit to the Freudenberg Chemical Specialities plant in Mysore, Karnataka in early August 2022 revealed the company’s futuristic, safe and innovative solutions for multiple industries with automotive at the forefront. Insightful interactions with Hitendra Bhargava, CEO and Regional Management Board Member Asia Pacific, Klüber Lubrication and Kanakaraju Thangavel, Chief Technical Officer, Freudenberg Chemical Specialities allowed Sarada Vishnubhatla to understand the company’s strict adherence to safety regulations, their keen interest in and aggressive plans for the aftermarket, but more importantly, how their leading lubricant brand, Klüber Lubrication is geared to offer future mobility solutions.
It is in their legacy. Freudenberg Chemical Specialities is wired to tailor-make innovative and futuristic speciality chemical products for many an industry around the world and in India too. Their manufacturing plant situated in Mysore, Karnataka is spread across 17000 square meters that houses their production and testing facilities, laboratories, warehouse for their popular brands – Klüber Lubrication India and sister brands, namely, Chem-Trend, Capol, SurTec and OKS.
The Freudenberg Group and the five brands are known worldwide for their oils, greases, waxes, pastes, bonded coatings, dry and solid lubricants, anti-corrosion products, hydraulic oils, cleaning and release agents, composites, and industrial parts cleaning and electroplating and more, for across a wide range of applications in different industries.
New-Age Solutions for New Mobility
With the concept of new mobility, especially EVs, taking the centre stage in the global and Indian contexts today, Freudenberg and its business divisions are standing tall with a bouquet of niche products on offer. And Klüber Lubrication dominates the market in terms of technology for EVs.
Hitendra Bhargava, CEO & Regional Management Board Member Asia Pacific, Klüber Lubrication shares the latest trends in the automotive industry: “We are one of the frontrunners to offer solutions when it comes to new mobility, especially the electric vehicles. India is growing at a fast pace in this direction especially with the central government giving a tremendous push for clean and green energy. Backed by our legacy, we have been an early entrant into the domain, and we are ready with a complete portfolio of electric vehicle solutions that can easily cater to a wide range of requirements.”
Kanakaraju Thangavel, Chief Technical Officer, Freudenberg Chemical Specialities says: “Our USP is that we have a product for every application in a vehicle – be it a conventional one or an EV. It is so because we know the kind of load that every touch point, and every joint in a vehicle bears. There are approximately 250 friction points in a conventional car which have varied tribological requirements and we have developed as many different products that are backed by our extensive tests and approval cycles.”
Talking about their unique applications for the EVs, Hitendra explains: “We have a long and strong legacy of developing greases and lubricants and we already have a full portfolio of next generation greases. For EVs, we have modified our existing portfolio to create an application specifically for the electric motor. Take something like our quiet grease which has been designed to give vehicles longevity and quiet operations in a vehicle.”
Kanakaraju adds: “Our quiet grease is a highly successful product around the world and across vehicle manufacturers. This only highlights the fact that our products are designed and hence are known to bestow longevity to the vehicles as we have an in-depth understanding of the load factors, and their purpose.”
Rigorous Standards of Sustainability
As a global company, Freudenberg and its brands adhere to the fact that unless a product passes through a particular clearance on development standards, it is not taken for further testing or development. The reason being their long-term strategy which is to continue to make sustainable products and solutions. Hence, the company follows the mandate of using only those raw materials which are sustainable.
Kanakaraju says: “We always opt for the raw materials which clear the standard score of 3.5 plus on a sustainability scale of 5. We ensure that the materials we use are friendly to human beings. These raw materials are compulsorily phased out at the end of their stipulated lifetime. The products that we cater to the automotive industry carry the valid certification of our development standards of sustainability.”
But there are numerous challenges in a cost-sensitive market such as India as against elsewhere in the world. Adhering to the stringent instructions is made in some countries, unlike in India, because they have active ‘phase out’ regulations in place.
He continues: “In India, as a responsible company, we adhere to our own sustainable practices whether or not these are made mandatory by the government. We believe in manufacturing products that are highly reliable and are sustainable, and offer longevity. We will never use any carcinogenic chemicals. We follow something called a phase out program for raw materials, which dictates that by a certain date we must phase out a certain raw material. This is but one among many strong sustainability ethics that we follow as a company policy.”
So, even if high standards of quality and sustainability put the company’s products in the premium range, their discerning customers understand that it is handsomely offset by the superlative quality, longevity and sustainability of the products.
Customization at Heart
Customers, everywhere, tend to constantly look at increasing their profitability while reducing costs and utilization of resources. Hence, customization becomes the mainstay for the company to cater to the local customers with specific requirements.
Hitendra shares: “We are big on customizing products to serve our customers because we believe in value-addition. When they have specific requirements, we have to make modifications to suit their needs. We take examples from our global case studies and try to tailor-make them for our customers here.”
Kanakaraju agrees: “Our customers come to us if they have a problem and we solve it for them. For example, we have recently developed a product for the steel market to counter grease hardening. The challenge was that as the temperature in the steel mill increases when the molten steel is worked on, the radiant heat hardens the grease. We have products that can work at 160 degrees Celsius or intermittently at 180 degrees also. But if the temperature is consistently above 200 degrees, hardened grease tends to jam the roller and the production line needs to be paused to sort it out. We studied the issue and developed a new product for them and brought their machine downtime to zero. Our client saved cost and resources in totality though they may pay more on grease per litre. Removing their pain points is important to us and the customers also understand the nuances of the issue.”
Driving Fast-Paced Growth
Contrary to popular belief, the peak of IC engines is yet to come globally – possibly by the year 2035, Hitendra feels. And India too is still heavily dependent on conventional fuels. In such a context, Freudenberg and its brands are looking at the aftermarket domain as one of the big drivers of growth. Currently, the company documents a single-digit share in this space but has aggressive plans to grow to a double-digit figure in the next three years or so.
In the last quarter of 2020, Klüber witnessed exceptional growth where the company matched the previous year’s figures. Then in 2021, the company was much ahead of competition in terms of recovery from the impact of the COVID pandemic while recording a jump of almost 70% in growth compared to 2020. And the current year looks even more promising than last year.
Hitendra speaks about the market share in the automotive domain that Klüber enjoys: “In the speciality lubricants designed for the automotive industry, we make a restricted number of lubricants and in that niche segment, we have a market share in India which is pegged at almost 20%.”
In the context of their foray into the aftermarket to increase market share, he adds: “Despite the work happening at a war footing, Indian road conditions are still such that our vehicles need to source high-quality lubricants from the aftermarket. This is but one growth area for us. Currently, we have almost 50% of the market share in greases. Our solutions are used across the board – be it in the CV segment or the passenger vehicles.”
Another potential growth area for the company is in applications such as the brake and the electrical systems, steering, and some areas of transmission and in this space, Klüber is a top contender in offering solutions. Hitendra calls these as the ‘low-hanging fruits’ and cites their plans to harvest them by becoming more aggressive in these product domains. The company is planning to make private labels for OEMs and build up their own brand as well in the aftermarket by creating a proper channel network to reach out to the mechanics and the workshop owners.
Data-driven Solutions
Today technology poses a unique challenge in business. It develops fast yet comes with limited life. So, adopting smart practices is the key to keeping ahead of the times.
Hitendra opines: “The most challenging issue today is that of fast changing technology. It means that business houses do not know any more if their investment in a particular technology will yield expected results and profitability in the expected timeline or if they will break-even at all.”
Digital proficiency, in such a context, can come to the rescue.
He explains the changing scenario: “Today, with faster digitalization, we need to cater to our customers’ needs quicker than ever. Interpersonal relationships are topped by digital proficiency and we provide our customers with it because only then we can offer our best solution that fits in with their needs.”
In totality, it is the consistent efforts in understanding the customer’s needs to be able to offer faster solutions based on data, besides developing new products and solutions using advanced technologies that forms the crux of the growth strategy for the Freudenberg Group. The Group and its winning brands are working tirelessly to consistently reduce wastage, and increase the life of the machines for their customers.
And that is something that can come only with a legacy of high capabilities.