Haldex India, a joint venture between Swedish firm Haldex AB and India’s Anand Group, has been offering a range of products for commercial vehicles including the Swedish brand’s globally-acclaimed automatic slack adjusters, manual slack adjusters, valves for different applications and braking systems, among other technology. The company is going through a strong growth phase and has envisioned the development of new products such as air dryer, brake chambers and actuators for applications specific to the Indian market.
In an exclusive interview to MOTORINDIA, Mr. Binu Sivanathan, V.P & C.O.O. Haldex India Pvt Ltd. opens up about the company’s current business, opportunities for new product and technology introduction amid growing CV segment landscape in the country.
Excerpts:
“We have envisioned the development of new products such as air dryer, brake chambers and actuators for the Indian market,” Mr. Binu Sivanathan, V.P. & C.O.O., Haldex India Pvt. Ltd.
In an exclusive interview to MOTORINDIA, Mr. Binu Sivanathan, V.P. & C.O.O., Haldex India Pvt. Ltd., discusses the current business and the opportunities for new products and technology amid the growing CV landscape in India.
How has the journey been for Haldex in India?
Binu Sivanathan: Haldex India is among the country’s leading manufacturers of vehicle automatic slack adjusters and manual slack adjusters. Started in 1997-1998, it is a joint venture between Haldex AB of Sweden, the world’s leading manufacturer of auto slack adjusters, and the Anand Group. Today we have two state-of-the-art manufacturing facilities equipped with the latest high-tech machinery, catering to both domestic and foreign markets. We produce automatic brake adjusters for all commercial vehicle applications as well as ConSep (condenser-cum-oil separators – electric and pneumatic), a product for pre-cleaning compressed air and ‘ADV’ (automotive drain valves) for domestic as well as global markets. Haldex India was the first to install EBS with roll-over stability for trailers in India.
Could you please elaborate on the ‘ConSep’ product you mentioned?
Binu Sivanathan: ConSep offers the fleet operator, a viable solution to the contamination of the air brake systems through oil, dirt and water carryover from the compressor, which inevitably causes failure to valve and brake system component. The simple design of ConSep allows for easy installation by either OEM or fleets looking to retrofit a solution to their current vehicles. Whilst all vehicles are now provided with the installation of an air drier to alleviate some of the problems associated with poor air quality, (namely, water condensation and oil being thrown by wearing compressors), these driers require the additional ongoing cost of replacing desiccant cartridges.
ConSep removes up to 90 per cent of any water content, removes oil and dirt components and does not require any cartridge replacement. Using ConSep as an additional precleaning device will help increase the useful life of air dryer cartridge and downstream valves considerably. We produce around 120,000 units of ConSep every year. It is exported to North America, Brazil and Europe. It has not become a significant product in India yet. However, we were quite successful in convincing some fleet operators about it, thanks to which BEST is using ConSep on 100 per cent of their buses for the last six years. Even VRL is using our ConSep. We feel ours is an efficient product with a premium price, and slowly and steadily we will gain the market size.
What is the strategy you have adopted to grow in the Indian market?
Binu Sivanathan: As part of strategic planning, Haldex India decided to expand our product range by designing and producing parts in India with the active participation of our European and US colleagues. The prime focus was to design products with superior quality, additional features and integration of different functions. We must give superior products at best cost. In April 2014, we started the R&D Centre in Pune, and the ideas was to become like a system supplier without compressor. Four products are identified as the first step of our expansion.
The first product is ILAS-MS (Integrated Lift Axle System for Mechanical Suspended vehicles), commercial production of which is expected later this year or early next year. In the traditional lift axle control system there are different functions involved like pressure limiting, load sensing, lift axle control, relay valves, pressure switch, etc. Haldex is integrating everything in one unit. The best product available in India today consists of three different units. Our solution with one integrated unit will reduce weight. It will also reduce the cost and requirement of piping and other anchoring brackets. It is an Indian innovation supported by German engineering. The product is useful in countries where mechanical suspension is predominant. Hence we have identified potential business opportunities also in Korea and Brazil. The first and foremost focus is India.
The goal of opening and R&D division in India was to develop product for the Indian market with integration of functions and additional features which will resolve the existing problem areas. We should concentrate on future innovations so that we don’t get pushed for price. While doing so we must maintain the global quality of Haldex. Although it is difficult to keep the price low, our intention will be to provide best products costwise. We brought in the services of Erehwon, a consulting company, to the Anand Group to institutionalize the innovation process.
So, what did you identify after the services from Erehwon?
Binu Sivanathan: The products we identified and then prototyped are air dryer, brake chambers and actuators. These products are some of the airbrake parts for which Haldex has leadership in some parts of the world. Also they draw significant business volumes both in OEM as well as aftermarket. Our air processing unit has been named ‘AirTrec’, which is designed on the modular concept with functions like pre-cleaning, temperature reduction, distribution with pressure limiting function, governor controls, system purge and multi-layer cartridge.
Our ambition is to bring double diaphragm actuators against the traditional piston type actuator in India. Double diaphragm is prominent in North America where Haldex is the market leader. The advantage of double diaphram actuators is their longer life with less moving parts. We are also prototyping some different functions into brake actuators. For brake chambers, we are working on special features when used on lift axle vehicles. All new products being developed by Haldex India will have a targeted slat spray life of 480 hrs. We are also preparing for installation of disc brakes in India, so when the truck market is ready for that we want to be there.
To get some stats, how much of your business comes from the domestic market versus the export market?
Binu Sivanathan: As of today, Haldex India is roughly 55-60 per cent domestic and 40 per cent is export. In both cases we have plans to grow. We are exporting mainly ‘ConSep’ to Europe and North America and some volumes to Korea and Brazil. We also do some manual brake adjustors for aftermarket requirement in Europe and some components for our own company.
Going forward, where do you see your focus as between trucks and trailers?
Binu Sivanathan: As a company, we are very strong in trailers, but unfortunately the trailer industry in India is not using the latest technology available. It is also because the trailer industry is not big. Having said that, given the infrastructure growth and projects expected, we see growth. Even the ABS legislation will soon come to cover trailers, it was implemented and then put on hold. Hence on the trailer front, we are getting ready for the ABS launch in India. We already sold close to 800 EBS with stability control in India. IOCL, BPCL and HPCL together evaluating the possibility of retrofitting 20K trailers with EBS, and Haldex is one of the potential suppliers for this. So, we are there and ready for a trailer boom in India.
For the rigid trucks, we are acquiring expertise and the Pune R&D centre will help us build those capabilities. We have established an application and engineering development facility in India and commenced development of new products such as integrated lift axle systems, air processing unit, brake actuator & brake chamber for the Indian market applications. We have created facilities for design, prototyping and validation in Pune. Production still happens at Nashik. Most of the products that we manufacture here are localized, with roughly 10-12 per cent import content. Certain items like rubber items are imported.
Coming back to products for buses, do you also work with other STUs or private bus operators? Do you have solutions in the aftermarket for private players?
Binu Sivanathan: We are working on it. After BEST we have managed to penetrate around 37 per cent in MSRTC. We are also pushing for some more private players. Remember in 2007, the automatic brake adjustor became mandatory for new vehicles. However, general aftermarket is still run on manual brake adjusters. STUs and some private fleet owners understood the benefit of ABAs and switched over to it 100%. General aftermarket, people have been observed to go for manual adjusters instead of automatics. The cost is one reason, and the other is lack of education at the end user level. We are now educating end users with the help of OEMs at their dealerships and independently also in the aftermarket. The last few millimeters of stopping distance is what saves life & property. Fleet operators also will gain from less tyre wear. Today 10 per cent of our business comes from the aftermarket.
What’s the status of Truck ABS?
Binu Sivanathan: We have Truck ABS available in our global product portfolio. It was known as Tk+ sold in China and Brazil. Indian OEMs were demanding a lower price. Currently we are not supplying Truck / Bus ABS in India due to the price issue. However the product is available and can be supplied to customers who are willing to pay a little higher price.
Would you be able to share your financials?
Binu Sivanathan: We have done Rs. 102 crores in CY 16 and we are making a Budget for about Rs. 110 crores for 17-18. We have a project ambition to reach around Rs. 167 crores by 2021, including exports.
Any other area where you are not present currently but are looking to explore?
Binu Sivanathan: We are looking at agricultural tractors. Over sometimes, there will be possibility of air over hydraulic brakes. We are selling this in North America and Europe. When the bigger agricultural tractors will come here that is something we are looking at. There is also potential for the mining segment and we have sharpened our focus on it too. Globally for the mining segment our strength is dryer cartridges and brake chambers.