India set to become top automotive R&D hub

Discussion in 'Economy & Infrastructure' started by janme, Jan 31, 2014.

  1. janme

    janme Regular Member

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    January 30, 2014:
    India has become an R&D hotbed and in keeping with the global R&D trend of last year, the country is now a preferred destination for automotive R&D, according to a study on the Global Top 500 R&D spenders done by Zinnov, a globalisation advisory and market expansion firm.

    “With strong potential for growth in areas such as engineering analytics and significant talent located in the ‘Deccan Triangle’ region – encompassing Pune, Bangalore and Hyderabad – India is poised to become an auto R&D hub,” the study observed.


    Increasing headcount
    In particular, the automotive sector with its focus on creating differentiated offerings for global markets and appetite for investment, is an attractive industry. However, while cost arbitrage continues to be a key driver for R&D globalisation, there is a pressing need for Indian MNC R&D companies to take on big technology bets to drive innovation from here, according to Zinnov.

    The study says that close to 50 per cent of the G500 companies present have over 10 per cent of the global R&D headcount in India.
    Zinnov announced the results of the study on the Global Top 500 R&D spenders, showing the Automotive industry’s leadership across sectors in R&D spend in 2013. It said that the Auto industry spent $110 billion globally last year, the highest among the Top 500 R&D spenders in the world.

    Further, the automotive industry was also among the top three spenders in each region, across North America, Europe, APAC and Japan, with the total spend in the sector rising by 5 per cent over the previous year.

    Who’s in, who’s out
    India's position is highlighted by the fact that 874 MNCs have set up 1,031 centres and 45 per cent of the top 500 global R&D spenders have a presence here.

    Of the auto R&D centres located in India, the highest – 26 – are headquartered in the EU. In fact, BMW is the only automotive company among the Top 50 R&D spenders that hasn’t yet entered India for R&D. And, out of the 26 companies whose global R&D spend has increased by over 20 per cent during the last year. In fact, in the last five years, the automotive companies have shown growth leading to R&D intensity of almost of 6-7 per cent.


    Tracking growth nations
    The released Zinnov study brings to light that within the automotive sector, Japan contributed to 40 per cent, followed by 37 per cent from Europe, 13 per cent from North America and 12 per cent from the Asia Pacific region. Volkswagen was the highest R&D spender demonstrating a 32 per cent increase over last year. Bosch increased its spend by 14 per cent.

    Interestingly, the number of auto R&D centres India has 30 and In comparison, the Bay Area in the US has 20.
    According to the report, the Top 500 R&D spenders contribute over USD 577 billion with the Top 100 R&D spenders alone contributing almost 66 per cent to the global R&D spend. 40 per cent of the overall R&D spend is from organisations headquartered in North America, followed by 34 per cent from Europe, 18 per cent from Japan, and 7 per cent from Asia-Pacific.

    India set to become top automotive R&D hub | Business Line
     
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  3. arnabmit

    arnabmit Homo Communis Indus Senior Member

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  4. sesha_maruthi27

    sesha_maruthi27 Senior Member Senior Member

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    Thatha asthu... means may your wish become reality...
     
  5. tarunraju

    tarunraju Moderator Moderator

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    First they should get their heads together and develop/promote indigenous engines and powertrain systems.

    For example, Tata Motors screwed up big time in this department. Tata's indigenously developed 1.4-litre CR4 diesel engine is a fine kit. It puts out 70 PS of power and offers up to 26 kmpl on the company's Indigo eCS sedan. The same engine was offered on Vista initially, but pushed aside (relegated to base models and phased out), in favor of Fiat JTD 1.3L SDE. This one puts out 75 PS, but comes with a terrible 21.5 kmpl average on the Vista hatchback. CR4 obviously offers a great power-efficiency tradeoff. Yet every Vista or Manza you buy, you're buying a Fiat engine, and throwing some coins into Italian coffers. The Fiat JTD monopoly spans across several car manufacturers operating in the Indian market (Tata, Maruti, Chevrolet, Ford, etc). Likewise, M&M, which buys its engines from Renault. Both Tata and M&M have made their own engines for decades. Develop and promote local engines you fools!
     
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  6. janme

    janme Regular Member

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    Auto makers like Ford, Renault turn to India for sourcing engines

    [​IMG]
    India, a major base for exporting small cars, is becoming a preferred hub for some global auto makers to develop and source compact engines. ​
    ​
    MUMBAI: India, a major base for exporting small cars, is becoming a preferred hub for some global auto makers to develop and source compact engines.

    Ford Motor Co, which exports its Figo small car and EcoSport compact sport-utility vehicle from India, plans to source a new generation of small-capacity petrol engines, called Dragon, from its local unit.
    ​
    Renault SA's research unit in Chennai is developing a 986 cubic centimetre petrol engine, codenamed B4D, in collaboration with the French auto maker's facilities in Brazil and Europe. The B4D will be an enhanced version of a 0.8-litre engine that Renault would use in a car it plans to launch in 2015-16. ​

    [​IMG]

    While Ford plans to use India as a base for manufacturing the engines, its French rival is relying on the capability of its Indian research and development base. Both are trying to gain from India's low-budget capabilities.

    Auto makers are looking at frugal technologies because of changing customer preference towards lower-priced vehicles. Though sales have been hit by a slowdown in the economy, India is a major market for auto companies who are building new capacities here, especially to manufacture small cars that account for most of the local sales. For these companies, leveraging the manufacturing capacity in India to meet export demand helps keep costs low.

    "The cost advantage of India over other markets remains strong, and it (manufacturing in India) is a good 30% more cost effective than a matured base of Europe," said Deepesh Rathore, director of EMMAAA, an automotive research and advisory firm specialising in emerging markets. "There are competent suppliers in India. With volumes getting larger, it is natural for companies to source key modules of cars like engines and transmission from this country."


    Ford's Dragon range of engines is likely to be ready by 2016-17, and the US company plans to produce 1.5 million units of the 1.2- and 1.5-litre engines a year globally, a person with knowledge of the matter said. India would be the main supplier with 4 lakh engines a year, and Ford's proposed plant in Gujarat's Sanand would be the lead producer, this person said. "Besides India, the Dragon engine will also be made in China, Europe, Brazil and Russia," the person added.

    "We don't comment on speculations related to future programmes or product strategies," a Ford India spokeswoman said in an email response to a request for comment.

    Ford has an engine-production capacity of 3.4 lakh units at Chennai and it exports 40% of this output. Once the Sanand plant goes on stream by mid 2015, its capacity will go up to more than 6.1 lakh engines. At Renault, it isn't clear yet whether India will become the main production hub for the new engine. While the Indian R&D facility will play a key development role, the company is still exploring manufacturing bases such as Brazil and Europe apart from India for the best-cost sourcing, people close to the company said.

    Renault refused to provide any details. "As company policy, we don't comment on any project development not formally announced by Renault," a spokeswoman said.

    Source:- Auto makers like Ford, Renault turn to India for sourcing engines - The Economic Times
     
  7. tarunraju

    tarunraju Moderator Moderator

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    They're just 'turning' to Fiat JTD, Volkswagen TDI, and Renault K9D manufactured in India (yet designed and R&D'd abroad). Engines like Tata CR4 are truly Indian in design and manufacturing.
     
    Last edited: Feb 1, 2014
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  8. janme

    janme Regular Member

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