Auto firms embark on innovation drive

The ongoing global recession is prompting automobile companies to look for innovative ways to manage costs.

Not just negotiating long-term contracts for commodities, original equipment manufacturers (OEMs) are now working with component suppliers to achieve substantial cost reductions without having to compromise on either vehicle performance or safety.

In fact, in some instances, vehicle performance — specifically fuel efficiency — has actually improved because of these innovations.
A leading vehicle lighting supplier has begun work on reducing costs for one of the largest selling passenger cars in India — the Maruti Alto. The supplier has been asked to incorporate a technological innovation in Alto’s suspension which makes sure that the beam platform of the car is not affected by vehicle load.

This very innovation has been used for the first time in the Tata Nano and it seems Maruti is now trying to replicate this system in the Alto to reduce costs.

A Maruti spokesperson denied any plans to launch a “stripped down” version of the Alto next year even as some suppliers confirmed that the company has asked them to study cost innovations done for the Nano and try to offer similar benefits in terms of cost and vehicle performance.

A leading engineered plastics maker is in talks with Maruti to convert metal air intake manifolds to plastic. 

“This device is needed to supply the engine with air and we are in talks with Maruti for several car models where this application can be made by using engineered plastic instead of metal. In the soon-to-be launched ‘Splash’ car, Maruti has agreed to use a lot of engineered plastics.”

Tata Motors, meanwhile, is looking for conversion of various pulleys used in its cars from metal to plastic. Substitution of metal parts by plastic not only reduces the overall weight of the vehicle but also brings in significant fuel and carbon di-oxide emission efficiencies.

Then, a large parts supplier for two-wheelers has already reduced the number of components which go into making a starter motor assembly, besides achieving about 5% cost reduction in making electronic dashboards for the Bajaj Pulsar motorcycle.

“Having invested so much effort and skill in achieving such large cost efficiencies, we are now negotiating with Bajaj Auto for keeping at least 50% of the cost reduction achieved in such projects for ourselves,” this supplier said.

Even for the commercial vehicle segment, where sales are yet to get back on track despite several government sponsored stimulus packages, drastic cost reduction measures are being discussed.

For the ambitious ‘Tata World Truck’ project, a Mumbai-based clutch supplier has convinced the OEM to source the clutch assembly from India instead of importing it from its joint venture in South Korea - at half the cost! This supplier has already begun making these clutch assemblies at its domestic unit.

In the end, both the suppliers as well as OEMs are looking to meet increasing input costs through continuous design and process innovation.