Valeo Motherson is looking at reefer trucks, EV bus market for growth
Changing its identity from Spheros Motherson to Valeo Motherson post the global acquisition of Spheros by Valeo, the bus air-conditioning specialist is looking at reefer truck market. The company is also working on air-con for electric buses. It is a part of the complete transformation the company is subjecting to. Valeo Motherson Thermal Commercial Vehicles Ltd, (VMTI), from being a 100% bus air-conditioning solutions supplier, is shifting gears to expand to other areas of commercial vehicle airconditioning.
The prime target is reefer trucks. To get a firm footing in the reefer truck market in India, which is estimated to touch 60,000 units, VMTI, according to Cyril Xavier, Chief Operating Officer, is leveraging the acquisition of Transfrig, a specialist in transport refrigeration equipment and services from South Africa.
Cyril said, “Valeo acquired Transfrig in October 2017. The company specialises in transport refrigeration equipment and services. We are banking on its technological prowess and knowhow to boost our transformation. We will carry out a market seeding activity by the second half of 2018 with 3 key variants for truck refrigeration.”
The 3 key variants that VMTI is planning to introduce, include a model that would be powered by the truck engine itself. The second product will be powered by a slave engine, and the third product will comprise of pipes to deep freeze the truck via Eutectic system for transporting frozen food, meat and chocolates, ice creams, and more. A performance study using a 12 and 24 ft. container is scheduled and would pave the way for VMTI to enter the reefer truck market. Clocking a revenue of Rs 1 billion in FY2017-18, VMTI, growing with a CAGR of 16%, is keen to see its revenues double by 2020. Experiencing a strong growth with the sale of 5000 mini and midi-bus air-cons on the back of the 14% growth clocked by the respective segments (they come under LCVs), VMTI is also working towards increasing its share of aftermarket business.
“From the current ratio of 60:40 for OEM and aftermarket, we are keen to increase our aftermarket business to achieve a 50:50 ratio,” he said. Conducting a value stream mapping exercise at its 30,000 sq. ft. facility at Noida, VMTI, to keep up with the pace of growth in bus air-con and reefer truck air-con demand, is drawing plans to expand. According to Cyril, the company will shift to bigger premises in 2019. 201 The new premise is expected to aid a the company to double and an triple the size of
To ensure uuninterrupted ggrowth, VMTI is aalso investing in ememployees. Terming them aas the strength of the compacompany, Cyril averred, “The new facilifacility will meet Valeo production, healthhea and safety norms.” DeveloDeveloping 14 air-con systems for appapplication across 3 bus segmentssegments, VMTI currently manufactures aair-cons in the 6 kW and 47 kW rangrange.
The bus air-con market in FY201718 was estimatedestimate to be 20,000 units. In the currentcur fiscal, the
market is expected to grow by 16% at 23200 units. Confident of gaining more ground in bus air-cons even as it looks at reefer trucks, VMTI is paying particular attention to quality and support. Of the firm opinion that support is what helps to retain a customer, he said that they have equipped the production lines with screens that provide assembly instructions as part of poka-yoke to avoid assembly errors. “It is impossible for the human being to remember all instructions in a flexible line on the same shop floor. The screens that provide instructions are helping us to eliminate errors even before they could crop up,” he said.
Introducing an upgraded version of its bus air-con model, CC350, in India with aluminium evaporator and condenser coils instead of copper to eliminate chances of premature failure, VMTI is paying close attention to market requirements in India. It wants to offer the best and the most reliable solutions. The replacement of copper coils with aluminium ones (including the inclusion of a multiflow aluminium condenser) has resulted in less moving parts (in the CC350), according to Cyril.
The 33 kW system is not suffering from any leakage issues as per the feedback received. The use of aluminium has also resulted in less use of refrigerant by up to 50%. Refrigerant recovery is 100%, and the weight of the system has also gone down by 30 kgs. Having supplied 90 units of CC355 bus air-con system (upgraded version of CC350) to TSRTC through Mahindra, VMTI is in discussion with various transport bodies to supply the same. These include APSRTC, MSRTC and GSRTC. The CC355 is expected to replenish or go into the new buses that will add to the fleet. Many transport organisations, are expanding their fleet, he said. Stating that the general practice in India is to convert a low horsepower chassis to an air-conditioned bus, Xavier expressed that this necessitates the mastering of art to deploy the compressor and power packs (slave engines to run the aircon). Sourcing Mitsubishi engines through a group company for the job, VMTI pays particular attention to how the slave engine and the
compressor are mounted. The brackets necessary to mount the slave engine and the compressor are made locally and were adapted for Indian application. By doing this, the company could save some costs. Of the opinion that it is essential to address customer requirements if one were to grow faster in India, Cyril said, “To gain the confidence of our customers, we have been conducting product performance testing in front of them. If it is a 25kW air-con, it has to be proven.” Introducing a test rig for air-con testing in 2015 with an investment of Rupees one and a half million, which certifies and authenticates every airconditioner that rolls out, VMTI has been able keep the OEMs happy. “Since we conduct tests in front of them, the OEMs are happy,” he said.
Aligning with Valeo’s culture of spending close to 12% of OE sales on innovation, VMTI is expanding its engineering capabilities in India. This is being done in-line with the plan to support Valeo’s endeavours in other markets across the globe. “Earlier there was only 1 designer. Now, there is a team of 8 people that specialise in different fields like fabrication, machining, mechanical, electrical, application, etc.,” informed Cyril. “That is how growth will come,” he opined. Catering to bus customers that are spread across the country, and thus amount to diverse geographies, VMTI is expanding its support network. Stating that a bus whose tender has been floated in Mumbai travels to Ratnagiri, and would require support throughout the route, Cyril mentioned, “We have 37 dealers across India, and are working to double them by 2020.”
Describing a bus as a sensitive product that demands instant decisions to keep it running, and to keep the travellers happy, he said that customer satisfaction is of utmost importance irrespective of the nature or cost of the products involved. “In view of this, we train our people every quarter in every region. We conduct customer meets. Our sales and service persons address their problems,” he added.
Working to introduce Controlled Area Network (CAN)-based air-con systems with the view that they will self- diagnose and collate data as the bus plies with a certain count of people and their luggage, Cyril mentioned that they are already receiving inquires for CANbased systems. “A lot of money is being spent on software,” he revealed. Of the opinion that CAN-based systems will become mandatory in India in the next 1-2 years, Cyril explained, “We are looking at offering CAN-based air-con systems as standard. The software-intensive nature of the product will require patch updates from time to time. To collect and analyse data in real time, we will have to dedicate a person or a team of people.”
Receiving inquires for electric bus air-conditioners as electromoblity picks up, VMTI is currently importing electric vehicle airconditioners. Of the view that ground support with dedicated sections is necessary to address the needs of electric vehicle air-conditioners, the company is looking at local assembly and manufacture of electric vehicle air-conditioners as their number grows. Certain global models like Revo E Global have already been adapted for India.
Work is on to develop an air-con for a 7-meter electric bus that will be launched by this year end. “We use R134a refrigerant for conventional air-conditioners. With electric vehicle air-cons, we could provide R407 refrigerant. The ability of this refrigerant to cool is very high. The efficiency is higher too. Much however depends on the success of electric buses; the implementation of fund allocation,” Cyril signed off.
Valeo Motherson will soon move to a new location from the current location at Noida
Cyril Xavier, COO, Valeo Motherson