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Home arrow News arrow Auto component arrow Continental AG invests Rs. 100 Crores in new plant in India
Continental AG invests Rs. 100 Crores in new plant in India Print E-mail
Written by Anand   
Monday, 21 January 2008
Targets 60% CAGR in operations by 2012

New Delhi: Hanover-based Continental AG is looking to boost its India operations after their recent buyout of Siemens’ Automotive business. The recent acquisition of Siemens VDO by Continental AG for €11.4 billion has made Continental as the second largest auto component manufacturer in Europe (after Bosch) and 5th largest in the world. With the acquisition, the overall basket of offerings to the Indian customers has widened and the combined organization will enhance Continental’s ability to develop electronic solutions that improve vehicle performance.

€11.4 billion buyout of Siemens VDO ushers in new era
    * Invests Rs 100 crores for automotive electronics plant in Bangalore
    * Focus on ‘affordable cars’ in growing markets like India and China
    * Company now has 6 manufacturing facilities and 3 R&D centres

 With an initial investment of Rs.100 Crores (17.5 Million Euros), the upcoming automotive electronics plant in Bangalore is one of the major investments for the new Continental in India. The new state-of-the-art manufacturing setup will also house an R&D centre. The Joint Venture facilities with Rico and Ashok Leyland will also attract fresh investments in the coming years.

“In the next decade one of the main focuses of the automotive industry will be the so-called affordable cars, especially in the growth markets like India and China. The production of cars with a in price range of Rs. 5 Lakh (approx. 9000 Euros) will increase from current figure of 650.000 to approx 1.1 Million units by 2017.This is 70 percent increase. To cope with this demand we have to focus on solutions for the Indian market, people want safe, yet affordable cars”, said Dr. Karl-Thomas Neumann, Chief Technology Officer and Board Member of Continental AG. “Continental has developed strategies and products that are suited to these demands”, said Dr. Neumann.

Continental aims to translate their extensive expertise in vehicle technology into low cost, affordable components and systems that are tailored to the Indian market. Their engineers in India are working on solutions that are optimized for our Indian market. “Localization also significantly reduces development and production costs and reduces the response time”, said Dr. Markus Distelhoff, Managing Director, Continental Automotive Systems, India.

With the Indian emission norms and safety legislations getting stricter the automotives of tomorrow will have more and more electronics built into them. To address this, the automotive products out of Powertrain, Interior and Chassis & Safety portfolio as well as out of ContiTech division (being the worldwide market leader in non tire rubber products) will have an increased share of value addition in the vehicle. Dr. Markus Distelhoff said, “We expect our products such as diesel/gasoline injections systems, immobilizers, electronic control units for body electronics, steering and airbags, brake systems, instrument clusters and radios to contribute to our growth in India in the near future”. Since Indian market is also of interest to the ContiTech division, both as a manufacturing location and as a market for its products, Continental has stepped up involvement in that market this year. ContiTech is currently producing in Kolkata and Delhi.

Through the current R&D facilities in Bangalore, Continental off-shores a lot of development work for its other locations in Europe and NAFTA. Besides engineering capacities, testing and validation services will also be provided from these development centers.

The new Continental AG in India now commands a significant share of the Indian automotive supplies market, with 6 manufacturing facilities and 3 R&D centres.
The company is targeting 60% compounded annual growth rate in its India business by 2012.

Rs. 100 Crores (17.5 Million Euros)

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