German automotive supplier Continental AG’s ContiTech arm will be focusing on its industrial segment in India, noted Chief Executive Officer of ContiTech Groupe, Phillip Nelles, during a visit to Kolkata.

Speaking to Motoring Trends exclusively, Nelles said, “ContiTech is doubling down on industrial applications, seizing opportunities amid India's multi-billion-dollar infrastructure and energy investments. With sweeping transformations underway, the company aims to cement its position as a leader in material-driven solutions. Our strategy is to focus on industrial sectors such as commercial vehicles, railways, construction and construction machinery, where we can deliver the highest impact.”

Picking up the sentiment, Hannes Friederichsen, Head of BA Industrial Solutions APAC, Continental AG, said, “We specialises in rubber, thermoplastic materials and rubber-metal bonded components, ensuring system-critical reliability for industrial clients. If a conveyor belt fails, it’s not just an inconvenience – it’s a system-critical disruption. That’s where we add real value.” 

The parent company recently announced plans to spin off its automotive division and Contitech’s OESL. While industrial applications remain the core focus, the company acknowledges that the automotive sector operates on a different business model, requiring a distinct strategic approach.

In focus

ContiTech's core industries in India include mining, ports, energy, cement, highway vehicles, heavy trucks and construction machinery. Additionally, the company has a plant in Pune for its surface solutions vertical, producing foils and surfaces for vehicle interiors and living environments. Having already established a strong presence in Europe and the Americas, the company is now investing in APAC, with India playing a central role in its regional strategy. 

The company operates a conveyor belt plant in Kalyani and another facility in Sonipat for power transmission belts and air springs. While specific investment figures were not disclosed, ContiTech plans to expand operations in both Sonipat and Kalyani, potentially diversifying the product portfolio in these locations.

“We’ve been laying the groundwork for major investments and are now scaling up with an expanded product portfolio and localised operations. In the commercial vehicle segment, we are focusing on air springs for trucks, trailers and buses, driven by increasing demand for comfort and tyre wear reduction. Additionally, we are exploring rubber-metal bonding systems for heavy-duty applications. The Pune facility remains a key part of this growth strategy, supporting increasing production volumes,” said Friederichsen.

The company is also eyeing opportunities in the motorcycle segment, particularly in seat coverings. As it expands, it plans to bring advanced technologies from its European and US operations into India, focusing on design, functionality and sustainability. 

“Sustainability is a growing priority, and we have the expertise to integrate recycled materials into our products. We’re also enhancing functionality with features like embedded buttons and translucent surfaces for interactive displays while ensuring that vehicle interiors reflect modern design trends,” noted Nelles.  

The company’s future innovations span beyond the cockpit, extending to seating, interior coverings and mid-arm components.

Another area of expansion is predictive maintenance services, aimed at identifying early warning signs for component replacement or repair. This initiative is expected to significantly reduce downtime and operational costs for industrial customers.

Additionally, ContiTech is actively involved in air springs for high-speed trains and metros. With India’s rapid rail infrastructure development, ContiTech is transferring its expertise to support high-speed and metro train projects.

Smart surface solutions

ContiTech is adapting its smart surface solutions portfolio for the Indian market. Commenting on the same, Friederichsen said, “Leveraging our material expertise, advanced design capabilities and expertise in living solutions, we're empowering our customers to design the car interior of the future. This includes the development of functional surfaces that bring the comfort and aesthetics of home interiors to future car interiors. Moreover, we're committed to sustainability, as evident from our first carbon-neutral product, XPRESHN - Carbon Neutral. We've also developed a comprehensive sustainability toolbox for our PVC products, catering to the diverse needs of our customers. Last year, we launched our Benova Eco Protect Line, a testament to our dedication to reducing environmental footprint.”

“In the commercial vehicle segment, our easy-to-clean surfaces, equipped with the staynu technology, are designed to enhance the well-being of truck drivers. By providing attractive cabin solutions, we are contributing to a better driving experience. In the Asia-Pacific region, we are observing a strong preference for translucent materials and super soft materials. We're well positioned to cater to these requirements, with a broad range of products that are generating significant interest among our customers,” he added. 

Alluding to the significance of his visit to Kolkata, he noted, “We have been in the Indian market for many years and we are constantly scanning the market to identify opportunities to grow. Kalyani plant remains in focus for us to expand Indian operations, and as we follow the principle of ‘in the market, for the market’, we are evaluating opportunities of extending our local product portfolio too.”

The Indian automotive components industry, which is a critical partner for the domestic as well as the global automotive industry is expected to grow by 8-10 percent in FY2026 according to ICRA.

The estimates are based on the company’s assessment of about 46 auto ancillaries with aggregate annual revenue of over INR 3,000 billion in FY2024, which accounted for about 50 percent of the industry.

For FY2025, the industry is expected to report 7-9 percent growth, with operating margines to be around 11-12 percent for FY2025 and FY2026. The confidence comes on the back of the industry benefitting from operating leverage, higher content per vehicle and value addition while remaining vulnerable to any significant unfavourable movements in commodity prices and foreign exchange rates.

The study stated that the ‘disruption along the Red Sea route has resulted in a surge in ocean freight rates by 2-3 times in CY2024 compared to CY2023. Any further sharp and sustained increase in ocean freight rates could also have a bearing on margins for auto component suppliers having significant exports/imports.’

In FY2026, ICRA estimates that the auto component sector will pump in INR 250-350 billion investment towards enhancing capacity, localisation/capability development and new technologies (including EVs) among others.

The big opportunity in EV segment can be seen on the fact that at present only 30-40 percent of the supply chain in India is localised, which includes traction motors, control units and BMS. On the other hand, EV battery cells that make up for almost 30-40 percent of an EV cost continues to be imported.

Vinutaa S, Vice President and Sector Head – Corporate Ratings, ICRA, said: "The domestic auto component industry is in a transitory phase with the automotive players increasingly focusing on sustainability, innovation and global competitiveness. Demand from domestic original equipment manufacturers (OEMs), which constitutes over half of the industry revenues, is estimated to grow by 7-9 percent in FY2025 and 8-10 percent in FY2026. Part of the growth would stem from premiumisation of components and higher value addition. Growth in replacement demand is pegged at 5-7 percent in FY2025 and 7-9 percent in FY2026, driven by increase in vehicle parc, higher average age of vehicles/used car purchases, preventive maintenance and growth in organised spare parts, among other reasons.”

“Exports, which account for close to 30 percent of the industry’s revenues, are likely to be impacted by subdued vehicle registration growth in the target markets. However, factors like rising supplies to new platforms because of vendor diversification initiatives by global OEMs/Tier-Is and higher value addition, partly stemming from increase in outsourcing, augur well for Indian auto component suppliers.”

Metal Castings & Forgings

ICRA finds that Indian component suppliers in the metal castings and forgings also have a bigger opportunity on the back of plants closure in European Union on the back of viability issues.

The report stated that ‘ageing of vehicles and sale of more used vehicles in global markets would aid in exports for the replacement segment. The impact of any import tariffs on Indian auto component exports remains monitorable.’

In the medium-to-long term, premiumisation, localisation, EVs and stringent regulatory norms continue to offer tailwind for the Indian automotive industry.

“ICRA’s interaction with large auto component suppliers indicates that the industry is estimated to spend INR 150-200 billion in FY2025 and another INR 250-300 billion in FY2026. The incremental investments would be made towards new products, product development for committed platforms and development of advanced technology and EV components, apart from capex for capacity enhancements and upcoming regulatory changes. R&D, though, is still at an average of 1-3 percent of operating income, significantly lower than the global counterparts. ICRA expects auto ancillaries’ capex to hover around 7-8 percent of operating income over the medium term, with the PLI scheme also contributing to incremental capex towards advanced technology and EV components,” he concluded.

Representational Image courtesy: Ronaldo Galeano/Pexels 

German automotive parts supplier Mahle has won its first series order for a new, high-performance cooling module in the megawatt charging sector.

The module will be used in fast-charging stations for e-commercial vehicles, which typically are installed on service stations on and off-highways. They can operate in varied temperatures and can generate waste heat of up to 8 kilowatts (kW). Rapid-charging for e-CVs capacities of up to 3.75 megawatts (MW) per charging station are now possible.

Mahle said a European cable manufacturer customer and outfitter of megawatt charging systems (MCS) particularly rated the performance and cost efficiency of the cooling module as crucial factors in placing the order.

“With this innovative cooling module, Mahle is expanding its product portfolio for intelligent charging solutions and setting new standards in the charging infrastructure for electric trucks and electric heavy-duty vehicles,” said Christian Kuechlin, Vice-President Mahle Industrial Thermal Systems.

The series production for the cooling module will start by end-2025 at Mahle’s facility in Namestovo, Slovakia.

The company explained that the modular cooling module can also be used in fast-charging systems for passenger cars and light commercial vehicles, in maritime applications or for rail vehicles. The cooling module can be adapted to the installation space of different charging stations and can operate in temperatures ranging from -35 degrees Celsius to +50 degrees Celsius.

Tier 1 supplier Uno Minda has further strengthened its lighting business with onboarding Todd Morgan as the Global Head of Lighting Technologies and Innovation.

Morgan comes with over three decades of experience in the automotive lighting industry. He has held various manufacturing and product development roles, and till recently he was the Chief Technology & Innovation Officer at Lumax DK Jain Group.

In his past roles, he has worked with Ford Motor Co, Visteon and Varroc, working across geographies including USA, Japan, France and the Czech Republic.

The appointment comes at a time, when Uno Minda Group is looking to expand its product offerings in the automotive space, especially banking on the PACE (personalisation, autonomous, connected and electric) megatrend.

German technology company Continental has announced that around 3,000 research & development (R&D) jobs worldwide are set to be impacted by end-2026. The move is part of the company’s continued optimisation drive for its global R&D network locations, which also focusses on streamlining processes that enable accelerated adaptation to customer needs.

Philipp von Hirschheydt, member of the Continental Executive Board and head of the Automotive group sector, said, “Offering forward-looking technology is critical to our business. We will continue to invest substantially in research and development for new products and systems. At the same time, we are continuously improving our competitive strengths in the interest of our sustainable market success. As a result, we will ensure our R&D team is one of the most efficient in the world market and secure attractive jobs for the long term.”

One of the factors, which seems to have influenced the move is the automotive slowdown being witnessed in several markets including Germany.

Continental stated that in response to shifting customer demand and the need for greater operational efficiency, it is implementing a series of targeted measures across its business segments, subsidiaries and global locations. The idea is to optimise capacity, enhance the effectiveness of its R&D network and improve overall processes.

In Germany, the primary impact of these measures will be felt at the Babenhausen site, where approximately 12 percent of employees are expected to be affected, and in Frankfurt, where around 5 percent of positions are involved. Additional, albeit smaller-scale, efficiency adjustments are planned for locations in Ingolstadt, Regensburg and Schwalbach.

Furthermore, company's subsidiaries, Elektrobit and Continental Engineering Services, will also undergo restructuring. Elektrobit is set to reduce 480 jobs globally, with approximately 330 of those in Germany. Similarly, Continental Engineering Services will be affected by workforce adjustments impacting 420 positions worldwide, including around 330 in Germany. As part of a broader global location strategy, the company also plans to exit its Nuremberg site.

At present, Continental’s Automotive sector employs around 92,000 people, including 31,000 in R&D as of 31 December 2024.

The German company has shared that the reduction will be done through planned measures as socially responsible as possible. A significant part of the R&D workforce optimisation efforts will be by not positions that become vacant due to natural attrition.

Image for representational purpose only.