AVL is the world’s largest independent company for development, simulation and testing in the automotive industry and in other sectors. As a global technology leader, AVL provides concepts, solutions and methodologies in the fields of e-mobility ADAS and autonomous driving, vehicle integration, digitalisation, virtualisation, big data and much more.

In an interview with Sharad P Matade, Urs Gerspach, Executive Vice President of Test Systems and Global Operations, Instrumentation and Test Systems at AVL, shares his thoughts on the growth enablers and the company’s capabilities to cater to a wide range of demand in the automotive testing business.

What is the impact of the Covid pandemic on AVL’s testing business?

There is an impact, no doubt about it. The effect was much stronger last year; the customers constantly postponed their decisions about the orders of lab projects. However, this year, we are seeing a sudden improvement in the situation. In the first quarter of this year, we received massive orders of over 180 test systems for battery test labs. The situation is improving very fast, and the investments are being released by the OEMs. Until last year, the trends were not clear. Now we see a fast and strong growth of the passenger car industry towards electrification business. We are also witnessing the growing focus on fuel cells in the commercial truck segment. AVL is very well on track regarding its turnover and our margins for this year.

What is the reason for the increased demand of battery test labs?

In the past, many OEMs bought their battery cells from cell manufacturers like Panasonic, LG, CATL etc. and used these third party cells to build their own batteries. Several passenger car OEMs changed their strategy and decided to develop their own battery cells. Increased range, reduced charging time and lower costs are important key factors to convince customers to buy electric cars. Not just the development of the battery, but the combination of Battery, Inverter, E-Motor and Charging Infrastructure is important to develop a successful electric car. For this development, you need new test equipment such as battery cell cyclers, conditioning systems, climate chambers, automation and lab management software. The entire car is tested on High Voltage Powertrain Test Beds and Chassis Dynos where AVL has been the market leader for many years.

Europe is gearing up for Euro-7. What is it? How will it influence the testing business?

EU-7 will set stricter limits for CO2 and particle emissions. We expect PM10 (particulate matter with a size of 10 μm) will be introduced for Euro-7 and we have therefore developed measurement systems which can measure PM10.

It is also important to measure the CO2 emissions of combustion engines as precisely as possible. It is not just about compliance with environmental standards, but also about fuel consumption. We also deliver Portable Emission Measurement (PEM) systems for measuring emissions in real-time conditions on the street. While driving the car under real conditions, you might not execute a certified test run under predefined environmental conditions, therefore, other emissions will occur that need to be measured and analysed. AVL offers a wide range of in-vehicle measurement systems and software to determine what is actually coming out of the exhaust - in real driving conditions.

But there will also be a focus on non-exhaust emissions, particularly brake dust. Electric vehicles don’t emit exhaust emissions, but there is still brake and tyre dust. We have developed entire test systems to test real brakes under real-time conditions.

What would be the significant growth drivers in the traditional combustion engine business for AVL testing divisions?

As mentioned, the Euro-7 regulation will be one of the main drivers for AVL in the future. Besides all the other technologies like ADAS, every engine will be partly electrified either as a pure Hybrid, Plug In- or mild Hybrid. The technology of an Integrated Combustion Engine (ICE) can also be used to run with pure hydrogen. AVL is developing several engines for various customers that convert existing ICE technologies in new concepts.

We are also working on measurement technologies for synthetic fuel. AVL is working closely with Formula One teams as they will soon run their engines with synthetic fuels.

AVL has played a significant role in the development of the diesel engine in Europe. However, many OEMs are talking about discontinuing diesel engine vehicles in the near future. Do you see this as a challenge?

This trend will not have a great impact on our testing division. It will have a larger influence on the powertrain development division for diesel engines. If you take a look at the share of electrified cars in Europe - especially in Germany - they only account for 10 percent of the total vehicles; the remaining share of cars are still powered by combustion engines.

The combustion engine will still remain relevant for a while. However, increasingly in the form of a hybrid powertrain. AVL is therefore converting existing test beds for the car manufacturers so that they can be used to test hybrid vehicles. There are several customers who request pure electrical test benches. Some of our customers come to us with the requirement to completely convert existing combustion engine test fields to electrification test systems.

Between electric vehicles and hybrid vehicles, which one holds more promise in India in the near term and the long term?

I believe, in countries where the electricity network is not yet fully developed, hybrid cars will provide more flexibility, combining the possibility to run with fuel for an overland trip and electrified within the city.

In India, two-wheelers might have a faster increase in electrification similar to the development in China. ICE engines might keep dominating for a while, especially for the commercial vehicle. The introduction of pure battery electric vehicles mainly depends on how fast India is able to provide the necessary high-voltage charging infrastructure.

What about the AVL Tech Centre in India?

Our Tech Centre in India is one of our strongest Competence Centre for turnkey projects. AVL India is a very strong and reliable partner when it comes to planning of entire test fields including plant facilities. In the field of Powertrain Development, our India Tech Centre focuses on all three technologies – ICE, electrification and hybridisation – equally in all segments. AVL is an engineering company assisting customers with all types of mobility technologies. We recently got one of the first orders for fuel cell test systems from an Indian customer. So there is something exciting happening in our Tech Centre in India.

What about the revenues? How much does your testing division contribute to the whole company?

In 2020, the company generated a turnover of EUR 1.7 billion, of which 12 percent was invested in R&D activities. The testing division contributes with around 50 percent of the turnover.

What are the challenges in the business?

One of the biggest challenges is definitely to cover the growing bandwidth of technologies. A couple of years ago, we were only talking about ICE vehicles. Today, we are talking about ICE vehicles, hybrid vehicles, electric vehicles, batteries, ADAS and autonomous driving, digitalisation, cybersecurity and big data. AVL has built comprehensive competences to accelerate the vision of smart and connected mobility.

If you are an engineer, you have a wide range of technologies to specialise in. So one of the challenges is to find the right engineers to work on these different technologies.

What is the latest on safety by AVL?

One of the issues that is yet to gain the industry’s attention is fire safety in electric vehicles. AVL has been associated with fire marshals in Europe. Fire brigades realised an increase in accidents with Battery Electric Vehicles (BEV). Not only accidents but also burning BEVs in parking garages are a big challenge. These vehicles are very difficult to extinguish due to the chemistry of the lithium-ion battery.

AVL has developed a firefighting system which can extinguish a lithium-ion battery fire on the testbed or for fire brigade usage. It is a unique patented system that runs on liquids such as water or gases like nitrogen to extinguish battery fires. We conducted a couple of test series with hybrid batteries. A burning battery with 18 metres of flame height and temperatures of up to 1,500 degrees Celsius could be extinguished in one minute. (MT)

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French automotive major Renault Group has appointed Francois Provost as the new CEO of Renault S.A. and Chairman of Renault s.a.s., effective 31 July, for a term of four years. The move is part of the recommendation of the Renault Group Board of Directors, under the chairmanship of Jean-Dominique Senard.

Provost earlier held the position of Chief Procurement, Partnerships and Public Affairs Officer and comes with over two decades of experience within the Renault Group. The company stated he has strong international experience in both operational and strategic roles, an in-depth understanding of the sector’s challenges.

In his new role, he will be responsible to continue and accelerate the development of Renault Group, particularly internationally. Through partnerships, capitalise on its strategic agility and maintain high performance standards, in full respect of the company’s values.

Jean-Dominique Senard, said, "I am confident that François Provost will lead the Group with discernment and determination in an environment that demands both rigor in execution, strategic vision, and the ability to innovate. In this rapidly changing industry, his determination and sense of responsibility will be true assets to guide the teams and sustain our momentum. At Renault Group, there is no place for the status quo. Thanks to his expertise and knowledge of the company, we will be able to complete the implementation of our strategic plan, finalise the terms of the next one, and ensure its successful execution. I sincerely look forward to working with him. I would also like to warmly thank Duncan Minto for serving as interim during these past few days."

Francois Provost, said, “It is with pride and gratitude that I welcome my appointment. I would like to warmly thank my President, Jean-Dominique Senard, and the Board of Directors for the trust they have placed in me. I have a special thought for the teams across the Group who have supported me throughout these past 23 years. I will dedicate all my energy and passion to contributing – alongside our 100,000 employees, our dealers, suppliers and partners – to the development of our Group, one of the flagships of French industry for the past 127 years. Renault Group benefits from strong fundamentals, with committed teams, an outstanding range of products, strong brands, and an innovative organisational model. These will be invaluable assets as we accelerate our transformation in an increasingly demanding environment for our industry. You can count on my commitment and determination to write the next page of our history together.”

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In what may come as no surprise, United States President Donald Trump has announced 25 percent tariff and additional penalty for goods imported from India starting 1 August 2025.

The announcement was made by Trump on social media platform ‘Truth Social’, wherein he stated that ‘While India is our friend, we have, over the years, done relatively little business with them because their Tariffs are far too high, among the highest in the World, and they have the most strenuous and obnoxious non-monetary Trade Barriers of any Country. Also, they have always bought a vast majority of their military equipment from Russia, and are Russia’s largest buyer of ENERGY, along with China, at a time when everyone wants Russia to STOP THE KILLING IN UKRAINE — ALL THINGS NOT GOOD! INDIA WILL THEREFORE BE PAYING A TARIFF OF 25%, PLUS A PENALTY FOR THE ABOVE, STARTING ON AUGUST FIRST. THANK YOU FOR YOUR ATTENTION TO THIS MATTER. MAGA!’

Over the last few months, India has been trying to work with the United States government to reach a trade deal, but no concrete deal has been finalised as of yet.

Reacting to the announcement, the Indian government stated, ‘The government has taken note of a statement by the US President on bilateral trade.  The government is studying its implications. India and the US have been engaged in negotiations on concluding a fair, balanced and mutually beneficial bilateral trade agreement over the last few months. We remain committed to that objective. The government attaches the utmost importance to protecting and promoting the welfare of our farmers, entrepreneurs, and MSMEs. The government will take all steps necessary to secure our national interest, as has been the case with other trade agreements including the latest Comprehensive Economic and Trade Agreement with the UK.’

At present, India’s top five exports to the United States include precious stones, metals & pearls (14.3%), electrical machinery & electronics (14%), pharmaceutical products (12.6%), machinery, mechanical appliances & parts (7.7%), mineral fuels, mineral oils and products of their distillation (6.1%).

While nuclear reactors, boilers, machinery parts; mineral fuel, oil; optic, photo, medical, surgical instruments; electric machinery; and pharamecutical products were the key imports for India from the USA.

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Delhi has prohibited fuel sales to petrol vehicles older than 15 years and diesel vehicles exceeding 10 years. The ban, enforced through automated Automatic Number Plate Recognition (ANPR) cameras at fuel stations and strict penalties, impacts over 6.2 million vehicles. With transport contributing 51 percent of Delhi’s pollution (as per CSE), the policy aims to reduce emissions but raises concerns over vehicle owners’ livelihoods.

The Indian Auto LPG Coalition (IAC), the nodal body for the promotion of Auto LPG in India, emphasises retrofitting older vehicles with cleaner fuels as an immediate, cost-effective solution. Auto LPG significantly cuts emissions without requiring premature scrapping of vehicles. The IAC urges the government to simplify and incentivise retrofitting, ensuring a smoother transition for affected citizens.

As Delhi balances environmental and economic priorities, promoting Auto LPG retrofitting could offer a sustainable path forward – reducing pollution while preserving mobility and livelihoods. This approach may also serve as a model for other Indian cities battling similar air quality challenges.

Suyash Gupta, Director General of Indian Auto LPG Coalition, said, “Delhi stands at a fundamental crossroad in its battle against the rising air pollution. The current ban, while bold, will disrupt the lives of millions unless we provide a viable alternative. By promoting retrofitment to Auto LPG, we can offer immediate relief to vehicle owners and the environment alike. Auto LPG retrofitment is a proven, affordable and scalable solution that can help Delhi achieve its clean air goals without forcing citizens to scrap their assets prematurely. The government’s support in incentivising and simplifying the retrofitment process will be crucial in making this transition both practical and impactful.”

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The United Kingdom has announced nearly GBP 6 billion in new investments and export wins tied to the UK-India Free Trade Agreement (FTA), with significant implications for the automotive, aerospace and advanced manufacturing sectors. The deal, signed during UK Prime Minister Keir Starmer’s meeting with Indian Prime Minister Narendra Modi, is expected to create over 2,200 jobs in the UK.

Under the FTA, India’s average tariff on UK products will drop from 15 percent to 3 percent, with specific cuts for key sectors. Automotive tariffs of up to 110 percent will be reduced to 10 percent under a quota system, while aerospace tariffs (previously as high as 11 percent) will be eliminated. Tariffs on electrical machinery will also fall, potentially halved or brought to zero, depending on product classification.

The UK government estimates the trade deal will increase UK exports to India by nearly 60 percent and raise bilateral trade by 39 percent by 2040, compared to current projections without the agreement.

British automotive, aerospace, and advanced manufacturing players are among the biggest beneficiaries:

Rolls-Royce and Airbus will begin delivery of aircraft powered by Rolls-Royce engines to Indian airlines as part of contracts worth around GBP 5 billion. The orders are expected to support jobs in Filton, Broughton, and Derby.

International Aerospace Manufacturing (IAMPL) — a joint venture between Rolls-Royce and Hindustan Aeronautics — is investing GBP 30 million to expand its facility in Hosur, India.

Johnson Matthey will invest GBP 4 million in new plants at Taloja and Panki, supporting up to 20,000 jobs in India during construction, alongside over GBP 20 million in secured contracts for engineering and catalyst supply.

Wilson Power Solutions will invest GBP 21 million in Chennai to expand transformer manufacturing capacity.

Helical Tech is committing GBP 5.72 million in overseas direct investment (ODI) to expand its Pune facility as a global supply hub.

The agreement also unlocks procurement opportunities in India’s clean energy market and improves market access for UK manufacturers across sectors such as components, electrical machinery, and mobility technologies.

On the export front, UK companies such as Carbon Clean, Occuity, Aurionpro, DCube AI, and Kyzer Software are tapping into Indian demand for carbon capture, healthcare tech, AI, and fintech. Combined, their deals are set to contribute hundreds of millions in export value over the next five years.

Jonathan Reynolds, Business and Trade Secretary, UK, said, “The almost GBP 6 billion in new investment and export wins announced today will deliver thousands of jobs and shows the strength of our partnership with India.”

The FTA also paves the way for long-term collaboration in defence manufacturing, semiconductors, AI, quantum computing and other critical technologies.

The UK currently imports GBP 11 billion in goods from India annually. With liberalised tariffs, the government expects significant cost savings for UK firms importing automotive and advanced manufacturing components, aiding domestic production and supporting supply chain resilience.

Shailesh Chandra, President, SIAM and Managing Director, Tata Passenger Vehicles & Tata Passenger Electric Mobility, said, “The Indian automobile industry congratulates the Government of India for its tireless efforts in bringing the India–UK Free Trade Agreement (FTA) to fruition. This landmark development marks a significant step forward in strengthening India’s global economic engagement, particularly with developed economies. As two major economies enter a new phase of partnership, SIAM appreciates the Government’s extensive stakeholder consultations throughout the negotiation process. Concluding this transformative agreement amid global trade uncertainties reflects India’s growing leadership in shaping modern trade and investment frameworks.”

The commitments made by the Government of India on automobile sector tariffs strike a thoughtful balance—addressing consumer interests while supporting the broader goals of Indian industry. We view this agreement as part of a wider strategic engagement and believe it opens new avenues for collaboration and opportunity with a key global partner. SIAM remains committed to working closely with the Government of India to ensure the benefits of the agreement translate into greater growth, global competitiveness, and technological progress for the Indian automotive industry,” added Chandra.

Shradha Suri Marwah, President, ACMA, said, “The Automotive Component Manufacturers Association of India (ACMA) welcomes the signing of the India-UK Comprehensive Trade Agreement as a landmark development in the bilateral relationship between the two nations. This agreement is poised to usher in a new era of economic cooperation, fostering greater market access, technology partnerships and value chain integration between the Indian and British automotive industries. The CETA is expected to benefit the Indian auto component sector through enhanced opportunities for exports, streamlined regulatory processes, particularly in key areas such as electric mobility, precision engineering and lightweight materials. Indian MSMEs, which form the backbone of our industry, stand to gain from the liberalised terms of trade and improved access to UK markets. We are hopeful that the agreement will also promote collaboration in R&D, skilling and innovation, especially in green and digital technologies – areas that are crucial for our sector’s long-term competitiveness and sustainability. ACMA congratulates the government of India and the United Kingdom for their vision and commitment in bringing this agreement to fruition. We look forward to working with our counterparts in the UK to realise the full potential of this partnership, and to strengthen our collective contribution to global automotive value chains.”

Dr Anish Shah, Group CEO and MD, Mahindra Group, said, “The landmark trade agreement between India and the UK marks a transformative moment in the global economic landscape. It’s not just a win for trade, but a blueprint for a modern, values-led partnership that puts innovation, sustainability, and inclusive growth at the heart of global collaboration. At Mahindra, we believe deeply in the power of such cross-border partnerships to unlock economic potential, create high-quality jobs, and accelerate progress in future-facing sectors from green mobility and clean energy to digital technologies and advanced manufacturing. The UK-India Vision 2035 aligns closely with our own strategic priorities building resilient supply chains, investing in frontier technologies, and fostering a just transition to a low-carbon economy. As Indian industry becomes increasingly global in its footprint and ambition, we look forward to contributing meaningfully to this next chapter of UK-India cooperation.”

Sudarshan Venu, Managing Director, TVS Motor Company, said, “We are deeply inspired by Prime Minister Narendra Modi’s vision of Viksit Bharat and his unwavering commitment to making India a global manufacturing and design powerhouse. The signing of the India-UK Free Trade Agreement is a pivotal moment—it opens new frontiers for Indian companies to take ‘Make in India’ to the world. We are particularly excited given the launch of new Norton vehicles this year, which will benefit from the strengthening of trade links between India and the UK. It energises our global ambitions and strengthens our resolve to build world-class products and brands.”

A spokesperson for JLR said: “We welcome this free trade agreement between the UK and India, which over time will deliver reduced tariff access to the Indian car market for JLR's luxury vehicles. India is an important market for our British built products and represents significant future growth opportunities.” 

Amit Kalyani, Vice-Chairman & Joint MD, Bharat Forge, said, “Congratulations to Prime Minister Narendra Modi on the historic India–UK deal signed yesterday! #IndiaUKFTA marks a breakthrough for India’s engineering and manufacturing industries, with zero-duty access on about 99% of tariff lines covering almost 100% of trade value. Indian manufacturers can now tap into the UK market with greater competitiveness, improving their global footprint. I’d like to extend my appreciation to Hon’ble Minister of Commerce and Industry, Piyush Goyal ji for his pivotal roles in facilitating this partnership. I look forward to seeing the positive impact of this agreement on trade, investment, and economic growth in both the countries.”

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