Bosch sees 3-5% growth in 2012, bets big on India

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Bosch sees 3-5% growth in 2012, bets big on India

India is very important for Bosch's, says company's chairman of the board of management Franz Fehrenbach. The German engineering conglomerate has already outlined an investment plan of about over Rs 2,000 crore over the next two years to expand its facilities in India.

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India is very important for Bosch 's, says company's chairman of the board of management Franz Fehrenbach.  The German engineering conglomerate has already outlined an investment plan of about over Rs 2,000 crore over the next two years to expand its facilities in India.

In 2011, the company grew about 9%. Fehrenbach expects a growth of between 3% and 5% for 2012. "If everything goes well, we can achieve 55 billion euros," he adds. He sees 10% growth in India in 2012.

Fehrenbach further says, the company wants to increase India's share to the total sales to 5% by 2015. Currently, India contributes 3% to the sales.

As the world goes through the reshaping and people acknowledge the new economic reality, the move towards smaller, Fehrenbach says, it's a very big opportunity for the automotive sector in India.

Below is the edited transcript of his interview on CNBC-TV18. Also watch the accompanying videos.

Q: You have been a regular India visitor. You have been coming to India through the 90's. It's a very different country today. Some of your colleagues have made their first visit to India. What's their first impression?

A: They have a mixed impression. On the one side, they see all the streets that are totally different from the streets in Europe.  At the same time, they see all the potential in the industry, and businesses. We visited our companies. They were amazed by the level of competence and professionalism in the Indian companies

Q: You have bought the global board of Bosch to India. That means India has a significant place as far as your global plans are concerned. You have already outlined an investment plan of about over Rs 2,000 crore over the next two years to expand your facilities in India. How important is India strategically for you at this point in time?

A: India is very important for us, especially on the research and development side. We have about already 10,000 software engineers in India. We are just in the phase to give them the worldwide responsibility for some platforms - diesel injection, gasoline injection and drive assistant. So, they really are now an important part of the R&D network.

As a manufacturing network we have about 14 manufacturing locations in India. They are not only producing for the Indian demand, they are also producing for the export. Right now, the sales portion of India of the overall Bosch portion is about 3%. We discussed it that we should atleast achieve 5% share.

Q: 5% by when?

A: Latest by 2015.

Q: The Indian auto story has been a robust story over the last couple of years. 2011 was a bit of an uncertain year, given the uncertainty in the climate, the high interest rates, we saw growth slowing down. What is your view on the Indian auto industry at this point in time?,

A: In the past, the Indian automotive followed very slowly the technological development in the developed markets. It's totally different today. Today, we have this low price segment which really was created in India. We find ideas which we never thought about before.

For example, we developed in India a common rail system, a modern common rail system for one single cylinder engine and for a two cylinder engine. We started this innovation in the Indian market. So, Indians have picked up the innovation development a lot compared to previous years.

Somethings are really very special. Sometimes in India you use a starter to move the vehicle and the starter gets over heated. So, we introduced here a thermal protector, which is also a new, a first one in the Indian market.

Q: So, in a sense India has now become the testing ground for Bosch to actually test low cost, fuel efficient technologies for the future?

A: We are convinced that there is a market segment between the two wheelers and the cars. In this segment, India has a leading role. We are already in supply. But we prepare on additional new products for this segment because we are convinced this is a segment which is not only good for India, but there will be other countries like Vietnam or Indonesia which can also use this segment.

Q: Do you think that this is a category that will work for countries like India?

A: Definitely, we are convinced that this category will come.

Q: And do you believe that it will have significant export potential as well?

A: Maybe export potential in other emerging countries. First of all, we have to penetrate or the OEM has to penetrate the Indian markets. That would be the stage one.