In an exclusive interview for just-auto, Matthew Beecham talked with Dr Peter Gutzmer, chairman of the board of management, LuK Group, about the group’s plans for globalisation and future markets, expansion into Asia and its key technologies and product trends.
Lamellen und Kupplungsbau GmbH & Co. (LuK) is wholly owned by the INA Holding-Schaeffler Group. Headquartered in Buhl, Germany, LuK employs 58,000 people at 180 sites worldwide. In 2004, the company posted sales of €7bn. The LuK Group is organised into three businesses: LuK, INA and FAG. LuK employs 8,500 people and generated sales of €1.6bn in 2004. LuK is relatively unknown, considering its products feature in one in four cars built worldwide. Its product range includes clutch systems, dual mass flywheels, CVT components, vehicle pumps and torque converters.
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just-auto.com: LuK expanded considerably since the 1970s through acquisitions in Europe and the US. What is your strategy for international expansion?
Dr Peter Gutzmer: “Back in the 1970s, we realised that to be a strong competitor we needed to have a worldwide presence. So we started by strengthening our presence in Brazil and then the US. Our basic strategy was to be able to offer three essential services: manufacturing, sales and engineering. By the early 1980s, we emerged as a global supplier of clutches and transmission components.
“Our current strategy is to pursue that. We are now trying to stabilise what we have achieved in North and South America and focus on further growth in the Asian region.
“In the mid-1990s, LuK started a business in India. In 2004, after being very successful on the sales side with Japanese customers, we opened a representative office in Japan. We are now considering sending further engineers to Japan. In Korea, we started in 2005 on the production side where we manufacture dual mass flywheels for local OEMs. Earlier in the year we have also opened a sales office in China. Next year we shall open a €125m manufacturing facility in China alongside a substantial R&D centre. These investments are being financed in-house. We are also further investing in Hungary, where LuK established a plant in 1997.”
just-auto.com: What kind of contracts are you winning in Asia?
Dr Gutzmer: “In Asia, we are working with all the major Japanese and Korean OEMs. We have also got contracts with European OEMs based in China and increasing our business with Chinese car manufacturers.”
just-auto.com: Could you tell us what percentage of your business is generated in Asia?
Dr Gutzmer: “All over the Schaeffler Group we achieve a turnover of €750m in Asia. We don’t disclose any figures for the LuK Group. However, we can say that our market share is still not where we would like it to be. But we see a lot of potential. The Chinese manufacturers want to engineer and manufacture globally competitive cars. In order to achieve that, they need competitive products from existing global suppliers. We can offer that.”
just-auto.com: If we look at China, India and South Korea, technology-wise what do you see as the main demand there?
Dr Gutzmer: “It is two-fold. The two ends of the spectrum are marked by either cheap products or sophisticated high-end solutions. I think the big players like General Motors, Volkswagen and Toyota wish to buy well-known global products. The Chinese OEMs, however, are looking for something in between. They would like to have technology that is available globally at high quality but are also crosschecking these with what the local market has to offer. That is why we are establishing services in sales, manufacturing and engineering in order to determine how we can best serve both requirements, i.e. good value for money according to the application required. The Indian market is similar to China. In South Korea, we are increasingly becoming a system partner to the OEMs in engineering, supply and advance development programmes.”
just-auto.com: Could you also explain the background to your decision to acquire the German manufacturer of clutch facings, APTEC Reibtechnik GmbH from Automotive Products International Ltd?
Dr Gutzmer: “We see ourselves as a complete systems supplier in the clutch business. We focus very much on how the transmission market will develop over the next few years. We would like to keep the conventional gearbox business but must improve our technology. A lot of robotized transmissions or automatic comcepts are only possible with adequate facing solutions. We therefore need knowledge of facings, friction materials and release systems. That is why we recently acquired LuK France and the APTEC friction business (now renamed LuK Friction).”
just-auto.com: Could you talk us through the stage of development of your PSG (power shift gearbox)?
Dr Gutzmer: “Fuel economy will continue to be a key factor throughout the next decade. From our side, there are two major approaches. One is powertrain design, i.e. making transmission more efficient, the other is improvement on the engine side. The most efficient transmission with shift comfort is the power shift concept. Volkswagen has already started introducing its dual clutch transmissions and market response has been very positive indeed. No doubt, that the powershift transmission concept is one of the winning concepts for the future, combining driving comfort, agility and efficiency.”
just-auto.com: What are your predictions for dual-clutch transmissions?
Dr Gutzmer: “By 2010, we expect approximately between 1 and 2m units across Europe. We expect manual and CVT being very stable over the next years while torque converter automatics will increase slightly.
“Ultimately, we have got to be the most innovative clutch company on the global market. Our outlook for the next few years is optimistic and positive with lots of possibilities.”
This interview is an extract from a new report published by just-auto.com, entitled: ‘Global market review of OE gearbox clutches – forecasts to 2011’ https://www.just-auto.com/store/products_detail.asp?art=36533&lk=ss
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