Nexteer Automotive was taken over by Chinese company PCM late last year, a move the Michigan operation described as the “single largest Chinese investment in the global automotive supplier industry.” Ahead of the US manufacturer’s electric power steering technology day in Poland, Nexteer VP of global sales and marketing and European region, Laurent Bresson, talked to Simon Warburton in Krakow.
j-a: What does PCM bring to the Nexteer table and how did the former US company workforce react?
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LB: They [PCM] really understand the dynamic – each of the board meetings is focused on global growth. Of course our owners have great financial stability and are committed to the long term. In general some folks – as this is a US company [said] we are there for more than 100 years – the people just wanted to see the facts. So far it has not been any disappointment.
j-a: What impact have the Chinese owners made in the first eight months of their tenure?
LB: The company is a US$2bn revenue and last year we booked $6bn of new life-time orders. It was [a] record booking in the history of Nexteer – that was influenced by the Chinese owners absolutely – we saw that so clearly and this year we are on track for a great year.
j-a: To what extent can Nexteer electric power steering (EPS) influence fuel consumption and how important is that facet of the business to the company?
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By GlobalDataLB: It is 5%-7% savings of CO2 – that is our number one focus. We have a massive influence on fuel consumption with the new technology in particular with EPS. Our business is heavily impacted by C02 regulations – regulations have been the catalyser for this.
j-a: What percentage of vehicles are now equipped with EPS and what are your forecasts for the future?
LB: In 2010 there were around 30% of vehicles [with] electric power steering and by 2016 it will be around 50% – that trend we see in every region.
The emerging markets are seeing some delay but they are following as well especially in China. There is a great momentum in China because of the new CO2 regulations. There is a real boom of electric power steering.
j-a: Is the momentum clearly with EPS systems now or will hydraulic options continue to be important?
LB: Once it [EPS] reaches a certain level, there will be such an economy of scale, that the traditional hydraulic systems will not necessarily be that competitive. By 2030, 100% could be the case.
We are not going to have the entire business, that is clear, but we are extremely confident to be number one.
j-a: How powerful are OEMs in dictating price improvements?
LB: The OEMs want technology, but of course at the best pricing level, so the more volume we have the more influence we can bring and as we are going very fast, hopefully the OEMS can benefit from that. From generation to generation our engineers are working to have breakthrough in terms of technological competitiveness. In the automotive world we have to strive every day.
What we are really doing is looking at and analysing with, the OEMs, the local needs. EPS for a small, light car in India is completely separate from a B segment car in Europe for example.
j-a: With Nexteer’s improved performance, is is it problematic to find sufficiently qualified personnel for your needs?
LB: It is definitely the challenge to find talent, we have to make sure we retain our talent. We are working closely with universities, we take talent wherever it is.
We have a need for more people. Really, it is amazing to see how [at] our various stages of ownership, we have been able to retain our talent and stability. When we have a record booking like last year, there is a need for talent.
