Electric power steering supplier Nexteer Automotive plans to double its size by 2020. Matthew Beecham talks to the Tier One’s president and chief operating officer, Laurent Bresson, to find out more.
Nexteer booked $6 billion of new business in 2010. How well has the company grown since then?
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Over the past 12 months Nexteer has continued to grow strongly. In 2011 Nexteer achieved sales bookings $3.5 billion and we are on course to meet our objective to achieve annual revenues of $4 billion by 2020. The switch from hydraulic to electric power steering (EPS) is driving our growth. The technology accounts for 50% of the new business booked last year and the majority of new contracts were conquest wins. We are continuing to displace our competitors.
We have succeeded by creating innovative products and a global network to meet demand. We have made significant investments in our engineering, which is up 30%, and in all our facilities around the world to build development and production capacity.
How will Nexteer deliver on its growth strategy?
We’re working to grow the business on a global basis, but growth in Asia, particularly China and India is a key part of our strategy to double our size by the end of the decade.
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By GlobalDataIt’s just a question of giving customers what they need. Vehicle manufacturers are sourcing global platforms that include volume in Europe, North America, Asia Pacific and South America. Our investment plans ensure that we have a presence everywhere and are able to support new customer programmes appropriately.
Not all the investment will be in Asia. This year in North America we’re investing to expand production and upgrade our testing and validation facilities. It will provide global customers with improve responsiveness and service.
We’re also investing to expand our European facilities in Poland to support the launch of new customer programmes.
How will Nexteer increase its footprint in Asia?
Since all our customers are either starting to produce in China or are increasing capacity there significantly, the region is important for Nexteer. We currently have capacity in China to produce around 400,000 EPS systems per year. In the next two to three years this will increase more than twofold.
In India the move from hydraulic to electric power steering is slower, but we are expanding production of steering columns and gears at our plant in Bangalore to support growing demand for hydraulic steering systems. We also see good growth prospects in South America where we have just launched an EPS programme at our facility in Brazil.
What growth do you expect for Nexteer in North America?
The remainder of this interview is available on just-auto’s QUBE research service
