Chennai: The Germany headquartered tier-1 automotive parts supplier ZF has inaugurated its new plant in Oragadam, Tamil Nadu (TN). With a plan to build the factory in two phases, the company has committed to invest INR 1,800 crore until 2030.
As part of the first phase, ZF has already invested INR 170 crore and plans to invest another INR 30 crore in 2024. Spread across about 44 acres, the site is divided by 26 acres and 18 acres on each side of a divider road.
This Oragadam plant will be ZF’s 19th facility in India and the 10th in TN. About 80% of the workforce is slated to be women.
ZF’s new site will produce components and systems for electric vehicles (EVs) including the electric compressors, which is a compressed air generation solution dedicated to electric and hybrid commercial vehicle (CV) applications. The facility will also produce EBS (electronic braking system), ASP cartridges, hydraulic ESC, wheel end solutions, digital FBV, ADB and even central drives and EPB by the next 10 years. The facility will cater to both the domestic and export markets.
The new facility will also contribute to the automotive supplier’s target of growing its sales revenue by 3X, up from INR 32 crore in 2023 to INR 100 crore in 2024. In Q4 this year, ZF will also begin the production of actuators at the new plant for supply to EU and China.
At the new plant inauguration on Wednesday, T.R.B. Rajaa, Minister for Industries, Investment Promotion and Commerce, Govt of TN , said, “ZF has so far invested INR 3,500 crore in the state creating 9,500 jobs.”.
The Memorandum of Understanding (MoU) for the new facility was signed in July 2021 and the work began in November 2021, he added.
Peter Laier, Member of the ZF Group Board of Management, and Head- Commercial Vehicle Solutions and Industrial Technology, said that India is a strategic market for the Group and it sees three key factors driving the growth. The first is serving the specific needs of the Indian market, which offers a lot of opportunities with the growing middle class and infrastructure projects. Second, India as a R & D location with skilled and qualified engineers to develop products for domestic and global markets. Third, India as a manufacturing site for the world.
While ZF holds a significant share in the commercial vehicle (CV) market, it is now betting big on growth opportunities in the passenger car segment with the electric mobility trend.
Akash Passey, President, ZF Group India, said, “We have a strong market share in whatever we produce in the CV segment. Going forward, the passenger car segment leaps a curve with over 40% of the sales coming from SUVs under 4.5 meter and the government also introducing a lot of regulations, which offers a lot of opportunities for us with the electric mobility coming in.”
“A number of OEMs have started to go in for full electric platforms and that is creating major opportunities for us,” he said.
P Kaniappan, Managing Director, ZF Commercial Vehicle Control Systems India, said “For ZF, India is a global hub for manufacturing excellence, and we aim this site to be the benchmark site for digital and sustainable manufacturing.”
ZF has a goal to be climate neutral by 2040. In line with the same, the company’s new plant will generate solar and wind power in long term contracts. It is also built with rainwater harvesting infrastructure to collect and reuse rainwater, targeting to be water positive by 2025.
