One important dimension of the new emission norms is the emphasis on meeting the norms at all times, not just under ideal testing conditions. Hence, the development of test routines that reflect the drive conditions of vehicles is currently an important area. Photo: Hindustan Times
One important dimension of the new emission norms is the emphasis on meeting the norms at all times, not just under ideal testing conditions. Hence, the development of test routines that reflect the drive conditions of vehicles is currently an important area.
Photo: Hindustan Times

The implications of BS VI on innovation

The switch to the new emission norms will lead to interesting shifts in the automotive and energy industries

Innovation can be driven by different stimuli—competition, inventive passion, the sheer need to survive. But in some industries, the biggest driver is regulatory change.

The automotive industry has been facing such a situation over the last two decades. While the fact that automobiles are major contributors to environmental pollution is hardly new, highly visible signs of pollution, such as smog, low visibility and respiratory ailments, have given a sense of urgency to the need to control vehicular emissions. This has manifested itself in city-wide initiatives like the odd-even scheme, localized events like “no car" days, and major changes in regulation like the government’s recent announcement of an accelerated jump from Bharat Stage IV (BS IV) to BS VI norms, leapfrogging BS V.

To understand what this means for innovation, I attended the annual Automotive R&D Trends meet convened by the Confederation of Indian Industry (CII) in Chennai recently. Amid Indian industry’s muted efforts at research and development, the automotive and transportation sector stands out as an exception. It is the largest spender on R&D after the pharmaceutical sector, and we have seen Indian R&D and engineering translated into impactful outcomes, such as the Digital Twin Spark ignition (DTSi) technology that underlies Bajaj Auto’s very successful Pulsar bike, the Tata Nano, and the Mahindra Scorpio.

Not surprisingly, the accelerated adoption of BS norms announced recently was the main topic of discussion at the conference. Emission control is the mantra of not only the oil companies (who have to make huge investments to meet the 10ppm sulphur norms of BS VI) and vehicle original equipment manufacturers (OEMs), but tyre and lubricant manufacturers as well.

Several interesting facets emerged from the deliberations.

The focus of the BS VI norms is on NOx (short for nitrogen oxide), sulphur and particulates. Control of these pollutants depends primarily on improving the input fuels and processing the waste products that come out of the engine.

One speaker described this post-processing as attaching a small chemical factory to your engine. The additional space occupied by this “factory" may be comparable to the space already occupied by the engine.

Cars have become more electronic these days and this trend will continue as electronic control units will be required to monitor and manage the increasing complexity in the engine and the rest of the vehicle.

Serviceability will become a bigger challenge. The addition of the “chemical factory" will make access complex. More sophisticated skills will be required to repair a vehicle in the future. The era of the neighbourhood workshop may soon be over.

Unlike in the past where tighter emission norms went hand-in-hand with better fuel economy because the focus was on reducing carbon emissions, lowering NOx emissions will reduce fuel economy as fuel will have to be burnt to create the required temperatures for effective neutralization of non-carbon emissions.

One important dimension of the new emission norms is the emphasis on meeting the norms at all times, not just under ideal testing conditions. Hence, the development of test routines that reflect the drive conditions of vehicles is currently an important area.

Developing these test routines can result in interesting new discoveries. I was intrigued by the fact that the throttle patterns of a London public bus and an F1 racing car are similar, though, of course, at very different speeds. As a result, flywheel-based energy recovery methods used in F1 are now finding their way into the bus industry. Combined with GPS, this allows a bus traversing Oxford Street in London to automatically use stored electrical energy rather than cause pollution in this crowded area.

New engines that meet BS VI standards will need BS VI fuel wherever they go, so the whole country will have to move to BS VI simultaneously, unlike in the case of the earlier BS standards where partial implementation was possible. However, the move to BS VI will not pose a problem for existing vehicles because backward compatibility will be maintained, i.e., old engines will continue to work with BS VI fuel. Of course, the benefits of the shift to BS VI fuel will be muted to start with, as only a small proportion of the engines (only new vehicles) will be designed for BS VI standards.

While this focus on new emission norms is urgent and important, competition is also intense. Developing new cars to be in tune with customer expectations and competitor offerings has become a challenge. Consumer tastes change quickly and a given model has a short lifecycle. We have seen this in SUVs in India. The Renault Duster, Mahindra XUV 5OO and Ford Ecosport all did well but for six-eight months, maybe a year at most, until a new and fresher offering came into the market from a competitor. Yet, we know that making a car has major fixed costs in dies and tooling, and recovering these costs needs volumes. But consumers are looking at a car more and more like the way they buy a mobile phone—something they want to change often. Reconciling these trade-offs will be a major managerial challenge, and calls for simultaneous innovation in design, production and marketing.

Established automobile manufacturers have to simultaneously run with three horses—the models based on existing technology (though, of course, keeping up with the advances in emission norms) with all the attendant competitive challenges; the technology that is already established but only partially diffused (like hybrids); and the next generation vehicles (electric vehicles, fuel cells, etc.). Not surprisingly, specialised firms like Tesla Motors Inc. have emerged to disrupt the next generation vehicle arena. And then, there’s the completely different business model, the driverless car, promoted by tech companies like Alphabet Inc. and Apple Inc. that could completely upend the automobile industry as we know it today.

Clearly, exciting yet complex times are ahead for innovation in the automotive sector.

Read an unabridged version on www.foundingfuel.com.

Rishikesha T. Krishnan is director and professor of strategic management at the Indian Institute of Management Indore.

Respond to this column at feedback@livemint.com.

Close
×
My Reads Logout