Home / Companies / People /  ‘Bosch India prepared to win EV projects to grow’
Listen to this article

NEW DELHI : Auto parts maker Bosch India expects its mobility business in the country, which accounts for 85% of its revenue, to grow this financial year despite various supply chain and inflationary disruptions. The local unit of Germany’s Bosch Group is also doubling down on new technologies such as electric vehicles (EVs) and hydrogen fuel cells as the country transitions to clean mobility over the next decade, Soumitra Bhattacharya, president and managing director, Bosch India, said in an interview. Edited excerpts:

Typically, when technology changes, a new set of suppliers crops up. As EVs become more mainstream, how will companies like Bosch India and the incumbents in the automotive supplier ecosystem participate? 

Within EVs, two-wheelers, three-wheelers, and four-wheelers are different markets. Our parent Bosch today has an acquisition value in electric vehicles of 20 billion euros – it is one of the highest acquisitions by a supplier. So, our parent is very competent in electrification. Secondly, Bosch has invested over the last 10 to 12 years, between €400 million and €500 million every year, amounting to more than €5 billion on EVs – there have been a lot of investments done in R&D and upfront expenditure to be prepared for EVs. As a policy, we will not manufacture cells, but we make everything else in terms of EV parts – batteries, individual components or the e-axle. We also use our parent’s capabilities to transfer knowledge and technology. We will initially do some trading, and we will definitely go quickly into localization. In the last four years, we have launched our EV project housed inside Bosch Ltd, so EV, hydrogen, and electrification will be all in the listed company by design. We’ve created big-ticket portfolios for the growth of the public listed company. 

How long will alternative technologies, such as hydrogen and EVs take to be deployed at scale? What’s your acquisition pipeline in EVs? 

EVs today are a very small percentage of the total turnover of what is being produced and sold. It is between 1% and 2% of the car market. However, we expect EVs to grow in India, to 30% of the total volumes by 2030 in the best-case scenario, or likely even 25%. We will participate in this transition partly through trading, then through part localization, and then full localization under the entire EV range we can do, excluding cells. Having said that for four-wheelers, it applies also to two-wheelers. In the case of two-wheelers, we acquired certain projects like the TVS iQube and Bajaj Chetak. We are also prepared to make announcements on our e-three-wheeler acquisitions. So, we are prepared for two-wheelers and three-wheelers, and we are greatly prepared for four-wheelers in EVs. In the same way, we are prepared for hydrogen, which will be more applicable for M&HCVs over the next seven years or so. We will first transition to a hydrogen internal combustion engine and then to a hydrogen fuel cell EV. 

What impact do you see from disruptions caused by the fresh covid outbreak in China and a prolonged Russia-Ukraine war? 

Today, you must imagine a world where planning is not possible. The only certainty is uncertainty for the long run, and one has to think in shorter cycles while having a long-term view. In the last couple of years, supply chain challenges in the automotive area or mobility area were  dominated by semiconductor shortages, which will continue in FY23. Supply will start easing out slowly in 2024, but will continue through the 2023. Second, because of the China lockdown, and the Russia-Ukraine war, energy prices and inflationary costs have risen. And due to demand-supply mismatch, raw materials prices have increased, too, resulting in electronics price logistics cost increase. While RBI has made a brave move by hiking the lending rate by 40 bps, inflation is likely to increase and inflationary pressure will be passed on to the consumer. It will have an impact, but I’m hopeful about the India growth story, albeit at a slightly slower pace.

Subscribe to Mint Newsletters
* Enter a valid email
* Thank you for subscribing to our newsletter.
Recommended For You
Edit Profile
Get alerts on WhatsApp
Set Preferences My ReadsFeedbackRedeem a Gift CardLogout