KSPG Automotive Is on the Fast Track Globally

January 23, 2015

Kami Buchholz

Horst Binnig, named CEO of KSPG Automotive in January 2014, talked with Automotive Engineering during media days at the 2015 North American International Auto Show. Steel pistons, exhaust gas recirculation systems, high-performance plain bearings as well as oil, coolant, and vacuum pumps are among its product offerings.

KSPG Automotive is tallying up impressive sales around the globe, but keeping pace with the galloping growth requires both product and people.

Inking a triple-digit million dollar contract for a combined oil and vacuum (tandem) pump is a nice beginning to 2015 for the company. Workers will produce the innovative product for the American market at Pierburg Pump Technology’s plant in Guanajuato, Mexico.

“We are growing double-digit in the North American market,” Horst Binnig, CEO of KSPG Automotive, said in an interview with Automotive Engineering at the 2015 North American International Auto Show at Cobo Center in Detroit.

KSPG’s mechatronic products for emission reduction and fuel efficiency have helped put the Germany-headquartered tier-one supplier in an enviable European market position. “This is one of the reasons why we are growing in Europe’s declining market,” Binnig said.

As a key negotiator in setting up KSPG’s second major joint venture in 2001 with Shanghai Automotive Industry Corp. in China, Binnig knows companies can realize rapid grow in a country with a population of more than 1.35 billion.

China’s overall market continues to roll, recording 9.5% Gross Domestic Product growth in 2013. “We are growing stronger than the market is growing. We are growing double-digit, nearly 30%. And one of the reasons is that we have a focus on the top OEMs. They are growing double-digit in China, too,” said Binnig.

The first KSPG products sold in China were pistons. Castings, cylinder heads, emission control products, and pumps later joined China’s market portfolio. The most recent products for the Chinese market are large-bore pistons and structural parts. Sales in China for KSPG are approximately €600 million. “We will double this within a short period,” Binnig said.

KSPG has seven production facilities and two technology centers in China.

“When I come to China for board meetings, they show a new study for a new plant and say, ‘by the way, in the afternoon we are going to have an inauguration ceremony.’ I’m kidding. But that’s the sentiment. Plants are heavily loaded right now, running out of capacity,” Binnig said.

Another KSPG manufacturing plant for China is coming in 2016.

“The biggest challenge for KSPG management globally is to realize the growth opportunities that the markets are giving to us. We have the right products in the pipeline, but we have to manage that,” Binnig said.

As the mobility-sector company within Germany’s Rheinmetall Group, KSPG has plants in Europe, the Americas, Japan, India, and China, employing more than 11,000 individuals to produce components, modules, and assemblies for vehicle drive systems. KSPG has approximately 1500 R&D engineers worldwide.

“To have the right people onboard all over the organization—on management side, on blue collar side—that is our limiting factor for growth. If you do not have the people, our growth is limited,” Binnig said.