Bosal USA

Source: Manufacturing Digital

Date :01/06/2007 18:13:29

Bosal North America finds a new partner – and new life – to survive and succeed in a new market landscape

Written & Produced by James Buchanan & Patrick Harlow

American automobile manufacturers have traveled a tough road the past few years, which has meant a bumpy ride for the ranks of those companies that supply parts and services.

For Bosal International of North America (Bosal North America), a manufacturer of automobile exhaust systems, this fact has not been lost on them.

To respond to the changing dynamic of its market place, the company entered into a strategic partnership with parts manufacturer Delphi to form what they have titled Bosal Delphi Complete Exhaust Systems.

“This is a very innovative and exciting alliance which will deliver significant added value to customers of both Delphi and Bosal,” said Karel Bos, CEO of the Bosal Group in a May 2, 2005 press release to announce the partnership. “The alliance is an excellent technical, commercial and geographical fit, enabling us to respond faster, more cost-effectively and completely for our customers around the world. It will also open up a wider customer base for our breakthrough cold-end innovations, which are delivering significant weight savings and other related benefits.”

In simpler terms, the word “Complete” in the title refers to the fact that Bosal and Delphi excel at opposite ends of the exhaust system.

Bosal is a leader in the manufacture of cold-end exhaust products such as mufflers, resonators and tailpipes. These are referred to as being on the cold-end because they are located further from the engine. Delphi, on the other hand, has excelled at manufacturing hot-end exhaust components, which includes catalytic converters, catalysts and exhaust manifolds.

As car manufacturers such as General Motors decided to buy from companies that can manufacture complete exhaust systems, Bosal and Delphi have managed to leverage their respective expertise to compete in a changing marketplace.

“Because the market evolved into something we weren’t in – complete exhaust systems,” says Gino Torio, purchasing and new business manager for Bosal of North America, “this partnership allowed us to adjust and provide complete exhaust systems without duplicating efforts, creating additional competition – there’s a lot of players in the exhaust game so why create more – or build additional capacity when we didn’t have to.

“It was a creative way to address a Business 101 issue, which is adjust to market demands or you cease to exist.”

Under the partnership, Bosal and Delphi can offer customers:

• Complete systems weighing 30-50 percent less than conventional 409 stainless steel systems

• Industry leading converter durability performance

• Fragile substrate canning capability

• Access to engine management systems controls expertise and algorithms

• Full computer-aided engineering (CAE) capability

• Worldwide validation capability

• Emission technology support

• Acoustics treatment optimized for sound level, performance, and cost

Further, according to Bosal, the partnership addresses service issues by providing customers with:

• A single point contact

• A global technical and manufacturing presence

• Program management to help meet program objectives—on time

• Compatibility with nearly any computer aided engineering system

• Worldwide engine, bench, and vehicle test facilities

• Design documentation and release capability using customer protocols

According to Torio, the new partnership was able to win two significant contracts with General Motors.

“It showed that the partnership could be competitive against other manufacturers of complete exhaust systems,” he says.

However, as the price of gasoline climbed and consumers started edging away from larger vehicles, General Motors made the decision to cancel one of the contracts to build complete exhaust systems for a line of its mini-vans.

Torio says that the cancellation reflects more on shrinking sales for General Motors than it does on the effectiveness of the company’s partnership with Delphi.

“The job cancellation was disappointing to everybody including GM,” he says. “I think it was a matter of a shrinking segment of their business, so in their mind it was an investment decision; they wanted to target their investment in another direction.”

Moving forward, Bosal is not so much dejected by the lost contract as they are trying to learn from it and take steps to make the company more competitive.

“Anybody tied to vehicle lines that aren’t selling well are harmed,” says Torio. “You have to adjust – lean manufacturing, inventory control, those sorts of things, and material prices haven’t helped – it isn’t anything magical, you just have to make adjustments to be competitive.”

One of the areas where Bosal has a natural advantage over its competitors beyond technology and product advancements is its size and diversity of product offerings.

Bosal – North America is one of a number of international subsidiaries held by the parent company Bosal International. Registered in the Netherlands, but headquartered in Lummen, Belgium, the company has a presence in Switzerland, France, Denmark, Austria, Spain, the U.S., Poland, Turkey, the United Kingdom, Canada, Zimbabwe, Mexico, Brazil, the Czech Republic, Germany, Ireland and South Africa.

In all, the company has more than 6,500 employees on five continents, 31 manufacturing plants and 51 distribution centers in 21 countries, and makes more than 6,000 exhaust systems and components for more than 2,500 vehicle makes and models.

Within the U.S., Bosal is comprised of two business units, which are Bosal International, which serves the North American OE market (the OE – original equipment – market is essentially vehicle manufacturers), and Bosal USA, Inc., which serves the aftermarket and performance channels.

The company has locations in North America in Ann Arbo, MI, Lavonia, GA, Warren, MI, Queretaro, Mexico, Kingston, Ontario, Whippany, N.J., Columbia, TN, Indianapolis, IN, Acton, MA, and Denver, CO.