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Michael Bleidt

Michael Bleidt of ArvinMeritor: “There will be a completely new view on diesel technology before too long.”

ArvinMeritor’s Exhaust Strategy

To many, Zeuna Starker GmbH of Augsburg meant very little indeed.

To many, Zeuna Starker GmbH of Augsburg meant very little indeed. Few had heard of this small German company that manufactured exhaust systems, being one of many dotted around the world. Even when it followed BMW to South Carolina 10 years ago so as to be close to Spartanburg for just-in-time delivery, it did not make an impact—exhaust systems are apparently hard to get enthusiastic about. In the last few years, though, things have changed dramatically. While it is still difficult to get excited by a length of tube that runs under the vehicle and is usually the cause of costly repairs every third year or so on older cars, exhaust systems are now one of the key tools in emissions technologies. There are so many things hung onto it to clean the gases emitted from the engine that it has become quite a high-tech piece of equipment even if it is unprotected and suspended only a few inches from the ground.

ArvinMeritor (Troy, MI; www.arvinmeritor.com) has been in the “air and emissions technologies” business for years. Only in June did it—or rather Arvin Industries, a precursor to the current company—celebrate the 40th anniversary of its first catalytic converter being approved by the California Motor Vehicle Pollution Control Board. Nowadays it has a suite of clean air solutions technologies helping both cars and commercial vehicles meet stringent emissions regulations in the U.S. and Europe, but it cannot get enough—and it is for this reason that it set about acquiring Zeuna Starker GmbH, initially as a minority partner in a joint venture before taking full ownership in 2003. “On emission technology, specifically diesel, Europe is the technology driver,” says Michael Bleidt, vice president and general manager of ArvinMeritor, Air and Emissions Technologies, explaining why the U.S.-based company became so interested in Zeuna Starker.

The usual scenarios when one company takes over another is a rationalization process that sees facilities closed, workforces reduced and a general downsizing. However, it was very different in this case, says Bleidt, who had been executive vice president, sales and engineering with the German company before the takeover. “I worked 10 years for General Motors but never for an American supplier before,” he says. “What has impressed me is the long-term strategic view that ArvinMeritor takes. One of our tools is a technology road map that looks at things like legislation and customer requirements and what we need to do to participate in the business, which is very, very important.

“When we brought these two exhaust divisions together, we decided not to touch the capacities of both former companies,” he says. Bleidt continues, “We were able to reorganize the engineering worldwide completely and separate the technology engineering from the application engineering. That means we created with very experienced engineers out of both companies, out of design engineering, and out of process engineering, so-called centers of competence or excellence. These are completely focused either on the improvement of current technologies or on advanced technologies.”

According to Bleidt, there is worldwide overcapacity in exhaust systems, so they considered how they would go to market. “We considered going only for cost, meaning low prices, but then we would have had to cut our engineering resources as well. However, we decided we could generate new business based on our expertise and technology. Of course, we have to be competitive, but specifically here in Europe where emis-sions are the driver, we have won new business based on our expertise and technologies.”

While many organizations are focused on China, Bleidt says they looked to Korea for opportunities. “We have recognized that the Korean automotive industry is growing very fast and recognizing this, we have got our technologies placed there in the last six months. We have a team that is working only on business strategy who have evaluated, for example, that Hyundai could build five million cars in the next few years. When you see its activities in both the U.S. and Slovakia, I personally believe that this automaker will become the next Toyota and be a major player in the automotive world.”

While Augsburg is a manufacturing site for ArvinMeritor, it also houses the Air and Emissions Technologies R&D center including full and sophisticated test suites with several rigs and engine test cells, a fully anechoic chamber and a large department developing simulation tools. One such is the RAVE (Rapid Vibration Evaluation) program, initially developed by Zeuna Starker, which reduces the modeling time needed for concept evaluation from four weeks to one day. Another tool is GT-Power that has been developed to understand acoustics and simulate exhaust noise.

One tool that ArvinMeritor does not have, though, is a reliable crystal ball, something that many in the automotive industry wished they had in order to make important investment decisions. One question vexing many in Europe is whether the American driver will ever accept the diesel engine in his car or SUV. Bleidt is quite blunt in his assessment: “At the end of the day, we don’t know what the future of the diesel is in the U.S. However, we are really convinced, like DaimlerChrysler and Ford, that there will be a completely new view on diesel technology before too long. What we are therefore doing is sending our competence teams to customers in America to give technical presentations, show our capability and be prepared for the time when they do develop a diesel engine.”

Asked whether the fuel cell vehicle spells the death knell of the exhaust business, Bleidt is unconcerned as his group is currently working on two government funded fuel cell projects—one in the US and the other in Europe. “There is still the question of whether the technology is ready to go,” he says. “I would say it is, but at the end of the day it’s down to politics.” Nor is he worried about hybrids: “It doesn’t matter to me if the hybrid uses 99% electric drive, because even with that 1%, it still needs emissions technology on board.”

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