Supplier Tech – The Sky’s the Limit

Things are looking up for Webasto.

The German-based manufacturer who sells about 1.5 million sunroofs in North America each year has added a new 205,000 sq.ft. manufacturing facility and encapsulation plant right next door to its existing 100,000 sq. ft. manufacturing plant in Lexington, Ky.

Webasto’s new Lexington, Ky., facility will be manufacturing the roof system for the production version of the Mercedes Benz Grand Tourer.

The necessity for the new plant was driven by a contract with Mercedes Benz to build the Ultraview roof system for the Mercedes Benz E-Class and new Grand Sport Tourer, with a second full roof module for an, as yet, unnamed OEM coming on line next year.

“There is a trend in Europe to large fixed roofs, whether they are fixed or moveable,” says Franz-Josef Kort?m, chairman of the management board, Webasto AG. “And that trend is now coming to the U.S.”

Less than a third of the new plant’s floor space is filled with the machinery needed to build the Mercedes roof, but Fred D. Olsen, president and CEO says that will change soon as Webasto is scheduled to launch 12 new products in the next 18 months. “Come back in a year and this building will be filled,” Olsen says.

Webasto 7 (the new plant’s designation) will also handle the overflow from Webasto 6 (next door). Webasto 6 builds standard sunroofs for Toyota, Ford, General Motors, GM China and the Chrysler PT Cruiser.

Nissan and Hyundai are Webasto’s newest customers. Webasto has three new contracts with Nissan, the first starting in August of this year and a Hyundai sunroof line, that will be installed in the new facility in October, will be up and running by the end of the year.
 
Brett Healy, vice president Business Development says that Webasto is currently shipping a lot of sunroofs to GM Shanghai, but that will change with the opening of a Webasto facility in China in about two-and-a-half years.

Webasto’s Welcome II concept is loaded with future innovations from a unique panoramic sunroof with foldable T-tops, to a power cargo load floor.

Webasto 7 is currently producing some saleable builds for Mercedes but won’t be up and running at full capacity (100,000 roofs a year in two shifts) until January of 2005. Webasto has invested $28 million dollars in the new Lexington facility and will invest an additional $14 million in a new stamping plant in Murray, Ky., that will begin production later this year supplying roof stampings for Ford and GM.

Webasto, who built its first North American Facility in 1997, currently holds 42 percent of the North American sunroof market and expects that to jump to 47 percent by 2007 with the addition of the new contracts.

That puts the company well on its way to achieving half of its goal of 50 percent market share and 50 percent take rate by 2010. With a current take rate of only 27 percent, Webasto has taken on the unusual task of sitting in with the OEM’s marketing departments recommending how they should sell the product and, ultimately grow the fitment rate.

“They’re starting to expect and respect what we say,” says Healy, “and we’re seeing that move the meter as well.”

Webasto is selling traditional sunroofs to all of the OEMs worldwide, but says that GM is the most aggressive customer in North America as far as introducing new and innovative products to the marketplace like the Ultraview full-glass roof for the Cadillac STX. Webasto says that it took a lot of work to convince GM to invest in the Ultraview roof because GM was convinced that it would only get a 30 percent take rate. The take rate has been closer to 70 percent.

Webasto builds the four-panel panoramic sunroof that’s an option on the new Pontiac G6 and will also be an option on another GM vehicle. Based on a module designed for the Fiat Stillo, the panoramic sunroof folds back in three separate panels with the first panel lifting up as a wind deflector. The GM sunroof will be manufactured in the same Turin, Italy, facility that does the Fiat module. Healy says that with cars like the Pontiac G6, the traditional sunroof is not the wow option any more. “They’re trying to create a differentiator with the new technology,” Healy says. “You’re going to see more of those coming.”

Healy sees the pickup trucks as the one remaining market segment left for Webasto to conquer.

Webasto’s thermal car heater is very popular in Europe. The company is trying to build interest for the technology in North America as both an OEM and aftermarket application.

“It really started with us breaking into Ford large pickup trucks (F-150) and has spiraled all the way through all its SUVs and large pickups,” Healy says. Webasto will also supply the sunroof for the next generation Explorer.

“It will be hard to find a mid-size pickup without a sunroof option by 2007,” says Healy. With a firm grip on the sunroof market, Webasto is looking to expand into other areas. “The biggest part of our growth strategy is convertibles,” says Kort?m.

“We don’t do convertibles yet in North America,” says Fred Olsen, president and CEO, “but we’re in the hunt. We’re working with our customers and our objective is to be producing convertibles, most likely the first one will be produced in this plant.”

Webasto teamed up with Pinninfarina in 2002 to form Open Air Systems (OASYS). “The strategy around OASYS was to take a major position in Europe and then very deliberately, as we gain that credibility, to spread it into the other markets,” says Healy. “Asia is now a success and the U.S. is our next focal point.”

OASYS has developed the OASYS Vision for the BMW 3 Series. OASYS Vision is a retractable hard top that folds into the same space as the soft top with the added feature of a glass-panel panoramic sunroof that opens when the hard top is up.

OASYS also developed the Mini convertible with its unique fold back front section and has done the Daihatsu Copen, a small Japanese compact car with a retractable hard top. Jean Guy Cocaign, engineering manager at the Rochester, Mich., facility says that it’s easier to do a retractable hardtop on a small car because of the lighter panels and the need for fewer kinematics. He says that Webasto is working with Daihatsu on a small car top that would be 100 percent electric, eliminating the need for hydraulics.

Webasto has broken ground in Portugal for a facility that will make the retractable hard top module for the production version of the Volkswagen Concept C that debuted at this year’s Geneva auto show, and Cocaign says that OASYS has a contract in Europe for a retractable hard top on a future product, where Webasto will manufacture the top system and Pinninfarina will build the car.

“We have other programs like this,” says Kort?m, “and we think that in the next five years we will see the business grow to $300 million.”

Beyond roof systems, Webasto is looking to expand in North America with other innovative technologies, many of which are demonstrated on the Welcome II, a concept designed specifically for the North American market.

The sedan/pickup concept features a Panorama sunroof that slides back over the rear of the roof. The side pillars can then be moved to the middle, creating the look of a car with the T-tops removed. Welcome II has a moveable load floor with a power lowering liftgate and a power retractable tonneau cover.

The car is currently on tour, visiting the design studios of Webasto’s OEM customers. “The innovations that we’re showing are gaining more credibility sooner,” says Healy. “Our message was to say that Webasto is a company of innovation. And we’re getting to a point where our customers are coming to us saying, ‘What do you have that’s new and different for us? It’s exactly what we want them to do.’

Webasto is also touting a pre-heating/preventilation system to the North American OEMs. The system, widely used in Europe, preheats the vehicle independent from the car’s engine. By drawing a small amount of fuel from the engine to power a heat exchanger, the system heats the engine coolant as well as defrosting and deiceing the windows and windshield wipers. The system can also ventilate heat in hotter months to cool down the interior of the vehicle.

The preheater can be preset via a timer integrated into the vehicle’s IP, or by remote.