AVL is the world’s largest independent company for development, simulation and testing in the automotive industry and in other sectors. As a global technology leader, AVL provides concepts, solutions and methodologies in the fields of e-mobility ADAS and autonomous driving, vehicle integration, digitalisation, virtualisation, big data and much more.

In an interview with Sharad P Matade, Urs Gerspach, Executive Vice President of Test Systems and Global Operations, Instrumentation and Test Systems at AVL, shares his thoughts on the growth enablers and the company’s capabilities to cater to a wide range of demand in the automotive testing business.

What is the impact of the Covid pandemic on AVL’s testing business?

There is an impact, no doubt about it. The effect was much stronger last year; the customers constantly postponed their decisions about the orders of lab projects. However, this year, we are seeing a sudden improvement in the situation. In the first quarter of this year, we received massive orders of over 180 test systems for battery test labs. The situation is improving very fast, and the investments are being released by the OEMs. Until last year, the trends were not clear. Now we see a fast and strong growth of the passenger car industry towards electrification business. We are also witnessing the growing focus on fuel cells in the commercial truck segment. AVL is very well on track regarding its turnover and our margins for this year.

What is the reason for the increased demand of battery test labs?

In the past, many OEMs bought their battery cells from cell manufacturers like Panasonic, LG, CATL etc. and used these third party cells to build their own batteries. Several passenger car OEMs changed their strategy and decided to develop their own battery cells. Increased range, reduced charging time and lower costs are important key factors to convince customers to buy electric cars. Not just the development of the battery, but the combination of Battery, Inverter, E-Motor and Charging Infrastructure is important to develop a successful electric car. For this development, you need new test equipment such as battery cell cyclers, conditioning systems, climate chambers, automation and lab management software. The entire car is tested on High Voltage Powertrain Test Beds and Chassis Dynos where AVL has been the market leader for many years.

Europe is gearing up for Euro-7. What is it? How will it influence the testing business?

EU-7 will set stricter limits for CO2 and particle emissions. We expect PM10 (particulate matter with a size of 10 μm) will be introduced for Euro-7 and we have therefore developed measurement systems which can measure PM10.

It is also important to measure the CO2 emissions of combustion engines as precisely as possible. It is not just about compliance with environmental standards, but also about fuel consumption. We also deliver Portable Emission Measurement (PEM) systems for measuring emissions in real-time conditions on the street. While driving the car under real conditions, you might not execute a certified test run under predefined environmental conditions, therefore, other emissions will occur that need to be measured and analysed. AVL offers a wide range of in-vehicle measurement systems and software to determine what is actually coming out of the exhaust - in real driving conditions.

But there will also be a focus on non-exhaust emissions, particularly brake dust. Electric vehicles don’t emit exhaust emissions, but there is still brake and tyre dust. We have developed entire test systems to test real brakes under real-time conditions.

What would be the significant growth drivers in the traditional combustion engine business for AVL testing divisions?

As mentioned, the Euro-7 regulation will be one of the main drivers for AVL in the future. Besides all the other technologies like ADAS, every engine will be partly electrified either as a pure Hybrid, Plug In- or mild Hybrid. The technology of an Integrated Combustion Engine (ICE) can also be used to run with pure hydrogen. AVL is developing several engines for various customers that convert existing ICE technologies in new concepts.

We are also working on measurement technologies for synthetic fuel. AVL is working closely with Formula One teams as they will soon run their engines with synthetic fuels.

AVL has played a significant role in the development of the diesel engine in Europe. However, many OEMs are talking about discontinuing diesel engine vehicles in the near future. Do you see this as a challenge?

This trend will not have a great impact on our testing division. It will have a larger influence on the powertrain development division for diesel engines. If you take a look at the share of electrified cars in Europe - especially in Germany - they only account for 10 percent of the total vehicles; the remaining share of cars are still powered by combustion engines.

The combustion engine will still remain relevant for a while. However, increasingly in the form of a hybrid powertrain. AVL is therefore converting existing test beds for the car manufacturers so that they can be used to test hybrid vehicles. There are several customers who request pure electrical test benches. Some of our customers come to us with the requirement to completely convert existing combustion engine test fields to electrification test systems.

Between electric vehicles and hybrid vehicles, which one holds more promise in India in the near term and the long term?

I believe, in countries where the electricity network is not yet fully developed, hybrid cars will provide more flexibility, combining the possibility to run with fuel for an overland trip and electrified within the city.

In India, two-wheelers might have a faster increase in electrification similar to the development in China. ICE engines might keep dominating for a while, especially for the commercial vehicle. The introduction of pure battery electric vehicles mainly depends on how fast India is able to provide the necessary high-voltage charging infrastructure.

What about the AVL Tech Centre in India?

Our Tech Centre in India is one of our strongest Competence Centre for turnkey projects. AVL India is a very strong and reliable partner when it comes to planning of entire test fields including plant facilities. In the field of Powertrain Development, our India Tech Centre focuses on all three technologies – ICE, electrification and hybridisation – equally in all segments. AVL is an engineering company assisting customers with all types of mobility technologies. We recently got one of the first orders for fuel cell test systems from an Indian customer. So there is something exciting happening in our Tech Centre in India.

What about the revenues? How much does your testing division contribute to the whole company?

In 2020, the company generated a turnover of EUR 1.7 billion, of which 12 percent was invested in R&D activities. The testing division contributes with around 50 percent of the turnover.

What are the challenges in the business?

One of the biggest challenges is definitely to cover the growing bandwidth of technologies. A couple of years ago, we were only talking about ICE vehicles. Today, we are talking about ICE vehicles, hybrid vehicles, electric vehicles, batteries, ADAS and autonomous driving, digitalisation, cybersecurity and big data. AVL has built comprehensive competences to accelerate the vision of smart and connected mobility.

If you are an engineer, you have a wide range of technologies to specialise in. So one of the challenges is to find the right engineers to work on these different technologies.

What is the latest on safety by AVL?

One of the issues that is yet to gain the industry’s attention is fire safety in electric vehicles. AVL has been associated with fire marshals in Europe. Fire brigades realised an increase in accidents with Battery Electric Vehicles (BEV). Not only accidents but also burning BEVs in parking garages are a big challenge. These vehicles are very difficult to extinguish due to the chemistry of the lithium-ion battery.

AVL has developed a firefighting system which can extinguish a lithium-ion battery fire on the testbed or for fire brigade usage. It is a unique patented system that runs on liquids such as water or gases like nitrogen to extinguish battery fires. We conducted a couple of test series with hybrid batteries. A burning battery with 18 metres of flame height and temperatures of up to 1,500 degrees Celsius could be extinguished in one minute. (MT)

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Germany-headquartered world’s largest chemical producer BASF has completed the transaction with Carlyle involving its coatings business, which now operates as Surventis.

The deal, which reached an enterprise value of EUR 7.7 billion, concluded on 30 June 2026 following regulatory approval with BASF receiving pre-tax cash proceeds of approximately EUR 5.8 billion.

Under the terms of the agreement, BASF retains a 40 percent equity stake in Surventis, which includes the automotive OEM coatings, automotive refinish coatings and surface treatment operations. This transaction, combined with the divestiture of the decorative paints business in 2025, values the former Coatings division at EUR 8.7 billion.

Dr. Markus Kamieth, Chairman of the Board of Executive Directors of BASF SE, said, “This successful closing marks a key milestone in the execution of our Winning Ways strategy aimed at unlocking the value of our standalone businesses. By holding a 40 percent equity stake, we will continue to participate in the future value creation of the coatings business while sharpening BASF’s strategic focus.”

Anup Kothari, Member of the Board of Executive Directors, BASF SE, added, “We are convinced that the new ownership structure provides an excellent foundation for future profitable growth of Surventis. We wish the former BASF Coatings employees every success as they move forward into their future as an independent company.”

BASF has accounted for the coatings business as discontinued operations since September 2025. From July 2026, the 40 percent stake in Surventis will be treated as a financial investment accounted for using the equity method.

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Pune-headquartered global product engineering and digital services company Tata Technologies and automotive component supplier Tenneco have signed an agreement to expand their partnership, committing to technical development and digital innovation.

The collaboration, which began in 2021, is based at Tata Technologies’ Global Engineering Center in Pune. It focuses on product development and operations through the use of engineering, digital technologies, and AI.

The agreement was signed by Jon Bagrosky, Chief Administrative Officer of Tenneco, and Warren Harris, CEO and Managing Director of Tata Technologies.

As part of the understanding, Tenneco plans to invest over USD 100 million in this engagement over the next five years.

Jon Bagrosky, said, “This next phase builds on the strong foundation we’ve established with Tata Technologies and reflects the continued importance of India as a strategic growth region for Tenneco. By expanding this partnership, we are strengthening the capabilities, scale and agility needed to support our customers, respond to evolving market needs and deliver long-term value across our global business.”

Warren Harris, said, “Tenneco has been a valued strategic partner, and this expanded engagement reflects the strength of our shared commitment. As Tenneco accelerates its mobility transformation journey, we are proud to bring together deep domain expertise, digital capabilities, and business transformation experience to support Tenneco’s global growth agenda.”

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Hero MotoCorp, the world’s largest two-wheeler manufacturer, has announced a cumulative investment of over INR 32 billion in Andhra Pradesh.

The announcement was made as the company held a foundation stone ceremony for its second Global Parts Centre (GPC) in Tirupati, which involves an investment of Rs 7.5 billion.

N Chandrababu Naidu, Chief Minister of Andhra Pradesh, said, “Hero MotoCorp has been a valued partner in Andhra Pradesh's growth journey, and particularly in the transformation of Rayalaseema. Its decision to establish the Global Parts Centre in Tirupati is a strong endorsement of our state's progressive policies, world-class infrastructure, investor-friendly ecosystem, and our commitment to the Speed of Doing Business. Over the years, Hero MotoCorp's presence has generated thousands of jobs, strengthened local supply chains, enhanced skills, and accelerated economic growth across Rayalaseema and Andhra Pradesh. We are delighted to see this partnership grow even stronger. This landmark investment will create new opportunities for our youth, strengthen the industrial economy of Rayalaseema, and further establish Tirupati as one of India's leading manufacturing, mobility and logistics hubs. As Rayalaseema emerges as a major centre for industry, innovation and advanced manufacturing, partnerships like these will play a defining role in shaping its future. We deeply appreciate Hero MotoCorp's continued trust in Andhra Pradesh and look forward to working together to build a future-ready, globally competitive industrial ecosystem that drives innovation, creates quality employment, and delivers sustainable prosperity for all.”

Dr Pawan Munjal, Executive Chairman, Hero MotoCorp, said, "At Hero MotoCorp, we have always believed that business growth and nation-building go hand in hand. The foundation stone of our second Global Parts Centre in Tirupati marks an important milestone in our journey and reflects our deep confidence in India’s future and Andhra Pradesh’s vision for growth. By transforming Tirupati into a future-ready manufacturing and electric mobility hub, this investment will enhance our global supply chain, support our expansion across markets, and reaffirm our commitment to 'Made in India, for India and the World.' It is deeply meaningful to mark this milestone on the birth anniversary of my father, our Founder and Chairman Emeritus, Dr. Brijmohan Lall Munjal. He believed in building enduring institutions and always preparing for the future. It is deeply meaningful to mark this milestone on the 103rd birth anniversary of my beloved father, our Founder and Chairman Emeritus, Dr. Brijmohan Lall Munjal. A true visionary, he championed the belief that great institutions are not just built to survive the present but are actively sculpted to lead the future. This Centre is a humble tribute to his vision, values and enduring belief in India’s potential. I am certain that this new Centre will proudly carry forward his legacy of enterprise, purpose and service to the nation.”

The Global Parts Centre is expected to support domestic and international operations. The company plans to scale the annual production capacity of the Tirupati plant to between 1.2 and 1.5 million units. The expansion is projected to create 4,000 jobs.

Furthermore, Hero MotoCorp also introduced two community programmes the ‘Dr. Brijmohan Lall Munjal Heroes of Tomorrow Scholarship’ to provide tuition coverage for students pursuing engineering degrees at state IIITs. And the company would deploy VIDA electric scooters and providing safety training for women police personnel in the Tirupati district.

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Automotive component supplier Rane (Madras) has signed a business transfer agreement to acquire the friction business of Hindustan Composites on a slump sale basis for an enterprise value of INR 3.7 billion.

The acquired business includes manufacturing plants in Paithan and Bhandara, Maharashtra. The facilities manufacture brake pads, brake linings, clutch facings and brake blocks.

The agreement also includes the transfer of the ‘COMPO’ brand name, which is intended to increase market access across distribution and aftermarket channels. Rane’s (Madras) existing friction business generates revenue exceeding INR 7 billion and the merger of these operations will scale the friction materials business to more than INR 10 billion.

Harish Lakshman, Chairman, Rane Group, said that the integration of the complementary operations is intended to build a scaled friction solutions platform to service the domestic transportation sector while creating manufacturing and supply efficiencies. The company expects the transaction to reach financial and operational closure by the end of the second quarter of the current fiscal year.

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