I think some interesting developments are going on in Kaunas now that we have three major manufacturers of automotive parts.
Littelfuse LT expects growth in orders from Hella and Continental
Juergen Sheele, a vice president of Littelfuse, hails the beginning of an era of autonomous vehicles in 2023-2025 as being of particular benefit to the company’s future. Such vehicles, he says, will require many more sensors and electronic devices that are used by other modern cars. Verslo žinios interviewed Mr. Sheele in Kaunas, please find the translation of the interview below:
Your company entered the Lithuanian market about six years ago, when most major companies in the car component sector weren’t aware of Lithuania, and opted instead to invest in Poland and Slovakia. What made you come to Kaunas, and what work are you engaged in there?
We came to Kaunas on 1 June 2012, after we acquired Sweden’s Accel, a manufacturer of advanced automotive sensors. At that time, Accel and its plant in Kaunas were well known in the market for sensors designed and produced for the transport sector. The company had been developing products in Kaunas since 1994.
Since then, the plant has expanded and today employs nearly 800 people. Back in 2014, we had around 340 employees working for the company.
Your colleague Dieter Roeder, vice president and general manager of the Littelfuse Automotive Business Unit, once said that by acquiring Accel and its plant in Kaunas, Littelfuse acquired a ‘low-cost manufacturing base in Eastern Europe’. Is this still an accurate characterisation of the role of Littelfuse’s Kaunas division?
Actually, some 40% of those 800 employees can no longer be referred to as production workers. We have invested in research and development activities (R&D) in Kaunas, and the group’s service centre there provides finance and HR management, and marketing services.
Enhancing our production activities alongside other operations was a deliberate move, as we found so many highly qualified specialists here. Today, more than 50 of the employees at our Kaunas division perform functions for our entire company.
In recent years, the Kaunas region has developed into a centre for production and services, attracting a number of well-known brands. Among them are two well-known German automotive electronic parts manufacturers: Hella and Continental. Are these two companies your competitors, or your partners?
Hella and Continental are our customers. The news that Hella was coming to Lithuania just provided me with further reassurance that Kaunas is the perfect place for us to manufacture technical components.
It will be very interesting to watch the coming competition for specialists who have acquired an engineering education. I would guess that quite a significant role will be assigned to the Kaunas University of Technology (KTU), because more engineers will be needed to meet the demand. I think it’s good news for Kaunas, and it only confirms that our decision to acquire an already operational company some six years ago proved to be the right call.
Do you believe there could be a shortage of talent within a couple of years?
In my opinion, the increased demand for talent will be met, one way or another. At least, that has been the case everywhere else we operate. Decisions have always been made. In this case, more employees will probably come to the city, or local universities will train more engineers.
What will you do if neither happens? There’s always a first time for everything, isn’t there?
We will not be sitting back and doing nothing. For instance, I came to Kaunas to open Littelfuse’s annual Engineering Academy, offering three-week courses for students in science and technology.
We work in close cooperation with KTU. Students join the academy straight from university. We select the candidates ourselves, just as if it were recruiting for our company. The training we offer covers a broad range of different business-related aspects. Trainees are enrolled in classes on sales, automotive component manufacturing, teamwork, marketing and Littelfuse’s global business. For the very best students, we offer a full-time job at our company.
What plans does the company have for future growth in Lithuania?
We are growing at a significant pace, in line with our increasing pool of customers and product range. Currently, we are in the process of implementing a new technology platform in Kaunas, right where it has been developed. This will enable us to manufacture more products that ensure the safety of vehicles, and as well as their conformity and efficiency.
What type of technology is that?
It’s a new liquid-level measurement technology that enables us to, for instance, determine the level of remaining fuel in the fuel tank. Depending on the type of liquid, sometimes it’s necessary to know accurately how much is available. This technology ensures that the level can be measured accurately and rapidly.
In what way will the technology benefit the automotive industry?
It will provide more data on the actual status of vehicles in the transport industry. Automotive manufacturers and drivers will be able to obtain much more accurate data on, for instance, how much fuel a car has left, and how far the car can go on that amount of fuel. Greater accuracy and more complete data will enable us to make more efficient decisions. In the future, we intend to adapt the technology to measure not only liquid levels.
Process automation enhances the productivity of modern industry. But robots taking over work that was previously performed by humans has become a sort of scourge that has brought to the surface a number of social problems. How do you address this phenomenon? Does your group have any plants in which operations are fully automated?
In our industry, it is impossible for robots to overtake production. You can’t really expect that at a company with 11,000 employees, all the automated production processes are supervised by a single person at a computer.
Which do you have more of in Kaunas – employees, or robot workstations?
At the Kaunas plant, I believe we currently maintain a good balance between manual work and automated systems. I believe such a ratio is characteristic of many companies in the automotive industry.
Employees are more suitable for customised orders, and automated production lines are more appropriate for standard orders. Because of the variety of products we make, we cannot apply the same production process to everything.
What are your expansion plans?
The number of employees we’ll need will depend on the demand from our customers. We are constantly looking for employees not only for production but also for other functions, whether it’s R&D, HR or process management specialists.
According to different forecasts, sometime between around 2023 and 2025, we might start seeing mass-manufactured self-driving vehicles. What impact will this trend have on Littelfuse’s business?
Self-driving vehicles will arrive on our roads sooner or later. In any case, such vehicles will need more sensors. You certainly wouldn’t want your car to run someone over or disrupt traffic, right?
These vehicles will need more sensors. They will also need more controllers and more computers to process larger volumes of data and ensure external connectivity. So undoubtedly, this is a perfect trend and a great prospect for us, working in the safety system segment. Littelfuse will grow in line with the self-driving vehicle segment.
Local suppliers have been hinting that Magna, one of the largest automotive parts and component manufacturers in the USA and Europe, has begun selecting partners in Lithuania. Do you work with this company?
Yes, Magna is a customer of Littelfuse, just like Hella and Continental.
Do you expect to start providing services to Magna from your Kaunas plant, too?
If they come to Lithuania, that would certainly be the basis for such an arrangement. But that will depend on their strategy. For example, we chose to invest in a number of operations in Kaunas, not just in production. Other companies may opt for a different route. Right now, it’s difficult to say.
Source: Verslo žinios