Since it was founded in 1952 in South Africa, Bosal International Group has become one of the world's leading exhaust system suppliers. It has 31 plants and employs 7,200 people worldwide.
In addition to exhaust systems, Bosal makes roof-rack systems and tow bars. Major customers include Renault, General Motors, Volkswagen, Saab, Seat, Skoda and Land Rover. Wim Oude Weernink of Automotive News Europe spoke with Karel Bos, the 71-year-old founder and chairman of the privately owned Bosal.
How was 1998 for Bosal, and what do you expect for 1999?
Last year was reasonable, apart from Brazil and South Africa. The problems there taught us how to handle a crisis and proved the importance of lean production. After initial worries because of weak stock markets, I am positive about the rest of 1999.
What percentage of your total output is for original equipment, and what percentage is for the aftermarket?
We want to have an equal balance between OE and aftermarket business. But even if lower new-car sales affect our OE sales, that is usually compensated for by higher aftermarket sales, because customers keep their cars longer and need replacement systems. So we are flexible.
What are the most interesting exhaust-system innovations?
Better gas-flow efficiency, improved heat insulation and weight reduction. At Bosal, we have developed three new concepts to achieve those goals.
First, there is a new manifold concept that improves gas flow and insulation by enabling us to place the catalytic converter much closer to the engine. It results in a more efficient catalyst after a cold start.
We have also developed a so-called radial-flow manifold catalyzer that has better acoustic and gas-flow properties and is lighter. We are focusing on lightweight technology that can offer weight savings of up to 50 percent compared with conventional systems - for example, cast-iron manifolds will be replaced by steel. The mild steel used for piping and mufflers will be replaced by thin-wall stainless steel.
What's your reaction to Ford's proposed takeover of Kwik-Fit?
The aftermarket customer has different needs to the new-car buyer. Franchised dealers do not have the logistical capabilities to deal with the demand for quick repairs to older cars, or to analyze the second-hand car market's requirements. Ford has shown that it recognizes this problem and is prepared to meet second-hand car owners' demands by acquiring Kwik-Fit.
What does the future hold for Bosal?
Public companies have better access to capital than private companies. And investors are prepared to pay a lot of money to acquire another company's shares. That makes smaller companies, especially privately owned companies, more vulnerable.
We think that if we seek partnerships, we have to stay within the limits of our specializations - such as exhaust systems. But within that part of the industry, there are only a few players left who have not been bought or merged with another company.