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Finding commercialy attractive applications for Magna’s electric vacuum pump technology

Wintersemester 2010/11 

Executive Summary

Kurzbeschreibung:

“Magna Powertrain AG” is a subsidiary of the multinational group “Magna International inc.” Magna International is one of the largest and most diversified suppliers in the world,
focusing in complete vehicle engineering and assembly operations. The company has 245 manufacturing operations and 80 product development, engineering and sales centers in 25 countries on five continents. The objective of this project was to find new application fields for the vacuum pump technology, which is an essential component built into break boosters of private vehicles. One student team of 8 persons was assigned to systematically search for and evaluate potential applications for the vacuum pump technology and to develop actionable commercialization strategies. Magna strives for a 10% increase in turnover in non-automobile sector by 2015. Therefore the cooperation with the WU is regarded by Magna as a project of great importance in order to expand into new profitable business fields.

Initial Situation

Electric vacuum pumps already exist in different models for various purposes on the market. In automobile industry vacuum pumps are built into most modern hydraulic brake systems, reducing necessary operating force on the brake pedal. Diesel and modern engine applications don‘t have enough depression to support the break booster and for that reason a vacuum pump is needed. As the technology in the automobile industry advances, vacuum pumps are required to be light and efficient. Magna designed a novel vacuum pump concept to fulfill all these requirements and to substitute common used mechanical pump types.
In addition to its automobile business, Magna intends to diversify its product range, targeting new application areas other than vehicle industry. Magna currently follows a cost leadership strategy in order to achieve optimum product distribution. Mass markets are therefore more suitable according to business strategy. In order to achieve the company’s objective, a cooperation with students of WU was formed, who assist Magna in searching for new commercially attractive applications for its vacuum pump. Technical assistance during the project time period was offered by DI Dipl. Kfm. Wolfgang Weber and DI Andreas Auinger. The
initial briefing revealed essential insights for under-standing the technology and its benefits from the producer’s perspective.

Project Target

The aim of the project was to find as many new and attractive application areas for the vacuum pump technology as possible, to evaluate these opportunities and to develop a commercialization strategy for the most promising ones. Thereby, the potential application areas should not only offer solutions to specific problems in these areas, but also be in accordance with the strategic orientation of Magna Powertrain.

Procedure and Methodology

The project was based on a communitybased search process for technological competence leveraging. This process consists of four interrelated steps.

1. Identification of the main benefits by interviewing current and potential users.
2. Systematic search for additional application areas via a combination of pyramiding and broadcast search
3. Analysis of the commercial potential of identified applications
4. Assembly of an actionable commercialization strategy for the most promising applications

Results

By interviewing 10 current and potential users of the vacuum technology, four main benefits (from a user’s perspective) of the technology were revealed: (1) low weight components, (2) compact de sign with minimum space requirements, (3) very easy to transport (4) high precision of engine control system. Based on these abstract ‘user benefits’, more than 40 potential fields of application were identified in the course of approx. 200 interviews. In accordance with the project partner, the four commercially and strategically most promising application fields were selected for further analysis. Consequently, detailed market-, competitor- and SWOT analysis were conducted, resulting in the most promising suggestions. In 2009 the global market value for the focal marked investivated is estimated to be between $ 1,1 billion and $ 1,8 billion, increasing steadily with an annual growth rate of approximately 8% due to demographical development in the western society and increasing demand for an effective solution. Hence the market value is expected to continue its expansion within the next five years to around $ 2,8 billion. The US market is by far the largest, which accounts for 60% of the global value. The European market, especially Italy, France and Germany are expected to show excellent performance in the future. This suggestion to Magna is based on the commercial attractiveness in the industry to ensure maximum return on investment.
In terms of the other 3 application fields, valid information regarding market value could not be obtained via online data base. Thus interviews by experts were conducted to estimate the market situation. As the results of the interviews, a critical size of the market could not be identified fitting Magna’s mass market strategy.

Cooperation Partner

  • Magna Powertrain AG
    Steyrer Straße 32
    4300 St. Valentin
    Austria

  • Ansprechpartner:
    DI Andreas Auinger
    Harald Bachmayr,
    DI(FH) Dipl.Kfm.(FH) Wolfgang Weber

Student Team

  • Aumüller, Christine
    Baumann, Gregor
    Hauswirth, Timo
    Häder, Janine
    Klosterer, Claudia
    Kössl, Ernst
    Witibschlager, Philipp
    Zhan, Jun