PHINIA: Why diesel still has a role to play

Posted on 8 Nov 2023 by The Manufacturer

Despite the migration towards electric vehicles (EVs) in the automotive sector, there is still a mass market for diesel combustion engines, especially in the heavy-duty arena. The Manufacturer editorial team paid a visit to Kent-based tier one automotive manufacturer, PHINIA, to find out more

Key takeaways:

  • PHINIA spun-off from BorgWarner in July this year
  • AIM (agriculture, industry, marine) is PHINIA’s key markets
  • PHINIA has had to diversify its product offering due to the dwindling diesel pump market
  • Investment in new machinery has taken uptime in some cases from 30% to 98-99%
  • The company are investing heavily in the development of hydrogen combustion technology

A leader in premium fuel systems, electrical systems and aftermarket parts, PHINIA completed its spin-off from BorgWarner (now focusing primarily on the electric vehicle market) in early July. 

Now trading as an independent company, PHINIA works across commercial vehicle and industrial applications (heavy-duty and medium-duty trucks, off-highway construction, marine, agricultural and industrial applications), developing fuel systems and aftermarket parts that keep combustion engines operating at peak performance, as cleanly and efficiently as possible.  

At its Gilligham plant, PHINIA operate a high variety, low volume scenario of manufacture, meaning there is a very wide mix and a variety of product change overs. The company is also investing heavily in future technologies such as hydrogen that will unlock the potential of alternative fuels (see box out).  

Plant Manager at PHINIA Gilligham, Dave Smith, commented: “This is an exciting time for us. As part of BorgWarner, the company strategy was predominantly based around moving towards electrification. However, our off-highway sector is still predominantly based on the combustion engine.  

“As such, there was a great opportunity to spin off and create our own company, where we can truly focus on the internal combustion engine and develop new, cleaner combustion technologies. It allows us to set our own destiny as we move forward.” 

With the 2030 phase out of new diesel cars looming large on the horizon, ‘diesel’ has become something of a dirty word within the public conscious, as the world looks towards the perceived greener world of electric vehicles. 

However, for some applications, the truth is that battery electric vehicles are just not fit for purpose. And PHINIA’s key AIM market (agricultural, industrial, marine) will be using diesel combustion engines for some time as Jamie Stewart, Manufacturing Supervisor at the company’s site in Gillingham, explained: “The yield for a high-quality electric car battery might be around 350 miles. But that’s no good for long haulage lorries or trucks.  

“Drivers can’t afford to wait 12 hours to charge their batteries. And if the vehicle is running with a full payload, the battery will drain even sooner due to the extra weight. It’s the same in agriculture; when a farmer makes a significant investment in a tractor, they don’t want an electric battery to limit the hours they can spend in the field before time is lost waiting for it to charge. For those reasons, diesel is still very relevant.” 

Product offering 

Indeed, Dave explained that the company has been experiencing something of a renaissance around its older rotary diesel pump technology, much of which has been driven by the emergence of 5G; this technology requires a lot of power, which has subsequently driven a significant uptick in sales of PHINIA’s diesel generator sets. 

A product line that we thought was dying off a few years ago has been given a new lease of life which will carry on for another ten years, so that’s great news for us,” Dave added. “And it keeps our whole supply chain moving as well.” 

In addition to the manufacture of original equipment, PHINIA also has a significant aftermarket section of the business, producing complete diesel pumps, injectors or even the components within the pumps as spares, as the pump itself is still a serviceable item.  

This aftermarket element will ensure PHINIA remain relevant for a long time to come. “Generally, when a farmer buys a tractor, it’s a lifetime investment of up to £250,000 in some cases. So, servicing the vehicle by replacing the pump will keep it running for another five to ten years; this is far more cost-effective than investing in a brand-new vehicle,” Jamie added. 

PHINIA has over 300 different specs for its legacy motor diesel pump, and within that a further 350 components. However, over the years the company has had to adapt and bring in other business due to the slight dwindling of the rotary pump market from within the automotive space, as passenger vehicles began moving towards EVs.  

This is where PHINIA picked up its common rail, variable cam phaser (VCP) and range of injectors for the likes of Volvo, John Deere, Daimler, Renault and DAF. Over the last decade the company has also introduced remanufacturing for certain ranges, where older, broken products can be stripped down, cleaned, put back together with new components where required, and then put back into the aftermarket. 

Jamie added: “This diversification is largely driven by the drop off in demand for diesel pumps within the automotive sector. In our heyday we were probably manufacturing 2,000 pumps a day; now it’s around 370.  

“So, to stay viable as a business and a site, we had to diversify. Our injectors were already being made at our sister site in Gloucester, where they were running out of capacity. We had an abundance of floor space available here, so it made sense to help each other – we’re ultimately the same business even though the two sites are governed individually.” 

Manufacturing processes 

PHINIA can boast around 850 different machines and productive assets on-site in Gillingham and some of the key technical processes in the manufacturing unit include semi-automated and manual assembly lines, high pressure test benches for the injectors and diesel pumps, and a variety of machining operations. The manufacturing site also features abrasive flow machining (AFM) and a small metal treating process. 

PHINIA’s Technology Centre conducts engine performance, product design, sub-micron machining, advanced materials, analysis, metrology, development, endurance testing, instrumentation and rig validation, where the company construct and validate its own test rigs. 

An important project for PHINIA over the last six months has been addressing the issue of machinery obsolescence. Some machines had been in-situ for nearly 30 years and reached end of life in many cases. Repair and replacement were not an option as many of the components no longer existed.  

“What we used to call our Flex Line consisted of two banks of Chiron machines. While they were brilliant when first brought in, they had reached their end of life and the uptime on these machines was at times, around 30%. This meant we just weren’t making enough product,” said Jamie. 

Because this slow uptime was ultimately hurting them as a PHINIA customer, Caterpillar invested in a trial machine which made such an impact that the whole Flex Line has now been replaced with new machines. 

Speaking in July, Jamie added: “We’ve got two banks of three of these new machines – the first bank was commissioned about three weeks ago and is up and running in production. We’ve been doing lots of validation work so the second bank got up and running just last week.” 

The new machines are operating at around 98-99% uptime which has meant PHINIA has managed to reduce its arrears on that one product line from 16,000 units to 1,600. This increase in productivity has enabled the company to reduce the number of shifts at the manufacturing site from three to two and as such, is using less machines and less people, while manufacturing more product. The next phase for PHINIA is to increase the amount of automation on the shopfloor over the next six months and look at robot loading which is already on trial. 

“Because we’re in this legacy technology space, the biggest challenge we have here is that we need to watch our cost base very carefully,” Dave continued. “We’re in a high-cost country and compete with others around the globe that have a lower cost base, so we must be very conscious of that.  

“We always take very strategic decisions around when to invest in new machines. We’ve taken the opportunity to refresh some of our machining processes, whereas previously we may have tried to cope with what we had. The capital is available for us and we’ve been using it; this has allowed us to be a lot more efficient.  

“We will also be automating some of our processes. In our high-cost country this is a technology space where we really need to be operating in so that we can improve cycle times. It’s something that is very key to us moving forward.” 

Emerging challenges, future strategy 

Like many manufacturers, over the last two years PHINIA has seen its price point from all its suppliers increase dramatically, and as such has faced a challenge around how to fairly pass that on to customers. “We have to maintain a sensible business model, and we can’t just absorb all those extra costs,” Dave added. 

These supply chain challenges have been accentuated in PHINIA’s case as the pricing increase has primarily been driven by the fact that the company use such a high variety of products. Therefore, it has to utilise many smaller suppliers, and doesn’t have the option to save money by having lots of volume. 

“Because they’re all small, our suppliers are affected adversely by the world economic crisis. So, in turn, they need to pass that on to us,” continued Dave. “Therefore, we’ve doubled our activity around making sure we’re purchasing parts at the right price and working with our customers to demonstrate that these costs are real, and to pass them on, so that we don’t get squeezed in the middle.” 

To this end another key focus for PHINIA in recent years has been understanding from industry what new technologies can fit into some of its older, legacy processes. He added: “We are trying to create a happy marriage between some really old technology, move it forward, and still produce older, legacy parts, but with new processes. 

“We’ll be looking at what is available in the marketplace, at the right cost per part, which can help us move forward. There’s not going to be the financial opportunity to refresh everything. So, the processes we must change are the ones that are slowing us down.” 

It’s clear that as far as PHINIA is concerned, the internal combustion engine, particularly in the commercial vehicle space, still has a very long future. Moving forward, Dave explained that PHINIA’s Gilligham site will continue to be the primary focus for the company’s aftermarket and legacy business, using the traditional technologies of diesel and gas, complemented by hydrogen.  

“We are quite unique in this space,” he added. “Many other plants prefer high volume, low variety work. We are the complete opposite – we prefer low volume/high variety, with lots of change overs, flexible labour, and we’re good at it; concentrating on the older legacy technologies that come with that low volume approach. Our strategy moving forward will be on continuing to make that successful and profitable.”

Hydrogen – A fuel for the future 

PHINIA is working very heavily in the commercial vehicle sector on developing hydrogen combustion; taking the company’s existing diesel or petrol fuel injection systems and further developing that technology to accommodate hydrogen. 

As EU and other countries set high objectives regarding their carbon footprint, emission standards worldwide are becoming increasingly stricter. At the same time, global OEMs are working diligently to find technological solutions for different drivetrains that comply with these standards. 

Hydrogen propulsion, based on existing engine technology and leveraging the available fuel supply network, is an attractive and fast-to-market solution for powertrains that contributes to the rapid decarbonisation the world needs. It requires only slight adjustments to the internal combustion engine while still meeting both zero emission CO2 targets and future emissions regulations. 

“Here at Gillingham, we are developing heavy duty commercial vehicle, hydrogen injection technology,” Dave added. “This will result in a clean combustion that is almost a net zero technology. The reason this is so important is because in the space we operate, battery electric vehicles are not going to be viable for the foreseeable future. In the light duty car sector, battery electric vehicles are absolutely the right way to go. But as a complementary technology, we strongly feel hydrogen combustion is needed.” 

PHINIA is currently working with government and legislation bodies around the world to have hydrogen recognised as a net zero technology. 

It’s something that a lot of major commercial vehicle OEMs are interested in. And governments around the world including North America, China and the European Union, are beginning to recognise this as a necessary bridging technology.  

As was seen with the advent of electric vehicles, there is a race currently underway to see who can get hydrogen to market quickest. And PHINIA are currently focusing heavily on how to make the company a big player. 

Dave added. “We’ve been fortunate enough to receive two government grants in the last year, which is helping fund some of this development work. And we’re working with three or four major OEMs developing this technology.” 

PHINIA can supply customers with components as well as complete turnkey applications, having the capabilities to integrate the entire hydrogen injection system, including controller, software and calibration.

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