Tremendous opportunities await
the auto component industry in India on the back of the growing vehicle
consumption in India on one hand and the introduction of next generation mobility
on the other. ACES – Autonomous, Connected, Electric and Shared mobility, like
the world over, will also impact the dynamics of the Indian automotive industry
and the opportunities in this space are contingent to Indian auto component
industry scaling up on the technology front.
These were part of the
findings of a study conducted by the Automotive Component Manufacturers
Association of India (ACMA), the apex body of the auto component industry in
India. The study themed “Auto component industry in India: Preparing for the
future” was conducted by McKinsey & Co and was released by the Chief Guest
Anant Geete, Minister for Heavy Industries and Public Sector Enterprises during
Annual Session of ACMA held in New Delhi.
ACMA’s Annual Session was
addressed by Nitin Gadkari, Union Minister of Road Transport and Highways,
Anant Geete, Minister for Heavy Industries and Public Sector Enterprises, Suresh
Prabhu, Union Minister for Commerce & Industry, Civil Aviation, and Dr.
Asha Ram Sihag, Secretary, Department of Heavy Industries, Ministry of Heavy
Industry & Public Enterprises, Government of India.
The event also witnessed key
note address by eminent leaders from the automotive industry including Kenichi
Ayukawa, Managing Director, Maruti Suzuki India, Guenter Butschek MD and CEO,
Tata Motors, Minoru Kato, President and
CEO, Honda Motorcycle and Scooter India, Rakesh Bharti Mittal, President CII
& Executive Vice Chairman, Bharti Enterprises, Dr. Pawan Goenka, Managing
Director, Mahindra & Mahindra, Dr Abhay Firodia, President SIAM &
Chairman, Force Motors, Nirmal Minda, President, ACMA & CMD, Minda
Industries and Ram Venkataramani, Vice President ACMA & MD, IP Rings.
Commenting on the future of
the industry Mr. Nirmal Minda, President, ACMA said, “The auto and auto
component industry, globally and in India, is undergoing a transformation
across its entire supply chain; several factors such as new regulations on
emission, safety & environment, fast changing customer preferences,
shifting economic dynamics and trade policies are reshaping our industry. The
case globally, e-mobility is fast catching the imagination of our policy
makers; a definite policy delineating the road map for e-mobility in India is
therefore the need of the hour. We are confident that as hybrid and electric
technologies gains traction, vehicle manufacturers will support localisation of
Nitin Gadkari said “To
strengthen the economy, our government is actively pursuing the policy of
substituting imports and boosting exports. I am pleased to see the auto
component industry perform remarkable in turnover and exports. I believe there
are immense possibilities for this sector to grow further. Our government is driving the agenda of promoting
Innovation, entrepreneurship, technology and research.”
He added that “the government
is working towards various kinds of alternative fuels as an effort to reduce
carbon footprint by introducing first generation bio ethanol. The industry
should come forward to develop the technologies to power the new generation
Anant Geete said “The
automotive industry is the top contributor to the Government of India’s Make in
India initiative and has accounted for maximum investments under the program.
Going forward, we would be framing the auto policy in accordance with the
current state of the automotive industry and demands of the future. I assure
the ministry of heavy industries will support the industry to resolve all
issues and concerns.”
Suresh Prabhu said “Government
has set a vision of realising a national GDP of USD 5 trillion in next seven
years with manufacturing sector accounting for USD 1 trillion with the auto and
auto component industry will contribute significantly.”
The McKinsey & Company
study on the auto component industry in India revealed that the future of the
auto OEM and auto component industry is being shaped by multiple trends,
policies, technologies and discontinuities. The study reflected upon the
opportunities these trends create for the auto component industry and how the
industry can the industry prepare itself to capture a share of these
Growth indicators paint a
picture of optimism for India – by 2023, it could be the world’s fifth-largest
economy, with a GDP of USD 4.7 tn. Anticipation of a growing consumer class,
enhanced ease of doing business, expanding infrastructure – such favorable
factors could propel the country forward, and, with it, India’s automobile
industry. The Indian automotive OEM industry is already in a strong position.
Globally India’s automotive industry is at the forefront of many segments –
leading in two-wheelers, segment a cars, and tractors.
As auto component
manufacturers prepare for a future where they ramp up performance in India and
globally, they need to account for numerous trends along 4 key dimensions that
are shaping the industry:
• Constantly shifting market
dynamics due to changing customer demands, manufacturing locales, operating
models and priorities
• The changing needs of OEMs,
who are likely to want different, more agile and rapid component inputs as
demand, timelines and processes keep shifting
• Technological improvements
and discontinuities that are already starting to change revenue pools, trigger
new competition and invite new forms of cooperation
• An evolving regulatory and
trade environment forming the backdrop for it all.
The 58th Annual
Session & National Conference concluded on a high note witnessing over 1500
participants. Eminent speakers from industry deliberated on the likely future
of the auto and auto component industry. The speakers included Ashok Taneja, MD
& CEO, Shriram Pistons and Rings, Asutosh Padhi, Senior Partner, McKinsey
& Company, CV Raman, Senior Executive Director, Maruti Suzuki India, Harish
Lakshman, Vice Chairman, Rane Group, Hemant Sikka, President – CPO, Mahindra
& Mahindra, Sandeep Sinha, Managing Director, Cummins India, Sanjay Labroo,
Managing Director, Asahi India Glass, Shivanshu Gupta, Partner, McKinsey & Company, Ms. Shradha
Suri Marwah, Managing Director, Subros, Soumitra Bhattacharya, Managing
Director & President, Bosch India Group and Vikram Kasbekar, Executive
Director, Hero MotorCorp.
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