Your future advertising space? Our media data

Your future advertising space? Our media data

Auto components industry in top gear

Auto components industry in top gear

March 15, 2017 12:56 pm

With the rising demand for automobiles throughout the country and a turnover of $39 billion in 2015-16, the auto components industry seems to be in top gear.

India has been an upcoming hub for the auto components industry. The rapidly growing end user market, redesigned consumer sentiment and a clear liquidity in the financial system are said to be the drivers for this.

According to a report by SIAM, the apex national body representing the, Indian automobile industry, a total of 23,960,940 vehicles including passenger vehicles, commercial vehicles, three wheelers, two wheelers and quadricycle were produced during April-March 2016 as against 23,358,047 in April-March 2015, registering a marginal growth of 2.58 percent over the same period last year.

As per a survey by Make in India, the automobile components industry contributes towards 25.6 per cent to the manufacturing GDP and 3.8 per cent to the national GDP, proving indirect employment to 1.5 million people.

Auto components sector growing leaps and bounds
With so much happening in the auto components industry in India, experts seem to be optimistic about the growth of the sector. Suresh KV, Country Head, ZF, India says, “With rapid globalisation and constant innovation, the auto sector is growing by leaps and bounds. We are constantly on the move- from electric cars to next-gen hybrid vehicles. I am certain that this growth trajectory is set to continue in the coming year. After a rather fruitful year, we welcome the coming year and all the challenges and opportunities it brings.”

Suresh claims that the company was successful in localising high technology products in India. The company plans to focus on the ‘Make-in-India’ theme and source quality products for the company’s global portfolio. Suresh further adds, “The interest shown by the OEMs in the recent past to introduce advanced technologies in the auto sector is a welcome move in this sector. Such changes will help us to introduce more variants into the market.”

ZF is optimistic about the possibilities of launching other product lines and will continue to explore newer verticals and opportunities and establish avenues to increase the sourcing from the Indian sub continent. “The integration of ZF & TRW will also be a major activity in the next 2-3 years,” says Suresh.

Demonetisation hits hard
N K Taneja, Group Chief Marketing Officer, Minda Corporation feels that the commercial vehicle sales have taken a hit as a result of the demonetisation. He says, “As a result of the demonetisation, the sales are likely to remain subdued till the liquidity situation improves. Nevertheless, as the emission norms in India progress, to the next stage, from April 2017, the industry is expected to witness some pre-buying in the last quarter of 2017.” He further adds, “We are very positively looking forward for vehicle scrap policy and if it happens, will be the game changer for the industry.”

As per Tanjea’s observation, the deferment of consumer demand in the automotive segments (particularly in Passenger Vehicles and Two Wheelers) is having a temporary impact on the automotive sales volumes, as the structural factors would continue to support demand once liquidity scenario improves.

He adds, “The recent fiscal budget seems to be positive for tractors and two-wheelers although passenger cars will remain unaffected, neutral for rest segment. The push on rural areas and reducing the tax burden of individual would also increase personal disposal income in the near term. The full roll out of the GST would undoubtedly have a positive impact for the automotive and automotive component industries.”

‘Make in India’ a major boost
Pointing out the growth drivers for the auto component industry, Suresh says, “Automotive industry is the key driver of any growing economy. It plays a pivotal role in country’s rapid economic and industrial development. The norms for foreign investment and import of technology have also been liberalised over the years for manufacture of vehicles and components by the government.”

Suresh feels that the introduction of the ambitious ‘Make in India’ plan is set to boost the manufacturing sector further. The single window clearance for foreign investors which helps in quicker land acquisitions is a great beginning to facilitate manufacturing in India. Speaking about this, Suresh said, “Since the new government took over in May 2014, the process of applying for industrial license has been made online which again is a boon of sorts for the manufacturing sector in India. Added to the above, the programs launched by the government to make the ‘ease of doing business’ better along with initiatives like ‘Skill up India’ and ‘Start up India’ has been beneficial to the growth of the industry.”

Regulatory bottlenecks: a large problem
However, with the growth drivers, there exists some roadblocks too. Suresh outlines the roadblocks stating, “The first and foremost challenge is still the large number of regulatory bottlenecks. To set up a manufacturing centre in India, companies need to go through a series of procedural and regulatory clearances to get due permissions.” He further adds, “India has been strict with approvals of projects which once dealt with will contribute largely to a business friendly environment.”

Suresh also feels that for any industry to flourish, there needs to be adequate technological innovation and push as modern manufacturing is all about technology, R&D, skill and innovation. He feels that in order to keep pace with the global growth, the ‘Make in India’ campaign needs to be treated as an imperative rather than an option. “An increased focus towards novelty and innovation is going to add greatly to this vision,” he says.

When asked about the roadblocks when it comes to the auto component industry, Tanjea feels that as a result of the correct resources at right places and complete clarity there are not much roadblocks as such. “Planning part is over now and our complete focus is now on execution part which is the most important one,” says Taneja when asked about the specific hurdles for Minda group. Planning part is over now and our complete focus is now on execution part which is the most important one.

Local for global approach by ZF
Suresh also shared the future expansion plans of ZF. The company views India as an extremely important market and is dedicated to strengthening its R&D in the region. “With the expansion of our operations in India, we are well prepared to meet local for local and local for global market requirements and provide our customers with the most innovative and high quality products, solutions and services,” says Suresh.

The company also plans to launch its first ever Technology Centre in Hyderabad for the software and mechanical engineering requirements. As per the company claims, this new technology centre will help advance ZF’s ongoing efforts to accelerate local product development while also extending support to the global development teams.

ZF has also made considerable investments and advanced technology launches in the Indian market for example in its Pune facility, the first launch of the Electric Park Brake (EPB) technology in India and also inaugurated ZF Hero Chassis systems Pvt. Ltd., a 50-50 JV ZF India Pvt. Ltd. and Hero Motors Ltd in Oragadam, Kanchipuram district.

Minda Corporation to set up new plants
Sharing the details about the future expansion of the Minda Corporation, Taneja says, “Minda Corporation, at Group level, is focused on setting up a new plant at Queretaro Industrial Park-II Puerto, Mexico. This new facility has already received order from a leading automotive player for the manufacturing of plastics parts including Glove Box, St. Column, End Cap, Hang on parts and others.”

Taneja informs that the first batch of injection moulding machines with latest technology from Germany has been received and is being commissioned. The construction in accordance to the projected timelines is expected to start in FY2017-18.

The Group is also setting up with a new plant at China which is 50:50 joint venture with SBHAP China focusing on Interior Plastic Products of Minda. Taneja further says, “The group is also setting up 3rd die casting plant in Chakan, Pune with an initial investment of Rs. 75 crore over two years, to enhance production capacity. The project is expected to be completed by the second quarter of the financial year 2018.

Minda Corporation has an existing production capacity of 4,600 MT and plans to target a capacity of 9,600 MT by 2019-2020. Throwing light on the investments and the future growth in Pune, Taneja says, “We are the second tier company one in India to have EMC and EMI facilities. Spark Minda Technical Centre in Pune will to be fully operational in last quarter of FY2016-17. This center’s main focus will be amid electronic, hardware, software, and mechatronic to support our legacy business and future growth due to high electronic content and besides in automotive.”

With the government having a pro-manufacturing stance and favourable policies, steps have been taken to facilitate exports. This will no doubt help to generate additional jobs in India in a way being a stimulant for the economic growth and contribution to the overall GDP. Also, the amendments in the Foreign Trade Policy 2015–2020 are aimed to strengthen trade facilitation and ease of doing business. This collectively positive environment will no doubt place the auto component industry in top gear.

Cookie Consent

We use cookies to personalize your experience. By continuing to visit this website you agree to our Terms & Conditions, Privacy Policy and Cookie Policy.


Your future advertising space? Our media data


eMagazine July 2024

Your future advertising space? Our media data

Our Sponsors

B&R AutomationPragati GearsCarl Zeiss IndiaSTMCNCAngel IndiaAMFMallcomLinear WaysigusDelta ElectricRavik Engineers Private LimitedFagor AutomationSuper SlidesIMTMA- IMTEX 24AutonicsACE Micromatic GroupChicago Pneumatic ToolsMMC Hardmetal Pvt LtdMennekesTruCutamtex-expoLMWFietestFiltermistExon mobilXPSShot Blasting
Original text
Rate this translation
Your feedback will be used to help improve Google Translate