Desma

Editorial
By MT Bureau| Oct 11, 2020

Investment On Self-reliance

At the recently-concluded ACMA Annual Convention Dr Pawan Goenka, Managing Director, Mahindra & Mahindra, posed five soul-stirring and pertinent questions to the India auto industry that must be addressed to position it globally. He himself answered them. The first question that has sparked many minds is: Can we or should we de-link from imports completely? His reply is: Neither we can nor we should. We will have to continue to import the things that some other countries can do better. While accepting the fact that manufacturers mostly import for the cost benefit, he asked why most of the component suppliers are not considering India to set up a plant and suggested looking into the dearth of technological innovations in India. Good points indeed!

The topic doing the rounds, according to industry experts, is on the imports from China. The major items include the side-stand and alloy wheels for two-wheelers, cylinder block and certain varieties of gears. For side-stand, which is a commodity, all of us know that the Indian companies can do it, but may not match the cost. According to sources, the difference is around INR5. Similarly, for alloy wheels, one of the leading companies in this space blazed a trail by becoming the first direct Indian exporter to Ford of Europe, during early 2000. As part of being the Full Service Supplier, the company did the design, engineering and developed a prototype and manufactured the wheels. When the Indian companies can supply alloy wheels to global players, can they not supply to local OEMs?

Instead of looking at cost as an impediment, the OEMs that import components could look at the differential as an investment on Atmanirbhar or self-reliance and insist on the local suppliers to match the price in due course. As per conservative estimates, a million dollar revenue creates six direct and 24 indirect jobs; again 100 manufacturing jobs create 12 indirect jobs in the society. Therefore, as Dr Goenka said, it is high time for OEMs to look at India for what it is good at doing better.

Today, the industry is importing components worth about INR1 lakh crore. The ACMA and SIAM members are aiming at reducing this number to half in about four to five years. With the initiatives like localising several components including side-stand, alloy wheels, etc. the target is easily within reach.

The Cover Story of this edition is on Commercial Vehicles, the segment that continues to witness several challenges. While the availability of skilled drivers is a perennial problem, rising expectations from the end-users fuel the demand for customising trucks and buses with specific applications. This special section has stories from major players in the commercial vehicle manufacturing segment and from the suppliers on their technology and product offerings.

In addition, we have reports on SIAM and ACMA conventions and several interesting stories.

Happy Reading.

T Murrali

Editor

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