EDITORIAL – Strong outlook for vehicles production in India to drive investments in local supplier industry
The significant rise foreseen in vehicle production in India over the next decade will present many new growth avenues for suppliers, but the auto parts industry needs to scale up investment on production capacity, research and development, technology acquisition, and manpower to stay ahead of the curve
The Automotive Component Manufacturers Association of India (ACMA) held its annual convention in New Delhi (India) last month to highlight the achievements of the industry as well the challenges. Like every year, top executives from automakers and suppliers as well as Indian government ministers and official attended the annual event. The convention started with ACMA president Nirmal Minda highlighting the supplier industry’s performance in fiscal year (FY) 2017/18, when turnover grew 18.3% year-over-year (y/y) to a record INR3.45 trillion (USD51.2 billion). According to ACMA data, auto parts exports surged 23.9% y/y to INR905.7 billion (USD13.5 billion) and imports went up 17.8% y/y to INR1.06 trillion (USD15.9 billion). In FY 2017/18, the Indian supplier industry’s turnover increased at the highest rate in four years, driven by robust growth in vehicle production in the domestic market. While exports recorded a robust growth after two years of low single-digit growth, imports also increased 17.8% y/y during the year after witnessing a decline in the previous fiscal year.