India first
It’s more than a marketing strategy when companies position their new launches as ‘first in India’. Not only is India emerging as a high growth market, but also a fast developing auto industry hub given the several positive arbitrages that it offers on account of labour, capital and technology costs. While vicinity to the huge market potential is a certain lure, establishing a base in India also offers significant strategic advantages on the pricing front. It is a sure shot way to avoid the heavy custom duties and hence hope to find your company’s fortune with those at the middle of the pyramid or may be slightly above. Establishing production base in India also offers a competitive advantage as far as catering to other international markets is concerned. Low production costs offer better margins and India’s emergence as a key global player helps facilitate better trade opportunities and terms of trade for both international and domestic participants.
Fact bite
The facts tell the same story very well. On the market potential bit, it is interesting to note that, in spite of the lacklustre year for the global economy, overall production (passenger vehicles, commercial vehicles, two wheelers and three wheelers) in India increased from 10.85 million vehicles in 2007-08 to 11.17 million vehicles in 2008-09. And things are not looking southwards just yet, if experts are to be believed. According to an Ernst & Young study, passenger vehicle sales in India will grow at a CAGR of 12 per cent and reach 3.75 million units by 2014 as against 1.89 million units at the end of 2008-09. One million units out of these would contribute towards exports and thus earn precious foreign exchange for the country.
Policy press
Industry growth is unfeasible without a strong and favourable policy framework. The auto sector looks attractive from this perspective as well. India’s Automotive Plan (AMP) 2006-16 as a policy framework envisages a platform that can support robust growth across different horizontals of the sector. Envisaging auto sector investments of $40 billion, the plan aims at positioning India as a global automobile player in the next few years to come. The 25-point plan AMP aims at making India a global manufacturing and export hub for small cars, multi-utility vehicles, two and three-wheelers, tractors and components.
Global showcase
With technology changing the world every second, interacting with the global auto fraternity is of tremendous importance. Indian auto manufacturers have come a long way in the recent years and are regular participants at auto shows around the world. The Indian Auto Expo itself has evolved into a splendid showcase for Indian manufacturers to let the world know of their mettle and for them and the public to get a hang of the global auto pulse.
Attracting huge crowds in every edition thus far, the 2010 avatar of the Auto Expo looks all set to inundate the track record of not only the previous editions but also that of some of its global contemporaries. Experts believe that the Auto Expo 2010 will end up being the biggest in the world, expected to nudge ahead of the global supremacy of The New York and Shanghai Auto shows. While we will have to wait to see if that happens, the prospects are certainly alluring. With an impressive bench of brands and models set to unravel auto splendour during the exciting seven days of the event, Auto Expo 2010 is something you can’t afford to miss.
Events like the Auto Expo are platforms to envision higher growth trajectories in the domestic industry at large. The Auto Expo will certainly provide a platform for global auto majors to find mutual synergies with the developing Auto Component industry in India. It will also prove a catalyst to raising quality benchmarks in the domestic industry in line with the global standards. The end user ultimately ends up being the real winner with newer and better vehicles to look forward to in the near future.
Incessant growth
In line with its close correlation with development all around the world, the Indian auto sector also looks set to add momentum to the rapid strides that India is putting towards its development goals. The future looks all good for the Indian auto industry and maybe it is here that we will see the next paradigm shift in the way people commute all around the world. The theme of this year’s Auto Expo, mobility for all and green technology seems a fitting one for envisaging this paradigm shift. The Indian auto industry must express its futuristic perspective in both the fields and thus earmark a resonating contribution to the global auto sector.
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Last Updated on Thursday, 18 February 2010 09:11.
A bunch of passionate musicians who listen to their heart and soul. Here is a story that unravels the happiness of being in sync with your heart. All of us, at some point of time in our lives, have had the opportunity to connect with our inner souls. Be it those testing times when life seems so low, or the beautiful moments when we feel on top of the world – there are many of those precious moments when our inner voice resonates and tends to blend with the outside world.
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