Auto Components Industry- Shaping the New Normal.

India to become the top automotive manufacturing hub of the world.

Automotive Component Manufacturers Association of India (ACMA), the apex body representing India's auto component manufacturing industry, recently hosted its 60th Annual Convention under the theme Auto Components Industry- Shaping the New Normal. The event witnessed participation of over 2000 delegates and eminent dignitaries from the government and ministries, OEMs, industry bodies and think tanks. The event was graced by Nitin Gadkari, Union Minister for Road Transport & Highways, and MSMEs, Government of India, Piyush Goyal, Union Minister for Commerce and Industry and Railways, Government of India and Amitabh Kant, CEO, NITI Aayog who shared their views on Shaping the New Normal for the auto component sector.

ACMA also used the platform to launch its mobile application, which was unveiled by Director General, Vinnie Mehta. This new application will be a one stop destination for all the users and the industry players for information on the products and services.

ACMA in partnership with McKinsey & Co., also released a study on 'Shaping the New Normal' that gives a strategic roadmap to the industry with newer trends and opportunities in the new normal. The study recommends the auto suppliers to take four key actions that include Increasing the localization to capture USD12 billion opportunity for import substitution, collaborate and step into adjacent sectors that involve focus on aftermarket with distinct go-to market strategy, optimize to become competitive to reduce15-20% cost and enable a winning mindset by making digital, analytics, and automation a way of working. The study further highlights on the role of Government and industry bodies as a critical differentiator in the sector's recovery.

Nitin Gadkari, stated, “We are constantly working to foster growth of MSMEs, develop the road infrastructure and focus on safety guidelines and increase adoption of alternative cleaner fuels in India. We understand that road are critical for the growth of automotive sector and in these challenging times we have been constructing 30 kilometres of roads every day. The Government is also working on 22 green-expressways and the component companies can set up automobile manufacturing cluster next to these expressways. We plan to bring the Scrappage policy which has been a long-standing demand from the industry within a month. We believe that the auto industry has reached international standards and we will soon become the top automotive manufacturing hub in the world.”

Piyush Goyal, said, “ACMA has been the forefront of shaping the new normal. We must now foster a spirit of collaboration, cooperation and commitment to grow and compete with the rest of the world. I am confident, that with a collaborative approach and working with stakeholders and suppliers, the auto component industry is on the road to success.”

Amitabh Kant, said, “The current times has been challenging which has given a huge opportunity to adapt and leapfrog to the world of tomorrow. The auto component industry is a strong representation of Atmanirbhar Bharat and we see India's recovery on the back of automobile and component manufacturing. We must make the Indian companies excel, capture the large domestic market and using it as springboard to penetrate the international market. The future course requires to focus on local manufacturing and across tier 1, 2 and 3 suppliers as we believe all resources and capabilities are available in India. We need to ramp up R&D to create indigenize technology and therefore reduce imports. There is also need for new synergies such as with IT industry in the areas of power electronics. India must look at using the first mover advantage for producing all components for electric vehicles, thus driving towards the path of being a future global leader. The Electric vehicles battery prices are set to go below USD 100, throwing a huge opportunity in the sector to localise. Moreover, we also need to re-skill our existing workforce with information related to electronics and digitization.”

Deepak Jain, President, ACMA said, “Though we have witnessed challenging and inescapable new realities during the COVID19 pandemic, we must now consciously work for the future. In the past month, we have seen a massive rebound to almost 100% in most segments, which is indeed heartening. We now look forward to the upcoming festive season and the industry to achieve a significant level of normalcy by November 2020. With a view to create a sustainable industry, our auto-component manufacturers will have to gear themselves to the realities of a dynamic and volatile environment and reinvent their business models to deal with the new set of challenges.”

Jain further added, “This year of resilience has strengthened our spirits and we are confident that we will surpass the current disruptive challenges facing us and create a new paradigm in global quality, manufacturing excellence and sustained competitiveness for an Atma-nirbhar Bharat.”

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