Synergising with global supply chains can drive gains for India’s component suppliers

The Automotive Component Manufacturers Association (ACMA) recently held the second New Delhi Automotive Summit 2017 on the theme of ‘Synergising with Global Supply Chains’.                

The two-day summit, held on February 3-4, saw the presence of Girish Shankar, secretary, Ministry of Heavy Industry and Public Enterprise, government of India as the chief guest; Chaand Sehgal, chairman, Samvardhana Motherson Group and Motherson Sumi Systems; Deep Kapuria, chairman, The Hi-Tech Group; Rattan Kapur, president, ACMA and Nirmal K Minda, vice-president, ACMA.

Ms. Priyam Saraf, economist - Young Professional, Trade & Competitiveness World Bank Group, presented the results of a recent World Bank study on the Indian auto-component industry's competitiveness in the global value chain and the imperatives for the industry to stay competitive in tune with the dynamism of the global automotive value chain.

Girish Shankar said, “The Indian auto components industry is expected to grow fivefold, touching a turnover of US$ 180 to 200 billion in the next 10 years. The government is continuously focusing on enhancing the ease of doing business in India, GST being one of the biggest initiatives for the cause, which will help streamline the prevailing indirect tax structure in the country. It is crucial for the Indian automotive industry to synergise with the global supply chain and focus on R&D and innovation.”

Chaand Sehgal, chairman, Samvardhana Motherson Group and Motherson Sumi Systems, said, “Keeping pace with the changing face of mobility in India and the world, faster adoption of new technologies has made the Samvardhana Motherson Group a globally preferred solutions provider.

"Some essentials which have differentiated us from the others include a clear non-monetary vision of working in synergy with our customers, treating employees and shareholders as strategic partners, building a future roadmap through a five-year performance projection with focus on three growth pillars: organic, growth, joint ventures and alliances and inorganic growth through acquisitions. Further, there is a need to move from products to solutions considering the parameters of quality, cost, delivery, design, management, safety, environment, and sustainability.”

Rattan Kapur, president ACMA, said: “The past few years have witnessed a systematic shift as Indian auto component manufacturers are making a conscious effort to move away from ‘Build to Print’ to innovation, R&D, and creation of products and IP, with quality as the bedrock. Technology has the capacity to bring about disruptive changes as we are witnessing today with the fast adoption of hybrid vehicles, electric vehicles and autonomous vehicles. Our exports have grown at a CAGR of 18% over the last six years to 160 countries with the presence of 40 IPOs, which is a matter of great achievement for us.”

Kapur called on the government to enable setting up of R&D facilities in various parts of the country where ACMA members, especially the smaller ones, can come together for joint research programs and technical training.

Giving a backdrop to the Indian auto components industry, Deep Kapuria, chairman - Trade Fairs, CII; past president, ACMA, and chairman, The Hi-Tech Group said: “The Indian auto components industry is going through a transformational period with the concept of mobility changing continuously. The business model of the industry is fast evolving and shifting from a manufacturing to a service-intensive industry. The shift requires the supply chain to change in order to build synergies with global value networks. The industry needs to contemplate about the contingencies of de-risking against natural calamities which disrupts the supply chain and compliance with increasing tax structure.”