The country must become self-reliant in growing the production of critical automotive components, or vehicles will continue to be expensive in the coming years.
It’s high time that the Indian automobile industry must form new strategies to reduce dependence on importing electronic components such as semiconductors from China and other countries, says Maruti Suzuki India MD and CEO Hisashi Takeuchi. The country must become self-reliant in growing the production of critical automotive components, or vehicles will continue to be expensive in the coming years.
At the 64th annual Automotive Component Manufacturers Association of India (ACMA) session, Takeuchi said that the automotive industry is experiencing a transformative shift, spearheaded by escalating demand for convenience, comfort, safety, and compliance with government regulations. Customers are looking for cars infused with the latest technologies and cutting-edge features, which increases the demand for electronic items in cars.
Reports suggest India currently imports over 80 percent of its components from China and other countries. In FY2023, the company also urged increasing component production within the country as global shortages impacted its production lines tremendously in the last fiscal year. The company manufactured around 19.22 lakh units in 2022-23 but failed to reach the target of 20 lakh units in the last financial year. The mint exclusively reported that Maruti’s total production, including passenger vehicles and light commercial vehicles, stood at 1,54,148 units, down 6 percent from 1,63,392 units in March 2023.
According to the CEO, the biggest impediment is providing customers with cars loaded with the latest technology at affordable prices. Strategies must be formulated to furnish and integrate new-age features without compromising on cost-effectiveness. In an effort to meet this goal, investments in R&D are a priority. The industry must also understand the dynamics of the domestic market and form partnerships throughout the value chain.
If partnerships start now, the required chips can be developed and manufactured in India. Investments in the workforce are another crucial requirement to bolster the industry. Workers need to be trained in robotics, mechatronics, SCADA (Supervisory Control and Data Acquisition), and new-age technologies to assist the shop-floor engineers.
