Association Interview India: Driving to New Horizons

Editor: Lisa Saller, Lisa Saller

The steady growth in the auto component sector stands to be bolstered by various Government of India initiatives around infrastructure development, skilling initiatives and ease of doing business.

Arvind Balaji , ACMA President
Arvind Balaji , ACMA President
(Photo: MM Indien)

Associations such as the Automotive Component Manufacturers Association (ACMA) are undertaking initiatives to support the current scenario and encourage further growth through expanding avenues. President, ACMA and Joint Managing Director, Lucas-TVS Ltd, Arvind Balaji shares his views on the potential of this industry in the coming years and what this segment does to emphasize India’s position globally.

The automotive and auto ancillary industries are the primary drivers of the Indian machine tool industry. What is the growth of the machine tool industry in India?

Arvind Balaji: The automotive industry in India accounts for 60 per cent of the machine tools consumed in the country. The domestic machine tool manufacturers provide significant capital cost advantages over imported tools. Over the years, the Indian machine tool industry has improved in technology and is well positioned for medium accuracy requirements; however, to be globally competitive, areas such as reliability, solution engineering, new/improved technology & products and delivery commitment/CRM need to be focused upon.

According to the recent ACMA–IMTMA joint study conducted by Roland Berger Strategy Consultants, it is observed that the machine tool industry in India is facing strong competition from foreign players who have advantages in terms of technology, workmanship, quality, robustness, delivery commitment, etc. However, Indian machine tool players have an edge over the overseas counterparts in terms of cost, flexibility, availability of spares, service network presence, etc. The domestic machine tool manufacturers also provide cost advantage over imported tools. Furthermore, some large domestic machine tool players are developing new products and adopting new technologies in their offerings.

In the next five years, the entire Indian automotive industry across vehicle and component segments is expected to witness robust growth that will propel the machine tool consumption in India from $1.3 billion in FY14 to $3 billion by FY20 growing at a CAGR of 14 per cent per annum.