ACMA: Industry rebounding but still a long way to go
Even as some industry players are witnessing year-on-year growth, the Indian automotive industry is still far behind its peak of FY2019.
The Indian automobile industry has been showing signs of recovery in the past 3 months. The good news is that last month production in many segments were at the level of August 2019, shares Deepak Jain, president, ACMA, at the 60th annual conference of the association.
However, it’s no reason to celebrate yet. Even as some industry players are witnessing year-on-year growth, the Indian automotive industry is still far behind its peak of FY2019. Especially during the first half of that year, points out Jain. During that period the industry clocked average daily production of 92, 000 vehicles a day. At 57,000 vehicles a day currently, the production level is down 38 percent. “Supply chain is still struggling to meet even the muted demand,” says Jain. Lack of skilled manpower, inadequate availability of finance, rising cost of production are some of the challenges being faced by the Rs. 3.49 lakh crore Indian component industry. In FY2018-19, the Indian component industry clocked a turnover of Rs. 3.95 lakh crore.
However, with a resilient sprit the industry is advancing with hope. Much of the shipment of vehicles by OEMs to the market in August is also to build up the inventory for the festive season. In some cases, there may be aggressive build up of inventory in order to make the most of the expected demand. “We look forward to the festive season for growth to get back on track,” says Jain.
Jain, who today starts his second year as ACMA’s president, says, “It’s truly been a year of resilience.” Now the increased focus of ACMA will be to secure the industry better against various vulnerabilities.
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