India to be 2nd largest auto market in a decade: GM

Wednesday, 18 April 2007, 07:00 Hrs
Printer Print Email Email
New Delhi: Indian manufacturing costs are extremely competitive and among the lowest in the world, even as this country is poised to become the world's second largest market in less than a decade, a top executive of General Motors (GM) declared here Tuesday.

"This is not just because of low wages but also because of the Indian attitude that abhors waste," GM chairman Rick Wagoner maintained during an interactive meeting here.

The Confederation of Indian Industry (CII), the Society of Indian Automobile Manufacturers (SIAM), the Automotive Components Manufacturer's Association (ACMA) and the American Chamber of Commerce (AMCHAM) organised the event.

"India is expected be the second largest auto market in less than the projected 10 years. The growth will be driven by overall economic growth, rising disposable income and a rapidly expanding middle class," he added.

Wagoner said that over the next 10 years, emerging markets within the Asia Pacific region alone are expected to account for nearly 70 percent of global sales' growth.

"Three of the top five fastest growing auto markets over the next decade are going to be in Asia Pacific including India," he contended.

Wagoner attended the interactive session immediately after a meeting with Prime Minister Manmohan Singh during which he pledged GM's full participation in India's economic growth.

"India is very important to GM's strategic plans. We reckon that if we have to succeed (globally), then we have to do so in emerging markets like India," he maintained.

GM, which began manufacturing in India in the early 1990s, today offers a range of mid and upper-end motorcars and sports utility vehicles. It will soon launch the entry-level Chevy Spark, a re-engineered version of the Daewoo Matiz.

To leverage what Wagoner termed the "immense intellectual capacity available in this country", the company has also established a technical centre at Bangalore where some 800 engineers and doctorate-holders function as part of GM's global Project Development Team. The centre is only one of seven such the company runs worldwide.

"We are also looking to source more parts from India for the global market," Wagoner stated.

In this context, he referred to the four "lessons" GM had learnt about running a worldwide business:

* Tailor your activities to the local market

* Get local in as many aspects of business as fast as you can

* Offer products that are focused specifically on local customers' needs, wants and desires, and

* Learn from the new, leaner and more cost-efficient models frequently found in developing countries like India.

Terming the India experience as "great" and a "jewel" in the GM family, Wagoner said the automobile industry here provides huge job opportunities, as for every direct job created by vehicle manufacturers here, 15 more jobs were created in support.

According to Wagoner, India's new 10-year automotive plan "lays out a thoughtful strategy to develop and leverage the potential and GM wants to play an important role in the government's initiative".

Speaking on the occasion, Minister for Heavy Industries and Public Enterprises Sontosh Mohan Dev said the Automotive Mission Plan 2006-2016 released by the prime minister earlier this year had identified three areas of intervention at the levels of the government, the industry and academia.

"The policy objectives include making India an international hub for manufacturing passenger cars, tractors and two-wheelers," he added.

"The policy also underlines the crucial need for setting up world-class automotive testing facilities and the implementation of an emission roadmap," Dev stated, even as he stressed on internationalising safety norms and establishing an inspection and certification regime.

The minister said the government has already initiated an Automotive Testing and R&D Implementation Project (NATRIP) to given the Indian automotive industry a distinct edge amongst the newly emerging automotive destinations.

As part of this, testing and homologation centres will be established in the northern, southern and western hubs of India, while a world-class centre for testing tractors and off-road vehicles will be established on more than 4,000 acres of land in central India.

"In the second phase of growth, we expect more and more OEMs (original equipment manufacturers) to use India as a domestic base for exports," he added.
Source: IANS
Fossil Group sells smartwatch
Global watch and accessories maker Fossil Group has announced to sell its smartphone technolog..
Ola raises Rs 400 cr for electric
Leading ride-hailing cab aggregator Ola on Friday said it raised Rs 400 crore from its early in..
GST rate cut to spur Bengaluru
The realty market in India's tech hub is set to grow as lower Goods and Services Tax (GST) rate..
SpiceJet plans aggressive
Budget passenger carrier SpiceJet plans to aggressively expand its international networks to fl..