The Indian auto and auto components industry is growing at a steady pace of 15 - 18 per cent annually. As per the estimates, the retail market (generally called as after-sales or after-market) for auto components is valued at Rs 600 crore (US$ 107.12 million) and is expected to witness a quantum jump on the back of robust domestic demand. Rajkot-based Ikon Marketing Consultants predicts that the Indian auto component industry, which is currently valued at US$ 30 billion, will touch US$ 100 billion by 2020.
As per industry estimates, Indian auto component industry derives 60 per cent of its turnover from sales to domestic original equipment manufacturers (OEMs), 25 per cent from sales to the domestic replacement market and around 15 per cent from exports.
According to industry statistics derived by the Automotive Component Manufacturers Association of India (ACMA), engine parts form the largest segment (31 per cent) of auto part industry followed by drive transmission and steering parts (19 per cent). Suspension & braking parts and body & chassis account for 12 per cent each in the entire product range, followed by equipment accounting for 10 per cent of the same.
Further estimates made by ACMA reveal that auto component exports would robustly grow at a compounded annual growth rate (CAGR) of 18.8 per cent over 2011-21, garnering about US$ 29 billion. OEMs account for 80 per cent of the exports while the rest 20 per cent is handled by aftermarket or retailers. European and North American markets account for 36 and 23 per cent of the entire industry exports respectively, while 28 per cent of the exports are made to Asian countries.
Supportive Government policies, positive business environment, availability of reasonably priced talented workforce and stable outlook for the industry has made India a global hub for the international manufacturers to set up their facilities in the country. The auto components manufacturers are also reaping the benefits.
Blaupunkt, the German in-car entertainment brand, has set up its plant in India via a 55:45 joint venture (JV) with its business partner AutoSonics India. Till now the brand was present in India through multi-channelled distribution networks for almost 15 years. Industry experts believe that the alliance will help the company boost its access points, improve after-market sales and connect better with OEMs.
In a bid strengthen its presence in Asia, French auto components maker Faurecia has set up a new, expanded research and development (R&D) facility in Pune. The Tech Center, developed for conceptualising, designing and validation for products in automotive interior systems, automotive seating and auto exteriors, is the company's second centre in India after Bangalore.