Global auto companies bring onboard Indians to grow sales

Foreign makers bank on Indian market for next gen auto growth

Even as the slowdown in the domestic economy continues to take its toll on car companies, global auto majors are increasingly turning to local managerial expertise to prepare for the next wave of growth in the Indian market.

In a major change of guard in its Indian operations, Italian car maker Fiat last week appointed Nagesh Basavanhalli as president and managing director of Fiat and Chrysler India. Basavanhalli, who earlier headed the group’s technical centre out of Chennai, succeeds Enrico Atanasio who is set to assume responsibilities for the company in the Asia-Pacific region.

Fiat stated the change was as part of ongoing efforts to strengthen its business position in India. The company - with two products on offer in its portfolio in India – registered a decline of 56 per cent to sell a mere 6,471 units in the India market between April and December last fiscal.

Basavanhalli’s appointment comes at a time when in a major product offensive Fiat is set to unleash nine new products badged under the Jeep, Abarth and home brands over the next three years in the Indian market.

It is not Atanasio alone who has in recent times relinquished charge to a local executive. In December last year, Ford India appointed Joginder Singh as president and managing director to step in in place of Australian Michael Boneham.

In Ford again, Vinay Piparsania was brought in from the Group’s operations in Philippines as executive director (marketing, sales & service) in place of Nigel Wark. In Renault too, Britisher Len Curran made way for Sumit Sawhney as head of sales & marketing at the French car maker.

“Automobile companies examine their strategies continuously and explore possibilities of shifts in top management to innovate in sales and marketing. Global auto majors are appointing executives with deep local knowledge to connect better with Indian consumers”, says Abdul Majeed, partner and leader (automotive practice), Pricewaterhousecoopers.

Majeed’s contention is evident in the organizational restructuring underway at Korean auto major Hyundai’s Indian subsidiary. Sanjay K Pillai, vice-president (human resources & general supporting), informs, “The sales organization is divided into five zones, viz North, South, East, West and Central zones, 13 regions and two branch offices. Except the south zone head, all the other positions are manned by Indian executives. We aim to achieve 100 per cent target of having Indian department heads by 2014.” Right now, around 89 per cent of all department heads in Hyundai India are Indians.

“The current restructuring is part of a global initiative to encourage local executives to manage key positions. While the expats bring a certain degree of global inputs to the management system, the Indian management have a better understanding of the finer nuances of local conditions and hence help in increasing efficiency and productivity while fostering greater harmony amongst employees”, adds Pillai.

Earlier last year, while Sudhir Rao was appointed managing director at Volkswagen (VW) group company, Skoda Auto India -  a position left vacant for over two years since Karsten Bogun retired, a new position was created to bring in Arvind Saxena as the managing director of the passenger car business at Volkswagen India.

V G Ramakrishnan, senior director, Frost & Sullivan, says, “Expats brought in the investments and laid out the foundation. Now that the product strategies are in place for the next seven to eight years, and the organizations have matured the local team is ready to take on more responsibility in heading operations in the country.”