Needed, more autoelectonics manufacturing in India

Ingredients present to ramp up from outsourced model to consuming model: MAIT

A growing number of discerning customers, willing to pay for features, B-segment cars more "loaded" at prices not very different from earlier, and the overall automobile market growth in India will combine to make manufacturing of auto-electronic components viable in the country, representatives of the industry said here.

The result will be shifting gears from India as a tried-and-tested outsourcing destination to an India that will consume cars that are safer, more fuel efficient, and in the bargain offer greater comfort and entertainment, Sanjay Handu, chairman, southern Region, of the Manufacturers' Association of Information Technology (MAIT) told Business Standard.

Using India as a base for making embedded software for various sensors and chips that go into cars is already happening, Handu said during a MAIT organised meet here on "growing synergies and emerging opportunities" in autoelectronics. Component makers such as Robert Bosch were already exploiting Indian talent in this area.

What is now emerging is the "synergy" between the technology and the platform: the coming together of electronics hardware makers, auto engineering and the IT companies. "Increasingly, you will see that subsystems will get built here," Handu says.

The overall trend of volumes being driven by the least safe, minimum features small car is seeing sub-trends that will grow. The average Indian car buyer is also beginning to change cars faster. The first change is often an upgrade to a B-segment car.

Newer models, such as the Maruti Swift and the Hyundai Getz, come with standard features that were till recently optional -- power steering and air bags. "Safety," Handu said, "should be the number one driver of the auto-electronic components market in India."

This will also be helped by the movement, as customers become more aware of international trends, from passive parts such as seat belts to the active ones such as anti-lock braking systems, traction control systems, and in the case of crashes, air bags.

These changes are happening slowly, but "the point is, we don't have a learning curve to go through, in terms of the technology. All it takes is to identify what is needed to penetrate the market here in those segments that drive volumes."