Auto cos swear by north: survey

New Delhi, Aug 1 | Updated: Aug 2 2005, 05:30am hrs
The auto industry in north India is optimistic about its business prospects inspite of the infrastructural bottleneck and lack of proper business environment, and refuses to accept that south India is better for business than the north, says a survey on the business perception for the auto and components industry carried out by the PHD Chambers of Commerce and Industry.

The survey covered 60 units located in Delhi and the National Capital Region, Punjab, Haryana and Rajasthan and found 60% of the respondents didnt agree that they would have done any better if they were located in south. They prefer to continue their operations and expand them from their present location rather than relocate to the south.

The business confidence is stemmed from the fact that around 70% of the respondents expect a growth in sales during the next six months. Three out of six respondents said that their profit margins had increased by 10% in the last six months, due to higher sales volumes. Around 20% said their sales margins remained unchanged but could increase by 4-8% in six months whereas 10% of the respondents expect lower sales.

Companies are also upbeat about their future exports with 70% units described the progress in business in the next six months as average or good. And none of the units that participated in the survey felt the climate would worsen.

However, all impediments to large-scale growth of the industry are also crystal clear. Around 90% said lack of adequate infrastructure, high power tariff, archaic labour laws, multiplicity of taxes at the state level, corruption and intransigent attitude of the government are some of the long-standing obstacles in the path of progress.