Indian automobile representative body, Society of Indian Automobile Manufacturers (SIAM), held its 57th Annual Convention that focused on “Building the Nation, Responsibly” topic and saw every single automobile manufacturer participating with full energy. As the Indian company’s lays its eye on future a lot was spoken today about the frequent changes in government policies and the improper road map that has not just caused confusion about the future growth but has prompted many companies to hold on investments till a clear path is constructed. The outgoing President of SIAM in his inaugural speech expressed his frustration on policy changes, the addition of cess but is also hopeful that the current government will form the future policy changes that will help in sustainable growth for both the nation and the industry. Union Minister of Road Transport & Highways, Nitin Gadkari was one of the chief guests of the event and called upon India’s automobile industry to gear up to face the competition heating up in the international market. He further said that Indian automotive industry has done well despite facing various regulatory hurdles and environmental issues. He accepted the blame and said that it is not the manufacturer's fault. OEM’s including two-wheeler manufacturers believes that constant disruption has caused a negative impact on the entire auto-industry. For developing the complete ecosystem for the auto sector, "stable policy is one of the important things we need in the ecosystem", said Venu Srinivasan, Chairman, and Managing Director, TVS Motor Company.
The move from BS-III to BS-IV was required and the minister applauded the industry for the successful move and accepting losses worth thousands of crore after the top court did not allow the company’s to sell the BS-III compliant vehicles from 1st April 2017.
“I am proud to say that the auto industry has always been one among the leading players in our nation building, and that too responsibly. When it comes to sustainable and environment-friendly transportation, the Indian auto industry took up the challenge and agreed to go through the pain of leapfrogging towards the better environment by accepting BS6 norms from 1st April 2020,” Mr Gadkari observed.
With no dedicated ministry to monitor the policy and taxation structure in the automobile industry none of the government body’s are taking the responsibility which has resulted in major loss during the transition from BS-III to BS-IV and the involvement by different state governments, Green courts, NGT, Transport commissioners have made it difficult to do the regular businesses.
Speaking at a SIAM function, Venu Srinivasan further added: "Courts, unfortunately, coming in and changing the BS-IV introduction created such a great deal of pain for the whole industry."
The talk of electrification circled around the SIAM annual convention as was the hot topic for the day. Manufacturers like Mahindra and Mahindra who have already ventured in electric vehicles are very happy with the move and have been filling government notified tenders to purchase electric vehicles. While others like Maruti Suzuki, Tata Motors, Hyundai Motor India still awaits a clear road map for electrification and some incentives to manufacture them at mass scale.
Guenter Butschek, CEO & MD, Tata Motors said “The industry understands and fully appreciates the regulatory and policy changes but what we seek today is a platform to ensure a well-orchestrated, collaborative and participative approach from the Government for a policy framework that enables and supports sustainable growth. Today, we live in a world of complexity and hence focus, speed of execution and quality of implementation across the ecosystem will be key to our success.”
Although the minister was bullish on the size and market of Indian auto industry and directly linked it to India’s GDP growth, he pointed out that as more vehicles are coming on road, the government will have to increase lanes of roads and highways to meet the demand which will cost the government about 80,000 crore. In its current form, India will not be able to handle the existing infrastructure and the auto industry along with the government should come up with a diversified solution. “We need to bring in qualitative reforms in the automobile sector and expand the scope of rural transportation while bringing in newer technologies and encourage electric vehicles,” Gadkari asserted.
Venu Srinivasan. Chairman, TVS Motor Company Limited was of the view that the GST and demonetisation will make a transparent economy.
“The most important disruption is the electrification. It is something certainly going to happen by 2030 or 2040, I cannot say. But at least 30 per cent of the vehicle will be electric,” Srinivasan, an industry veteran apprised.
Dr. Abhay Firodia, chairman of the Force Motors Limited said that the government is closely monitoring the DNA of the manufacturing industry, especially the auto sector in India to ensure that it is as per the global standards.
“It is good that Indian automobile industry is taking up this challenge despite shocks in the past year. We had disruptions due to demonetisation last year. We have the GST now. We had transition to BS IV emission norms in an unplanned manner owing to which we suffered losses. We need a clear, firm policy guidelines concerning fuel, new technologies, and clean transport. This would ensure that the industry doesn’t suffer jerks and losses,” Dr. Firodia stated.
Kenichi Ayukawa, Treasurer, SIAM and Managing Director & CEO, Maruti Suzuki India Limited called India as a unique country where the auto industry offers a large scale employment. He, however, pointed out that there are some concerns like issues related to CO2 emissions, growing traffic, and accidents.
The event united the Indian automobile industry and the government allowed the industry representatives to take out its frustration and promises to work together to achieve a mutual goal of sustainable development.