Don’t be cost-centric but focus on quality, Gadkari tells auto parts makers

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November 24, 2020 3:30 AM

Nitin Gadkari called upon the automobile industry to push for manufacturing of flex engines, which have the versatility to use petrol or ethanol/ CNG as fuels.

In a recent report, ICICI Securities said cement’s industry average operating margin grew 25% Y-o-Y in FY’20 and further rose 20% Y-o-Y to over Rs 1,250/tonne in the first half of the current fiscal.In a recent report, ICICI Securities said cement’s industry average operating margin grew 25% Y-o-Y in FY’20 and further rose 20% Y-o-Y to over Rs 1,250/tonne in the first half of the current fiscal.

Union road transport and highways minister Nitin Gadkari on Monday asked the auto component industry to refrain from a cost-centric approach and instead focus on the quality of the products on the lines of international manufacturing standards.

The minister also asked the automobile industry to encourage setting up of a local ancillary industry, which will reduce dependence on the imports.

“Quality is important. You should understand the approach of the consumer now; they need good quality,” Gadkari said.

He said the government is aiming at creating core global competencies in India by facilitating seamless integration of the automotive industry with the world. The government is trying to create an ecosystem to accelerate the uptake of electric vehicles in the country.

Addressing a virtual conference at Auto Serve 2020 on the theme of ‘Seizing opportunities in the new normal’, Gadkari asked the auto industry to work jointly towards achieving a broader national agenda of reducing pollution.

He elaborated on the steps taken to promote electric vehicles, such as reducing GST to 5% and allowing delinking of battery cost of two- and three-wheelers from vehicle cost as it accounts for nearly 30% of the cost.

The battery charging ecosystem is very important and the government is planning to set up at least one electric vehicle charging kiosk at around 69,000 petrol pumps across the country, he said.

Gadkari also said, “The government is also working towards making India a global automobile manufacturing hub in the next five years. This is my dream. This will also contribute in fulfilling the Prime Minister’s vision of Atmanirbhar Bharat.”

He said this goal is attainable as the auto industry has made significant strides in terms of development of designs and models, robust R&D, huge market, stable government framework and bright and young engineering minds. India is already the largest manufacturer of two-wheelers in the world, he added.

The government has earmarked over Rs 51,000 crore for this sector under the production-linked incentive (PLI) scheme, the highest amongst the 10 champion sectors. He also said there is a huge requirement of about 25 million skilled jobs in the automobile sector in the near future. This industry is going to create the maximum jobs and growth, he said.

He called upon the automobile industry to push for manufacturing of flex engines, which have the versatility to use petrol or ethanol/ CNG as fuels. The Indian auto industry needs to follow the example of its counterparts in Brazil and US in this regard. “Our industry will utilise the opportunity being thrown up by the alternative and less polluting fuels like CNG, hydrogen and electricity,” he said.

Gadkari also said the government is working towards making an e-highway between Delhi and Mumbai.

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