Auto Components Manufacturers Plans to Invest in India

The Indian automobile components industry has travel a long way since the country's economic liberalisation opened up the automobile component sector in the early 1990s. From a quiet supplier of low-value components to the larger industry, the industry has transformed itself into a global hub for sourcing a range of high-value and critical automobile components. The Indian auto components industry is a favourite industry for many global automobile manufacturers such as GM, Toyota, Ford, Volkswagen, Suzuki, etc., who source auto components worth millions from India.

From past few months the automobile component manufacturing industry is facing a historic slump but that does not deter auto component manufacturers to invest more in India. An automotive components and systems manufacturer, "Anand Automotive Systems", plans to invest Rs. 6 billion(Rs. 600 crores) to set up 13 more plants in India. Anand Auto Group coprises 18 companies in India with 44 manufacturing locations and now the company plans to go ahead with its expansion plans.

According to the Investment Commission of India, global automobile manufacturers see India as a best place for the manufacturing of auto components and are rapidly increasing the value of components they source from India due to:

* Competitive cost in terms of labur and raw material.
* Its already established manufacturing base.
* Many global auto component makers including Delphi, Visteon, Bosch and Meritor have set-up their plants in India.
* Many International Auto manufacturers including GM, Ford, Toyota, Suzuki etc. and auto components manufacturers have set up thei IPOs(International Purchasing Offices) in India.
* India is also emerging as a global hub for R&D : GM, Daimler Chrysler, Bosch, Suzuki, Johnson Controls etc. have set up development centres in India.

The heavy demand from domestic and global auto companies makes this sector the fastest growing manufacturing sector in India. According to the Auto Components Manufacturers Association of India (ACMA), this sector is likely to grow at a CAGR of 11 per cent between 2007–15 to touch US$ 40 billion by 2015.