As it grows and develops at unprecedented rates, these are exciting times for the Indian vehicle industry. India Brand Equity Foundation IBEF, a government trust, states that vehicles account for 7.1% of the country’s GDP, exports are rising and more foreign companies are now manufacturing in India. These include BMW, Honda, Ford, Suzuki, GM, and FIAT. The Huffington Post recently quoted Elon Musk, founder of Tesla Motors telling BBC listeners, “Long term it’s going to make sense to have a Gigafactory in Europe and probably one in India.”
Business news publication Live Mint reported that more than 2.5 million passenger vehicles are sold in India each year, and that figure is growing annually by 7.6%. This growth makes India the world’s 5th largest car market and the global growth leader with every chance of reaching the number 3 position by 2026. Maruti Suzuki predicts that in 3 years, local annual car sales will reach 5 million. The central government’s Auto Mission Plan II forecasts the passenger vehicle market will more than triple to 9.4 million units per year in the coming decade helping to generate an additional 65 million jobs.The central government's Auto Mission Plan II will help generate 65 mn. more jobs by the next decade. Click To Tweet
The country’s OEMs (Original Equipment Manufacturers) produce a wide range of vehicles with supplier tiers covering engine parts, drive chain, body and chassis, suspension and brakes, electrical components and systems. These are all seeing significant, in some cases double-digit, growth. Changes to the tax system and the government’s Make In India policies are also achieving significant and welcome support at many levels.
Because of the unprecedented changes that the market is experiencing and its fast growth, the industry faces many new challenges. Chief among these is the need to innovate, changing consumer patterns, alternative vehicles and varied propulsion types mean that competition now comes from established vehicle makers as well as technology-based companies such as Google’s autonomous vehicle, (recently renamed Waymo) and the Apple iCar which some media speculate may be officially announced this year.
To achieve long-term competitive advantage, many Indian manufacturers are innovating not just products but their whole working methodology. They are gearing up for the future by investing in R&D in all areas such as hybrid and electric vehicles, improved safety features, emission reduction, better logistics, industry 4.0 and technology that integrates their entire enterprise. This change is important because when individuals within an organization share a single business platform they can collaboratively innovate, scale up production volumes and future-proof their operations.
Ford India has major plants in Chennai and Sanand. The company’s founder Henry Ford understood that collaboration is the key to progress when he said, “If everyone is moving forward together, then success takes care of itself”.
A business platform that brings people together and helps them work in international teams allows vehicle OEMs, and their supply chains to operate with common processes and standards. Removing silos of data by combining them into a single unified structure so that there is only one version of the truth. The same interface powers Industry Solution Experiences, based on 3D design, analysis, production environment simulation and logistics intelligence software in a collaborative, interactive environment. Throughout India, these applications are being used on premise and in public or private cloud creating and enhancing value chains throughout the industry.
There has never been a better time for the Indian vehicle industry because growth equates with success. However, costs must be cut and design time reduced. International and inter-departmental teams must work together seamlessly. Warranty risk must be borne by supply chain partners who need to calculate lifespans at the design stage. Weight has to be reduced without affecting durability; factories must become more efficient and precise financial control of all operations is paramount.
We find it inspiring to partner with some of the most innovative vehicle enterprises and witness how, by unifying their enterprises through cloud technology, collaborative innovation flourishes, and many challenges are resolved and turned to commercial advantage.