Auto com­po­nents in­dus­try growth

Commercial Vehicle - - CONTENTS -

The Auto com­po­nents in­dus­try is ex­pected to clock healthy growth on the back of prod­uct changes that en­tail re­plac­ing metal with high-grade plas­tic and lighter me­tals, higher elec­tronic con­tent and reg­u­la­tions. Emerg­ing tech­nolo­gies such as au­to­mated man­ual trans­mis­sions, anti-lock brak­ing sys­tems, elec­tronic con­trol units, and ad­vanced en­gine de­signs are pre­dicted to be the key trends go­ing for­ward. With safety the main con­cern, re­quire­ment for ad­vanced driver as­sis­tance sys­tems for lane as­sis­tance, dis­tance con­trol, and ve­hi­cle-to-ve­hi­cle com­mu­ni­ca­tion are also on the rise. In 2019 fi­nan­cial year, Crisil Re­search ex­pects the auto com­po­nents in­dus­try to grow at the rate of 12 to 14 per cent yearon-year over a high base on the ba­sis of de­mand from do­mes­tic man­u­fac­tur­ers. Led by im­proved ru­ral de­mand, as­sum­ing a nor­mal mon­soon and state pay com­mis­sion pay-outs, the firm ex­pects higher sourc­ing from Com­mer­cial Ve­hi­cle (CV) and trac­tor man­u­fac­tur­ers who are known to ben­e­fit from the govern­ment’s in­fra­struc­ture push and four con­sec­u­tive years of good crops. Ex­ports are ex­pected to rise by eight to 10 per cent year-on-year given the firm global au­to­mo­bile de­mand. Ex­ports to coun­tries in South-East Asia and Latin Amer­ica (Brazil es­pe­cially) are also ex­pected to im­prove. With global trade and geopo­lit­i­cal is­sues as key el­e­ments, ex­ports in the 2019 fi­nan­cial year could be marginally lower than the pre­vi­ous fis­cal due to ca­pac­ity con­straints faced by auto com­po­nents play­ers.

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