FOR IMMEDIATE RELEASE Auto Ancillary Market Outlook – Growth in Automotive industry drives the Auto Parts Market in India Netscribes (India) Pvt. Ltd. launches Auto Ancillary market in India 2014 report covering a market with strong growth potential. The report is part of Netscribes’ Automotive and Logistics series. Mumbai, India – November 18, 2014 – Global market intelligence firm, Netscribes, Inc. released its latest report on the ‘Auto Ancillary Market in India 2014’. The market is rapidly growing with the rapid growth of automotive industry and increasing production of automobiles, resulting in increased demand for Auto Ancillaries. The report highlights the analysis of the drivers and explains the factors for growth of the industry. Growing automotive industry, the auto after market demand, the healthy economic outlook also opportunities from new US IT Compliance Law, are the key drivers of this market. Auto makers are placing bulk orders for supply of auto parts to the auto parts manufacturers. India is also an attractive destination for the foreign investors with consistently increasing FDI in the automobile sector. The original equipment manufacturers (OEMs) and the aftermarket or replacement market are the two prime source of demand for auto components in India but Strong aftermarket provides better sales stability and higher operating margins than an OEM.
There are various challenges too that the Auto Ancillary industry faces, Rising labor costs, Counterfeit Market, Technical Inefficiency and depreciating currency are the major challenges faced by the auto ancillary industry. Rise in steel prices further adds to the cost disadvantage as steel is a primary raw material for the auto ancillary industry. Organized sector facing serious threats from rapidly growing counterfeit market in India, Fake auto parts hold a considerable amount of share of the total aftermarket. Since the finishing and packaging of fake parts closely replicate the original products, consumers fail to differentiate between the fake and original parts. Depreciating currency has adverse impact on the imports resulting in declining profits for the import dependent auto parts manufacturers. However, on the positive side, it has increased the cost-competitiveness of exports and also OEMs will look towards sourcing from local players due to higher price of imports Government has plans of setting up the National Automotive Board (NAB) which will act as a catalyst between the government and the auto parts industry. Auto Component manufacturing companies should identify the long term growth pockets and enhance global competitiveness accordingly. They should diversify into adjacent fields of business, such as defense, construction, farm implements etc. They should also cooperate with government to enhance country competitiveness.
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