What are the necessities for Indian auto industry to grow?

Even luxury market manufacturers like Mercedes and Porsche are scrambling for a share of the Indian pie by rapidly launching new models in this country. The latest launch by Ford of the Figo in the entry level segment follows a host of other new models being unveiled by other manufacturers who are now trying to get a toehold in all categories of passenger cars. With production being ramped up by nearly all players, India will emerge as an export hub for cars being supplied to the Asian region.

The Indian Auto industry must start manufacturing to global, if not better, standards first. Then only we can be globally competitive. We have all the skill set in the world and all the brains in the world. But on the quality front we are lacking. 

Let the readers here react to two questions:

1. Recently I saw the Manza - a tata car - which was launched a few months ago. It has some nice features but the plastic used in the car is terrible. It presented a stark and trashy appearence. Lower prices should not mean cheaper looks and quality.

2. Does any one know the ratio of cost of manufacture and taxes in the price of a car. The govt attitude is that Car is still a high end luxury. With that attitude and taxation, the car manufacturer provide cost reduction often by reduction in quality on many fronts. The entire tax structure on the purchase of a new car should be studied and revised drastically. When will it happen and why has it not happened already?

Focus on quality production rather than mere production and call off the product launched in the market to avoid reputation damage.

India is one of the fastest developing country where the incomes of an individual are increasing with the passage of time and with that the demand of luxury is increasing too. In this economy the upper class people wants to fall in the premium segment, the middle class are crawling ahead to be on the upper segment and lower class towards middle. With this growth they are desiring to fulfill their luxurious need. And if a support will be provided to them, they will leap ahead. As easy availability of car loan by reducing procedure and offering at lowest interest and EMI, the demand will significantly increase resulting in the growth of Indian Auto industry.

It is a fact that Indian roads are already so congested with vehicles of all types , that adding more vehicles to this situation is like adding fuel to fire.

Secondly , with fuel prices rising , transportation of goods by road will also become more expensive compared to transportation by rail.

India also has one of the worst accident records as far as roads are concerned. Nothing is being done to suggest that the roads will become any safer in future.

Considering all this , since the infrastructure is already in place as far as auto manufacturing is concerned , and also considering that Indian designers are coming up to international standards , I feel the Indian auto industry should start concentrating on exports. It just requires a shift in thinking.

1. Invest in R & D, innovation and sector specific education

2. Look for alternative energies and materials.

Copy paste can at best allow them sustain, thanks to size of market and not grow.