Indian Auto Component Industry Research Articles

The Indian auto component industry – Estimation of operational efficiency and its determinants using DEA

In this paper, the performance analysis of the Indian auto component industry is carried out from the perspectives of an original equipment manufacturer and a component supplier. Various efficiency measures are estimated using Data Envelopment Analysis with publicly available financial data on a representative sample of 50 firms. The first stage analysis reveals various operational inefficiencies in the auto component industry which are subsequently decomposed into technical, input mix and scale efficiencies. The study finds evidence that a majority of the inefficient firms are operating in the diminishing returns to scale region and demonstrates potential savings through benchmark input targets. A second stage analysis aimed at exploring root causes of inefficiencies finds that substitution of labour for capital could be causing a variety of inefficiencies including the input mix inefficiency in the Indian component industry. The empirical results also suggest that, unlike the global auto supply chain, higher average inventories are required for higher operational efficiencies in the Indian context. Contrary to the popular expectations, the technology licensing does not show significant influence on efficiency, at least in the short term, whereas efficient working capital management does result in higher operational efficiencies. The study also unearths the need to reform labour laws which are significantly contributing to various inefficiencies in the Indian component industry.

QS 9000 as a Stepping Stone to TQM a Study in Indian Auto Component Industry

Post liberalization in the nineties, Indian economy transformed with an influx of multinational automotive companies into India. The entry of these foreign auto companies changed quality standards and impacted the complexity of the parts required by OEMs. The component manufacturers embraced the practices of Total Quality Management (TQM), Total Productive Maintenance (TPM) and lean manufacturing practices . The journey towards TQM was propelled by the vision to become global. One of the strategies that Indian component manufacturers adopted to become part of the global value chain was the QS 9000 certification. This paper is an attempt to understand the impact of QS 9000 certification on TQM implementation. It ascertains the role that QS 9000 certification plays in transforming organizations with respect to the critical success factors of TQM implementation. The analysis is based on data collected for a specific study on TQM among auto component manufacturers in Chennai. Data pertaining to the level of critical success factors was examined prior to and post certification, to draw conclusions.

Knowledge management in SMEs in India: a study of the automotive components sector

The global automobile industry is facing a lot of challenges in the changing scenario. There are number of new issues facing the firms and original equipment manufacturers are transferring many of the responsibilities to the suppliers. Knowledge management is widely accepted as a source of competitiveness. Increasing environmental standards and safety concerns, and the search for alternative fuel technology, are putting a further premium on knowledge creation and knowledge management. The knowledge management requirements and its implementation for small firms is different from that for large firms. The Indian auto component industry, which is dominated by small and medium firms, has been performing quite well over the last decade. This paper studies the state of knowledge management in the Indian auto component sector.

SMEs and Globalization: A Delhi Automotive Study

The automotive industry in India has metamorphosed from a virtually non existent, low-quality-low-volume industry to a conglomerate of one among world best auto manufacturers with highest growth rate with in last 15 years. The earlier studies revealed that Indian automotive industry was not competitive enough for the global market due to inferior quality, lower labour productivity and high cost of raw materials in India (Khisty, V., 2004)1. Recent trends show that Indian auto component industry has become the hub of high quality, low cost products. How the industry has changed in last one decade is an important burning issue to be analysed. The reforms adopted by the government have opened up tremendous opportunities for investment and technology transfer. Indian firms are now looking for joint ventures and technology transfer specializing niche technology and to complement their range of products with the world's latest and the best. It is important to know the dynamics of the industry while it is undergoing a tremendous restructuring. The various technological and non-technological innovations that have been brought in by the industry to capitalize on the opportunities in the wake of globalization need to be closely monitored. In India, the National Capital Region (NCR) of Delhi alone accounts for almost 40% share of the overall component industry. A case study based on automotive sector in the NCR of Delhi was initiated to examine the effect of Globalization, Competitiveness and Innovation. The study is a part of a major programme on the vast industrial growth in NCR. The main focus is on innovative activities and initiatives in enhancing capabilities in technology, RD export obligations and policies of progressive liberalization have actually brought confidence and dynamism in the industry.

Managing the Supply Chain for Global Success a Case Study of Indian Auto Component Industry

From a country that sold just a few hundred thousand cars annually a decade ago, over a million cars roll out of Indian factories every year to fuel a vibrant component industry with global quality and technology standards.
 McKinsey and Company has predicted that the Indian automobile component industry would grow to a whopping $33-40 billion by 2015, out of which the global outsourcing of components could be to the tune of $20-25 billion! The Indian auto component manufacturers would see an exponential growth in output over the next decade. The industry is growing at a compounded rate of 20-25%, much faster than that of the domestic market (10-14 %). Many consider this growth in exports as just the tip of the iceberg similar to that witnessed by the information technology industry in the early 1990s. The sustained growth of Indian auto component industry can be attributed to many factors, but primarily to efficient management of the supply chain.