By Pramod Thomas:
The Society of Indian Automobile Manufacturers (SIAM), the apex Industry body representing leading vehicle and vehicular engine manufacturers in India, held its 58th Annual Convention in New Delhi on September 6, 2018, with the theme, ‘Building the Nation Responsibly, Future of Mobility in India’. The industry body sought a long-term regulatory and fiscal policy roadmap for India’s automotive sector as it heads towards electric vehicles and future mobility. SIAM urged the government to provide clarity on rules for automakers to plan further investments, and to cut tax on electric vehicles to make them viable for the manufacturers and consumers.
Dr Abhay Firodia, Outgoing President, SIAM, and Chairman, Force Motors, in his inaugural speech, said that In India policies changed abruptly creating uncertainty in the industry. He called for a 10-year policy roadmap for the sector which will give more sustainability and growth to the sector as vehicles are no more luxury goods and are important for driving the economy.
“A long-term regulatory policy will be a boon for the industry. Once it is announced it should not be changed soon. A vehicle is an integrated, complex machinery manufactured with globally compatible technical regulations and norms. Just after four years of moving to BS-IV, transition to BS-VI emission norms is too fast. Since the industry today is far more complex, there is a need to build an ecosystem and the transition needs to be more gradual than having a sudden disruption. IC engines are not going to roll over and die, and
will continue for at least a decade,” he said.
Firodia added that the auto industry is not against electric vehicles and will not step back in delivering competitive and technically viable EVs if there is a clear policy for the government.
“Without a formal policy to promote EVs, actions to enable proliferation of EVs will not help the industry. EV adoption is a gradual process, it does not happen overnight. A clear policy and ecosystem is required for this transition. Lack of long-term policy will jeopardise the confidence of the industry,” he said.
Responding to the industry demand, Union Minister of Heavy Industries and Public Enterprises, Anant G Geete, assured that the government would soon come out with a new Auto Policy.
“There should be no fear. While we are going through a process of change, we also have to understand the need of the consumer. The new policy will be industry, consumer and environment-friendly. It is important for us to move on and change with the times. If we don’t we will slip back. We are here to work for and ensure the growth of the industry,” the Minister said.
Dr Rajiv Kumar, Vice Chairman, NITI Aayog, said that the auto industry is in the midst of disruption. “Since India has engineering and software capabilities, the country is in a unique position to tap all the opportunities in the sector. India can join the frontline industries in the world of mobility which will be connected, shared, data-driven, and with minimum carbon footprint. The transition, which is happening in the industry now, is critical as it is a huge employment provider. We have to plan this transition. And this has to be carefully managed. Let our R&D expenditure go beyond one percent. NITI Aayog is open to new ideas and suggestions,” Dr Kumar said.
He informed that NITI Aayog is finalising a framework for the auto industry and is coordinating with state governments to form a task force and come out with a paper for future mobility. There has to be a unified and convergent view on electric mobility among the states and the central government. In our federal system states are equally important players.
Rajan Wadhera, President, Automotive Sector, Mahindra & Mahindra, said that India’s auto sector has grown in size and stature and has plans to create 65 million additional jobs. “The industry faces massive challenges but despite all odds, it is working hard with different stakeholders and the government to ensure sustainability and growth. Going forward, the challenges will be complex. Topics such as sustainability, safety, vehicle ownership, urban congestion and technology maturity will drive future mobility in India,” he said. Wadhera was later elected as the new President of SIAM.
Ram Venkataramani, President, Automotive Component Manufacturers Association (ACMA), and Executive Director, IP Rings, said the quality of exports, which provide job opportunity to over 3.2 million people in India, has improved a lot. “There is significant room for growth. More than 60 percent of India’s exports go to matured markets in Europe. We are committed to 2020 BS-VI deadline. We are moving ahead to autonomous and connected vehicles,” he said.
Rakesh Bharti Mittal, President, CII, and Vice Chairman, Bharti Enterprises, said India’s competitive weakness is in design and product components in the auto sector. The sector is working on advancement of manufacturing technology, up-skilling and re-skilling workers and employees. “More has to be done for sustainability, safety, new value propositions, increased software components in car, in-depth alignment, working closely with supply chain, new technology and to be future-ready,” he said.
Commercial Use Of EVs
The Union Minister for Road Transport and Highways, Nitin Gadkari, told a special session at the convention that electric and alternative fuel vehicles for commercial use will not require permit to ply on roads. Various permits, such as contract carriage buses, goods carriers, cabs and all-India tourist, are given to different categories of commercial vehicles by the state governments. He said that 15 percent of electric vehicles in the country in five years would be a good number to go by.
“This will open more businesses for the industry. Our government has given priority for development of bio-fuel. Our price-centric mentality needs to be cost and comfort-centric. Any two-wheeler can be run as a taxi in non-metro cities and this will provide large employment opportunities for young people,” Gadkari said.
He urged the industry to look at diversification and viable businesses. “You can explore water transport, which will not only be economical but also provide growth for the auto sector. We are adding more roads and highways and industry is benefitting from them. The government is ensuring seamless, faster traffic which will connect people and goods faster. More access to fast track and electronic toll plaza is being given. We are also cancelling speed governors. We don’t need them as we are developing good roads. There is no need to limit the speed artificially,” the Minister said.
He said the industry must ensure better models, engines and produce high performance vehicles. Gadkari also spoke on road safety.
Dharmendra Pradhan, Minister for Petroleum and Natural Gas and Skill Development and Entrepreneurship, gave his views on BS-VI emission norms and its benefit to the auto industry and assured that the government will ensure a level playing field for the industry.
“By April 1, 2020, BS-VI-grade fuel will be made available in the country. The ministry has so far invested Rs 70,000 crore to prvoide the infrastructure. The public sector oil companies have invested Rs 10,000 crore for the development of ethanol and biogas and Bio-CNG. Uptake guarantee will be given by oil PSUs, if anyone converts Biogas into Bio-CNG,” Pradhan said.
In his address on, ‘Mobility Revolution-Transformational, Sustainable and Inclusive’, Guenter Butschek, MD and CEO, Tata Motors, said that mobility in India was poised to take a giant leap towards the future. “Three Fundamental challenges impeding industry outlook are Road Safety, Rising pollution and Unsustainable Economy. Changing consumer preferences, intensifying competition and progressive policing have opened up new opportunities thereby redefining mobility. The only approach to holistic growth is IST : Inclusive, Sustainable and Transformational,” Butschek said.
He urged for a proactive approach and a joint policy making platform of the Government, SIAM and ACMA.
Felix Kuhnert, Global Automotive Leader, PricewaterhouseCoopers, said that the auto OEMs and technology companies will collaborate in the future, and the world is moving towards a Robo-Taxi economy.
Peyman Karger, Senior Vice President, Nissan Motor Corporation, said that Nissan will commercially produce easy drive Robo-Taxi by 2020.
Anat Bonshtein, Chairman and Director, Smart Mobility Initiative, Prime Minister’s Office, Israel, said that the Israeli Government has created the ecosystem for R&D and development of smart mobility and alternative fuels.
Dr Pawan Goenka, Managing Director, Mahindra & Mahindra, in his address on ‘Readiness for Automotive Mission Plan 2016-26’, said that OEMs and suppliers have together invested $35 billion during 2000 to 2017 in the sector.
“In the last three years till 2018, there has been a five percent improvement in fuel efficiency. Around 17 of Top 20 PVs are available with ABS and dual airbags. The industry has implemented 15 regulations (against eight during 2008-2014) and 27 are under implementation, and has accepted the challenge to jump to BS-VI by 2020. There was a 2– 3.5 percent increase in selling price Vs 8.3 percent increase in CPI,” Goenka said.
He pointed out that clean air and global warming, rise of shared economy, emergence of other LCC and protectionism were the major concerns of the industry.
Sumit Sawhney, Managing Director, Renault India, said that by 2021 India will be the third automotive market in the world after China and the US.
“Automotive is the second largest employment generator after textiles. However, it is the most regulated industry. A common understanding with central and state governments is the need of the hour,” he said.
Niti Aayog CEO, Amitabh Kant, said that the policy regime had to be both clear and consistent with regard to the automotive industry. John Simlett, Global Leader, Future of Mobility, Ernst & Young, while speaking on ‘Transformation Vs Disruption’, said that the mobility market is being driven by customers, cities, investors and is enabled by Data and Technology.
“Over the next 15 years, India will have to build between 7.5 billion and 9.5 billion sqft of residential and commercial space each year just to keep pace with population growth. In China, air pollution causes an estimated 1.6 million deaths per year. Resources are limited and there’s a need to increase infrastructure, yet advancements are behind. Australians’ travel time increased 15 percent between 2002 and 2011. Travel is the second largest household expenditure in Australia, between 10-17 percent of household income,” he said.
He pointed out that cities are becoming market developers and regulators, developing roadmaps, and working with business to experiment with new mobility service solutions.
Dirk Wisselmann, Senior Advisor, Automated Driving, BMW Group, said that autonomous driving opens new opportunities for customers and community. He remarked that, in the future, further automation levels and more complex use cases would require additional sensors.