Making India a World Class Automotive Hub will Bolster Machine Tool Industry

India’s automotive industry is evolving at a rate faster than ever before. Riding on the back of a buoyant end-user market, positive consumer sentiments, government initiatives and return of adequate liquidity in the financial system, the industry is poised for its next big leap.

The automotive industry of India which is one of the largest in the world accounts for 7.1% of the country’s GDP. As per data published by the Society of Indian Automobile Manufacturers (SIAM) the automotive industry posted 14.41% growth in domestic sales in the April 2017 to February 2018 period. The Government of India’s Automotive Mission Plan 2016 - 2026 envisions the automotive industry to grow approximately 4 times by 2026 with around 10% CAGR for vehicle sales volumes.

Automotive and machine tool sectors have a symbiotic relationship. The growth of the country’s automotive sector drives the demand for machine tools since it is one of its biggest clientele.

Over 50% of the machine tool industry’s production is supplied to automotive industry. The steady growth in sales of commercial vehicles, three-wheelers and two-wheelers has impacted the demand for machine tools positively. It has brought business to machine tool manufacturers and we are witnessing a sizeable growth in orders and the volumes of sales has increased.

It is estimated that in 2017-18 machine tool industry’s production would touch Rs. 7250 Cr, recording a growth of 25% and the consumption would touch Rs.13950 Cr., recording a growth of 20%.

Moving forward Indian machine tool industry needs to upgrade its capability and processes, gear up to venture into new areas such as Internet of Things which will further establish it in benchmarking itself against the best in class globally.