Auto components industry set to grow 6 per cent

The auto components industry is expected to post growth figures of up to 6 per cent in the current fiscal after witnessing a decline last year, industry body Automotive Component Manufacturers Association (ACMA) has said.

Turnover in the auto components sector dipped by 2 per cent to Rs 2,117 crore in 2013-14, largely due to flagging vehicle sales, high capital costs, high interest rates, currency fluctuations and slowing down on investments in manufacturing. The sector now hopes for better times in this fiscal, riding on the back of vehicle sales growth as witnessed in the past few months.

“The last fiscal has been one of the most challenging for the automotive industry in India. However, with the automotive sector being a key driver of the economy and  growth returning to vehicle consumption in the last couple of months, we expect the component industry to grow in the range of 4-6 per cent in the current fiscal 2014-15,” ACMA President Harish Lakshman said.

According to data released by ACMA, investment in the auto components industry also declined in 2013-14 to about US$ 700 million, compared to around US$ 1.2-1.7 billion in the previous fiscal. The industry body is hopeful that this year investment figures will be even better.

Exports however, increased posting growth of 16.7 per cent to Rs 61,487 crore in 2013-14 as compared to Rs 52,690 crore in 2012-13.