Financial Daily from THE HINDU group of publications
Saturday, Dec 13, 2003
Industry & Economy
Waiting for Volkswagen in Vizag
Ch. R.S. Sarma
Visakhapatnam , Dec. 12
THE small-scale and medium-scale automotive units here are gearing up for the arrival of Volkswagen, amid speculation that the German major has almost cleared the proposal to set up a Rs 1,700-crore plant and that only a formal announcement is yet to be made.
However, there is no official statement yet on the issue either from the State Government or the company.
The enthusiasm of the local entrepreneurs over the proposed plant was evident on Friday on the second day of a two-day vendor development meet organised by the Confederation of Indian Industry (CII).
The delegates discussed ways and means to make use of the great opportunity likely to be thrown up by the entry of the company.
"It would be the best thing to have happened to Visakhapatnam after the setting up of the steel plant and it will really galvanise the local industry,'' said Mr Shekhar Movva, Managing Director of Synergies Dooray Automotive Ltd, a company in the Special Economic Zone which manufactures and exports aluminium alloy wheels for vehicles.
He suggested that the local auto component manufacturers identify their competencies and develop common testing facilities to measure up to the quality standards of Volkswagen.
"The boom in the auto components segment is likely to continue for quite sometime and so we must rise to the occasion.''
Mr B.C. Varma, Deputy General Manager (Development and Certification), Mahindra and Mahindra, said that it was quite possible that Volkawagen too might develop its own vendor base in India at a later stage, while importing the parts initially, as Suzuki did in the case of Maruti.
"Local units should prepare themselves. It will stand them in good stead, as the segment is really booming now,'' he added.
The local units have been advised by the experts to upgrade their quality standards and obtain ISO-9001 certification as a preliminary.
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