Auto focus

Magna eyes Indian CV segment

| Updated on: Dec 10, 2015
image caption

Auto supplier keen on expanding its customer base

Magna International is eyeing the Indian commercial vehicle (CV) industry as a critical growth engine in the coming years.

The Canadian auto component maker is already part of the rapidly growing car segment where its clients include Ford and Mahindra & Mahindra. The engineering that goes into seats and other body parts could now be extended to CVs.

While the Indian passenger car market is estimated to grow three-fold from four million units to 12 million by 2030, Magna is also keenly following the Centre’s directives on old and polluting CVs by taking them off the roads. This will spur demand for new trucks and generate more business for suppliers like Magna.

Positive outlook "We are definitely considering CVs as an opportunity in India especially when there is a move to phase out older vehicles on pollution concerns. This will provide a big push to CV sales,” says Deval Desai, Executive Director, Strategy and Planning, and Country Manager India, Magna International.

This becomes even more relevant with road transport poised to grow with better connectivity in the coming years. "Our current product portfolio is good enough to cater to the CV segment. These include mirror, latches, windows and seating systems," he says.

Further, India’s macroeconomic indicators are positive developments for component makers. As Desai says, China's car market grew much faster than estimated in the last decade thanks largely to higher GDP per capita.

Local focus "In India, signs are looking good and our policies are going in the right direction. Infrastructure has to be in place for people to drive vehicles. Hence, the primary driver would be higher GDP per capita that can fuel the demand in the coming years," he adds.

Magna’s product portfolio includes body and chassis systems, power train, mirrors and closure components. "One differentiator we have as a global automotive component supplier is that we do our engineering, production and process engineering here in India. We know the market requirement and, based on that, design and make our products here," says Jim Tobin, Chief Marketing Officer and President of Magna Asia. He was here for the inaugural of the newly set up facility at Sanand in Gujarat this week.

Magna is particularly bullish on India and has sufficient capacity in place to cater to any short-term spurt in demand. It plans to fully use this capacity first before going in for further expansion.

"We see production increasing for two reasons: higher consumer demand coupled with exports. We have capacities built up here and would like to further invest in the second phase of automobile growth in India,” says Tobin.

Apart from Ford and M&M, Magna also meets the needs of Nissan and Volkswagen. The company entered India in 2006 and has since expanded from a single facility to 12 manufacturing locations and three engineering centers which focus on extensive design and R&D.

Published on March 10, 2018

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