The automobile component makers are facing severe slowdown in their market demand owing to the flat or no sales in the market. The car makers have cut down their production plans which have eventually resulted in decline in demand for the auto parts.
Auto component firms are now eyeing aerospace, prosthetics and power segments to boost up their sales. They are also targeting the aftermarket in India and overseas. These auto component firms are also looking at building new components as per the changing Euro emission norms. "With emission norms changing and given the fact that the Obama administration is keen on promoting clean technology, OEs have postponed their requirement by about a year. Instead of June 2010, we are now working to meet the 2011 timelines," said an official from one of the top auto component firms. He further added that the company is planning joint with Chinese firms to step up its auto components business by catering to the demands from the aftermarket in the US.
Another auto component maker endorsed that the US aftermarket is definitely a promising opportunity for the auto component makers. "Even if they look at a $ 2.5-3 billion aftermarket volume in five years time, it would benefit them tremendously. Wipers, starter motors and alternators are products that Indian companies can evaluate through cost-competitive strategies," said VG Ramakrishnan, Automotive and Transportation Director, Frost and Sullivan.