The auto component industry is facing the heat of recession. However, there are a few benefits of this recession time. There is no pressure of meeting the deadlines of delivery of existing products. The auto component makers, especially the medium sized companies are now evaluating options of cost cutting. According to the auto makers, they are spending more time on the shop floor to bring back more discipline in the assembly. The recession time also provides an opportunity to them to look into different avenues to develop new product and improve their existing product line as well.
“Now that there is no pressure of delivery for existing products, we are able to give more attention to developing new products, new customers,” says Mr K. Vidyashankar, Managing Director, MM Forgings. He also comments that the market may grow up to 10 percent in the worst case. “In happy times, companies focus on only meeting increasing production schedules,” says Mr. C Jayrajan, Managing Director, of Bangalore Based Aditya Auto Products.
The companies are also able to look for new customers and not depend upon single big customer for major chunk of their sales. Mr Ajith Kumar Rai, Managing Director, Superijit Engineering says that the company is not dependant on a single customer for more than 15 percent of its sales. The company has also been able to cut its inventory and use alternative materials and add value engineering.
