It is estimated that in the next four or five years, out of every three cars on the road, one would be a product manufactured in Gujarat. According to Abdul Majeed, partner and head of auto practice in PricewaterhouseCoopers India, “Over the next three-five years, we estimate Gujarat will have an installed capacity of over three million per annum, nearly half of the total capacity in the country by then.” Industry experts feel that the total car sales will probably be 4.5 million to 5 million by 2015-16.
Gujarat Chief Minister Narendra Modi has not only allowed Tata to set up its factory in the state, but is also negotiating with Maruti Suzuki, Ford India, Kia Motors and Peugeot PSA for the same. There are various reasons that have enticed the car manufacturers to throng Gujarat.
Companies like Ford and Maruti Suzuki feel quite positive about opening up manufacturing units in Gujarat. Ford plans to shift its plant from Chennai to Gujarat; the facility that is capable of producing 200,000 units per year.
Michael Boneham, the President and Managing Director of Ford India, says, “The new facility at Gujarat will complement our world-class operations and facilities in Tamil Nadu wonderfully. Ford selected Gujarat because of its pro-business environment, infrastructure, access to ports and skilled workforce.
Our second plant in Sanand will give us access to the north-western region, which is by and large the biggest market for passenger cars in the country. Gujarat will also help us get access and balance in India from a logistics aspect.”
Maruti Suzuki, India's largest auto maker also plans to shift its plant and is considered to be the leading investor in the automobile sector in Gujarat. It has invested around Rs. 18,000 crores and signed an agreement with the state government to build 2 million capacity unit in the Mehsana District of Gujarat.
R.C. Bhargava, Chairman of Maruti Suzuki India Limited (MSIL) says “I think all major projects on expansion and new projects are now coming to Gujarat. I have not heard of any going to other locations. The capacity being built up there will be equivalent to what is currently available across the country for cars.”
It is assumed that the Mehsana centre, where all these new plants are coming up, will move ahead of the other centres like Pune, Chennai and Manesar in Haryana.
However, there are a few drawbacks that may emerge at the time of setting up manufacturing units in Gujarat. A major deterrent would be filling the void with skilled and experienced workers. Since Gujarat comprise oil and petrochemical
Industries in majority, the workers are trained accordingly and thus, car manufacturing plants are likely to bear the brunt.
Thus, with these automobile manufacturers coming to Gujarat, the state is definitely going to become an auto hub in the coming years and eventually get ample of opportunities to strengthen the economy as a whole.
