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Lack Of Skilled Man power is a Threat to Indian Auto Industry

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India is the second fastest growing auto market in the world. Lack of skilled manpower can hamper the growth of the auto market in India.

The biggest challenges in the auto industry are the skilled labour and the infrastructure. The industry’s drive for a turnover of $145 billion is obstructed by the infrastructure development and because of lack of employees.

According to Automotive Mission Plan (AMP), 25 million people are provided with the employment. Out of the total automotive sector, 30% accounts for the manufacturing. Employment is provided for 13 million people either directly or indirectly to the industry. Although many engineers are produced every year, only 20- 30 % of people are eligible for employment. Next to China, India is the country with 26% increase, and the man power which is needed is 30 million by 2022.

Coming to the infrastructure, Indian ports are not sufficiently equipped with the electronic information exchange for the exports. India even lacks the experts for R&D capabilities like prototyping of a product.

When compared to the global average percentage 5-8% is spent for R&D, domestic players in India are spending very less i.e. 1%. The domestic passenger vehicle market is expected to improve from 1.9 million units to 3 million units by FY 15. Even the exports of passenger vehicles is expected to be improved from 0.4 million units to one million units by FY15.

Coming to the two wheeler industry growth has increased from 10 million units level to 16 million units. Thus, India will be retained at the second position when growth is compared , next to China.

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Filed under Business
Aug 3, 2010