SMC president tells auto component suppliers to localise aggressively, step up R&D

The advice comes amid the Centre's clarion call to manufacturers across sectors to cut imports and become self-reliant

Localise aggressively and step up research & development to become self-reliant, Suzuki Motor Corporation (SMC) President  Toshihiro Suzuki told India's auto component makers in his address at the 60th Annual Session of Automotive Component Manufacturers (ACMA).

India subsidiary Maruti Suzuki India contributes over half of SMC's global sales. In a separate video, SMC Chairman Osamu Suzuki said SMC was committed to 'Make in India'.

“Localisation in India is now viable as the volumes have increased over the years. Request you to localise aggressively,” said Suzuki. This, he added, would help the companies improve cost competitiveness in India and outside.

Suzuki’s request to suppliers to step up localisation comes amid the Centre’s clarion call to manufacturers across sectors to cut imports and become self-reliant.

Maruti’s imports (those by vendors and the company), as a percentage of net sales is 15-20 per cent. In FY20, it paid royalty to parent SMC at a 5.3 per cent rate.

“You must focus on R&D to generate IP (intellectual property) in the process,” he said adding that it’s time for manufacturers to graduate from build-to-print to art-to-part.  

Meanwhile, the auto component makers should not take their eyes off quality, human resource development and safety of their employees, he said.

Addressing the Society of Indian Automobile Manufacturers' (Siam) annual convention on Friday, commerce and Industry Minister Piyush Goyal told automobile companies in India to reduce royalty payments to their parent firms as it would help them sail through the crisis easily.