IBM and University of Michigan Reveal India’s Automotive Industry Challenges

IBM and University of Michigan Reveal India’s Automotive Industry Challenges

A study unveiled today by IBM (NYSE: IBM) and the University of Michigan’s Transportation Research Institute reveals that India still needs to overcome significant challenges to continue its rapid growth in the automotive industry, and that the path to success is an even stronger partnership between industry and government. India faces challenges in the areas of transportation infrastructure, product quality, and skilled workers as well as labor and tax regulations. The study authors interviewed industry executives, academics, industry experts, and government officials to get a picture of what India itself sees as the real future state of its automotive industry.

India is expected to be one of the top 10 countries in terms of vehicle sales by 2015. The number of four-wheelers sold in 2006-2007 was about 1.4 million. But industry executives interviewed for the study expect sales to double to 2.8 million by 2010 and triple to 4.2 million by 2015. The interviewed executives also expect an increase from 7 to 17 million two-wheelers from 2005 to 2015.

“The Indian government will certainly play an integral role in shaping the automotive industry and its future. Their Automotive Mission Plan could be construed as a step in the right direction as it outlines development goals till 2016, including the role of the government in improving infrastructure, tax and labor law revisions,” said Bruce M. Belzowski, assistant research scientist & associate director, University of Michigan Transportation Research Institute, Automotive Analysis Division. “Most of the interviewed industry experts are optimistic about government’s support for the growth of the industry.”

Read the complete Press Release