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New challenges for auto industry in restart phase amid COVID-19 crisis: Tata Motors MD

Guenter Butschek says COVID-19 hit industry at a time when it was managing transition from BS-IV fuel emission norms to BS-VI in a new fiscal while battling extremely low activity and subdued demand in 2019-20

twitter-logoPTI | September 5, 2020 | Updated 22:43 IST
New challenges for auto industry in restart phase amid COVID-19 crisis: Tata Motors MD
Tata Motors MD and CEO Guenter Butschek

Calling for a collaborative approach among stakeholders, Tata Motors MD and CEO Guenter Butschek on Saturday said there are new challenges for the automotive industry in the restart phase of the economy.

"Now that we are in the restart phase, new challenges like growing virus cases and acute shortage of labour have come up. The end of the lockdown doesn''t necessarily mean that we are post-COVID, because it is still there, it can possibly create more intermittent disruptions," Butschek said.

He was speaking at the 60th annual convention of the Automotive Component Manufacturers Association of India (ACMA) in New Delhi on Saturday. Stating that COVID-19 has placed extraordinary, unprecedented demand on the industry, he stated that the pandemic hit the industry at a time when it was managing transition from the BS-IV fuel emission norms to BS-VI in a new fiscal while battling the extremely low activity and subdued demand in 2019-20. The impact has been nothing short than devastating, he added.

He said that supply chain disruption has been a significant problem for the automakers globally in this crisis along with funding issues, a slump in demand, among others. "Collaboration in this new environment are equally important between sour suppliers and strategic partners and OEMs," he said, while emphasising the need for working together.

Butschek said that the industry is seeing green shoots in the sub-sectors of industry in the last two months since the gradual opening of the economy.

The Tata Motors chief said that Prime Minister Narendra Modi's Aatmanirbhar Bharat is aimed at taking India to the next level, repositioning India as a global hub by not only focussing and leveraging the Indian market but also going global. To achieve this, auto component makers being a key part of the whole automotive eco-system industry has a role to play, he said.

"We must stretch beyond products and focus on building design. We need to make the design in India and then Make-in-India. With the frugal approach to production in India, we will have the opportunity to take on the global supply chain," Butschek said.

"If we would like to become a global hub, we just can''t be the global hub for manufacturing leveraging the scale of market or labour cost," he said.

Also read: Slowdown Blues: Tata Motors MD says Indian auto industry growth story about to collapse

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