A Chinese invasion of the auto landscape

As seen in Australia, tariff cuts may have an unwelcome outcome for domestic car makers

ILLUSTRATION: BINAY SINHA STAY INFORMED THROUGH THE DAY @ WWW.BUSINESS-STANDARD.COM T he Indian automobile industry is poised for disruption with the large-scale entry of Chinese auto firms, especially in the electric mobility sector. These changes will affect the fortunes of existing automakers, as well as jobs and imports.

In the next few years, Chinese companies could make one in every three electric vehicles (EVS), along with numerous passenger and commercial vehicles on Indian roads, either directly or through joint ventures (JVs) with Indian firms. Just one JV between SAIC Motors (owner of the MG brand) and India's JSW Group aims to sell over 1 million new energy vehicles by 2030.

The JV wants to recreate the "Maruti Suzuki moment" of the 1980s that revolutionised the Indian auto sector.

SAIC Motors is one of the "Big Four" state-owned Chinese automakers. In 2007, SAIC Motors acquired British car maker MG Rover's assets after it went bankrupt. It uses a plant in Halol, Gujarat, previously owned by General Motors, to produce vehicles like the Hector and the ZS EV for the Indian market.

SAIC Motors is not alone.

Chinese car company BYD (Build Your Dreams) Auto sells a range of electric vehicles in India, as well as buses, trucks, cars, and sports utility vehicles (SUVs). BYD entered the commercial vehicle sector independently and through a partnership with Megha Engineering under the Olectra brand.

Recently, BYD has also started importing ready-todrive cars in completely-built-unit (CBU) form.

Similarly, Volvo cars are also being imported from China in completely-knocked-down (CKD) kits.

Chinese companies like Changan Automobile, JinkoSolar, and several bus and truck manufacturers, including Zhongtong Bus and Foton Motor, contribute to China's automotive presence in India. Additionally, several others like Great Wall Motors and Haima Automobile are looking to enter the Indian market.