Schaeffler AG Navigates Supply Chain Hurdles, Bets on Hybrid Vehicles in India
Schaeffler AG, a global automotive and industrial supplier, is navigating supply chain hurdles while adapting to India's evolving vehicle market. The company, which specializes in precision components and systems, is facing challenges such as steel and semiconductor shortages, intense competition for shipping containers, and commodity price inflation.
In response to these obstacles, Schaeffler has achieved 80%-85% localization in the region, a strategic move aimed at reducing costs. Meanwhile, the company is also looking ahead to the future of mobility in India. Dharmesh Arora, CEO of Schaeffler Asia Pacific, believes that hybrid cars can bridge the gap in India's underdeveloped electric vehicle (EV) infrastructure.
Currently, electric cars account for less than 1% of India's annual car sales, a stark contrast to China's nearly 10%. Maruti Suzuki India Ltd., the country's largest carmaker, is echoing this sentiment, focusing on hybrid models due to the slow uptake of electric vehicles and charging infrastructure issues. Schaeffler AG expects electric mobility to become mainstream in India, but this transition may take longer than in other parts of the world.
Despite these challenges, Schaeffler India is expanding its global footprint. The company is exporting products to Asia and plans to extend this reach to the rest of the world, leveraging its cost-competitiveness. In the second quarter alone, exports accounted for 14% of Schaeffler India Ltd.'s sales, a testament to the company's growing presence as an export hub in the Asia Pacific region.
Schaeffler AG is navigating supply chain challenges while adapting to India's evolving vehicle market. The company is focusing on hybrid cars to address immediate infrastructure challenges and is expanding its global footprint through exports. Despite the slow uptake of electric cars in India, Schaeffler AG remains optimistic about the long-term potential of electric mobility in the country.
Read also:
- Predictive modeling introduced in DP World's automotive supply chain operations
- China's Foothold in Europe
- Machine Learning and Forecasting Advancements in Supply Chain Resilience: Insights from Jaymalya Deb
- India's construction sector receives a significant boost with Suraksha Group leveraging one of Asia's biggest captive precast factories for mechanization.
