Text: J Srikant
Automotive Component Manufacturers Association (ACMA), the apex body representing the auto component industry, recently hosted the first ever reverse buyer-seller meet with African countries in which 7 African nations participated. This was supported by the Ministry of Commerce. While ACMA has taken Indian delegations to African nations earlier, this is the first time that African companies have been invited to visit Indian suppliers. In all, there were close to 40 delegates who came from Botswana, Tanzania, Uganda, Kenya, Nigeria, South Africa and Egypt. The event was primarily focused on the aftermarket; therefore the majority of visitors were distributors and wholesalers.
MoU between the National Automotive Council (NAC) of Nigeria and Automotive Component Manufacturers Association of India (ACMA)
The event saw a display of products by 70 Indian suppliers from across the country right from fastener makers to critical engine part manufacturers. Some of the prominent names present at the event were UNO Minda, Rane Brake Linings, Sriram Pistons and Rings, National Engineering Industries (NBC Bearings), Subros etc.
“The theme for ACMA’s annual conference was globalisation and this event was one of the first key initiatives towards this vision of reaching out to markets,” said Ramesh Suri, President, ACMA. He added that it makes sense to have reverse seller-buyer meets with only emerging markets and not with developed markets. “ACMA is planning a similar engagement with China wherein they are looking at a technology show with Chinese OEMs. We will take 20-odd component manufacturers from India in Chinese OEMs where the arrangement will be similar to this event.” He said that it is still on the drawing board and might happen in December or early next year.
Anuj Kapuria, ACMA past president and Chairman of Hi-Tech Gears, said that traditionally India’s focus as far as auto component trade is concerned, has been towards Eastern countries like Japan and Korea or Europe and North America. However, the next wave of growth will come from Africa where there is huge scope waiting to be tapped. To further strengthen India’s trade with the African continent in the auto industry, ACMA signed a memorandum of understanding (MoU) with the Nigerian Automotive Association (NAA) which will facilitate free flow of information between the two countries and also help to exploit opportunities that crop up on both sides.
According to ACMA, the MoU seeks to foster a spirit of strong co-operation and coordination between the two countries, in particular the respective members of the two associations, for improved technical and business relations to render better services to their respective constituents. Both NAA and ACMA will look to share market intelligence with each other, which could cover technology, mutual interests, laws and regulations pertaining to foreign trade and investments. The agreement will also address and encourage the avoidance, and prompt settlement, of trade disputes between the members as per applicable international norms and standards
ACMA has signed a similar MoU with Egypt, represented by the Egyptian Auto Feeders Association (EAFA). “For the time being, we are just exchanging information and newsletters about events and regulations. But now we are making it more deep after this meeting,” said Ali Mohammad Tawfik, Founder and Chairman of EAFA. He said that the two associations are discussing more in-depth cooperation like JVs and B2B meetings in Egypt in order to introduce Indian auto component makers to the Egyptian Market and also to neighbouring countries in the Middle East and North Africa. “We are inviting ACMA to have a free stand during the most famous exhibition in Egypt called ‘Automech Formula’ which will be held for six days in March. We will introduce ACMA’s plans and its members to not only our members but also to some officials, white-goods makers, railways and wholesalers and traders.”
During the last fiscal year, India exported nearly $714 million worth of auto components to Africa whereas imports touched $114 million. Suri said that it is still early days and he would not be able to comment on how these numbers will change in the coming years.
The delegates from the African countries unanimously said that this reverse buyer-seller meet was an excellent initiative by ACMA which helps save a lot of time by allowing them to meet numerous suppliers under one roof. “This is a welcome move. There is a lot that Indian industry can do in Africa, and it is time that Indian industry did a lot in Africa. Markets are big and they need to be seized when they are available and not explored after other people have moved in,” said Ramchandran Balachandran, CEO, Quality Core Services which is a Tanzania based component importer.
One of the delegates cautioned that Indian companies and ACMA need to do a lot of work in Africa before they can reap rewards. It is said that Africa is a huge market but it is going to need development, especially the aftermarket. It is not a readymade market nor is it high volume initially like Europe or the US, and companies need to think creatively from the logistics and supply aspects.
While most of the visitors were distributors and importers, the OEMs were solely represented by Mobius Motors Kenya, a new entrant, who recently launched an SUV in the country. “The reason we are looking at Indian component manufacturers is because suppliers here are quite mature and the kind of quality provided on low cost is the best you can have. The geographical proximity of India to Africa is another factor,” said Mohammed Ayaz Qureshi, Senior Cost Engineer at Mobius Motors Kenya. “As long as we can get quality at cheaper price, we can source anything and everything from India, right from engines and radiators to tyres and wheel rims.”
While the visitors were all praise for the initiative, even Indian suppliers who were present at the event said it is a good first step that gives them an insight into the requirements of African buyers.
