The 52nd Annual Convention of the Society of Indian Automobile Manufacturers (SIAM) took place on 6th of September, 2012. SIAM is the apex industry body which represents 46 leading vehicle and vehicular engine manufacturers in India. Revolving around the topic on the current automobile industry, the theme for the meet was: India in the Changing World Order. A lot was said on the situation of the Indian automobile sector in the last one year. Concern was also showed on how the vehicle industry is the most highly taxed industry in the country.
“If we add up all the Central and State Taxes, the overall tax burden on cars ends up being as high as 62% for small cars and a whopping 82% for large cars,” S. Sandilya, President, SIAM, said.
The challenges faced by the automobile industry was yet another segment of the convention. In the last one year, there were too many things that ate up the sales in the automobile industry, most important of all being the fuel price hikes. There was also the problem of inflation and high interest rates. They also spoke against the possible hike in duty on diesel vehicles. Finally, there was some light thrown on the current situation of the electric vehicle industry. Over the past few weeks, the Government had been showing a lot of interest and involvement to grow the electric vehicle segment.
At the annual convention, many automakers also revealed their plans to increase investments in the country. Force Motors will invest Rs. 1000 crore in the next 3 years to boost capacity and develop new products. Volkswagen plans to invest Rs. 700 crore in the next 2 years, which will be utilized in capacity expansion and new product launches. Audi plans to set up a dedicated assembly unit at its Aurangabad facility. Toyota will invest Rs. 900 crore in order to increase its production capacity. Mercedes-Benz will increase its investment to Rs. 850 crore (for the next two years). Clearly automakers are betting big on the Indian market, even though the industry seems to be in a midst of a slowdown.