Profitability – the biggest issue for auto industry!
While the auto sales in the country are touching the highest levels ever, the fact of the matter is, profitability remains a concern for several players in the Industry.
Be it the market leader in the passenger cars, Maruti Suzuki that has recently posted one of the best sales figures in its history or the pole position holder in the Indian two-wheeler industry, Hero Honda, almost all the players in the Indian automotive circuit are having a good time in making their top lines rise.
However, it is the bottom-line which is becoming an issue for the Indian automotive giants. Apart from the rising input costs, the component shortage remains major issue for the Indian automotive giants. In fact, the component makers are having a luxurious time amidst such a situation.
For instance, Mahindra & Mahindra has recently said that it has faced a 10% production loss over the past few months due to the shortage of components. In fact, the rising royalty payments have been an issue for players like Hero Honda and Maruti Suzuki, the duo which relies on its foreign partner for the technology support.