After witnessing a lean phase for over 9 months, the Pune auto component industry is now gradually showing signs of recovery. The mood among the SME auto part makers, which was once grim, is now turning upbeat as demand in the domestic market has started picking up.
Following the start of the current financial year, orders have once again started pouring in for small-scale automotive equipment players, thereby offering them a new lease of life.
Positive turnaround
More than 4,500 SMEs operating in the automotive and engineering verticals in and around Pune city are now heaving a collective sigh of relief thanks to the resurgence in auto parts demand.
As a direct consequence of the recent surge in sales and increase in orders, capacity utilisation by SME units has also risen significantly, climbing to nearly 70% over the last 3 months.
"A few months back, several auto ancillary units in Pimpri-Chinchwad, Talegaon, Pune, Bhosari and Chakan among others had to reduce their output levels and lay off a large number of their employees in the wake of sluggish demand both on the global and domestic front. However, as the scenario is improving, the SME auto part makers are once again witnessing a rise in capacity utilisation of up to 70%," said N Patil, proprietor of Sudal Industries, an auto component supplying unit in Pune.
The sudden spurt in demand has also provided a boost to the small-scale units engaged in vehicle engineering, prototypes, automation, robotics and material handling services.
"We are witnessing increased inquiries as a result of the recent push in the sales of vehicles seen in the domestic market. New orders by domestic auto companies are being placed, thereby prompting SMEs to work at full capacity," said N Bhave, MD, AUTOMAG India in Pune.
Though the demand has gone up in the recent past, bringing cheer to the Auto Parts Manufacturers hub in Pune, it would still take some time for the global auto market to recover fully.
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