In an exclusive interview with ET Edge Insights, Satish Sundaresan, Vice President, Global Strategy, and Managing Director of Elektrobit India, discussed the unique opportunities and challenges for global automotive players entering the Indian market. Sundaresan addressed aspects such as consumer demands, collaborations with local players, sustainability, and Elektrobit’s strategies for growth in India.
Edited excerpts from the interview
When global automotive players consider entering the Indian market, what unique opportunities and challenges do they encounter?
Firstly, the Indian consumer landscape is characterized by a significant number of tech-savvy individuals. This implies a desire to seamlessly integrate digital experiences from home to vehicle. The convergence of mobile phones and cars represents an extreme end of consumer needs.
On the other hand, there exists a specific societal stratum in India that remains highly price-sensitive. This poses a challenge for automakers to offer a comprehensive set of features within a specific price point. For instance, the demand for features like a sunroof is prevalent, even though its necessity may be debatable, given its ubiquity in most cars. The complexity arises from the diverse nature of Indian society and the automotive industry, balancing factors such as price sensitivity and the dynamic preferences of consumers.
However, within these challenges lies a significant opportunity. The automotive sales trajectory in India is on an upward trajectory, encompassing both cars and motorbikes. This growth presents the prospect of catering to niche segments of customers, offering the potential to successfully market specific products in targeted regions within India. Moreover, with emerging trends such as connected, shared, and electrified mobility, there are even more possibilities.
What growth and development strategies is Elektrobit pursuing in the Indian market?
Elektrobit is strategically focusing on key automotive trends, particularly electrification, with a specific emphasis on the two-wheeler segment. Beyond traditional standardized architecture, exploration of middleware and open-source opportunities is underway. Adopting a platform approach aims to reduce time to market and overall costs, ultimately benefiting OEM customers within the Indian ecosystem.
For a global player when they come to a new market (talking about India), there is always a domestic or the local market, so how do the international players look at the domestic market players? Is it a competition or probably they can leverage them and collaborate with them knowing their local knowledge?
The landscape provides a variety of use cases. Some manufacturers approach India with the mindset of selling whatever they have globally. While this approach has seen success in certain cases, there have also been instances where old or outdated products failed to gain traction. On the other end of the spectrum, there are examples like Williams, which decided to exit the Indian market, acknowledging the challenges it posed.
Certain Original Equipment Manufacturers (OEMs) take a different approach by actively seeking collaborations with Indian players. However, this strategic move is not without its challenges. It’s paramount that, regardless of the chosen strategy, the success of global players in India hinges on how well their product aligns with and meets the diverse needs and preferences of the Indian consumer base.
How do you perceive the sustainability landscape in the Indian ecosystem, involving all stakeholders such as the government and private players, and how does it align with global manufacturing standards?
The sustainability landscape in India presents a complex picture, necessitating the collaboration of various stakeholders. Notably, pollution, particularly in cities like Mumbai, has become a prominent concern, reportedly attributed to factors like the El Nino effect and the high density of vehicles. There is considerable pressure on the automotive industry to combat pollution and transition beyond sustainability towards circularity. Some manufacturers are actively adopting circular practices, recycling raw materials throughout the production process to minimise environmental impact.
Fostering traffic discipline through collective efforts, overcoming challenges in renewable energy adoption for electric vehicles, promoting public-private collaborations and education are pivotal steps toward achieving a synchronised and sustainable future, aligning with global manufacturing standards.
What are Elektrobit’s key strategies for growth and development in the automotive business, particularly in India, and how do you anticipate these initiatives evolving?
From Elektrobit’s standpoint, our focus revolves around key automotive trends, with electrification taking center stage. We believe that as electrification expands, the significance and value of software in vehicles will rise. Particularly in India, where electrification is flourishing, our primary focus lies in the two-wheeler segment.
Rather than designing software for each model, we are considering a platform-based approach, whether for the entire vehicle or specific segments like coils. Acknowledging the increasing demand for digital experiences, cybersecurity, and effective software lifecycle management, we are exploring a shift toward virtualized platforms. The end goal is to enhance efficiency, reduce time-to-market, and cut overall costs, offering substantial benefits to our OEM customers. This strategy is tailored to align with the unique dynamics of the Indian automotive landscape.
