Forbesindia.Com
Total Page：16
File Type：pdf, Size：1020Kb
SOCIOECONOMIC FALLOUT OF A PANDEMIC PRICE ` 250 RNI REG. NO. MAH RNI REG. NO. APRIL 10, 2020 E N G /2009/28102 Auto Special BUCKING Auto Special Auto THE TREND How MG Motor and Kia Motors are seeking to capitalise on their brisk beginning in India. New emission norms, weak demand and Covid-19-triggered supply FORBESINDIA.COM chain disruptions, however, present fresh challenges / VOLUME 12 ISSUE 8 APRIL 10, 2020 8 APRIL 10, 12 ISSUE / VOLUME (From left) Rajeev Chaba, president & MD, MG Motor India Kookhyun Shim, MD & CEO, KIA Motors India BS VI AND THE BIG SHIFT THE ELECTRIC IMPERATIVE CHINESE AUTO AND THE INDIA OPPORTUNITY TATA MOTORS’ SUV GAMBIT www.forbesindia.com A crisis is a good time to look at the Letter From The Editor opportunities for the Indian auto sector Long and Winding Road uhan in China, the centre of the outbreak worst. The exception may well be China, which bore the of the coronovirus, is also the “motor brunt in the March-ended quarter. As growth in new city” of China, the world’s biggest car infections slows down and employees get back to work, W market. From General Motors and Honda economic indicators will slowly pick up. For the rest of to Nissan and Renault, a clutch of car makers has their the world, a recovery may be some time away, but the factories there. The World Economic Forum says Wuhan planning—and the resolve—to come back is evident. accounts for half of Honda’s production in China and, in As Oliver Zipse, chairman of BMW AG, put it 2019, the Hubei Province, of which Wuhan is the capital, in a mid-March press conference in Munich to was the fourth-largest car producer in China. As car makers announce the car maker’s 2019 financial performance: stopped production because of the nationwide shutdown, “There will be a time during the coronavirus. And car sales in China fell 92 percent in the first half of February. there will be a time after the coronavirus.” A month on, the pain has moved from China to A crisis is also a good time to look at the opportunities the rest of the world. At the time of writing, car for the Indian auto sector on the road ahead, and in this factories in Europe, the US, Canada and Mexico special issue on automobiles we have done exactly that. were preparing to temporarily shut down. The cover story by Pranit Sarda is on two relative new kids There’s little choice, as supply chains—not only in town: MG Motor India owned by SAIC, China, and the from China but most of the developed world—get Hyundai-owned Kia Motors, who have blazed a trail in disrupted, demand slumps and factory workers quick time. Consider Kia which, since debuting in India in take the precaution of not turning up. August 2019, has sold 75,000 units of the mid-sized SUV Cut now to India where the auto sector was Seltos. And then there’s MG Motor, which has bucked the feeling the heat of an economic slowdown before the slowdown with the Hector SUV launch in June 2019. 4 pandemic broke out. Sales of passenger cars plunged So where do these two go from here? After all, the by almost 14 percent in 2019 over a year ago, the worst Indian car market is no stranger to debutants who dip in two decades. The woes of non-banking finance started with a bang only to flatter to deceive. Sarda companies resulted in a slump in retail loans. reckons MG and Kia may be better placed than many And, come April, the transition to BS VI emission of the multinationals that entered India earlier. To norms will worsen demand as many models know why, go to ‘Fast and Furious’ on page 28. become more expensive and a few bow out of the In the other auto stories, don’t miss Manu market. The coronavirus crisis has disrupted the Balachandran’s feature on the impending blitzkrieg supply chain from China, on which Indian and from Chinese car makers, who may well see in multinational car makers are dependent on. India the opportunity to recover from the Covid- So that’s the bad news—the spread of the virus, the 19 crisis. And Jasodhara Banerjee dives into what consequent lockdowns and the fallout on economic the new emission norms mean for Indian auto, growth, with the April to June period expected to be the who gains, and who loses. That’s on page 30. Brian Carvalho STORIES TO LOOK OUT FOR Editor, Forbes India [email protected] Best, (From left) Kookhyun Shim, CEO, Kia Motors India, believes that extensive market research has helped them plan their product better; China’s Great Wall Motors has lined up investments worth `100 cr in India FORBES INDIA • APRIL 10, 2020 APRIL 10, 2020 ☛ VOLUME 12 O N ISSUE 8 T H E Contents COVER 30 • THE BIG SHIFT The BS VI emission norms Auto Special are good for the environment, but the rising costs that will come along may dampen the industry mood FAST AND FURIOUS PG. 26 Amid India’s worst automobile slowdown, two new entrants are trying to make it big. Can they sustain the 34 • CHINA DRIVES IN success after the initial rush? With India showing the potential to become the world's third-largest automobile market, car makers from China are revving up 38 • ROAD TO REVOLUTION The future’s electric. And Indian auto makers are launching newer models and building up an ecosystem 42 • HOW TO PUT EVs ON FAST TRACK From setting up charging points to domestic manufacturing, electric vehicles need infra push for faster adoption MIT VERMA A 46 • ‘INDIA Is A PRICE- ; 5 SENSITIVE MARKET IA ND I DRIVEN BY SENTIMENT’ ES Schaeffler India’s Harsh B FOR Kadam on the German FOR component maker’s plans AR for the changing automotive K A landscape N RAT T N A 48 • ON A FAMILIAR H TERRAIN IS Tata Motors, the maker of EFT) N L India’s first SUVs, is back ( in the game with its Kookhyun Shim (left), managing director and CEO of Kia Motors India, and Rajeev Chaba, president and aggressive line-up managing director at MG Motor India PG. 38 FEATURES PG. 16 TALKING POINT 16 • BANKING WITH UNCERTAINTY The Yes Bank turmoil came with a one-off solution, but newer banks will not be spared from the contagion effect SPECIAL REPORT 20 • TWO DECADES AND COUNTNG Odisha CM Naveen Patnaik is scripting another chapter in a series of developmental Kona is Hyundai's first electric offering in India turnarounds for the state APRIL 10, 2020 • FORBES INDIA Contents ☞ APRIL 10 • 2020 PG. 20 PG. 64 After their success with cables and wires, the Jaisinghanis of Polycab India Naveen Patnaik has been Odisha's CM for five terms now want to dominate the Fast Moving Electrical Goods sector ENTERPRISE 67 • HOLD-’EM HERBIE 51 • THE NEW A Florida optometrist has UpGRADE PG. 58 beaten the odds to become a Lenovo is remoulding itself buy-and-hold billionaire as a maker of more than laptops and phones 72 • TRUST YOUR GUT 6 Scientists are using bacteria 54 • FIGHT AGAINst from the digestive system to FAKES create novel medicines that Technology company could transform lives and Ennoventure has built an deliver massive returns for authentication tool that can investors enable pharma companies Robert Joseph Scaringe, Rivian’s 37-year-old founder and CEO to combat counterfeiters LIFE 76 • SOUNds OF SOULS 64 • SWItcHING With its serene atmosphere GEARS and intimate spaces, the The next-gen at Polycab centuries-old Ahhichatragarh India is working on making Fort plays the perfect host to the wires and cables leader the Sacred Spirit Festival a player to reckon with in PG. 84 the FMEG space 80 • TEstIMONIEs TO TIME CROSS BoRDER The architecture of 58 • ELON’S NEW Luxembourg City reflects NEMESIS centuries of styles and heritage Rivian has a $3 billion war chest from Amazon, Ford and the Saudis, and is 84 • THE INHERITANCE revving up production on OF FLAVOURS its electric SUVs and trucks Tracing the food traditions of India’s lesser-known cuisines The chhappan bhog is made on special occasions in Vrindavan REGULARS ● 8/LEADERBOARD ● 88/ THOUGHTS WE VALUE YOUR FEEDBACK: Subscriber Service: To subscribe, change address or enquire about other customer services, please contact: Write to us at: [email protected] FORBES INDIA, Subscription Cell, C/o Network18 Media & Investments Limited, Empire Complex, • Read us online at: www.forbesindia.com 414, Senapati Bapat Marg, Lower Parel, Mumbai - 400013. Tel: 022 4001 9816 / 9782. Fax- 022-24910804 • On the cover: Photograph by: Rajeev Chaba: Amit (Mon – Friday: 10 am - 6 pm) SMS FORBES to 51818 Email: [email protected], Verma; Kookhyun Shim: Nishant Ratnakar for Forbes India To subscribe, visit www.forbesindia.com/subscription/ To advertise, visit www.forbesindia.com/advertise/ • Digital Imaging by: Sushil Mhatre FORBES INDIA • APRIL 10, 2020 Managing Director & CEO: Priyanka Kaul FORBES MEDIA LLC Group Editor-in-Chief: Chairman & Editor-in-Chief: Rahul Joshi FORBES INDIA ADVERTISING SALES Steve Forbes Senior Vice President: Preeti Sahni Chief Executive Officer: Editor, Forbes India: Brian Carvalho Michael Federle Girish Sharma, Brijesh Singh, Atishay Chief Content Officer: Chief Creative Director: Anjan Das Singh, Kanwaldeep Singh, Divya Bhatia, Randall Lane Mona Parate, Dilshad Ahmed Khan, Janki CEO, Forbes Asia: Editor (Technology): Modi, Daksha Solanky, Mitu Midha, Riti William Adamopoulos Harichandan Arakali Menghani, Anil Bhatia, Abhishek Shah, Editor, Forbes Asia: Senior Editor: Samar Srivastava Priyanka Nalavade, Maulik Thaker, Supriya Justin Doebele Sahoo, Richa Kushwaha, Sheshagiri Raj, Associate Editors: Senior Vice President, Forbes Asia: Arijeet Sengupta, Arijit Nandy Monica Bathija, Salil Panchal Tina Wee Senior Assistant Editor: Rajiv Singh SOLUTIONS Assistant Editors: Views & opinions expressed in this Pankti Mehta Kadakia, Pooja Sarkar Executive Vice President: Smriti Mehra magazine are not necessarily those Special Correspondent: of Network18 Media & Investments Limited, its Manu Balachandran Sachin Mhashilkar, Abhinav Gupta, publisher and/or editors.