Suzuki’s request to suppliers to step up localisation comes amid the Centre’s clarion call to manufacturers across sectors to cut imports and become self-reliant.
Maruti’s imports (those by vendors and the company), as a percentage of net sales is 15-20 per cent. In FY20, it paid royalty to parent SMC at a 5.3 per cent rate.
“You must focus on R&D to generate IP (intellectual property) in the process,” he said adding that it’s time for manufacturers to graduate from build-to-print to art-to-part.
Meanwhile, the auto component makers should not take their eyes off quality, human resource development and safety of their employees, he said.
Addressing the Society of Indian Automobile
Manufacturers' (Siam) annual convention on Friday, commerce and Industry Minister Piyush Goyal told automobile
companies in India to reduce royalty payments to their parent firms as it would help them sail through the crisis easily.