April 6, 2011
School of Business, Coimbatore
In the last three years, car manufacturing in India skyrocketed from 7,23,330 cars to 13,08,913.
And why wouldn’t it?
India’s economy is booming and so is its spending power. That extra boost in financial freedom is making India look very attractive to automotive giants like Toyota.
Even as the demand for cars in developed countries continues to crash, India is becoming one of the fastest growing automobile markets in the world.
If the rate of growth persists, by 2050 every sixth car in the world will be produced for the Indian market.
But will this growth come with a cost?
More cars on the road, means more pollution.
Right now, the Government of India and the auto industry are battling over carbon emission limits. Probably a good idea to push for stricter limits, if we consider research from NASA’s Goddard Institute for Space Studies (GISS).
“If developing countries adopt stricter vehicle emissions standards, like the “Euro 6”, health, agriculture and the climate will be improved world-wide,” stated a new study from NASA’s GISS.
“At least 100,000 premature air-pollution-related deaths can be prevented; millions of tons of ozone-related crops losses can be avoided and climate change can be mitigated.”
That’s why when second-year MBA students at the Coimbatore campus, studying Logistics & Supply Chain Management went to visit Pricol Ltd., a car parts manufacturing plant, it was no small matter.
Pricol, whose logo is Better Ideas for a Better Planet is a dominant force in India’s auto parts industry.
While at Pricol’s factory in Coimbatore, the students observed manufacturing and supply chain methods in real time. Sivaprasad L. shared, “The visit was an eye opener. I thought textbook concepts like MRP and BOM weren’t used in the real world. Now I understand these time-tested concepts explain the theoretical underpinnings of a company’s work flow.”
Students also learned that constant performance evaluations keep a successful business competitive.
“Benchmarking the highest industry standards helps Pricol identify what improvements are needed in order to increase its efficiency,” said Azeem Hafeez.
Finally, students discovered there are many unseen factors that contribute to making a finished product.
“I was surprised to find small automobile parts, like the speedometer, are made with a lot of even smaller components that go through a long assembly line,” explained Anand R.E.
And where do all of these small parts come from? “It was interesting to discover that many materials, such as plastics, are imported from countries like Korea,” said Mridula K.
When they put all the pieces together, students discovered just how complex the supply chain of the auto parts industry can be.
When we put all of the pieces together, India’s economic growth is definitely good for the people and the country … but shouldn’t we make sure it’s good for the environment too?