The union government should make a common platform for formation of future regulations related to the automobile industry with representations from all the ministries responsible for making policies related to the sector, said Kenichi Ayukawa, managing director, Maruti Suzuki India ltd.
As of now more than 5 ministries – Ministry of Heavy Industries, Road Transport and Highways, Petroleum and Natural Gas, Environment, Science and Urban Development – are responsible for policy making related to different aspects of the automobile sector.
According to Ayukawa, the carbon monoxide emission in a car is regulated by one ministry but the carbon dioxide emission is regulated by another ministry. While, the fuel that goes into the car is regulated by a third ministry. In addition, there are many courts and judicial bodies.
“In the future, with more technologies and regulation, the complexity will grow manifold. How to navigate through these multiple bodies and ensure that there is alignment?," added Ayukawa.
Taking a cue, Siam president, Rajan Wadhera, also urged the government to have only one nodal ministry for the auto industry.
Executives in the auto industry are of the opinion that the upcoming regulations and technologies will make policy formulation very intricate. Hence a single ministry or a platform should help policy formulation in the days to come.
“A few years ago, for addressing this issue, an institutional framework was planned by Ministry of Heavy Industries. There was the concept of a National Automotive Board or NAB with specialized automotive experts to provide knowledge and stakeholder consultation for all auto related policy making. Is it possible to have a central common platform for all ministries?," added Ayukawa during his speech.
At a time when the union government want to promote alternative powertrains to curb pollution and reduce import of crude, the automobile industry has been divided into two parts with one supporting for a transition to fully electric vehicles and while the other half lobbying hard for hybrid vehicles as an interim step before moving to electric.
Ayukawa also urged the centre to let the customers decide which technology they would choose in order to reduce vehicular emission.
“Is it possible that the government sets a target on its objective of emission or energy efficiency and allows the industry the freedom to choose the technology to achieve that goal. Once the “regulatory end-objective" is taken care of, which design or technology is used should be left open to the customer to choose," added Ayukawa.
“By leaving the choice to the customer, it will help engineers to design the most optimal solution without any compromise on reaching the end goal. It will help us, as manufacturers, to be clear which investment we can undertake," he explained.
The auto mobile industry has been facing a severe slowdown over the last one year as sales of passenger vehicles declined for ten straight months to August, 2019. Maruti Suzuki curbed production in its three plants for seven consecutive months as vehicle dispatches also declined by double digits. Vehicle production at Maruti’s three plants, including the one in Gujarat, plunged 34% year-on-year (y-o-y) to 111,370 units in August.