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Indian ITs eye global automobile market

Last updated on: January 27, 2011 14:35 IST

Indian ITs eye global automobile market

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Swati Garg & Shine Jacob in Kolkata

India's sunshine sector, the information technology industry, heading towards consolidation in the past five years, has its eyes set on the burgeoning global automobile market.

That global market is slated to go from 800 million cars a year at present to 2.9 billion in 2050, according to International Monetary Fund estimates.

India would have over 400 million cars, a five-fold increase over current numbers.

For automobile manufacturers, the challenge increasingly has been, and progressively will be, to innovate with the adoption of technologies, in the process of production and of the final product.

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Image: Cars lined up at the Hyundai plant in Chennai.
Photographs: Reuters
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"The biggest changes in the past few years are those of electrification and the inclusion of infotainment features within the car space.

"The use of internet will further revolutionise the automobiles," said P Balendran, vice-president, General Motors India.

The futuristic features, which exist already in American, European and Korean automobiles, include those that facilitate conduct of business from within the vehicle and allow connectivity to the world at all times through the phone, Bluetooth and the Internet.

"It is like living on the road. Faster applications, global connectivity and management of all personal data and choices will be instantly available, thus making the automobile a friendly living space," said Balendran.

The increasing use of technology is also relevant in supply chain management, along with the production and dispatch process.

An average automobile has over a million lines of codes and electronics worth Rs 25,000.

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Indian case

T
hese requirements, along with technology for interaction within the car, afford endless possibilities for IT companies.

A fact apparent in the partnership that India's largest IT company, Tata Consultancy Services, signed with Ferrari, the global auto giant.

TCS is the software partner for Ferrari, known better for its racing achievements. For Cognizant Technologies, which is India's fastest growing IT company, the process of technology adoption in production provides opportunities for growth.

"We have leveraged our domain insight and customer relationships to build solutions that focus on specific gaps in 'off-the-shelf' products.

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"We have also helped define pre-configured services", said Mahesh Venkateswaran, senior vice president, manufacturing and logistics practice, Cognizant.

For India's IT bellwether, Infosys Technologies, growth in the sector has meant targeting innovation aimed at infotainment within the car space.

The company claims it is in the process of building products for the consumer, not just aimed at the reduction of costs.

"Small cars, emerging markets, electric vehicles and 'infotainment' that is becoming more standardised around the world are areas we would want to capture," says a company white paper on opportunities for growth in the automobile segment.

For Indian buyers, however, the chance of browsing the internet on the car's dashboard is still far.

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The amalgamation of multiple technologies is not yet available in Indian cars, where the scope of technologies being employed is restricted to independent features heightening user experience.

"In terms of technologies like onboard telematics, India is behind. Many have transformed dashboards into mini computers. But for us, overall infrastructure needs to be developed before incorporating these technologies", said R K Ramesh, general manager, marketing, Toyota Kirloskar Motors.

The utilisation of technology in the Indian market is characterised by standalone IT applications like Bluetooth and electronic functions related to the engine. The average features raise the cost of a car by 5-15 per cent.

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Image: A car manufacturing unit.
Photographs: Babu/Reuters
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Indian IT companies are eyeing this market and the possibilities from three basic perspectives -- aiding business processes, mobilisation of user-friendly applications within the car space and along with leveraging social media platforms.

"The car market in India is 2.2 million at present. This is growing at a rate of 15 per cent. Global and domestic players are increasing the use of technology in manufacturing and, increasingly, technology will have a greater role to play," said Kapil Arora, automobile industry analyst, Ernst & Young.

A confluence, then, of profit for Indian IT companies because of social networking in the car.



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