Schedule a Call Back
Indian auto component exports at risk amid UAW Strike in the US
Industry News- Sep 20,23
Approximately one-third of India's automotive component exports are destined for North America, and this strike by thousands of UAW members, known as a 'stand-up strike,' is impacting the US auto majors.
The strike called by the United Auto Workers (UAW), the American automotive workers' union, against the Big Three automakers (Ford, General Motors, and Stellantis) in Detroit, USA, is causing concerns for automotive component manufacturing hubs in India.
Approximately one-third of India's automotive component exports are destined for North America, and this strike by thousands of UAW members, known as a 'stand-up strike,' is impacting the US auto majors. They have initiated walkouts at one factory for each of these automakers in the United States and plan to expand their protests to multiple locations.
Negotiations are currently underway between the union and the automakers to address the workers' demands for a wage increase.
This strike marks the first time that the UAW has simultaneously targeted all three major automakers, resulting in factory shutdowns in states such as Michigan, Ohio, and Missouri.
In the fiscal year 2023, exports to North America accounted for 30% of the Indian auto ancillary sector's export revenue, totalling $6.5 billion, making it the largest market for India.
Tier-1 suppliers serving North America, including companies like Sona Comstar, Sundaram Fasteners, Bharat Forge, and Motherson Group, could face adverse effects if the strike continues.
In 2019, the UAW's protests against General Motors saw 49,000 workers from 50 factories across the US going on strike, which lasted for over 40 days. This time, industry experts anticipate a faster resolution, as political intervention is likely in an election year to facilitate negotiations.
On the third day of the strike, which began on September 15, 2023, Sona Comstar, a leading supplier of critical electric vehicle components and automotive systems to original equipment manufacturers worldwide, informed Indian stock exchanges that it is closely monitoring the situation. They mentioned that while the strike's current impact on their sales is minimal, a more significant impact could occur if the strike persists or spreads to other plants.
Approximately 45% of Sona Comstar's revenues come from the US, with 20% of its export volumes originating from the Big Three in North America, excluding Mexico.
Other companies with exposure to the Big Three OEMs among the listed large auto ancillaries, such as Sona BLW and Sundaram Fasteners, are also closely monitoring the situation. Sundaram Fasteners' exposure to the three US companies is around 10%, while for Samvardhana Motherson International, it is 3-4%, according to informed sources.
Vinnie Mehta, Director General of the Automotive Components' Manufacturers' Association, highlighted the significance of the North American market for Indian auto components exports and expressed hope that the issues would be resolved in the mutual interest of both workers and the industry.
Source: Mint
Sundaram Fasteners
Sona BLW
Samvardhana Motherson International
Vinnie Mehta
Automotive Components' Manufacturers' Association
North American market
Motherson Group
Bharat Forge
Sona Comstar
Ford
General Motors
Stellantis
Detroit
Related Stories
Auto & Auto Components
Can the new RDI scheme be a game-changer for R&D in India?
India spends just 0.64 per cent of its GDP on R&D (compared to global average of above 2 per cent). The new Research Development and Innovation (RDI) scheme, with a corpus of Rs 1 trillion, can chan..
Read morePolicy Regulation
Can India’s Exports Takeoff Amid Global Market Uncertainty?
India's merchandise exports are navigating a complex global landscape marked by economic and geopolitical turbulence, including trade wars. India needs to take multiple measures to build a resilient..
Read moreAuto & Auto Components
Indian auto component industry expects 8-10% growth in FY25: Vinnie Mehta
In this interaction with Rakesh Rao, Vinnie Mehta, Director General of Automotive Component Manufacturers Association of India (ACMA), presents his views on the impact of recent global events on Ind..
Read moreRelated Products
Tata Motors unveils facilities for development of Hydrogen propulsion tech
AUTO COMPONENTS & ACCESSORIES
Tata Motors, India?s largest automobile company, unveiled two state-of-the-art & new-age R&D facilities for meeting its mission of offering sustainable mobility solutions. The unveilings constitute of Read more
Tata Motors plans petrol powertrain for Harrier and Safari SUVs
AUTO COMPONENTS & ACCESSORIES
Tata Motors is in the process of developing a new petrol powertrain for its premium sports utility vehicles, the Harrier and Safari, as confirmed by a senior company official. Currently, these models Read more
Electric Vehicle Charger
AUTO COMPONENTS & ACCESSORIES
RRT Electro is engaged in manufacturing of customized Power Electronic Products over two decades having capability to Design, Develop, Prototyping, Regulatory Compliance testing & Certification, Manuf Read more
latest News
Subscribe to iNoW
For Industry News on WhatsApp, Give a Miss Call on: +91 84228 74016
