Jun 12, 2019
India’s new Automotive Industry Standard (AIS 140) is designed to revolutionize and innovate the public transportation system in India. Under these standards, all Indian public transit would need to have a GPS tracker. This allows for better control of the individual units and the system as a whole. In fact, every commercial vehicle would be outfitted with a tracker. These trackers would work in real-time and must include an emergency button that would notify authorities in the event of an accident. The new guidelines were announced in November 2016 by the Ministry of Road Transport and Highways. The Indian government gave all commercial vehicles a deadline of April 2019 to enforce the new requirements. The standards affect ambulances, private buses, public cars, rental cars, school buses, and taxis.
The new guidelines have many purposes. For example, India’s national traffic has grown to unprecedented levels, especially in metropolitan areas, like Mumbai and Bangalore. Traffic congestion is serious, and emergency vehicles are struggling to make decent time on the road. Because of the extreme traffic, business productivity has waned. Meanwhile, traffic laws have grown lax, collisions have increased, transport schedules have been thrown off, and instances of car-related crime have grown. Simply put, traditional vehicles aren’t equipped to handle the requirements of the roads; this is evident across multiple sectors.
Aside from the obvious physical danger that more traffic, especially poorly regulated traffic, puts people in, there are economic factors at play. When productivity slows, its effects are felt across many different industries. Something as simple as making sure cars can get where they need to go can help people avoid losing an enormous amount of money. The Bangalore Development Authority estimated that 10M people living in Bangalore lose an average of 60 hours every year because of traffic-related issues. This is equivalent to close to Rs 37,000M. About one-third of this, roughly 13,500M, is due to lost fuel because of traffic congestion.
Impact on Manufacturing
The new standards affect the Indian economy in more ways than one. By increasing productivity and improving working hours and efficiency across multiple sectors, the standards will save money. They’ll also decrease the number of accidents and vehicular crime incidents. But, there’s another way that they aim to improve the Indian economy: through the domestic manufacturing industry. AIS 140 tracking devices are highly regulated and refined pieces of technological equipment with highly specialized standards. All commercial vehicles outfitted with an AIS 140 tracking device must be up to code. This creates a new domestic market for producing these tracking devices. Such highly specialized equipment means that a new industry is being formed in India: regulated GPS tracking devices. In addition to being able to pass the ARAI physical tests, AIS 140-compliant tracking devices must meet the following requirements:
The highly specialized requirements of the AIS 140-compliant GPS trackers demonstrate the need for a specialized production sector. GPS manufacturers across India are now producing AIS 140-compliant GPS trackers. There’s a significant need for this, indicating there could be widespread returns for domestic manufacturing and the Indian economy. The GPS systems’ technicalities and special requirements also make this a niche market. Not everyone has the ability or resources to produce these systems. The new standards have been mandated for less than a year. There’s little data on how this niche production market will affect the Indian economy in the long run. But for now, the potential for new jobs in a growing market is promising.
Syrma: Automotive Parts Manufacturer
As automotive electronics have long been among our prime market focuses, we support the government’s expanded efforts to catapult India to the forefront of this vital worldwide industry. We’re also excited about the new need for AIS 140-compliant GPS trackers since we already manufacture GPS tracker-related electronics for our clients. We look forward to leveraging our world-class engineering and manufacturing resources to meet the expanded demand for automotive OEMs through the next decade and beyond. We’re uniquely positioned to fully capitalize on opportunities presented by India’s expanding domestic market.
We’ve identified strategic locations to develop and bring online world-class infrastructure within government incentivized locations. These SEZs and IT parks are designed to support the facilities and infrastructure provided by our partners to ensure time to market. We also help our clients to successfully introduce products and services into the lucrative Indian domestic market. Our management team is extensively engaged with industry and government leaders in India, leveraging these long-time relationships to assist OEMs in navigating unfamiliar or complex sales channels to enable mutual success.
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