FADA Pitches for Auto Clusters in Cities

Welcoming the guests and participants at FADA’s 51st Annual Session held recently, K V S Prakash Rao, President, FADA made a strong pitch for creation of auto clusters/zones in various cities, as otherwise it would be difficult to sustain growth expected in the next ten years.

Shrinking space for commercial & industrial activities and increasing congestion and pollution have not only made the cost of real estate prohibitive, but have also led the State Governments to come up with stringent land use laws. 3S automobile dealerships, encompassing sales, service & spares under one roof, can operate neither from commercial area nor industrial area. He suggested that auto clusters/zones may be created in various cities.

He pitched for simplifying registration procedure and delegating the registration of new vehicles to the automobile dealerships in the State of Andhra Pradesh on the lines of schemes introduced by the Governments of Delhi and Rajasthan. He hoped that the signing of MoU between Automotive Skills Development Council (ASDC) and AP State Skills Development Council (APSSDC) would give impetus to the skilling of the people in the State.

FADA President was happy to note that development of auto sector in the State was one of the priority areas for action identified by the AP Government.

Kesineni Srinivas, Hon’ble MP, speaking on the occasion, assured that the AP Government under the leadership of N Chandra Babu Naidu, Chief Minister would favourably consider suggestions aimed at removing road blocks and promoting all-round growth of the State. He pointed out that AP contracted 56.0% of the debts of the unified State at the time of bifurcation and there was not much organised industrial and service activity in the State to generate revenue. The State was virtually staring at the crisis. However, the CM was working hard for the growth and development of the State, the State having registered growth of 9.0% in GDP and 15.0% in revenue during the last year. The CM is strongly of the view that every crisis also provides an opportunity.

Referring to the Auto Nagar in Vijayawada developed for workshop activities way back in 1960, the Hon’be MP assured that AP Government would favourably consider the suggestion for creating an auto zone comprising sales & service activities.

Ganta Subba Rao, MD & CEO, Andhra Pradesh State Skills Development Corporation (APSSDC) stated that APSSDC has been set up on a PPP model with the objective of skilling over 2 crore people in AP over next 10-15 years. With double-digit growth envisaged, Andhra Pradesh would need an incremental human resources requirement of approximately 10 million skilled workers between 2012 till 2022, across the high-priority and emerging sectors. The idea was to shape AP as the skilled-workforce and knowledge hub for the world. He said that a multi-pronged approach, including the setting up of 36 Centres of Excellence, would be adopted to achieve the goal. He cited resource crunch arising from the bifurcation of the State and shortage of qualified trainers as two major challenges going forward.

Sunil Chaturvedi, CEO, ASDC said  that AMP 2016-2026, likely to be brought  out by the Government f India shortly, envisages 3x growth in production volumes of vehicles and 5x growth in revenues in the next ten years, which presents a gigantic challenge of skilling of huge manpower required by the auto sector. There are currently 2,000 training delivery centres accredited by ASDC, which need to be increased to 10,000 centres to meet the present demand of skilled manpower. He invited automobile dealers to become training centres of ASDC, which would not only increase skilled manpower availability for the auto sector, including automobile dealerships, but would also become an additional revenue stream for them.

ASDC and APSSDC signed and exchanged an MoU at the event, with the objective of giving fillip to the skilling of people in the State.

The occasion also saw a presentation by Amit Jain, CEO & Co-founder of Cardekho.com, brought forth loud and clear that the digitalization and online presence was the way forward for the automobile dealerships to cut costs, increase efficiency and improve profitability. He said that Cardekho.com could associate with automobile dealers as technology partner, which would enable automobile dealers to focus on their core business areas and stay viable in the fiercely competitive environment. An MoU between FADA and Cardekho.com was signed on the occasion.

Since the CM of AP, who was expected to grace the occasion, was not able to make it due to his other emergent engagements, a group of senior FADA members, led by K V S Prakash Rao, President, FADA met the CM in his office, after conclusion of the Annual Session.

Among various other submissions, FADA delegation reiterated the suggestions for (i) Creation of Auto Clusters/Zones in cities; and (ii) Delegation of registration of new vehicles to the automobile dealers. The CM asked the delegation to share concerns and suggest workable solutions in writing. Assuring positive action, the CM sought the support of automobile dealers for the growth & development of the State.