FAST India releases State of Industry R&D in India for the Automobile and Components sector in collaboration with IIFL Securities
28th June 2024, New Delhi: FAST India released its sectoral brief on the Automobile and components sector for its series on the State of Industrial research and development (R&D)in India in collaboration with IIFL Securities. The latest brief presents an in-depth analysis of trends, innovation outputs, and comparative performance metrics of major Indian automobile and components firms against their global counterparts. Thereportunderscoressignificant disparities in R&D intensity, the proportion of PhD employees, patent output, and and publication rates, providing important insights for policymakers and stakeholders
Performance firms in various domains of R&D and innovation, comparing them with their global counterparts as well as categorizing Indian firms into high-revenue and low-revenue clusters provide a more nuanced analysis:
1. R&DIntensity:
a. FerrariN.V.hasthehighestR&Dintensityat15.2%,significantlyaheadofotherfirms.Overall, the global automotive firms show 3x higher R&D intensity compared to the Indian firms.
b. Mahindra and Mahindra has the highest R&D intensity amongst Indian firms studied(5.7%), almost double the second-best R&D intensity of an Indian company, Bosch(2.9%).
2. ProportionofPhDEmployees:
a. GlobalfirmsoutperformedIndianfirmsintheproportionofPhDemployeesbyafactorof 3x.
b. TVSMotorsranksthirdamongstallfirms(globalandIndian)fortheproportionofPhDemployees indicators.
c. Many Indian low-revenue cluster firms have negligible/zeroPhDqualifiedemployees.
3. Publications:
a. Overallglobalfirmsproduced2xpublicationsperUSDbillionrevenuethanIndianfirms.
b. FerrariN.V.maintainsitsfirstrankinpublicationsperUSDbillionrevenuebypublishingmore than 9xthe second-ranked firm, Bosch.
c. TVSMotorandMRFrankfourthandfifthinpublicationsperrevenueamongstallfirms, global and Indian.
d. Indianlow-revenueclusterfirms-BoschandTVSMotorperformwellforthisparameter.
4. PatentOutput:
a. Indianfirmssignificantlylaginpatentoutput,withglobalfirmsproducing30xthe
numberofpatentsperbillionUSDrevenueascomparedtoIndianfirms.
b. AmongstIndianfirms, TVSMotors, which is in the low-revenue cluster, has the highest patent count. It ranks first amongst Indian firms for patents per USD billion revenue, foreign (global) studied.
Conclusion
TheIndianautomobilesectorispoisedforcontinuedgrowth, driven by significant achievements in R&D and innovation. However, to maintain and enhance its global position, the industry must address the gaps in patents and publications per revenue. By fostering a culture of innovation and investing in intellectual property, Indian automobile firms can secure a competitive edge in the global market.
