Airbag industry in India to reach Rs 2,000 crore by 2019
Recent NCAP results of many of Indian hot selling cars have not been impressive. As a result, the government has been improving the vehicle safety standards and initiated the BNVSAP (Bharat New Vehicle Safety Assessment Programme). It is also supposed to come out with a new set of safety standards by 2017-19. These new safety standards though won't make use of airbags in personal vehicles mandatory, but these are most obviously the way ahead.
According to ICRA, a private credit rating company, there is a sizeable opportunity to tap into the future with a projected market capitalisation of around Rs 19-23 billion by 2019. The current players in the airbag market comprise of foreign players like Takata, Autoliv and TRW with a 60-80 per cent market share amongst them. Although the opportunity will be huge, it will be difficult for local vendors to match to the international standards due to limited technical expertise and expansion possibilities.
The new standards are also supposed to make ABS standard across the entire motorcycle range along the lines of many other developed nations. Two-wheelers account for the most number of accidents in India. This will provide select auto component makers an opportunity to enjoy a market value of Rs 42-50 billion by 2020. Bosch and Continental will benefit the most from this development as they will continue to produce low-cost ABS solutions for our market.
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