Q: Congratulations on assuming the charge of the President of FADA. What are your immediate priorities?

Gulati: Thank you!

The past eight to nine months have been a challenging time for the entire humanity and every business sector. It has been a difficult phase for the dealer fraternity too. We have worked in very adverse conditions with zero business and zero earnings, along with a high operational cost. Post reopening of dealerships, proper decontamination and sanitisation of the entire premises, vehicles, employees, etc., have added cost to dealers who were already seeing slow sales for over 18 months in the pre-COVID era.

We are a resilient lot, and COVID has taught us to make tough decisions to ensure that our business and community survive, while offering the best of our services to customers. During my tenure, I will rigorously take up all our dealer issues at every possible platform and offer the association the finest representation, better visibility and hearing, offering a competitive business and operational environment to our fraternity.

The automobile industry has been an important driving force in India’s economic growth. Reviving the automobile industry is vital to regain lost momentum in the economy. The Government and the sector need to work together to strengthen the industry, wherein the dealer fraternity is an important element in the system.

One of the key issues which we will be working upon is improving dealer margins. Over the years, profitability has dwindled due to high costs and low operating margins.

Auto dealerships in India are operating at an average net profit level of 0.5 percent to one percent of the total turnover, which is much lower than the global standard, as internationally, dealer margins range from seven percent to 12 percent on selling price of the vehicle.

We have already written to SIAM about this, and we will further strongly urge all our OEMs to make the dealer business more sustainable and shockproof.

While we were trying to bring auto dealers under the ambit of MSME, we will up the ante further and make sure that dealers are treated at par with other businesses who are reaping the benefits of being an MSME.

Further, as a category, 2-wheelers comprise 75 percent of the sales in India, and I am working to make an exclusive 2-wheeler vertical at FADA.

This will specifically work on the nuances of 2-wheeler dealership such as sub-dealers, brokers etc. The dynamics of 2-wheeler dealers are very different from 4-wheeler dealers and hence need special attention. As they say, fortune is at the bottom of the pyramid!

FADA will continue to take up issues concerning regulatory and legislative burdens, representing the dealer fraternity across every possible platform. We will continue to reach out to our principals and build strong relationships moving ahead.

Q: FADA has been working on increasing dealer margins for ages but ends up in a stalemate. Where is the issue? How are you going to tackle this?

Gulati: Yes, this is one issue which we have been working for many years, but efforts were not made concretely until sometimes back. It’s during the 2nd Auto Retail Conclave, when we brought up the issue to our executive committee, had a panel discussion exclusively on dealer margins. There onwards, we started building momentum with continues efforts in this direction, and a few months back we also did a study on dealer margin offered by individual OEM to their respective dealers across the product lineup. This was an eye-opener for the entire fraternity as nothing of this sort was brought out in the past; this showcased that Indian dealer’s community were working on a minimal margin which was way below the global standards.

I am happy to mention that post this study, few OEMs have reviewed their dealer margin, few are in discussion with their management and respective dealer council. However, the increased margins are still not at a level which we have been asking for, but a movement has started, which is quite encouraging for the entire community.

Dealership business has a significant daily expense which is addressed by the dealer from his marginal profit. A better profit margin will help the dealer to re-invest a subsequent amount of his earning for the development and expansion of his business, which in return will add up a new business to OEMs.

We will continue to do this kind of studies in times to come and also keep negotiating with our principals as they also understand that their first customers are not in good shape and they require higher margins to sustain their business.

Q: What according to you are the skill gaps persist in the automotive industry still and how FADA is addressing this?

Gulati: Skill gap is a subject which is never-ending as technology keep changing, and we need to make a continuous effort to upgrade our manpower. In recent time, the automobile industry has gone a long way in terms of technology upgrade.

To address this change, all the three auto Associations (Automotive Component Manufacturers Association of India (ACMA), Federation of Indian Automobile Dealer Associations (FADA) and Society of Indian Automobile Manufacturers (SIAM)) have come together in tune with National Skill Development Council and created ASDC (Automotive Skill Development Council) which looks to reduce the gap in between yesterday’s skills and today’s requirement. FADA has been making a continues effort to keep our dealership manpower at par with the newer technologies.

At FADA, we are starting up with a FADA Academy which will hold courses for Dealer Principals and their Chief Experience Officers to train them in running an efficient dealership business from all aspects.

Q: With more than 50 percent of the work in purchasing any vehicle done online, where do you see the role of dealers in the future? Do you see the new trend fuelling unemployment further?

Gulati: Getting prospective customers through the online route is a growing trend. Dealers and manufacturers have been active on online platforms for quite a long time now. The pandemic is the reason for this change in consumer behaviour. Earlier, customers had to visit dealerships several times before the final buy. e.g. all loan formalities, document verification, vehicle test drive etc. These are now offered online or at the doorstep. But for the final sale, customers have to visit the dealerships to test the vehicle and take delivery.

Today every customer is well informed. The vehicle-buying experience involves several steps, right from an online search, specific automobile website visits, going through views, reviews, product comparison, collecting information from peers, social media and users and evaluating a brand, product and its services.

Only after doing all these research consumers make their decision. It is not just a transaction for the customer, but more about in getting into a relationship of trust. That is where the dealerships come into play. Every customer wants to experience the vehicle physically before closing the deal. More importantly, they want to meet up face-to-face with the dealer and satisfy themselves before committing to this high-ticket purchase.

I don’t think there is any change in the playbook, but digital has now moved from “Nice to have” to Necessity. In this COVID era, with total lockdown, digital marketing has played a significant role in boosting sales and smooth execution. Every dealership has initiated digital training of its manpower, equipping them to conduct sales coordination through a digital platform. This initiative has further enhanced its sales and service reach. Dealerships must be the most frugal and flexible link across the automobile network.

Dealers and dealerships have always been the face of the brand and will continue to be so. I don’t see any immediate challenge or threat to the dealership business. However, with companies being more aggressive and active on online platforms, this will add on to dealership engagement with the brand and the customers, helping them further to enhance their sales and service reach and experience.

Q: What are the challenges you face with emerging technology trends like vehicle electrification?

Gulati: I don’t see vehicle electrification as a challenge for the dealer fraternity. The dealer community has been one of the most adaptable segments of the automobile ecosystem. We have always strived to keep ourselves at par with the manufacturers, and it’s business requirement, product and services utility. The dealer business is one business which significantly depends on its skilled workforce across the offerings such as sales, aftersales, engineering, etc. With every new product or technology, the dealer in association with its OEM partner makes certain that it initiates rigorous training for its employees so that it can offer the best service to its customers on behalf of the brand.

As far as vehicle electrification is concerned, India is still at a very initial level as electric PVs still have less than 0.25 percent market share. The EV segment requires immense Government support in terms of infrastructure, subsidy, allowance, recognition, etc., to get the segment to grow. I don’t want to comment on the technicalities of the segment and its products and services. Instead, on behalf of the entire dealer fraternity, I would like to assure that as a community we are committed to offering all necessary support and service to the Government for its vision about the EV industry.

Q: Episodes like FIAT & Peugeot (decades ago) and GM & MAN Trucks (in the recent past) etc., exiting the Indian market continues, leading the dealerships to lurch. What kind of safeguard mechanisms can we have to support the dealer community?

Gulati: Setting up a global brand dealership in India is a massive cost which varies from brands to segment, size of the dealership, region, location, etc. On an average setting up a premium 2-wheeler brand dealership cost somewhere around INR8-10 crore whereas setting up a premium 4-wheeler brand requires close to INR 20 - 30 crore. It is not just the setting up of a dealership which is a cost, the operation of a dealership is also a huge which involves day to day operational cost, vehicle stocking, employee salary etc. The dealer bears all this. As you know, the dealership business operates on a very minimal profit margin; any such activity by any brand ends up leading to capital loss along with loss of jobs in the sector. And now the pandemic poses another challenge for the dealer fraternity.

For example, the recent announcement by Harley-Davidson to discontinue its manufacturing and sales operations in India has left its Indian dealers stranded. This will result in the closure of 35 Harley-Davidson dealerships, with an approximate capital loss of INR 110-130 crores, besides also leading to a job loss of around 1,800-2,000 people at dealerships.

This is the fourth instance of automobile companies exiting India in the last three years (since 2017). Earlier, General Motors, MAN Truck and UM Lohia had quit their Indian operations, leaving their dealers in a similar fix. Due to FADA’s strong intervention and the Indian Government’s full-fledged support, General Motors and MAN Trucks had partially compensated their channel partners, but the UML matter remains unresolved till date.

Had there been a Franchise Protection Act in India, brands like these would not have abruptly closed their operations, leaving their channel partners and customers in the lurch.

We are already working on a draft with our legal team and have initiated communication with other retail associations to bring the Franchise law in India, which will support the dealer fraternity in the dire situation of an exit or termination.

We would also request the Government to initiate the law on priority as this law will help level the playing field for large international and domestic automakers and dealers and also help in regulating over-dealerisation.

Q: What kind of support/guidance FADA has given to its members to tide over the current situation triggered by the pandemic?

Gulati: These are unprecedented times. Everybody is making the best efforts to emerge from it in their own way. The auto dealership is one such business which was deeply impacted by COVID-19. The auto dealership is a very marginal profit business, and we do not have large funds like car and component manufacturers have, which makes it more difficult for us to emerge from this difficult time. The industry was already struggling with a 15 to 16-month slowdown, and the lockdown has pushed the entire industry further back.

FADA has provided all possible and necessary help to its dealer members. At the time of the lockdown, FADA wrote a letter to Prime Minister Narendra Modi to apprise him about the dealers’ issues and suggesting dealership survival and demand revival initiatives. Apart from this, FADA wrote a letter to SIAM making them aware of the situation of the dealers, requesting them to review the dealer margin and extend their support so that dealer can survive these difficult times. FADA quite actively worked to protect dealers from the loss on remaining stocks of BS-IV vehicles from the ban on the sale. The association petitioned the Supreme Court to extend the dateline for sale of these vehicles. At the same time, while securing the future of dealers, FADA demanded that car makers increase the dealer margin to five percent PBT and reduce the infrastructure cost by 25 percent.

FADA conducted online training for its dealer brothers, training them to prepare for maximum work with limited resources. (MT)

COEP Technological University (COEP Tech) and JSW Projects, a subsidiary of JSW Group, have signed a Memorandum of Understanding to establish an Advanced Battery Research & Development Centre at COEP Tech's Chikhali Research Park in Pune.

The initiative represents a combined investment of over INR 8 billion to construct an indigenous battery prototyping and pilot-scale research facility on an academic campus in India.

The project is structured in two operational phases – phase 1 will establish a Cell Research & Development Centre focused on the design, simulation and prototyping of lithium-ion and sodium-ion cells.

Phase 2 will expand the site into a Cell Validation Centre with pilot-line capabilities to produce battery cells ranging from 100 Ah to 600 Ah. The facility aims to develop cell chemistry and battery architectures adapted to Indian climatic conditions and operational requirements across electric mobility and stationary grid storage applications.

Sunil Bhirud, Vice Chancellor, COEP Technological University, said, "This collaboration has the potential to create a strong indigenous alternative to imported batteries and make a significant contribution to India's journey towards self-reliance. For students, it will provide a unique opportunity to learn and work on cutting-edge battery technologies. The scale and scope of the Phase I and Phase II collaboration between COEP Technological University and JSW make it a landmark industry-academia initiative. At a time when next-generation battery technologies are receiving significant research attention across the country, the partnership places research, innovation and technology development on a much larger platform. The collaboration has the potential to develop technologies that can reduce dependence on imported batteries and contribute to the vision of a self-reliant and developed India. The scale of this initiative makes it a significant step forward in strengthening India's battery technology ecosystem. We are grateful for the valuable support extended by the Government of Maharashtra and the Board of Governors of COEP Technological University in enabling this important initiative."

Sajjan Jindal, Chairman, JSW Group, said, “Cell is the new oil. Just as oil powered the last century, battery cells will power this one, from electric vehicles to the grid. For decades, India has spent precious forex importing oil. This time, we must build the cutting-edge skills and capabilities to make these cells right here, for a new India. Our partnership with COEP Tech, with its 170-year legacy of engineering excellence, will bring industry and academia together to design, test and validate cells built for Indian conditions, and help shape India's clean energy future.”

The R&D centre is designed to support the energy storage initiatives of JSW Energy and the electric vehicle manufacturing operations of JSW Motors. The facility will also serve as a platform for intellectual property creation, scientific publications, and technical workforce development within Maharashtra's industrial belt.

German automotive major the BMW Group has received the ‘Global New Energy Vehicle Innovative Technology’ award at the 2026 World New Energy Vehicle Congress (WNEVC) in China.

The company was recognised for its sixth-generation (Gen6) high-voltage battery system, which uses round battery cells with a high-nickel cathode. The BMW Group was the sole non-Chinese automotive manufacturer to receive a technology award at the event.

The Gen6 battery system serves as a component of the company's upcoming ‘Neue Klasse’ vehicle platform, which will be integrated across its electric vehicle lineup. In developing the sixth-generation eDrive technology, the BMW Group filed over 500 patent applications. The battery architecture utilises an 800-volt system, bidirectional charging capability and a cell-to-pack design that integrates cylindrical cells directly into the battery pack without intermediate module structures.

Jochen Goller, Member of the Board of Management, BMW AG responsible for Customer, Brands, Sales, said, “We are very proud to receive this international award for our Gen6 high-voltage battery. It confirms our long-term approach of combining technological innovation with the highest standards of quality and safety and genuine customer relevance. With the Neue Klasse, we are setting new benchmarks in this area.”

Thomas Engelhardt, Senior Vice-President Development High-Voltage Batteries, Charging at the BMW Group, said, “The Gen6 high-voltage battery represents a technological leap across all customer-relevant features. Its innovative, flat design with cylindrical cells paves the way for greater range and faster charging, while maintaining the highest level of safety. As a core technology of the Neue Klasse, it forms the foundation for fully-electric driving pleasure across the entire BMW portfolio.”

The battery system incorporates steel-housed round cells, multi-stage insulation and thermal management features. The energy management functions are directed by the ‘Energy Master’ unit, featuring hardware and software developed in-house by BMW to manage power distribution, vehicle electrical system supply and battery data processing. The Energy Master system provides compatibility with both 400-volt and 800-volt charging infrastructure and allows for the integration of alternative cell chemistries.

The presentation marks the fifth consecutive year and sixth time overall that the BMW Group has received recognition at the World New Energy Vehicle Congress, an annual industry conference bringing together automotive, academic and government representatives to discuss electric vehicle developments.

Japanese automotive component supplier Toyoda Gosei Co has announced plans to establish a new manufacturing facility in the Bidkin Industrial Area in Maharashtra.

The plant will produce interior and exterior components, including bumpers and instrument panels, alongside safety systems such as airbags and steering wheels and functional components like plastic fuel filler pipes.

It will commence operations in the first half of 2029 to supply Japanese car manufacturers operating in the country, including Toyota Kirloskar Motor, which is constructing a vehicle plant in the same industrial zone.

The development represents Toyoda Gosei’s eighth location in India and will operate as a branch plant under its subsidiary, Toyoda Gosei South India.

The site covers approximately 78,400 square metres of land with a planned building area of 29,200 square metres. Toyoda Gosei plans an investment of approximately INR 5.758 billion (JPY 9.3 billion) for the project, with projected workforce numbers reaching around 570 employees by 2030.

The facility will incorporate equipment including electric injection moulding machines with automated mould-changing systems, a bumper painting booth, automated guided vehicles and rooftop solar panels.

Production processes will integrate Internet of Things technology, digital transformation systems, collaborative robots, and mechanical mechanisms derived from Karakuri design principles.

The expansion comes as product demand in India shifts from compact cars toward sport utility vehicles. Toyoda Gosei intends to utilise the new facility to expand its local development and manufacturing network across the region.

Pune-headquartered automotive company Kinetic Engineering has announced an investment of approximately INR 570 million to support its capital expenditure requirements and expand its electric two-wheeler segment.

The company shared that it intends to deploy INR 170 million toward CAPEX, while INR 400 million will be directed toward electric vehicle manufacturing and distribution. The capital injection is being executed through the final tranche conversion of 4,451,000 warrants issued to promoters in March 2025.

The investment follows an increase in the company's dealer network and product distribution footprint. Kinetic Engineering has signed letters of intent with over 150 dealers across India, with 60 dealerships operational featuring sales, service and spare parts operations. Promoter shareholding in Kinetic Engineering has increased from 50 percent to 69.27 percent over the past four years.

In its electric two-wheeler business, the company is focusing on its Kinetic DX and DX+ scooter models, which incorporate 3.1 kWh lithium iron phosphate battery packs that deliver a range of up to 132 kilometres under Indian Driving Cycle test conditions.

Ajinkya Firodia, Vice-Chairman and Managing Director, Kinetic Engineering, said, "Kinetic Engineering is entering an exciting phase of growth, with strong momentum across both our automotive components and electric mobility businesses. Our auto-components business is seeing a healthy pipeline of new orders, which will support growth and help us work towards our target of improving EBITDA margins to around 12%. At the same time, the response to our Kinetic DX electric scooter has been encouraging, giving us confidence to expand our presence across markets. With continued investments in capacity, technology and our retail network, we are focused on scaling both businesses and building Kinetic into a leading and enduring player in India’s electric mobility segment."

The company aims to secure a position among the top ten electric vehicle brands in India as industry projections indicate electric two-wheeler market volumes could expand from 1.8 million units to 7 million units by FY2030.