Market for fake auto parts continues to thrive in India

The Automotive Component Manufacturers Association (ACMA) estimates that fake auto parts account for 30-40% of the total parts sold in India. The total valuation of auto parts (in retail outlets) in India is worth about Rs. 35,000 crore. Out of these, the value of counterfeit parts could be in the region of Rs. 10,500-14,000 crore. Three years ago, the value of these parts was estimated at Rs. 8,500 crore, which indicates that the market for fake spare parts is growing.

The most common among these fake parts include clutch, filters, lamps wipers, bearings, steering arms, brakes and brake linings and are available for a range of vehicles including two-wheelers, cars, SUVs and commercial vehicles (trucks and buses). Some of the parts in this list are critical for the safe operation of vehicles. ACMA has claimed that about 20% of the total road accidents in the country could be caused by the use of counterfeit parts.

Fake parts are priced a good 20-30% cheaper than genuine parts. The ease of manufacturing these parts, packaging and importing and the higher margins on their sales, results in retailers and mechanics opting for them over genuine parts. Additionally, the short replacement cycles of certain parts, supply constraints faced by original equipment manufacturers and legal shortcomings are responsible for the market for counterfeit part growing despite several crackdowns.

Vehicle manufacturers too claim that the use of counterfeit parts affect the vehicle's performance and subsequently, its brand value. Some of them have started conducting raids on the premises of manufacturers of fake spare parts. However, in the absence of stringent laws and mandated safety standards for after-market products, the import of counterfeit parts is going to be difficult to check.

Note: Image use for representation purpose only.

Source: Business Standard