Bosch wants to increase its presence in India by increasing its stake in Indian supplier, Mico, from 60.5% to 80%.
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Last week Bosch offered shareholders 4000 Indian rupees (72 euros) per Mico share, according to the German press agency. This is around 20% higher than the average trading price of shares during the last month.
Mico, headquartered in Bangalore, has a turnover of around EUR660m and produces mainly diesel components, including common rail systems.
Bosch employs a total of over 15,000 people in India. Mico (Motor Industries Company Ltd.) was founded in 1951 and is the flagship of the Bosch Group in India, but Bosch also has subsidiaries making automation technology, brakes (Robert Bosch Chassis Systems India Ltd.) and IT and engineering solutions. It also has a 50:50 joint venture with Mann+Hummel in the country, and another brake operation in partnership with Brembo. ZF Steering Systems (a 50:50 joint venture between Bosch and ZF Friedrichshafen) is also present in India.
India’s automotive industry is expanding fast. By 2016 India is hoping to employ around 25 million people in India, according to its Automotive Mission Plan. Currently around ten million are employed in all aspects of the industry, including sales and service.
According to a report on the BBC’s website, of the 25 million only ten percent will be unskilled workers, while 62% will be skilled, and the remaining 29% will be management/sales workers. Already only half of the 4,000 people employed at Ford’s plant in Madras are blue collar workers, and many of them are skilled. Ford also sources IT from India, and runs the entire group’s business invoicing out of Madras.
According to the Automotive Mission Plan, the automotive sector will increase in importance in terms of its contribution to GDP. By 2016 it is forecast to contribute ten percent of India’s total GDP (up from five percent) today, generating a turnover of US$145bn.
