Analysis of demand risks for the Indian automotive sector in globally competitive environment

Abstract

Purpose The purpose of this study is to understand the different types of risks affecting the demand for the automotive sector in India. The study is further trying to illustrate an approach for analyzing the relative intensities of these risks in the present uncertain business environment. Design/methodology/approach Risk on the overall demand is assessed by a combined Bayesian – multi-criteria decision-making approach. Data related to the different factors, affecting their product demand is collected from major automobile firms. Then, weights for these factors are evaluated by applying the analytic hierarchy process approach. Further, these weights are used in the Bayesian analysis network to evaluate the risk intensity for different subgroups, namely, political, economic, social, technological and environmental. Findings From the literature and experts’ opinion, total 16 risk factors have been finalized and these are further grouped into 5 categories i.e. political, economic, social, technological and environmental. It is observed that the demand for organizations functioning in the automotive sector is more vulnerable to economic risk as compared to other risks considered in the study. Practical implications Managers and decision makers of associated organizations can use the proposed framework to assess the demand risks so as to pre-evaluate their demand corresponding to future changes. Factors can be added or removed and importance could be assigned to different risk factors according to the prevailing business environment for an organization or sector. This will also help the organizations to conduct a more effective risk management in an uncertain business environment. Originality/value The study will help in better understanding of the various demand risks prevalent in the Indian auto sector. The methodology used, provides a novel approach for assessing the macroeconomic demand risks and can be used by the firms working in the automotive sector. The proposed methodology could be used for assessing supply chain risk or any other business initiative risk. The suggested approach will help managers in devising flexible management techniques so as to mitigate the risk.

Evaluation of supply chain risks by fuzzy DEMATEL method: a case study of iron and steel industry in Turkey

“…When the results of environmental risks are examined, it is observed that economic risk is the most critical risk. Similarly, Kumar et al (2020) assessed various risks affecting demand for the Indian automotive sector. They found that companies are most affected by economic risks than other risks.…”

“…Supply chain risk management, which includes the identification, evaluation, and management of risks in supply chain processes that are critical to business performance, has become an important area in supply chain management research (Ceryno et al, 2015;Dong & Cooper, 2016;Ho et al, 2015). While previous research concentrated on supply chain risk management (Hermoso-Orzáez, & Garzón-Moreno, 2021;Ho et al, 2015;Mital et al, 2018;Zimmer et al, 2017), classification of risks (Alora & Barua, 2022;Duong et al, 2022;Kumar et al, 2020;Oke & Gopalakrishnan, 2009;Rangel et al, 2015) and assessments of risks (Ali et al, 2021;Alora & Barua, 2022;Mital et al, 2018;Zimmer et al, 2017), only a few studies (Khan et al, 2021a;Pfohl et al, 2011;Sharma & Routroy, 2016) have examined the relationships between risks. In practice, supply chain risks are generally related, but this situation is ignored in traditional risk management.…”

Research on the Direction Optimization of Professional Cluster in Higher Education Institutions Based on Industrial Demand

“…The first step is to understand the development trends of different industries, that is, to understand the development of different industries in technology, market, demand, and policies. Through detailed analysis of industry development trends, it can help higher education institutions better grasp industry demand, and then make more appropriate professional adjustments, in order to cultivate talents more suitable for the development of different industries [5][6]. Secondly, it is necessary to understand the demand for talent in different industries, fully considering the current technological requirements, market demand, salary situation, and ability requirements of different industries.…”