A Dynamic Simulation Model for the Long Term Analysis of the Indian Automotive Industry

Number: 007-0412 A Dynamic Simulation Model for the Long Term Analysis of the Indian Automotive Industry S.Balan, Prem Vrat and Pradeep Kumar Research Fellow, The Logistics Institute Asia Pacific, NUS, Singapore – 117574 Email: [email protected] Vice Chancellor, UP Technical University, Lucknow, India – 226021 Email: [email protected] Professor, MIED, IIT Roorkee, India – 247667, Email: [email protected] * Corresponding author Abstract: This paper presents a new model for long term analysis of deregulated Indian auto market. In this model we try to capture the main factors affecting long term development of the Indian auto industry. Investor’s lack of perfect foresight, together with construction delay could possibly result in periods of over capacity or capacity deficits in the system in the global supply chain. By using a dynamic simulation model and analysis framework, it’s possible to analyze the Indian auto market and analyze the industry over the next 10 years. Under different delay and risk conditions, policy experimentation is carried out considering various global economies and their degree of development. A detailed sensitivity test is carried out to examine the robustness of the model. The research recommends some strategies for a global supply chain that could improve flexibility across the chain, reduce lead time, reduce inventory and enhance supply chain efficiency. Accepted in: POMS 18 Annual Conference, Dallas, Texas, U.S.A, May 4 7, 2007