The automotive industry is one of the most
rapidly growing industries in the world. By 2026, it is believed India will be
the third-largest host to the automotive industry, and it all makes sense. India manufactures
approximately 26 million vehicles including Passenger Vehicles, Commercial
Vehicles, Two Wheelers, Three Wheelers, and quadricycles.
With the increase in the volume of the industry, the
manpower and resources required for the automotive industry are also bound to
increase and the need will only become more apparent with time. Therefore,
Human Resource Management need and have to take on necessary and relevant
practices to keep up to date and prevent the obstacles that arise from a bigger
sector of the economy.
The bigger the sector, the bigger the teams in the companies, therefore, HR professionals need to be on top of their game to effectively handle and manage the human capital in an organization. HR faces a lot of challenges in the automotive industry due to the volume of the sector, and it is bound to rise even further. Therefore, let’s study and analyze the major challenges HR professionals or the department face in the automotive industry.
1. Talent Acquisition
The automotive industry has been facing scarcity in acquiring the appropriate talent for some time now. The lack of availability of proper talent in the market has caused major problems to the automotive industry. Being unable to put the right man in the right position has caused a lack of efficiency in the operations of the industry or organizations.
2. High Employee Turnover Rates
The employee
turnover rate in the automotive industry is massive. The reason might be due to
incompetent salary, lack of job security and employee benefits. A high employee
turnover rate has been one of the major challenges for HR. A high employee
turnover rate is one of the most negative aspects of an organization, thus, it
becomes extremely crucial for HR to overcome this hurdle as turnover rates
determine the organization’s standing in the public market.
3. Developing Leaders
As stated above,
the automotive industry is growing and is getting bigger in volume at a good
rate. Therefore, it is quite a challenge to retain the employees in the first
place to even nurture them as leaders in the later stages. It becomes extremely
difficult to develop leaders at an organization with low employee retaining
rates and high employee turnover rates
4. Managing Organization’s
Public Reputation
With everything
that is going on with the automotive industry from high employee turnover rates
and low retaining rates, it becomes a top priority for HR professionals to
manage and handle the organization’s public reputation the best. An
organization’s reputation determines everything for the company while acquiring
talent and its overall standing in the market alongside the goodwill,
therefore, this is one of the key challenges HR professionals face.
5. Going Digital or ‘Phygital’
One of the major challenges that HR faced in recent times was to shift to digital due to the global pandemic in COVID-19. The shift was necessary and it required proper planning to execute it. Although, amazing results have come out that the productivity of employees has actually increased from work from home against the stereotypes. The term, ‘phygital’ means a small number of employees being available on-site and most of the employees working from home, a practice which is here to stay even after the pandemic subsides.
6. Lack of Young Talent in the
Automotive Industry
The automotive
industry severely lacks in this one particular aspect, that is, attracting
young talent. The automotive industry is one of the poorest in this aspect, as
the lack of a young crowd puts them in the backseat compared to other
industries even after developing at an increasing rate. Automotive HR faces
this challenge on a daily basis and the workers are usually in their late 20s
in the automotive industry.
7. Low Compensation Rates and Benefits
One of the most severe challenges HR professionals face in the automotive industry is the compensation to the employees. The most crucial factor at any job. The jobs are not well paid in the automotive industry and naturally, it fails to attract good talent. HR professionals need to be a master at advertising and recruiting in this particular case, hiring people with low returns is not an easy job. Despite their growth, the automotive industry gives lesser returns than the manufacturing industry which is astonishing.
Conclusion
Putting all these factors and challenges into
consideration, it is easy to figure out automotive HR jobs are one of the
toughest in the HR field considering the changes and the situation of the
automotive industry. From low returns, lack of young talent, to adopting new
techniques and methods due to mishappenings in recent times, automotive HRs can
be concluded as one of the toughest jobs. The situation might see a change in
the future as the industry is growing exponentially and it is bound to see new
heights abroad, and especially in India.