Automobile Sector (2)

8/6/2019 Automobile Sector (2)

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INDIANINDIANAUTOMOBILEAUTOMOBILESECTORSECTOR


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MembersDIVMembersDIV CC

y Chinmay Sawant 136

y Puneet Sharma 151

y

KirtiTaneja 172


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EvolutionEvolution and growth of Indianand growth of Indian

auto industryauto industry

y Early 1980

y This was the pre-1980 era where the

manufacturing of automobiles especially carswas subject to strict licensing

y

A land of Premier Padminis, Ambassadors,scooters, tempos, trucks and autos , India had

not seen much of choice in vehicle


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y

Maruti Udyog in collaboration with Suzuki ofJapan came in the passenger car segment

y

Indian roads saw the launch of Maruti 800

y It was still not very easy to own a car, first was

affordability and next was a long waitingperiod.


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LiberalizationLiberalization 1990s1990s

y with liberalization, some more Japanesemanufacturers entered the two-wheeler and

the commercial vehicle segment in a

collaborative arrangement

y market started opening up

y Automobile Industry was delicensed in

July 1991


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y The abolition of the controls led to an

avalanche of demand

y Decrease in customs and excise duties meant

that a vehicles started getting affordable

y The entry of foreign banks with attractive

auto finance schemes helped garner a huge

base of middle class population.y However the market was still ruled by the

sellers


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GlobalizationGlobalization 2000s2000s

y Several policy changes were introduced withfocus on boosting the auto exports.

y A Core Group on Automotive Research andDevelopment (CAR) was established in 2003for encouraging R&D activities.

y Foreign manufactures started looking at Indiafor sourcing auto components


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y The buyers started ruling the market due to

the availability of choices in the form ofmodels, price points and brands

y A vibrant economy meant an increase in the

GDP and per capita income.

y The vast geographic spread of India attracted

foreign investments. The marquee brands from

all over the world started courting Indian

consumers aggressively


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Growth Trajectory of IndianGrowth Trajectory of IndianAuto IndustryAuto Industry


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y The sharp increase between 2007 and 2010 is

the result of government initiatives, growing

economy and disbursement of loans for

purchase of vehicles

y A World Bank report puts India up ahead as

the fourth largest economy in the world in

terms of purchasing power parity


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y The sales of automobiles have increased dueto an increase in income and a rapid increasein private final consumption expenditure

y It is estimated that India will see over Rs30,000 crore being invested by 2010

y This is because Indian auto industry is racingahead with a healthy growth


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KEY PLAYERSKEY PLAYERS

y Maruti TATAHyundai HondaFord GMSonalika International HM

Force ToyotaKirloskarM&M FiatSkoda AudiMercedes Benz BMWVolkswagonMitshubishi


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What makes the Indian AutoWhat makes the Indian Auto

Market attractive?Market attractive?y While the markets in the developed

countries reach a maturity point, markets

such as India are looking very attractive

y As the second largest populous country,

with poor public transport and

infrastructure, most of the people aredepending on their personal transport for

comfort, convenience and style


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y The consumers are being wooed by the

manufacturers with attractive finance options

and with models at various price points.

y There is a huge potential for the demand of

cars because of the low penetration rates of

11 cars for 1000 peopley The hub and spoke approach followed by

most distributors and suppliers is pushing the

demand for commercial vehicles drastically.


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THE FUTURETHE FUTURE

y By 2016 the size of the Indian automobileindustry is expected to grow by 13%, toreach a mark of US$ 120-159 billion

y

Presently, India is the 2nd largest twowheeler market in the world and fourthlargest commercial vehicle marketworldwide

y

India is the 11th largest market in thepassenger car segment globally which isexpected to become the 7th largest marketby 2016.


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THANK YOU

Documents

Automobile Sector (2)