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Emerging Countries and Manufacturing IT Solutions Will Shape the Automotive Industry Landscape
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1© ARC Advisory Group
Emerging Countries and Manufacturing IT Solutions Shape the
Automotive Industry Landscape
Ninth ARC India Forum, Pune August, 2011Rajabahadur V Arcot
Kishore M Karandikar
Vice President & GM
ARC Advisory Group
2© ARC Advisory Group
AgendaAgenda Automotive Industry Status in Emerging Countries
including India• Global Automotive Industry Landscape• Global Automobile Sales Outlook India & Automotive• India & Automotive Industry - Trends
Manufacturing Industry Continues to Evolve • Invention Based & Basic-needs driven Manufacturing
(Europe & NA)• Convergence of Information and Communication
Technologies (Japan & Asian Tigers) • IT Enabled Manufacturing – IT Everywhere• Manufacturing Evolution
Emerging Countries and Automotive Industry• LEAP Manufacturing
4© ARC Advisory Group
GLOBAL AUTOMOTIVE INDUSTRY Landscape
Source: Global Auto Report, Published by Scotia Bank Group
5© ARC Advisory Group
Global Automobile Sales Outlook
Based on Global Auto Report, Scotia Bank Group
6.91
10.45
15.0717.68
22.47 23.08
26.60
30.67
35.35
32.29
38.7437.26
32.8234.33
37.05 36.38 35.30 33.75
0
5
10
15
20
25
30
35
40
45
1990-99 2000-07 2008 2009 2010 2011 2012 2013 2014
MIL
LIO
NS
OF
UN
ITS
ASIA REST OF THE WORLD
6© ARC Advisory Group
India & Automotive Industry – Present LandscapeIndia & Automotive Industry – Present Landscape
Asia’s third-largest Private
Vehicle market
Globally Fourth Largest
Commercial Vehicle Market
Emerging as Center of
Excellence for Compact Cars
Globally Second-
largest Two-Wheeler Market
Globally Fifth Largest Bus and Truck Market by
Volume
7© ARC Advisory Group
India & Automotive Industry - Trend India & Automotive Industry - Trend
Expected to contribute 10 percent of India’s GDP in the next 5-6 years
Emerging as an exporter of automobiles and auto components
12© ARC Advisory Group
Manufacturing Industry
Continues to Evolve Invention Based & Basic-needs driven
Manufacturing (Europe & NA)Higher-order wants driven
Manufacturing and Manufacturing Deconstruction (Japan, Asian Tigers)
Factory of the Future / Smart Manufacturing - IT Enabled (Emerging Economies can leapfrog Manufacturing)
13© ARC Advisory Group
Invention Based & Basic-needs driven Manufacturing (Europe & NA)
1825
Steam Engine
1769
Four Stoke Engine
1862
Electric Telegraph
1809
Automobile
Airplane
Electric Bulb
Telephone
1870
1879
1885-86
1903
Transcontinental Railway
1869
First Public
Railway
1904
Triode
Invention based manufacturing Basic-needs driven invention – mobility, communication Started in Europe and NA
Focus: Produce, Meet Basic needs
14© ARC Advisory Group
Vacuum Tubes / Triodes Transistors Integrated Chips
1904 1947 1961
Radio Broadcasting Corporation of America Television Computer
1927 19461919
Higher-order wants driven application inventions – entertainment, computing, analysis
Expanding applications – Convergence of Information & Telecommunication Technologies
Manufacturing deconstruction Emergence of Asian Tigers
Convergence of Information and Communication Technologies (Japan & Asian Tigers)
Invention NA & Europe
Production Asia
15© ARC Advisory Group
IT Enabled Manufacturing – IT EverywhereIT Enabled Manufacturing – IT Everywhere
IT in Design
IT in Maintenance
IT in Operations
ARC’s CMM Model
MES
FA
PLM
17© ARC Advisory Group
Benefits of Information and Intelligence Enabled Smart Manufacturing Benefits of Information and Intelligence Enabled Smart Manufacturing
Become more agile and responsive Reduce design-engineer-make cycle time Reduce capital expenditure Reduce operational expenses Achieve internal and external collaboration Achieve excellence in design, operations, and
maintenance Gain time-to-market advantages Emerge as a center of automotive excellence
and innovation Examples: Instrumentation; Automotive
19© ARC Advisory Group
Emerging Countries and Automotive IndustryEmerging Countries and Automotive Industry
Right Chemistry Exists
• Emerging Countries are Experiencing Economic Growth
• Demand for Automobiles is Increasing
• Automobile & Auto Component Industries are Expanding
• Industry Ecosystems are Emerging and Companies are Becoming Global Sized
• Technology is Available
• Emerging Countries are well positioned to Leapfrog
20© ARC Advisory Group
Emerging Perspective Emerging Perspective
+
= Emerging Countries and Manufacturing IT Solutions will Shape the Automotive Industry
Landscape
Shifting Economic
Power+Changing
Demographics + Business Compulsions
Powerful New IT
Capabilities
21© ARC Advisory Group
LEAP Manufacturing Technology and Business Practices for World-Class ManufacturingLEAP Manufacturing Technology and Business Practices for World-Class Manufacturing
Leading-edge• Innovative• Technology-forward
•Mobile, Social, Cloud, Model-based, Virtual, PLM, MES, etc.
• Collaborative, Integrated
• Performance driven
Efficient• Profitable• High Quality• Compliant• Safe & Effective• Local/Regional
Agile• Responsive
•Collaborative, Networked, Pull-based, Interactive
• Flexible, adaptive, changeable
Progressive• Sustainable
•Energy, Carbon, Social, Water, Waste, Closed Loop
• Responsible
Companies In Emerging Markets Can Jump To A Market Leadership Role
LEAPMfg
22© ARC Advisory Group
RecommendationsRecommendations
Leapfrog and take the path of LEAP Manufacturing
Invest in Technology Solutions
23© ARC Advisory Group
Thank You.Thank You.For more information, contact the author at [email protected] or visit our web pages at
www.arcweb.com