2. Indian Auto Industry
Facts
• Second Largest two wheeler manufacturer
in the world
• Largest tractor and three wheeler
manufacturers in the world
• Fourth largest Commercial vehicle market
in the world
• Eleventh largest passenger car market in
the world
Trends Growth Potential
•Can become World’s third largest
• Growth of exports of 33.57 % FY 2011-12. automobile market in 2030.
• Output of commercial vehicles has grown
2.8 times compared to the 2.2 times •By 2016, Automotive sector can DOUBLE its
increase in passenger cars percentage contribution to GDP from current
• For every passenger car turned out, there levels of 5% (US$50 billion) to 10% ($180
billion).
are almost 7 two-wheelers produced

3. The Growth Journey
Pre 1983 1983-1993 1993-2012
Closed market Japanisation - GOI- Delicensing of sector in
Suzuki joint venture to 1993
form Maruti Udyog • Global major OEMs
• Growth of market start assembly in India
limited by supply • Joint ventures with (Toyota, GM, Ford,
companies in Honda, Hyundai)
• Outdated models
commercial vehicles and • Imports allowed from
Players components Era of
April 2001; alignment of
• Hindustan Motors globalisation and
Players duty on components
• Premier and parts to ASEAN evolution of India
• Maruti Udyog levels as a global
• Telco • Hindustan Motors manufacturing hub
• Implementation of
• Ashok Leyland • Premier VAT
• Mahindra & • Telco
Mahindra
• Ashok Leyland
• Mahindra & Mahindra

4. Automotive Companies in India
Major Indian Companies Major Multi-national companies

5. Booming Indian Economy

6. Key Growth Drivers

7. Auto Industry Numbers
• Overall Market
• Over all Production increased to 14.82 million vehicles in 2010-11 from 11.17
million vehicles in 2009-10
• Passenger vehicles increased marginally from 1.95 million from 1.83 million
• Two-wheelers increased from 9.11 million to 9.51 million
• Domestic Market
• Vehicles sold including PV,CV 2W and 3W in 2008-09 was 9.72 million as
compared to 9.65 million in 2007-08.
• Exports
• Sales was 1.53 million units in 2008-09
• As per the Automotive Mission Plan (AMP) 2006-2016 total turnover of the
automotive industry in India would be in the order of US$ 122 billion-159 billion
in 2016

8. Category wise numbers
Dominated by Motorcycles 80% , Scooters 14% Mopeds 6%
Two Wheeler Domestic - 7.25mn units . Hero mocorp.35% & Bajaj 32% share CAGR – 9.5%
Exports 819000 units (07-08) . Bajaj Auto 59% TVS 17% share CAGR – 41%
Dominated by Cars 78% , MUV/SUV 22%
Passenger Vehicles Domestic – 1.5mn units Maruti-46% Tata-15% Hyundai 14% CAGR -14.8%
Exports - 217000 units (07-08) Maruti 66% Hyundai 24% CAGR – 26%
Dominated by M&HCV – Goods 48% Passenger 38% , Rest by LCV -14%
Commercial Vehicles Domestic – 487 thousand units , Tata-62% Ashok Leyland -15% CAGR- 22%
Exports – 59 thousand units, Tata 67% Ashok Leyland 12% CAGR -30.6%
Dominated by Passenger Carriers with 64% share , Goods Carrier -36%
Three Wheeler Domestic – 365 thousand units , Bajaj -42% Piaggio-41% CAGR- 10.5%
Export – 141 thousand units , Bajaj -97% CAGR -44.5%

9. Production data

10. The Indian Auto Components
Market
• Original Equipment Manufacturers (OEMs)
• Replacement Parts Production and Distribution : e.g. Air
filters, oil filers and replacement lights
• Rubber Fabrication : tyres, hoses, belts etc.
• Estimated component market size is US$ 8.7 bn
• The exports of auto components industry has grown at a
rate of nearly 30 per cent CAGR over the last four years.

11. Second Hand Automobile Market
• Used car market demand : 1.4 million cars annually
• Market Structure :
– Organized : 10%
– Unorganized : 90%
• Vendor Based – 30%
• Direct Dealings – 70%
• Certified used car dealers in India are – Maruti TrueValue, Honda Auto Terrace,
Ford Assured, Toyota U Trust, Hyundai Advantage, Mahindra and Mahindra’s First
Choice, General Motors - Chevrolet-OK
• Unorganized market lacks services like -warranties, OEM equipments, insurance
and taxes
• Second hand market expected to grow at 12-15 per cent in the next five years to
touch a robust 2.5 million units and a turnover of Rs 50 thousand crore
• Estimations are that 50 percent of the used cars sales will be brought under
organized car market by 2013

12. Economic Factors
1 year 1-5 year 5-10 years
•Investment in •Growing working
•Increased access to Infrastructure spending population (441 million
credit and lower interest can boost the people in 2015/16)
loans commercial vehicles
segment. •Upward migration of
household income levels
(600 million people have
annual income of more
than $10,200)
•Middle class expanding
by 30 - 40 million every
year
Can propel growth

13. Economic Factors
1 year 1-5 year 5-10 years
•Non- availability of
•Non-availability of Key supplier base with
•Impact of delayed raw material (like Steel) demanded capability
monsoon (85% of at cheap price. (Quality and Quantity).
normal, subsequent
impact on paddy •Poor execution of
cultivation) on rural •Possible increase of Infrastructure
demand. interest rates (by 2-2.5% investments.
BPLR) because of (Construction of
planned government Highways of 16km per
borrowing. day against the target of
32 km per day)
•Increase in crude oil
price($ 35/barrel to $ 70/
barrel in 14 months).
Can Stunt Growth

14. Social Factors
• A perfect marriage of rise in disposable income
• Rapid Urbanization of semi urban regions and demographic dividend (From US$ 556 per
• Rising aspirational levels. Improvement in annum US$ 1150 by 2015)
living standards of middle class
• Increased spending on Fashion & lifestyle
comforts.
• Seeking “Value for money”- consumer behavior
• Increasing customer emphasis on aesthetics
and comfort.

15. Technological Factors

16. India as a Testing Hub : NATRIP

17. RATIO ANALYSIS

18. Key Financial Ratios of maruti suzuki

19. Key Financial Ratios of Tata Motors

20. FUTURE GROWTH
According to the Society of Indian
Automobile Manufacturers,
•Annual vehicle sales are
projected to increase to 5
million by 2015
•more than 9 million by 2020.
•By 2050, India is expected to
top the world in car volumes
with approximately 611 million
vehicles on the nation's roads.

21. India : A Developing Hub for Compact Cars
 Compact cars account for 70% of the total car market.
 Compact car sales increasing at about 20% each year
 Excise duty on small cars increased from 22% to 24% in the present budget.
 Maruti Suzuki :
 Tata Motors :
• New car plant to make 2,50,000 cars per
Tata Nano became a big success gaining
annum (total 10,00,000 cars/annum) worldwide popularity with Tata planning to
• total investment worth 6,000 crores. increase capacity
 Hyundai :
 Already a big player in the small car segment  Toyota :
 Increase capacity to 600,000 cars per • Toyota Kirloskar motors planning to launch
annum over next 1 year. its own small car in India by 2013
• plans to hire 877 more workers to add a
third shift at its Montgomery, Ala. plant  General Motors :
 Nissan : • New Capacity to manufacture small cars at
• Micra, UK  India its Talegaon, Maharashtra plant with 80%
local inputs.
– Four more models in India, involving a total Brought in Spark small car in 2007
investment of over Rs 2,000 crore.
 Nissan-Renault :
 Ford :  50:50 JV, to make 400,000 cars a year with
an investment of over US $ 1 billion.
• Plans to unveil its new small car with 1.2 ltr  Coming up with the $2500 car to compete with
engine by 2013 Tata Nano in 2013.
 Honda :
 Investing US $ 250 million in a new plant in  VW :
Rajasthan with capacity of 60,000 car per • Investing 500 million euro to import parts
year (First car to roll out in 2009). from India for next five years

22. Break through future trends
•India will be a Automotive hub, led by small cars and auto component domains
•Export of automotive components to ASEAN,BRIC,EU and USA for OEMs as well as
Aftermarket
•Booming Automobiles (Particularly cars) second sales and remodeling
•Increased deployment of IT-enabled Automobile support systems like GPS,ABS,ASR and
Safety systems
.
•Quality Certification (Deming, Six Sigma,TQM,TS16949) amongst suppliers have attained
critical mass and the entire market will follow to get quality certifications.
•Will be a hub for optimal cost, high quality vehicular testing and terrain data acquisition
services
•Alternate fuel (Bio fuel, electricity) and environment friendly green engines (Bharat
emission norms)

23. References
• www.acmainfo.com
• www.wikipedia.org
• www.siamindia.com
• www.ibef.org
• Ernst & Young Auto Track
• www.economywatch.com
• www.business-standard.com
• The Economic Times
• Hindu Business Line
• www.automobileindia.com
• automobiles.mapsofindia.com