2. Introduction
Indian automobile industry: an
overview
Automobile Industry -Global
scenario
The key players
Mahindra & Mahindra
Maruti Suzuki
Tata motors
Limitation
3. Introduction
It begins as earlier as 1960.
History of the automobile begins as early as
1769, with the creation of steam-powered
automobiles capable of human transport In
1806.
The first cars powered by internal combusti
on engines running on fuel gas appeared,
which led to the introduction in 1885 of the
ubiquitous modern gasoline or petrol-fueled
internal combustion engine.
Continued to next slide
4. The automotive industry remains
one of the highest revenue-
earning industries in India and
contributed over 5% to India’s Indian Automobile
GDP in 2009, providing direct and Industry
indirect employment to more than
13 million people.
Multi utility Commerical
Three Wheeler vehicles Passenger car Two wheelers
vehicles
Before going further it is
necessary to understand the Passenger
Indian car market classification. carriers Mini vans Motor cycles
Good carriers Small cars Scooters
The Indian automobile industry
mainly constitutes the following
four segments: Medium cars Mopeds
Passenger vehicle
Commercial vehicle Luxury cars
Two wheeler
Three wheeler
6. Source: society of Indian Automobile manufacturers (SIAM)
Passenger cars and utility vehicles
are the main segments of the Indian 1200
943 1006
passenger vehicle industry with the 1000
former accounting for ~80% the total 800 753 743
volumes.
600
Within the passenger car segment, 400
the mini and compact segment 200
together accounts for around 80% of 0
total volumes.
production
year-2010 year-2011
Source: society of Indian Automobile manufacturers (SIAM)
10. 2500000
2000000
1500000 passenger vehicles
commercial vehicles
1000000
Three Wheeler
500000 Two wheeler
Grand total
0
Source: society of Indian Automobile manufacturers (SIAM)
11. India ranks 1st in the global two-
wheeler market
India is the 4th biggest
commercial vehicle market in
the world
India ranks 11th in the
international passenger car
market
India is the second largest
tractor manufacturer in the
world.
12. The Indian automotive industry has been
noticed to have grown in clusters, which
are evident in and around Manesar in
North, Pune in West, Chennai in
South, Jamshedpur-Kolkata in East and
Indore in Central India (GOI 2006a).
ACMA (2008a) describes such a pattern of
investments in the country as ‘regionally
balanced’. Figure below indicates the
distribution of manufacturing plants of
major automobile players across different
states and union territories in India.
13. The maximum numbers of cars are
produced in Japan, followed by
Germany, South Korea, India and USA.
These 5 countries are stand at the top
when the production of cars is
concerned.
14. All the car manufacturers are giving
tough competition to each other by
opting innovative and unique ideas to
capture the market. The car market
deals with different types of cars like
big cars, small cars, sports
cars, luxurious cars, etc. For
those, who cannot afford to buy a new
car can go for used cars.
Some of the major players are:
Mahindra & Mahindra
Maruti Suzuki
Tata Motors
15. Strength
Mahindra has been one of the strongest brands in the Indian automobile market
Mahindra group give employment to over 110,000 employees
Excellent branding and advertising, and low after sales service cost
Weakness
Mahindra’s partnership with Renault did not live up to international quality
standards through their brand Logan
Opportunity.
Tapping emerging markets across the world and building a global brand.
Fast growing automobile market. Growing in the market through electric car Reva
(controlling stake) and entry into two-wheeler segments.
Threats
Government policies for the automobile sector across the world
Ever increasing fuel prices.
Intense competition from global automobile brands
Substitute modes of public transport like buses, metro trains etc
16. PROFIT & LOSS ACCOUNT: The operating income of the
company is increasing at good phase and the same root has
been followed by operating expenses. In other words cost of
sales is also increasing. As, a result the PAT of the company is
also increasing at a fair way year. Thus, the earning of the
company is stable.
Balance sheet: The basic funding source of the company is
equity share capital & reserve. The dependency of borrowed
capital is showing a decreasing trend and the major portion of
capital is invested in fixed assts also the external investment of
the company is showing a investment trend.
Cash Flow Statement: The company earning good quality
of profit the same is also supported by the cash flow statement
.Moreover increasing investment activity in last year is also
supported by the cash flow although in 2011 there was
negative net cash flow and that was basically due to the heavy
outflow related investment activity.
17. Strengths
Maruti Udyog limited (MUL) is in a leadership position in the market with a market
share of 48.74
Major strength of MUL is having largest network of dealers and after sales service
centers in the country.
Alto still beats the small car segment with highest number of sales.
MUL is the first automobile company to start second hand vehicle sales through its
True-value entity.
Weaknesses
Low interior quality inside the cars when compared to quality players like Hyundai
and other new foreign players like Volkswagen, Nissan etc.
Maruti hasn’t proved itself in SUV segment like other players.
Opportunities
MUL can start R&D on electric cars for a much better substitute of the fuel.
Maruti’s cervo 600 has a huge potential in tapping the middle class segment and
act as a strong threat to Nano
Export capacity of the company is giving new hopes in American and UK markets
Threats
MUL recently faced a decline in market share from its 50.09% to 48.09 % in the
previous year(2011)
China may give a good competition as they are also planning to enter into Indian
car segment
18. Profit and loss- The operating income of the company is
increasing gradually and the cost of the sales is also
increasing at a fair ways year after year. Thus, the earning
of the company is stable
.
Balance sheet:
The equity share capital of the company remaining .And
on the other hand the secured loans are increasing
gradually but the unsecure loans are decreasing. . The
increasing trends of fixed assts indicate that the most of
the capital is invested in fixed assts but the external
investment is fluctuating year after year.
Profits & loss:
the operating income of the company is increasing
gradually and the same root has been followed by
operating expenses. In the other word cost of the sales is
also increasing at a fair ways year after year. Thus, the
earning of the company is stable.
19. Strengths
Market share leadership..
Innovation .
Introducing Tata Nano.
Weaknesses
Tata Motors is not well positioned in the luxury segment.
Most of the automobiles Tata manufactures are based on
older platforms.
Opportunities
The Nano could sell well in other geographic markets.
Product and services expansion
Takeovers
Threats
Rising material costs will create pressure to increase prices.
There is a trending rise in diesel fuel costs which will hurt
Tata’s line of products
20. Profit and loss- The operating profit is showing a healthy increasing
trend. However the area of concern is that the EPS is very much fluctuating
which means due to multiple financial factors.
Balance Sheet- Equity base is increasing but the company is not having
preference capital. The company is also utilizing the leverage advantage by
having suspension amount of secured and unsecured loan.
Cash flow- The operating activity is fluctuating i.e. high quality profit is
not guaranteed other fig. are more or less rational.
Ratio -All profitable ratios more or less stable and satisfactory. Current
and quick ratios are showing a very poor position .interest coverage ratio
is also very safe and showing an increasing trend which is optimistic.
21. .
Sample size
Lack of available and/or reliable data
Lack of prior research studies on the
topic
