ACMA presentation about Indian automotive Industry

1. ACMA Presentation

2. About ACMA
2

3. About ACMA
• Established in 1959
• Apex body of Auto Component Industry in India
• Over 700+ members from the Organized sector
• Represents 85% of the Industry by turnover
• Represented on all Government and Industry bodies –
Strategic to the Auto Sector
• Offices across all Regions in the Country
• An ISO 9001-2008 Institution
ACMA – Excellence in Service Delivery
3

4. Collection &
Dissemination of
Information
Quality
Enhancement
Technology
Up-gradation
Promotes Indian
Automotive Component Industry
Vital Catalyst for Industrial
Development
Trade Promotion
ACMA Services
4

5. ACMA Centre for Technology (ACT)
• ACT focuses on providing technical services to ACMA
members for improving process and quality capabilities
through Cluster Programmes
- ACT SME Cluster
- ACT UNIDO Partnership Program
- ACT SME Advance Cluster
- ACT Foundation Cluster
- ACT Advance Cluster
- ACT Engineering Excellence Cluster
• ACT Clusters Programs
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6. India: A Vibrant Economy
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7. 1. Largest Democracy – 1.2 billion people, Growing Middle Class
2. 3th largest GDP (PPP) and 10th largest GDP (Nominal, USD 2 trillion)
3. One of the fastest growing economies – 2014-15: ~ 7.5% (E)
• India’s average GDP growth rate for the last five year: over 7%
4. 3rd Largest Investor base in the World
5. Robust Legal and Banking Infrastructure
6. Demographics Advantage – Youth driven economy
7. Suburbanization & Rural to Urban Migration – 140 million by 2020; 700 million
by 2050
8. 2nd largest pool of Certified Professionals and highest number of Qualified
Engineers in the world
9. Investment in Infrastructure
India: A Vibrant Economy
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8. Infrastructure Development – A Special Thrust
Railways
USD 117 bn
Roads
USD 172 bn
Total planned
infrastructure
investments of
USD 1 Trillion*
from 2012-17
Airports
USD 16 bn
Energy
USD 331 bn
Ports
USD 36 bn
Telecommunication
USD 172 bn
8
USD 10 bn for 100 smart cities

9. Automotive Industry in India
9

10. Automotive Clusters in India
West
Tata Motors
North
Significant Manufacturing base of OEMs – Indian & Global
Ashok Leyland
BMW
Caterpillar
Daimler
Ford
Hyundai
Nissan
Renault
Royal Enfield
Same Deutz
TAFE
Tata Motors
Toyota Kirloskar
TVS
Volvo Buses
East
South
Eicher
Escorts
Hero Moto Corp
Honda Motorcycle
Honda SIELCars
ICML
JCB
Maruti Suzuki
New Holland
Mahindra
Suzuki Motorcycles
Swaraj Mazda
Tata Motors
Yamaha
Bajaj Auto
Fiat
Force Motors
GM
John Deere
Mahindra
Man Force
Mercedes Benz
PSA
Skoda
Tata Hitachi
Tata Motors
Volkswagen
Volvo Eicher
(Illustrative List)
10
*New Hub: Sanand
Tata Motors, Maruti, Ford India,

11. Source: SIAM
Where does India stand?
Largest TRACTOR manufacturer
2nd Largest TWO WHEELER manufacturer
2nd Largest BUS manufacturer
5th Largest HEAVY TRUCK manufacturer
6th Largest CAR manufacturer
8th Largest COMMERCIAL VEHICLE manufacturer

12. Vehicles Exported From India
12
Hyundai - i10
Maruti - Alto
Hyundai - EON
Tata - Indica Mahindra - Bolero
Volkswagon - Polo
Maruti - A Star
Nissan - Micra
(Illustrative List)
Hyundai - i20
Bajaj Auto - Pulsar Hero MotoCorp – Splendor

13. 13
Ashok Leyland
Piaggio - Ape Tata - Magic
Tata Mahindra
Bajaj - Auto
Mahindra - Alfa Mahindra - GioMahindra - Maxx
Vehicles Exported From India
(Illustrative List)

14. (’000 units)
 CAGR 2011-15: 2%
Passenger Vehicles Production
Figures for financial year – April to March
14
Source: SIAM
2987
3146
3234
3087
3220
1000
1500
2000
2500
3000
3500
2010-11 2011-12 2012-13 2013-14 2014-15

15. 545
640
579
697
613
0
200
400
600
800
2010-11 2011-12 2012-13 2013-14 2014-15
Figures for financial year – April to March
( ’000 units)
Commercial Vehicles Tractors
( ’000 units)
 CAGR 2011-15: 3%
Two & Three Wheelers
(In ’000 units)
Commercial Vehicles include:
• Small Commercial Vehicles (SCV) < 1 ton
• Light Commercial Vehicles (LCV) > 1 ton but < 7.5 tons
• Medium Commercial Vehicles (MCV) > 7.5 tons but <16 tons
• Heavy Commercial Vehicles (HCV) > 16 tons
Construction Vehicles*
( ’000 units)
 CAGR 2011-15: -2.6%
 CAGR 2011-15: -2%
 CAGR 2011-15: 8%
Other Vehicles Production
Source: SIAM
753
929
833
699 697
0
200
400
600
800
1000
2010-11 2011-12 2012-13 2013-14 2014-15
14176
16330 16584
17713
19449
0
5000
10000
15000
20000
25000
2010-11 2011-12 2012-13 2013-14 2014-15
62.3
69.2
50.5 52
56
10
30
50
70
90
2010-11 2011-12 2012-13 2013-14 2014-15
* E&Y Estimates

16. Auto Component Industry in India
16

17. 25.3%
35.9%
8.7%
5.6%
-2.0%
11.1%
-10%
0%
10%
20%
30%
40%
0
500
1000
1500
2000
2500
2009-10 2010-11 2011-12 2012-13 2013-14 2014-15
17
Turnover - Auto Component Industry: 2010-15
GrowthRateinRupeeTerms
(Turnover includes supplies to OEMs, aftermarket sales and exports)
1386 (30.8)
2160 (39.7)
1883 (41.3)
2046 (42.2)
2117 (35.1)
TurnoverinINR’00Crore(USDBillion)
CAGR: 11%
2348 (38.5)

18. 18
Product Range - Auto Component Industry
The Industry produces High Quality – Cost Competitive
Components in all product segments.
Engine Parts; 31%
Drive Transmission
& Steering Parts;
19%
Body & Chassis;
12%
Suspension &
Braking Parts; 12%
Equipments; 10%
Electical Parts; 9%
Others; 7%

19. 19
Auto Components Supply to OEMs
OEMs consumption includes locally produced Components and Imports
SCV Less than 2 T
LCV 2 to 7.5 T
MCV 7.5 to 16 T
HCV More than 16 T
PVs, 45%
SCV , 1%
LCV , 4%
MCV , 5%
HCV, 8%
Three-Wheeler,
4%
Two-wheelers,
22%
Backhoe Loaders,
2%
Others, 2%
Tractors, 8%

20. -19.3%
60.7%
40.7%
23.3%
16.7%
11.4%
-40%
0%
40%
80%
0
300
600
900
2009-10 2010-11 2011-12 2012-13 2013-14 2014-15
189 (4.2)
614 (10.2)
526 (9.7)
427 (8.8)
303 (6.7)
20
Exports - Auto Component Industry: 2010-15
Exports Destinations: Top 10 Countries
USA 22.35 Thailand 3.38
Germany 7.51 Brazil 3.37
Turkey 6.49 China 3.07
UK 5.43 UAE 2.95
Italy 4.79 France 2.92
TurnoverinINR’00Crore(USDBillion)
GrowthRateinRupeeTerms
CAGR: 29%
Africa
7.28%
Latin
America
and the
Caribbean
7.04%
North
America
23.25%
Asia
25.29%
Europe
36.39%
Oceania
0.75%
685 (11.2)

21. 21
725 754
2194
2605
3866
86
817 789
2609
2839
4084
84
0
1000
2000
3000
4000
5000
Africa Latin America
and the
Caribbean
North America Asia Europe Oceania
2013-2014 2014-2015
12.6% 4.6%
18.9%
9.0%
5.6%
2.0%
FiguresinUSDMillion
Exports by Region
India’s Export Growth Rate: -1.2%
Auto Component Export Growth Rate: 10%

22. 2100
831
525
627
499
344
412
314 288 337
2508
843
728
610
537
379 379 344 331 327
0
500
1000
1500
2000
2500
3000
USA Germany Turkey UK Italy Thailand Brazil China UAE France
2013-2014 2014-2015
22
FiguresinUSDMillion
Exports: Top 10 countries
19%
1%
39%
8% 10% 10%
15%
3%
8% 3%

23. 23
Exports
Hydraulic Power Steering Systems & Steering Gear Systems and Parts
Gear boxes and parts
Parts of Diesel Engines
Parts for automobiles and earth moving Equipment
Drive-axles and parts
Spark Ignition and parts
Suspension systems and parts
Crank shaft for engines
Toothed wheels, other transmission parts
Brakes and servo-brakes; parts
Key Auto Components Exported
(Illustrative list/ Products in random order)

24. -4.4%
38.1%
34.3%
11.6%
3.6%
7.5%
-40%
0%
40%
80%
0
300
600
900
2009-10 2010-11 2011-12 2012-13 2013-14 2014-15
24
Imports - Auto Component Industry: 2010-15
Origin of Imports: Share of Top 10 in %
China 23.94 USA 6.96
Germany 14.57 Italy 3.75
Japan 11.53 UK 2.67
South Korea 10.66 France 2.01
Thailand 8.27 Spain 1.40
TurnoverinINR’00Crore(USDBillion)
GrowthRateinRupeeTerms
CAGR: 18%
360 (8.0)
744 (13.7)
771 ( 12.8)
829 (13.58)
Africa;
1.04% Latin America &
Caribbean; 1.21%
North
America;
7.21%
Asia;
57.97%
Europe;
32.45%
Oceania ;
0.12%
497 (10.9)
667 (13.8)

25. 114
152
812
7505
4218
18
142 164
979
7874
4408
16
1
10
100
1000
10000
Africa Latin America
and the
Caribbean
North America Asia Europe Oceania
2013-2014 2014-15
25
FiguresinUSDMillion
Imports by Region
India’s Import Growth Rate: - 0.4%
Auto Components Import Growth Rate: 6 %
19%
8%
17%
5%
4%
11%

26. 2671
1929
1593 1527
941
821
483
293 315 276
3170
1979
1566
1448
1123
945
510
363
273
191
0
1000
2000
3000
4000
China Germany Japan South
Korea
Thailand USA Italy UK France Spain
2013-2014 2014-15
19%
5%
15%
19%
3%
24% 31%13%
5%2%
26
FiguresinUSDMillion
Imports: Top 10 countries

27. 0
0.5
1
1.5
2
2.5
3
2009-10 2010-11 2011-12 2012-13 2013-14 2014-15
27
0.33-0.46 ( 20-28 )
1.7 ( 77 )
2.0 - 2.5 ( 91-102 )
1.6 – 1.9 ( 77-92 )
1.26-1.75 (69-95)
Capital Investment - Auto Component Industry: 2010-15
USDBillion(‘00Crore)
0.53-0.73 ( 32-44 )

28. 28
Aspiration 2020
Indian auto
component
industry to
cross USD
100 billion
mark
With Export of
USD 35 - 40
billion
5 suppliers in
global 100
USD 20-22
billion in
revenue from
overseas
assets

29. Favorable Policy Regime
Auto Policy 2002 and Auto Mission Plan 2006-16 – framework for Automotive
Manufacturing in India
• Manufacturing and Imports Free from Licensing and Approvals
• WTO compliant policies (no import restrictions and reduced
tariff levels)
• Robust Legal system and stable Foreign Exchange regime
• Joined UN-ECE WP 29 for Global Standard in Technology
• Increased budgets for R&D activities
• 100% FDI permitted without prior Govt. approval
Robust Indian
Automotive
Industry
29

30. Capabilities & Challenges of Indian Component
Suppliers
30

31. Indian Suppliers’ Focus – Global Best Practices
Industry fast embracing modern
shop-floor practices:
 5-S; 7-W
 Kaizen
 TQM
 TPM
 6 Sigma
 Lean Manufacturing651
546
287
162
ISO 9001
TS 16949
ISO 14001
OHSAS…
Deming
Award - 14
Japan Quality
Medal - 5
JIPM - 3Shingo Silver
Medallion - 2
TPM Award
- 15
Largest no. of Deming Award winning companies outside Japan
Focus on Quality
31

32. Increasing focus on Innovation and Research
• AMD
• Boeing
• Bosch
• Caterpillar
• Continental
• Cummins
• Ford
• GM
• GE
• Honda
• Honeywell
• Hyundai
• Intel
• Magna
• Mercedes Benz
• Microsoft
• Renault Nissan
• Suzuki
• Valeo
Design & Research Centers of leading Global companies in India
(Illustrative List)
32

33. 33
Challenges
Challenges
High Cost of Capital
Capacity Utilization
Infrastructure Challenges & Cost
Roads
Ports
PowerImports - higher than exports
Combating Counterfeit Parts
Skilled Manpower
Building R&D Competence & Ecosystem

34. 34
Summary
Figures in INR’ 00 Crs
2009-10 2010-11 2011-12 2012-13 2013-14 2014-15
Turnover 1,386 1,883 2,046 2,160 2,117 2,348
Growth rate(%) 25.3 35.9 8.7 5.6 -2.0% 11.1%
Export 189 303 427 526 614 685
Growth rate(%) -19.2% 60.3% 40.9% 23.2% 16.7% 11.4%
Import 360 497 667 744 771 829
Growth rate(%) -4.3% 38.1% 34.2% 11.5% 3.6% 7.5%
Investment 77 91-102 72-92 69-95 32-44 20-28

35. 35
Summary
Figures in USD Billion
2009-10 2010-11 2011-12 2012-13 2013-14 2014-15
Turnover 30.8 41.3 42.2 39.7 35.1 38.5
Growth rate(%) 27.8 34.1 2.2 -5.9 -11.5 9.6
Export 4.2 6.6 8.8 9.7 10.2 11.2
Growth rate(%) -17.6 58.6 32.3 9.9 5.4 10.0
Imports 8 10.9 13.8 13.7 12.8 13.5
Growth rate(%) -2.4 36.3 26.2 -0.6 -6.3 6.1
Investment 1.7 2-2.5 1.6-1.9 1.2-1.7 0.53-0.73 0.33-0.46

36. ACMA
The Capital Court, 6th Floor, Olof Palme Marg, Munirka, New Delhi – 110 067
Tel: 011-26160315, Fax: 011-26160317
E-mail: acma@acma.in, Website: www.acma.in
Thank You
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