• With sales of around 40,000 luxury cars in 2017, India became the 27th most attractive luxury market in the world. • The luxury car market in India is expected to grow at 25 per cent CAGR till 2020. • Audi is launching its luxury electric SUV in India in 2019. The electric SUV will be called e-Tron. • Premium motorbike sales in India crossed one million units in FY18. • As of February 2019, Lamborghini sold 45 units in the year 2018 and expects a jump in sales by 60 per cent in the year 2019. • Volvo plans to assemble hybrid electric cars in India and also scale its market share to 10 per cent by 2020 in Indian luxury car segment. • As of May 2019, Jaguar Land Rover launched its locally assembled Range Rover Velar making the JLR cars more affordable by quite some margin. • BMW crosses 10,000 unit mark for the first time in a calendar year 2018. BMW along with Mini grew 13 per cent compared to 2017. Mini sales rose by a staggering 66 per cent in 2018.

1. AUTOMOTIVE
INDUSTRY ANALYSIS
Submitted By:
Group 1
Abraham John K06004
Robin Shaji K06073
Riya Aseef K06071

2. i
OVERVIEW
The Indian auto industry became the 4th
largest in the world with sales increasing 9.5 per cent year-
on-year to 4.02 million units (excluding two wheelers) in 2017. It was the 7th largest manufacturer
of commercial vehicles in 2018.
The Two Wheelers segment dominates the market in terms of volume owing to a growing middle
class and a young population. Moreover, the growing interest of the companies in exploring the
rural markets further aided the growth of the sector.
The automobile industry is supported by various factors such as availability of skilled labour at
low cost, robust R&D centres and low cost steel production. The industry also provides great
opportunities for investment and direct and indirect employment to skilled and unskilled labour.
Indian automotive industry is expected to reach Rs 16.16-18.18 trillion by 2026.
India is also a prominent auto exporter and has strong export growth expectations for the near
future. Automobile exports grew 14.5 per cent during FY 2019. It is expected to grow at a CAGR
of 3.05 per cent during 2016-2026. In addition, several initiatives by the Government of India and
the major automobile players in the Indian market are expected to make India a leader in the two-
wheeler and four wheeler market in the world by 2020.

3. ii
TABLE OF CONTENTS
Chapter
No. Title Page No.
Executive Summary ii
List of Tables and Figure iii
1
Evolution of Automobile Sector in India 1
2
Market Overview 2
3
Key Players 5
4
Trends 7
5
Growth Drivers 9
6
Policies and Initiatives 11
7 Investment Scenarios 12
8 Opportunities 14
9
Industry Organizations 15
10 SWOT Analysis 17
11 PESTEL Analysis 20
12 Porter’s Analysis 25
13 Conclusion 27
14
References 28

4. 1
EVOLUTION OF AUTOMOBILE SECTOR IN INDIA
• Before 1982:
The first car that came to Indian roads was as early as 1897 and the first Indian to own a
car in was Jamshedji Tata in the year 1901. Before India’s independence Hindustan Motors
manufactured the first automobile in India in the year 1942.
Soon after India’s independence, the Government of India tried to boost the sector by
encouraging manufacturing of automobiles. Before that, the cars were imported directly.
The automobile sector formally came into being in the year 1952 when the
Government appointed its first tariff commission with the aim of indigenizing this
industry. The year 1952 also marked the introduction of passenger cars in the
country. Manufacturers like Hindustan Motors, Premier Automobiles and Standard
Motors came into the limelight.
• 1983-1992
Indian government & Suzuki formed Maruti Udyog and commenced production in 1983.
This is the time when component manufacturers entered the market. This is all the time
when the concept of Buyer’s market emerged. A buyer's market is a situation in which
supply exceeds demand, giving purchasers an advantage over sellers in price negotiations.
• 1992-2007
Automobile Industry was delicensed in July 1991 with the announcement of the New
Industrial Policy. The passenger car industry was, however, delicensed in 1993. No
industrial license is required for setting up of any unit for manufacture of automobiles.
Major Original Equipment Manufacturers (OEMs) started assembly operations in India.
Imports were permitted from April 2001 and value- added tax was introduced in 2005.

5. 2
• 2015 Onwards
Automotive Mission Plan 2016-26 was launched in 2015. It is the collective vision of
Government of India and the Indian Automotive Industry on where the Vehicles, Auto-
components, and Tractor industries should reach over the next ten years in terms of size,
contribution to India’s development, global footprint, technological maturity,
competitiveness, and institutional structure and capabilities.
Bharat Stage IV emission norms have been in place since April 2010 and it has been
enforced for entire country since April 2017. 30.92 million vehicles where produced during
the year 2018-19. Now, more than 40 companies are operating in the country in 2018.
MARKET OVERVIEW
• The automotive manufacturing industry comprises the production of commercial vehicles,
passenger cars, two-wheelers and three wheelers.
• In 2017, India became the 4th largest auto market with sales (excluding two-wheelers)
increasing 9.5 per cent year-on-year to 4.02 million units in 2017. Overall domestic
TWO-
WHEELERS
MOPEDS AND
ELECTRIC
SCOOTERS
SCOOTERS
MOTORCYCLES
PASSENGER
VEHICLES
PASSENGER CARS
UTILITY VEHICLES
MULTI-PURPOSE
VEHICLES
COMMERCIAL
VEHICLES
LIGHT
COMMERCIAL
VEHICLES
MEDIUM AND
HEAVY
COMMERCIAL
VEHICLES
THREE-
WHEELERS
PASSENGER
CARRIERS
GOODS CARRIERS

6. 3
automobiles sales increased at 6.71 per cent CAGR between FY13-19 with 26.27 million
vehicles getting sold in FY19.
• Domestic automobile production increased at 6.96 per cent CAGR between FY13-19 with
30.92 million vehicles manufactured in the country in FY19.
• In FY19, commercial vehicles recorded the fastest pace of growth in domestic sales at 17.55
per cent year-on-year, followed by three-wheelers at 10.27 per cent year-on-year.

7. 4
• Two wheelers and passenger automobiles rule the residential Indian auto advertise.
• Passenger cars deals are commanded by little and average size autos.
• Two wheelers and passenger automobiles represented 81 percent and 13 percent of over
2.97 million vehicles sold in FY19, individually.
• Overall car fares arrived at 4.63 million vehicles in FY19, suggesting a CAGR of 8.11
percent between FY13-19.
• Two wheelers made up 70.9 percent of the traded vehicles, trailed by traveler vehicles at
14.6 percent, three-wheelers at 12.3 percent and business vehicles at 2.2 percent.
• Overall export on automobiles expanded by 14.50 percent year-on-year in FY19.

8. 5
KEY PLAYERS
Each segment in the Indian automobiles sector has few established key players which hold major
portion of the market.
MARUTI SUZUKI
• Market leader in the passenger vehicles segment and held around 50 per cent market share
in the segment in FY18.
• The company recorded its highest ever sales of 1,779,574 units during 2017-18, a year-on-
year increase of 13.4 per cent.
• To promote green technology footprint in India, the company announced launch of Wagon-
R S (Smart) which comes with factory fitted CNG.
• The company crossed its cumulative production milestone of four million two wheelers
from its Gurugram-based plant in 2018.
TATA MOTORS
• Market leader in the commercial vehicles segment held 44 per cent market share in FY18.
• Company’s commercial vehicles sales increased 26 per cent year-on-year to 39,859 units
in August 2018.
• Commercial and Passenger vehicles for FY19, stood at 678,486 units.
• As of January 2019, Tata to soon unveil the electric car based on its newly developed Alpha
Platform as a long term plan for sustainable mobility.
OTHER FIRMS
• Hero MotoCorp and Honda are the top two players in the two-wheelers segment, with
market share of 37.67 per cent and 30.9 per cent, respectively in Q1 FY19.
• Bajaj Auto recorded domestic motorcycle sale of 1.57 million units in December 2018, up
by 39 per cent over December 2017.
• Honda Cars India had a cumulative growth of 3.7 per cent year-on-year by selling 134,797
units during April-December 2018.

9. 6
• Bajaj Auto is a leader in three wheelers with 58.15 per cent market share in FY18.
• As of February 2019, Bajaj Auto will launch its new all electric brand Urbanite in India in
the coming six to nine months.
• Piaggio Vehicles is the second leader in three wheelers with 24.05 per cent market share
in FY18.

10. 7
TRENDS
LUXURY VEHICLES:
• With sales of around 40,000 luxury cars in 2017, India became the 27th most attractive
luxury market in the world.
• The luxury car market in India is expected to grow at 25 per cent CAGR till 2020.
• Audi is launching its luxury electric SUV in India in 2019. The electric SUV will be called
e-Tron.
• Premium motorbike sales in India crossed one million units in FY18.
• As of February 2019, Lamborghini sold 45 units in the year 2018 and expects a jump in
sales by 60 per cent in the year 2019.
• Volvo plans to assemble hybrid electric cars in India and also scale its market share to 10
per cent by 2020 in Indian luxury car segment.
• As of May 2019, Jaguar Land Rover launched its locally assembled Range Rover Velar
making the JLR cars more affordable by quite some margin.
• BMW crosses 10,000 unit mark for the first time in a calendar year 2018. BMW along with
Mini grew 13 per cent compared to 2017. Mini sales rose by a staggering 66 per cent in
2018.
CATERING INDIAN NEEDS:
• Most of the firms including Ford & Volkswagen have adapted themselves to cater to the
large Indian middle class by dropping their traditional structure and designs. This allows
them to compete directly with domestic firms making the sector highly competitive.
• Hyundai has entered into a strategic alliance with shared mobility company Revv under
which it will provide cars on subscription in six cities in India. This will provide customers
the opportunity to use Hyundai’s models with hassle-free ownership, flexibility and limited
commitment.

11. 8
• Skoda launches a new buy-back scheme called ‘Easy-Buy’ for its flagship sedan, the
Superb where prospective customers can enter into a three-year contract with the company
after which they are offered a buyback value of 57 per cent for their Skoda Superb.
NEW FINANCING OPTIONS:
• Carmakers such as BMW, Audi, Toyota, Skoda, Volkswagen and Mercedes-Benz have
started providing customized finance to customers through NBFCs. Auto finance business
of NBFCs in India is expected to grow at a CAGR of 15 per cent by FY20 on the back of
better macroeconomic environment and government’s focus on infrastructure and rural
areas.
• HDFC Bank Ltd started providing customized car loans to its customers in Mumbai, which
will help them to buy cars at a lower EMI.
CAPACITY ADDITION:
• Hero MotoCorp will invest Rs 2,500 crores (US$ 387.9 million) by FY21 to increase its
production capacity in India. Hyundai announced it will be increasing its production
capacity of its Chennai plant from 713,000 to 750,000 units in 2019.
• With the total investment of around US$ 163.7 million, Honda Motorcycle & Scooter India
expanded its production of Activa in three variants at Ahmedabad plant.
• As of October 2018, Honda Motors Company is planning to set up its third factory in India
for launching hybrid and electric vehicles with the cost of Rs 9,200 crore (US$ 1.31
billion), its largest investment in India so far.
• In November 2018, Mahindra Electric Mobility opened its electric technology
manufacturing hub in Bangalore with an investment of Rs 100 crore (US$ 14.25 million)
which will increase its annual manufacturing capacity to 25,000 units.

12. 9
ELECTRIC VEHICLES:
• Volvo plans to come out with hybrid version of its upcoming S60 sedan in India along with
a PHEV (Plug-in Hybrid Electric Vehicle) version of the S60.
• Avan motors, an electric scooter start up announced in December 2018 that it plans to have
total sales of 100,000 units in the coming two to three years.
• As of September 2018, China’s leading Electric Vehicle (EV) company, Sunra , is planning
to enter into Indian markets and set up a factory in Bangalore, Karnataka.
• As of December 2018, local arm of Finland based Energy Company Fortum India is
planning to install about 720 charging facilities for electric vehicles by 2020 in seven cities
in India.
GROWTH DRIVERS
GROWING DEMAND:
• Rising income and a large young population.
• Greater availability of credit and financing options.
• Demand for commercial vehicles increasing due to high level of activity in infrastructure
sector.
POLICY SUPPORT:
• Clear vision of Indian government to make India an auto manufacturing hub.
• Initiatives like ‘Make in India’, ‘Automotive Mission Plan 2026’, and NEMMP 2020 to
give a huge boost to the sector.
• Introduction of a new National Auto Policy and Faster Adoption and manufacture of
Hybrid and Electric Vehicles (FAME) II for a clean future in mobility to be launched soon.

13. 10
• In February 2019, the Government of India approved the FAME-II scheme with a fund
requirement of Rs 10,000 crore (US$ 1.39 billion) for FY20-22.
• The Government of India has introduced a policy which allows organizations and
researchers to buy bulk data related to vehicle registrations on an annual basis.
• To install electric vehicle supply equipment (EVSE) infrastructure for the electric vehicles
(EV), various public sector firms, the railways and various ministries have come together
to create infrastructure and manufacturing components.
SUPPORT INFRASTRUCTURE AND HIGH INVESTMENTS:
• Improving road infrastructure.
• Established auto ancillary industry giving the required support to boost growth.
• 5.09 per cent of total FDI inflows to India from April 2000 to March 2019 went into the
automobiles sector.
• In 2018, automobile manufacturers invested US$ 491 million in India's automobile
industry start-ups, according to Venture intelligence.

14. 11
POLICIES AND INITIATIVES
Support from the Indian government within the form of recent regulations and initiatives has been
important in the development and growth of Indian automobile sector.
NATRIP
Department of Heavy Industries & Public Enterprises
The Automotive Mission Plan 2016-26 (AMP 2026)
FAME
• Planning to implement Faster Adoption & Manufacturing Of Electric Hybrid Vehicles
(FAME) till 2020 which would cover all vehicle segments, all forms of hybrid & pure
• Setting up of R&D centres at a total cost of US$ 388.5 million to enable the industry
to be on par with global standards.
• Under National Automotive Testing And R&D Infrastructure Project (NATRIP), five
testing and research centres have been established in the country since 2015.
• Worked towards reduction of excise duty on small cars and increase budgetary
allocation for R&D
• Weighted increase in R&D expenditure to 200 per cent from 150 per cent (in-house)
& 175 per cent from 125 per cent (outsourced).
• AMP 2026 targets a 4-fold growth in the automobiles sector in India which includes
the manufacturers of automobiles, auto components & tractor industry over the next
10 years.

15. 12
electric vehicles. Under the scheme, the Government of India is planning to provide grants
of up to Rs 105 crore (US$ 16.33 million) to each of the selected city with population of
more than a million, for buying electric buses, cars and three-wheelers in FY18. Additional
funds will be provided for charging infrastructure.
• The Government of India has shortlisted 11 cities in December 2017 to have electric
vehicle based public transportation systems under this scheme. Number of vehicles
supported under FAME scheme has increased to 192,451 in March 2018 from 5,197 in
June. FAME Phase-I has been extended up to March 31, 2019. The Government of India
is expected to launch the second phase soon.
• In February 2019, the Government of India approved the FAME-II scheme with a fund
requirement of Rs 10,000 crore (US$ 1.39 billion) for FY20-22.
INVESTMENT SCENARIO
Indian automobile sector has seen huge investments from both domestic and foreign
manufacturers. FDI inflows to the sector were US$ 21.38 billion in automobiles sector between
April 2000 – March 2019.
Nissan
• Planning to double its current investment level of about US$ 2.5 billion over the next five
years.
• Aims to raise its market share to 5 per cent by 2022.
• To increase the Chennai Plant capacity to 400,000 units a year in a few years time.
• The company plans to launch eight new car models in India by 2021.

16. 13
• As of December 2018, the company opened its first global digital hub at techno park in
Trivandrum.
Toyota
• Toyota is planning to invest US$ 165 million on its new engine plants and projects.
Hyundai
• Plans to invest US$ 1 billion in India by 2020. As of February 2019, the company will
make an investment of Rs 7,000 (US$ 970.20 million) crore approved by the Tamil Nadu
Government for expansion into electric car division.
SAIC
• Chinese state owned auto major, SAIC Motor has announced investment of over US$ 310
million in India. It is expected to start operations in 2019. In March 2018, SAIC announced
that its subsidiary MG Motor India will invest Rs 5,000 crore (US$ 775.8 million) in India
over the next six years.
Mercedes-Benz
• Increased the plant capacity of 20,000 units per year in Chakan Plant, which is the largest
for any luxury car manufacturer in India. In March 2019, the company inaugurated two
new service stations in New Delhi.
• Expansion of MIDC, to invest US$ 244 million for capacity expansion in Chakan, Pune.

17. 14
Honda Motor Company
• As of October 2018, Honda Motors Company is planning to set up its third factory in India
for launching hybrid and electric vehicles with the cost of Rs 9,200 crore (US$ 1.31
billion), its largest investment in India so far.
Motoroyale Kinetic
• Superbike seller Motoroyale Kinetic is planning to establish a plant in Supa, Maharashtra
with an outlay of Rs 12 crore (US$ 1.71 million) by 2021.
OPPORTUNITIES
India is fast emerging as a global R&D hub.
• Strong support from the government; setting up of NATRIP centres.
• Private players, such as Hyundai, Suzuki, GM, keen to set up R&D base in India.
• Strong education base, large skilled English-speaking manpower. Comparative advantage
in terms of cost.
• Firms both national and foreign are increasing their footprints with over 1,165 R&D
centres.
• Nissan to open a global digital Research & Development hub in Technopark in
Thiruvananthapuram of Kerala for autonomous/driver-less cars by March 2019.
Opportunities for creating sizeable market segments through innovations.
• Mahindra & Mahindra targeting on implementing digital technology in the business.
• Bajaj Auto, Hero Honda & M&M plan to jointly develop a technology for 2-wheelers to
run on natural gas.
• Tata Motors to launch MiniCAT, a car running on compressed air,

18. 15
• Hyundai is planning to enter the hybrid vehicles segment, to explore alternative fuel
technology & to avail the government incentives.
• In May 2019, Nissan Motor Company received an patent for wireless charging of electric
vehicles in India.
Small-car manufacturing hub.
• General Motors, Nissan & Toyota announced plans to make India their global hub for small
cars.
• Passenger vehicle market is expected to touch 10 million units by 2020. Sales crossed 3.2
million in FY18.
• Strong export potential in ultra low-cost cars segment (to developing & emerging markets).
• Maruti Suzuki launched facelift version of Alto 800, after the success of earlier model.
INDUSTRY ORGANISATIONS
Society of Indian Automobile Manufacturers (SIAM)
• The Society of Indian Automobile Manufacturers (SIAM) is a not for profit apex national
body representing all major vehicle and vehicular engine manufacturers in India.
• SIAM works towards supporting sustainable development of the Indian Automobile
Industry with the vision that India emerges as the destination of choice in the world for
design and manufacture of automobiles. It works towards facilitating enhancement of the
competitiveness of the Indian Automobile Industry, reducing cost of vehicles, increasing
productivity and achieving global standards of quality.
• SIAM works closely with various stakeholders in the formulation of the policies,
regulations and standards related to automobiles.
• SIAM is the link between the Indian automobile industry and other bodies including the
government

19. 16
• All activities of SIAM are geared to protect Sustainable Development of the Automobile
Industry in India.
Federation of Indian Automobile Associations.
• Federation Of Indian Automobile Association is a Public incorporated on 24 February
1959. It is classified as Non-govt company and is registered at Registrar of Companies,
Mumbai.
• Its authorized share capital is Rs. 0 and its paid up capital is Rs. 0. It is inolved in the
manufacture of motor vehicles
• Federation Of Indian Automobile Association's Annual General Meeting (AGM) was last
held on 29 September 2018 and as per records from Ministry of Corporate Affairs (MCA),
its balance sheet was last filed on 31 March 2018.
• Directors of Federation Of Indian Automobile Association are Yogendra Premkrishna
Trivedi, Vimal Pravin Shah, Nitin Gordhandas Dossa, Trilok Kumar Malhotra, Jagjyoti
Jain, Sunil Hansraj Merchant, Tirunelveli Duraiswami Sadasivam, Edil Jal Katrak and
Manamathi Subraroyan Srinivasan.

20. 17
SWOT ANALYSIS
Industry experts have stated that growing digitalization and advancements in technology will
increase the automotive industry’s investments to $82 billion by 2020. This also implies that there
will be a rise in competition in the automobile industry like never before.
STRENGTHS
• Evolving industry: The automobile industry is a highly growing industry, continuously
contributing to growth and development.
• Constant product innovation & technological advancement: With the advent of E-vehicles
& alternative fuel such as Shell gas, CNG, and others, automobile companies are increasing
R&D expenditure to drive the next phase of growth through the use of renewable sources
of energy which may be solar, wind, etc.
• Manufacturing facilities in Asian nations to control cost: To monitor cost and to manage
shrinking margins, automobile companies like Harley, Volvo, Bharat Benz, etc. are
building their manufacturing facilities in developing nations like India and China. These
nations have a cheap workforce, are high in resources, and are nearer to developed
economies. These are ideal conditions for an emerging market.

21. 18
WEAKNESSES
OPPORTUNITIES
• Bargaining power of consumers: Over the last 3-4 decades the automobile market has
shifted from a demand to a supply market. Availability of a considerable number of
variants, stiff competition between them, and a long list of alternatives to choose from has
given power to customers to decide whatever they like.
• Government regulations: Regulations like excise duty, no entry of outside vehicles in the
state, decreasing number of the validity of registration period, and volatility in the fuel
prices pose considerable challenges to automobile companies. These factors also affect the
growth of the industry.
• High employee turnover: The employee turnover in the automobile industry is found to be
higher when compared to several other sectors. Furthermore, attracting and retaining
employees in the automotive industry can be very challenging, especially in the case where
competitors are doing what they can to lure the best talent.
• Fuel-efficient vehicles: Optimization of fuel-driven combustion engines and cost
efficiency programs are excellent opportunities for the automobile market. Emerging
markets will be the primary growth drivers for a long time to come, and hence fuel-efficient
cars are the need of the hour.
• Changing lifestyle & customer groups: The increased availability of data and information,
shift in consumer demand, and expanded regulatory requirements for safety and fuel
economy will fuel the growth of this industry.
• Market expansion: Entering new markets like Asian & BRIC nations will skyrocket the
demand for vehicles. Furthermore, other markets are also likely to emerge soon.

22. 19
THREATS:
• Rising competition: Presence of a large number of players in the automobile industry
results in intense competition and companies eating into other’s share, leaving little scope
for new players.
• Sluggish economy: Macroeconomic uncertainty, recession, unemployment, etc. are the
economic factors which will daunt the automobile industry for an extended period.
• Volatility in fuel prices: For the consumer segment, fluctuations in fuel prices remains the
determining factor for growth. Also, government regulations pertaining to the use of
alternative fuels like CNG and Shell gas is also affecting the inventories.

23. 20
PESTEL ANALYSIS
The worldwide automobile industry is a multi-billion industry with a few enormous brands going
after share in market. Since its establishment in the nineteenth century, this division has developed
to turn into a significant piece of the world economy regarding income. Because of the enormous
size of the vehicle business, its development and income are affected by a few powers. The ongoing
monetary emergency had hit this part extremely hard. Be that as it may, since the worldwide
subsidence has passed, the offers of automotive are again in the groove again. Aside from the
assembling of vehicles all around, this division is likewise engaged with the showcasing and offers
of automotive. During the ongoing years, the Asian markets have demonstrated profoundly
rewarding for the car brands. China has especially developed to turn into the world's biggest market
for vehicles. In the 21st century innovation and advancement have turned into the fundamental
premise of separation for the vehicle producers. Aside from it, the emphasis is on eco-friendliness
and condition kind disposition. The weight on the business concerning contamination control and
carbon impression has gotten high. All the real players are attempting to bring more eco-friendly
and low discharge vehicles to the business sectors. The offers of electric vehicles that are sans
emanation, is additionally getting up to speed. Introduced underneath is a PESTEL Analysis of the
car business that shows how the political, monetary and different variables sway this industry.

24. 21
POLITICAL
• Governments around the world are favoring low emission vehicles. Moreover, taxes on the
luxury vehicles and fuel guzzlers have grown higher.
• The markets like EU and UK are providing government subsidy for the low emission
vehicles. Environment friendly vehicles have grown in demand globally. They are also
receiving higher government support for their low environmental impact. As such the
government rules and regulations heavily affect the revenues of the vehicle brands.
• Technology that is fuel efficient and low on emission can easily pass government rules.
Moreover, the import rules and taxes vary from country to country.
• Changing government regimes as well political regulation of the market can from time to
time cause favorable or unfavorable fluctuations.
• Companies have to manage their costs and the political factors can have a significant role
in this area.
• If China has become a favorite of several brands then the reason is the low labor cost which
is because of the lenient wage regulation.
• The import and export laws that vary across nations can also be a headache for automakers
in case of the nations where import laws are stiff. Thus, the government policies to a
remarkable extent affect the fortunes of the auto companies
ECONOMICAL
• This area was hit hard by the ongoing monetary emergency. At the point when the monetary
conditions are bad, the offers of vehicles fall. The interest for extravagance or expensive
vehicles is likewise influenced ineffectively during poor monetary conditions.
• In the event that the monetary conditions are great, the offers of vehicles can stay high. The
deals are commonly higher in the developed nations.

25. 22
• In the developed and immature markets, they are relatively low. The created markets
consider higher to be as the obtaining intensity of the clients is higher. In these business
sectors, the offers of the higher estimated variations is likewise higher.
• The lower valued variations are commonly popular in the creating and immature markets.
Subsequently, the size of the economy and the monetary conditions all around, majorly
affect the gainfulness of the car business in different markets.
• There are different edges to break down the significance of the monetary elements for the
business. The most utilized point is the buying intensity of the clients. It plunges during
financial downturns.
SOCIO-CULTURAL
• The automotive business is additionally influenced by the changing socio social patterns
and individuals' inclinations. Vehicle creators need to receive to these powers.
• Consistently new models are discharged remembering individuals' inclinations. In
addition, explicit styles are favored in specific societies.
• In certain business sectors while the SUVs may be in higher interest, in the others the
vehicles may be liked.
• Age dissemination in the different populaces is likewise a significant factor that vehicle
creators need to remember while focusing on the buyers. They should discharge vehicles
dependent on the inclinations of their objective populace.
• Aside from it from culture to culture, individuals' style and inclinations likewise vary. The
outcome is that while a specific model will sell in a market, it probably won't be as well
known in the other.
• Social patterns likewise continue changing consistently influencing the fame of brands and
models. Changing patterns may a few times make the more seasoned models outdated or
leave design.

26. 23
TECHNOLOGICAL
• The more creative the organization, the higher is its piece of the overall industry. Given
this reality, all the real players make immense interests in innovative work.
• Brands like Toyota, Hyundai and Ford are putting resources into low outflow and condition
neighborly vehicles.
• Toyota is notwithstanding wanting to discharge a driverless vehicle in the coming years.
Not simply this, the major mechanical players are attempting to enter this segment of the
business.
• In the ongoing years mechanical advancement has stayed a noteworthy premise of
separation for the car creators.
• It is on the grounds that the clients' center moved towards eco-friendly and high mileage
vehicles. The offers of the low outflow and eco-friendly vehicles is in every case high. It
demonstrates that innovation is one of the most significant variables influencing the deals
and benefit of the car business.
ENVIRONMENTAL
• The laws identified with condition kind disposition and carbon discharges are becoming
stiffer around the world.
• Given that all the real players in the car business needed to center upon low outflow
vehicles. The vehicles which are low on emanations and fuel utilization get charge
endowments and are supported by the legislature and law.
• The contamination tests have become stricter and the vehicles breezing through these tests
just are permitted in specific markets including EU and UK.
• Condition invitingness has turned into a significant test for the vehicle creators in the 21st
century as governments have begun concentrating vigorously on contamination control.

27. 24
LEGAL
• Law is another significant factor that gets the chance to influence the productivity and
execution of the vehicle brands.
• Vehicles selling in the universal market are liable to laws identified with item quality and
wellbeing. The contamination laws have become stricter.
• The vehicles being sent out abroad need to pass exacting emanation controls. Next are the
laws identified with item security that importantly affect the offers of the vehicles.
• As of late, Toyota needed to review its vehicles as a result of its broken airbags. Because
of such mishaps, governments have made laws identified with traveler security stricter.
• Aside from it, there are ecological laws, charge laws and a few different laws that the
vehicle organizations need to manage while working in the universal market.

28. 25
PORTER’S ANALYSIS
• Buyer Power:
The buyers in the industry have high bargaining power because they have many options in
the same price range.
• Supplier Power:
The supplier power is low due to the availability of a large number of suppliers and cheap
import of automobile components from countries like China.
• Competitive Rivalry:
The competition in the industry is very high and is expected to increase further due to the
entry of many new foreign players in the country looking at the prevalent high demand.

29. 26
• Availability of Substitutes:
In each segment, there are substitutes available in the segments itself. Across segments,
passenger cars are said to be the closest substitute to the two wheeler segment, especially
after the introduction of the Tata Nano.
• Threat of New Entrants:
The industry is capital and technology intensive, Also the industry requires a wide
distribution network to be in the race. Hence the threat of new entrants is fairly low.

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CONCLUSION
The automotive industry in India is in a bad spot right now as the production and sales numbers
continue to drop month after month. Part of the consequences include vehicle manufacturers
having to cut jobs as they reduce their output in an attempt to maintain their own fiscal balances.
Some reports suggest that upto 3.5 lakh automotive jobs in India have been cut since April 2019
and more than 200 dealerships have had to shut shop. These numbers are likely to go up as the
downward trend continues.
A long term correction had been pending for some time in the sector. Dealers have now put a break
on the inventory, primarily due to the slowdown in sales. Secondly, the on-going elections and the
uncertainty over the results have also added to the slowdown in the commercial vehicle segment,
sales saw a 6 percent decline in April as against the same period a year ago. This was primarily
due to a 13.5 percent decline in medium and heavy commercial vehicles while light commercial
vehicles declined by 1.10 percent.
Declining automotive sales are primarily an indicator of how the Indian economy is performing,
particularly the purchasing power of people while a slowdown in commercial vehicle sales
indicates an investment cycle slowdown.

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REFERENCES
• Automobiles- IBEF (June 2019)
• Automobile Industry India- Invest India (https://www.investindia.gov.in)
• The Evolution of the Automobile Industry in India- Symboinsurance.com
• Top 8 Reasons Behind Automotive Industry Slowdown In 2019 – Cardekho.com