Automotive Components Industry
January 2010


By:     Rahul Razdan            rahulrazdan86@gmail.com

        Ravneet Sahi            ravneet.sahi@gmail.com




                                                          1
                Rahul Razdan | rahulrazdan86@gmail.com
Agenda

    1. Market Scenario – The impact of auto crisis

    2. Braving the crisis – Cost Saving / Cash flow measures

    3. Growth Strategy for markets – India, China and Europe are different

         3.1 Europe

         3.2 India

         3.3 China




                     Rahul Razdan | rahulrazdan86@gmail.com                  2
Market Scenario – The impact of auto crisis
Automotive value chain – Components manufacturers focus on
design to delivery as per the requirements of OEMs
                                                                                      Finance          Cost targets
                                                                   Revenue
                     Equipment Manufacturing                       management
                                                                                      Account
                                                                                       and IT
                                                           Marketing,                                         Product
                                                           Sales and         Production   OEM               Development
                                                            service             demand

                                                       Orders                          SCM
                                                       and                         Manufacturing         Financial
Retail and sales support                              incentives                                                        Designs
                                                                                    Purchasing           feasibility
                                                                                           Modules
                                Distributors                                               and parts
                Accessories
                                                                        Vehicles

                                 Dealers                                             Suppliers
                    Vehicle
   Consumers        service                                                                              Tier I
                                                                                                       Suppliers
               Financing        Credit &
               Payments         Leasing
                                                                                             Tier 2                    Tier 3


                                                                                                        Sourcing


Source: Adapted from Capgemini Consulting; McKinsey

                                  Rahul Razdan | rahulrazdan86@gmail.com                                                          3
Market Scenario – The impact of auto crisis
Auto component manufacturer have to deal with toppling revenues
and reduced orders due a sharp decline in vehicle demands
          The economic downturn has lead to              Global trade and logistical activity has
1           drop in consumer sentiment                     decreased



          Sales of cars in Europe and the US has         Truck have seen a drastic decrease in
            fallen                                         in 2008 and it expected to decrease
          • In developed markets, volumes have             further in 2009
2           declined by as much as 25-35%                • Dramatic and quick collapse of truck
                                                           sales worldwide (up to -60%-70%)




          • Decreased top-line and order books
          • Risk of clients failure
3         • Cash payment uncertainty



Source: Roland Berger; Auto Focus Asia

                                   Rahul Razdan | rahulrazdan86@gmail.com                         4
Agenda

    1. Market Scenario – The impact of auto crisis

    2. Braving the crisis – Cost / Cash Saving measures

    3. Growth Strategy for markets – India, China and Europe are different

         3.1 Europe

         3.2 India

         3.3 China




                     Rahul Razdan | rahulrazdan86@gmail.com                  5
Braving the crisis – Cost / Cash Saving measures
   Quick hit measures can provide immediate cash saving, and long
   term savings to be brought in by structural changes
    100%       4,143                                                            Structural cost
                                           (in INR Cr)
                                                                                transformation




                                                          Savings
     80%




                           Cost heads
     60%                                                            Variable cost                                     Systemic
                                                                    reduction                                         savings
                                                                                                        Structural
     40%                                                                                                savings
                                          7%      15%
     20%
                                          296                                                     Quick hits
      0%
                                                                                                               Timeline
             Revenue Costs              EBIDTA Target…
  Identification of
                                  Attack variable costs
   cost reduction                                                         Re-structure fixed cost heads
                                         heads
     objectives
• Increase EBIDTA to       • Reduction of non-operating/             • Closure of loss making plants/ adjustment of
  pre-2008 levels            ancillary expenses                        production footprint
• Spend on variable cost   • Temporary production stops              • SG&A headcount reduction                         Reach
  heads wisely and plan    • Reduction of purchasing costs           • Pay-cuts to employees by 20%                    Target
  fixed expenses             (re-negotiations)                       • Reduction of R&D expenses                       EBITDA
  strategically            • Putting Manpower to                     • Reduction of indirect plant personnel           margins
• Create a 8%                alternate industries to ensure          • Financial restructuring
  improvement in             optimum utilization                     • Reduction of CAPEX to the minimum
  EBIDTA margin to 15%
  Source: Roland Berger

                                        Rahul Razdan | rahulrazdan86@gmail.com                                            6
Braving the crisis – Cost / Cash Saving measures
With pointed and well directed cost reduction measures the
company can increase the %EBITDA to optimum levels

    Learning from Auto Component Manufacturers Initaitives
     • Bharat Forge is planning to reduce to             • SONA Group redesigned some of the
D      INR ~200 Cr. From working capital                   products which has resulted in 8%
O
M
       which gives INR ~20 Cr of interest                  decrease in through process
E      saving                                              improvements and value engineering
S    • No Capital Expenditures in FY 2010                • Product redesign capabilities will
T    • Emphasis on improving operational                   extensively be used in future at
I
C      efficiencies such as Yield, Scrap                   SONA, to products at lower costs than
       reduction and energy cost                           the ones developed in Japan or Europe

F    • Delphi has Closure of 10 plants (mainly
                                                         • Faurecia has closed plants in Germany
O      Europe) announced
R                                                        • Also the company is targeting a EUR
     • The company has also identified 400
I                                                          200 m improvement in working capital
E      employee redundancies in Germany
                                                           requirement
G
N


Source: Live Mint; Economic times; Roland Berger

                                   Rahul Razdan | rahulrazdan86@gmail.com                   7
Agenda

    1. Market Scenario – The impact of auto crisis

    2. Braving the crisis – Cost Saving / Cash flow measures

    3. Growth Strategy for markets – India, China and Europe are different

         3.1 Europe

         3.2 India

         3.3 China




                     Rahul Razdan | rahulrazdan86@gmail.com                  8
Growth Strategy for markets – India, China and Europe are different
The impact of the crisis is deeper on the European auto industry,
whereas China and India still exhibit growth
New passenger car registrations August YTD 2009 vs. 2008 (in’000)


             Europe                                          China                          India
                                                               37%                           10%
    10,414                                                              6,226

                  8.1%                                                                              915
                                                                                     830
                                                    4,550



                         9,566




     2008                2009                       2008                2009         2008           2009




Source: SIAM; Roland Berger; Association des Constructeurs Européens d'Automobiles

                                   Rahul Razdan | rahulrazdan86@gmail.com                                  9
Agenda

    1. Market Scenario – The impact of auto crisis

    2. Braving the crisis – Cost Saving / Cash flow measures

    3. Growth Strategy for markets – India, China and Europe are different

         3.1 Europe

         3.2 India

         3.3 China




                     Rahul Razdan | rahulrazdan86@gmail.com                  10
Growth Strategy for markets – Europe
 The European Auto industry reach the 2008 sales levels only after
 2012, while the scrappage scheme may bring short-term comfort
 Europe Light vehicles sales (in m Units)                             Scrappage Schemes
20
           18.6 19.0 17.5                                               • Scrappage schemes have been
18
                                                              16.8        introduced in almost all major
16                                                                        markets
                                                       15.1
14                                            13.8                      • Offered bonus: Germany 2,500
                                     13.1
12                                                                        EUR, UK 2,000 GBP, Italy 1,500 EUR
                                                                        • Total government budgets: Germany
10
                                                                          EUR 5 bn, UK GBP 300 m
      2006 2007 2008 2009e 2010e 2011e 2012e



• European market has seen a very down ward pressure on the sales volume leading to a
  decrease in the order books of the auto-component manufacturers
• Sales would have been even lower if it had not been for the Scrappage Schemes introduced in
  the EU region
• It will take more than 3 years for the demand to revive



Source: Datamonitor; CBI Market Information Database; Roland Berger

                                   Rahul Razdan | rahulrazdan86@gmail.com                               11
Growth Strategy for markets – Europe
The initiatives of operations restructuring in Europe can sustain
business in the short run and reap benefits by 2014

                                                                                      2014

    1. Retaining capacity to
                                                                      2012
       harness when the
        demand revives
                                                                      3. Diversification into
                                          2011                          Infrastructure and
                                                                         Lifting & Material
                                                                      handling equipments

          2010

                        2. Saving cash by
                        operating at low                                              4. Expansion into
                             volumes                                                  Other European
                                                                                           markets


Source: Datamonitor; CBI Market Information Database; Roland Berger

                                   Rahul Razdan | rahulrazdan86@gmail.com                                 12
Agenda

    1. Market Scenario – The impact of auto crisis

    2. Braving the crisis – Cost Saving / Cash flow measures

    3. Growth Strategy for markets – India, China and Europe are different

         3.1 Europe

         3.2 India

         3.3 China




                     Rahul Razdan | rahulrazdan86@gmail.com                  13
Growth Strategy for markets – India
Favorable policies and cost arbitrage will buoy auto component
sourcing to India
Force 1 – Export potential and
proximity to markets:                                      Force 2 - It is a proven base for cost
• Total value of exports by 2015 expected to
                                                           effective manufacturing:
  reach US$ 8–10 b for vehicles and US$ 20–
                                                           • India is cost competitiveness in terms of
  25 b for components
                                                             labour and raw material
• Proximity to other Asian economies and
                                                           • Manufacturing costs in India are 25-30%
  emerging markets like Africa
                                                             lower than the western countries
• Shipments to Europe cheaper than those
  from Brazil and Thailand


                                Auto component market in India to
                                     grow ten times by 2015

Force 3 - Investment Commission has
                                                           Force 4 - Margin pressures faced by
set a target of attracting foreign
                                                           auto manufacturers in developed
investment:
                                                           markets:
• Target foreign investment of USD 15 b by
                                                           • OEMs and Tier I suppliers in developed
  2015
                                                             markets facing intense cost pressures
• Increase India's share in the global auto
                                                           • Souring from Asian markets to stay cost
  components market from the existing 0.9%
                                                             competitive
  to 2.5% by 2015
Source: IBEF

                              Rahul Razdan | rahulrazdan86@gmail.com                              14
Growth Strategy for markets – India
 Indian auto industry - the growth presents scope for calculated
 measures to gain market share in the future
Indian auto component industry turnover (USD b) Foreign Companies sourcing from India
 2003-04          1.27                                         Manufacturer            Worth
 2004-05          1.69                  Market to grow    Volkswagen AG        1 billion Euros
                          CAGR
 2005-06           2.47                 10 times in the   Renault- Nissan      300 million Euros
                         29.94%
 2006-07           2.87                  next 7 years     Fiat                 USD Four million
 2007-08            3.62                                  Ford Motors          USD 150 million
 2015 (e)                                       33-40     Daimler Chrysler     USD 125 million
                                                          BMW AG               NA
            0.0       10.0       20.0    30.0     40.0




  • Indian auto component industry is well positioned to capitalise on the growth in outsourcing to
    low cost countries
    – Exports are expected to contribute to USD 20-25 B in 2015 to Auto component Industry
      market (~60%)
  • Tap into component exports pie by leveraging the foreign market reach through recent
    acquisitions
  • Diversify into non-auto components business to increase the revenues and diversify
 Source: A. T. Kearney; IBEF; ACMA

                                     Rahul Razdan | rahulrazdan86@gmail.com                     15
Agenda

    1. Market Scenario – The impact of auto crisis

    2. Braving the crisis – Cost Saving / Cash flow measures

    3. Growth Strategy for markets – India, China and Europe are different

         3.1 Europe

         3.2 India

         3.3 China




                     Rahul Razdan | rahulrazdan86@gmail.com                  16
Growth Strategy for markets – China
 China Automobile market is expected grow due to strong domestic
 consumption and governments recent stimulus packages
China vehicles production (in m Units)

                                                     15%   9.0
                                                                    • Chinese auto-component is
                       23%                     5.1                    expected to grow to USD 115.6 b
                                       4.2                          • The market is expected to grow
               2.5            3.1
   2.2                                                                at a stable rate of 18% per
                                                                      annum

  2003       2004        2005         2006    2007     2011e
                                     China Automotive Stimulus Packages
                                        • Subsidies to rural residents to trade in old cars for new
  RMB 5 Million worth
                                          ones
  of subsidies
                                        • Lowering fuel retail prices
                                        • For research into:
  RMB 10 Million
                                             – Vehicle safety
  worth of subsidies
                                             – Alternate energy

Source: A. T. Kearney; KPMG

                                    Rahul Razdan | rahulrazdan86@gmail.com                        17
Growth Strategy for markets – China
 China has a cost advantage when compared to Brazil, Thailand and
 India

Country         Annual lending rate                 Country    Labour cost (USD/hour)
India                         10-11%                India                  0.75
Brazil                        13-14%                Brazil                  4.3
China                         5-6%                  China                  0.75
Thailand                      7-8%                  Thailand                0.8



Country         Power Cost per kwh (USD)
India                          0.14
Brazil                         0.05
                                                       • China is competent with the other
                                                         economies on low cost labor front
China                          0.03                    • With India it has a overall cost
Thailand                       0.11                      advantage of ~9%, due to lower
                                                         power and funds costs


Source: A. T. Kearney; IBEF
                                                                                        18
                               Rahul Razdan | rahulrazdan86@gmail.com
Growth Strategy for markets – China
A manufacturer can enter/ accessthe Chinese market using a three-
pronged strategy

                                        Strategy for China


Serve the growing automobile market                          Realize the Chinese cost savings in
              in China                                          manufacturing components

• Tap the two-wheeler customer base                     • Enter into China through the route
  of Engines engineering in China, e.g.                   of Joint venture . Eg. Bharat Forge
  Loncin Group                                            and FAW

                                                        • Enter into China by directly investing
  Sourcing the components from the                        and setting up a company , Eg.
           Chinese markets                                Sundaram Fasteners

• Set-up Purchase office in China to
  source low cost components


Source: A. T. Kearney; IBEF
                                                                                             19
                              Rahul Razdan | rahulrazdan86@gmail.com
THANK YOU


Rahul Razdan | rahulrazdan86@gmail.com   20

Automotive Components Industry

  • 1.
    Automotive Components Industry January2010 By: Rahul Razdan rahulrazdan86@gmail.com Ravneet Sahi ravneet.sahi@gmail.com 1 Rahul Razdan | rahulrazdan86@gmail.com
  • 2.
    Agenda 1. Market Scenario – The impact of auto crisis 2. Braving the crisis – Cost Saving / Cash flow measures 3. Growth Strategy for markets – India, China and Europe are different 3.1 Europe 3.2 India 3.3 China Rahul Razdan | rahulrazdan86@gmail.com 2
  • 3.
    Market Scenario –The impact of auto crisis Automotive value chain – Components manufacturers focus on design to delivery as per the requirements of OEMs Finance Cost targets Revenue Equipment Manufacturing management Account and IT Marketing, Product Sales and Production OEM Development service demand Orders SCM and Manufacturing Financial Retail and sales support incentives Designs Purchasing feasibility Modules Distributors and parts Accessories Vehicles Dealers Suppliers Vehicle Consumers service Tier I Suppliers Financing Credit & Payments Leasing Tier 2 Tier 3 Sourcing Source: Adapted from Capgemini Consulting; McKinsey Rahul Razdan | rahulrazdan86@gmail.com 3
  • 4.
    Market Scenario –The impact of auto crisis Auto component manufacturer have to deal with toppling revenues and reduced orders due a sharp decline in vehicle demands The economic downturn has lead to Global trade and logistical activity has 1 drop in consumer sentiment decreased Sales of cars in Europe and the US has Truck have seen a drastic decrease in fallen in 2008 and it expected to decrease • In developed markets, volumes have further in 2009 2 declined by as much as 25-35% • Dramatic and quick collapse of truck sales worldwide (up to -60%-70%) • Decreased top-line and order books • Risk of clients failure 3 • Cash payment uncertainty Source: Roland Berger; Auto Focus Asia Rahul Razdan | rahulrazdan86@gmail.com 4
  • 5.
    Agenda 1. Market Scenario – The impact of auto crisis 2. Braving the crisis – Cost / Cash Saving measures 3. Growth Strategy for markets – India, China and Europe are different 3.1 Europe 3.2 India 3.3 China Rahul Razdan | rahulrazdan86@gmail.com 5
  • 6.
    Braving the crisis– Cost / Cash Saving measures Quick hit measures can provide immediate cash saving, and long term savings to be brought in by structural changes 100% 4,143 Structural cost (in INR Cr) transformation Savings 80% Cost heads 60% Variable cost Systemic reduction savings Structural 40% savings 7% 15% 20% 296 Quick hits 0% Timeline Revenue Costs EBIDTA Target… Identification of Attack variable costs cost reduction Re-structure fixed cost heads heads objectives • Increase EBIDTA to • Reduction of non-operating/ • Closure of loss making plants/ adjustment of pre-2008 levels ancillary expenses production footprint • Spend on variable cost • Temporary production stops • SG&A headcount reduction Reach heads wisely and plan • Reduction of purchasing costs • Pay-cuts to employees by 20% Target fixed expenses (re-negotiations) • Reduction of R&D expenses EBITDA strategically • Putting Manpower to • Reduction of indirect plant personnel margins • Create a 8% alternate industries to ensure • Financial restructuring improvement in optimum utilization • Reduction of CAPEX to the minimum EBIDTA margin to 15% Source: Roland Berger Rahul Razdan | rahulrazdan86@gmail.com 6
  • 7.
    Braving the crisis– Cost / Cash Saving measures With pointed and well directed cost reduction measures the company can increase the %EBITDA to optimum levels Learning from Auto Component Manufacturers Initaitives • Bharat Forge is planning to reduce to • SONA Group redesigned some of the D INR ~200 Cr. From working capital products which has resulted in 8% O M which gives INR ~20 Cr of interest decrease in through process E saving improvements and value engineering S • No Capital Expenditures in FY 2010 • Product redesign capabilities will T • Emphasis on improving operational extensively be used in future at I C efficiencies such as Yield, Scrap SONA, to products at lower costs than reduction and energy cost the ones developed in Japan or Europe F • Delphi has Closure of 10 plants (mainly • Faurecia has closed plants in Germany O Europe) announced R • Also the company is targeting a EUR • The company has also identified 400 I 200 m improvement in working capital E employee redundancies in Germany requirement G N Source: Live Mint; Economic times; Roland Berger Rahul Razdan | rahulrazdan86@gmail.com 7
  • 8.
    Agenda 1. Market Scenario – The impact of auto crisis 2. Braving the crisis – Cost Saving / Cash flow measures 3. Growth Strategy for markets – India, China and Europe are different 3.1 Europe 3.2 India 3.3 China Rahul Razdan | rahulrazdan86@gmail.com 8
  • 9.
    Growth Strategy formarkets – India, China and Europe are different The impact of the crisis is deeper on the European auto industry, whereas China and India still exhibit growth New passenger car registrations August YTD 2009 vs. 2008 (in’000) Europe China India 37% 10% 10,414 6,226 8.1% 915 830 4,550 9,566 2008 2009 2008 2009 2008 2009 Source: SIAM; Roland Berger; Association des Constructeurs Européens d'Automobiles Rahul Razdan | rahulrazdan86@gmail.com 9
  • 10.
    Agenda 1. Market Scenario – The impact of auto crisis 2. Braving the crisis – Cost Saving / Cash flow measures 3. Growth Strategy for markets – India, China and Europe are different 3.1 Europe 3.2 India 3.3 China Rahul Razdan | rahulrazdan86@gmail.com 10
  • 11.
    Growth Strategy formarkets – Europe The European Auto industry reach the 2008 sales levels only after 2012, while the scrappage scheme may bring short-term comfort Europe Light vehicles sales (in m Units) Scrappage Schemes 20 18.6 19.0 17.5 • Scrappage schemes have been 18 16.8 introduced in almost all major 16 markets 15.1 14 13.8 • Offered bonus: Germany 2,500 13.1 12 EUR, UK 2,000 GBP, Italy 1,500 EUR • Total government budgets: Germany 10 EUR 5 bn, UK GBP 300 m 2006 2007 2008 2009e 2010e 2011e 2012e • European market has seen a very down ward pressure on the sales volume leading to a decrease in the order books of the auto-component manufacturers • Sales would have been even lower if it had not been for the Scrappage Schemes introduced in the EU region • It will take more than 3 years for the demand to revive Source: Datamonitor; CBI Market Information Database; Roland Berger Rahul Razdan | rahulrazdan86@gmail.com 11
  • 12.
    Growth Strategy formarkets – Europe The initiatives of operations restructuring in Europe can sustain business in the short run and reap benefits by 2014 2014 1. Retaining capacity to 2012 harness when the demand revives 3. Diversification into 2011 Infrastructure and Lifting & Material handling equipments 2010 2. Saving cash by operating at low 4. Expansion into volumes Other European markets Source: Datamonitor; CBI Market Information Database; Roland Berger Rahul Razdan | rahulrazdan86@gmail.com 12
  • 13.
    Agenda 1. Market Scenario – The impact of auto crisis 2. Braving the crisis – Cost Saving / Cash flow measures 3. Growth Strategy for markets – India, China and Europe are different 3.1 Europe 3.2 India 3.3 China Rahul Razdan | rahulrazdan86@gmail.com 13
  • 14.
    Growth Strategy formarkets – India Favorable policies and cost arbitrage will buoy auto component sourcing to India Force 1 – Export potential and proximity to markets: Force 2 - It is a proven base for cost • Total value of exports by 2015 expected to effective manufacturing: reach US$ 8–10 b for vehicles and US$ 20– • India is cost competitiveness in terms of 25 b for components labour and raw material • Proximity to other Asian economies and • Manufacturing costs in India are 25-30% emerging markets like Africa lower than the western countries • Shipments to Europe cheaper than those from Brazil and Thailand Auto component market in India to grow ten times by 2015 Force 3 - Investment Commission has Force 4 - Margin pressures faced by set a target of attracting foreign auto manufacturers in developed investment: markets: • Target foreign investment of USD 15 b by • OEMs and Tier I suppliers in developed 2015 markets facing intense cost pressures • Increase India's share in the global auto • Souring from Asian markets to stay cost components market from the existing 0.9% competitive to 2.5% by 2015 Source: IBEF Rahul Razdan | rahulrazdan86@gmail.com 14
  • 15.
    Growth Strategy formarkets – India Indian auto industry - the growth presents scope for calculated measures to gain market share in the future Indian auto component industry turnover (USD b) Foreign Companies sourcing from India 2003-04 1.27 Manufacturer Worth 2004-05 1.69 Market to grow Volkswagen AG 1 billion Euros CAGR 2005-06 2.47 10 times in the Renault- Nissan 300 million Euros 29.94% 2006-07 2.87 next 7 years Fiat USD Four million 2007-08 3.62 Ford Motors USD 150 million 2015 (e) 33-40 Daimler Chrysler USD 125 million BMW AG NA 0.0 10.0 20.0 30.0 40.0 • Indian auto component industry is well positioned to capitalise on the growth in outsourcing to low cost countries – Exports are expected to contribute to USD 20-25 B in 2015 to Auto component Industry market (~60%) • Tap into component exports pie by leveraging the foreign market reach through recent acquisitions • Diversify into non-auto components business to increase the revenues and diversify Source: A. T. Kearney; IBEF; ACMA Rahul Razdan | rahulrazdan86@gmail.com 15
  • 16.
    Agenda 1. Market Scenario – The impact of auto crisis 2. Braving the crisis – Cost Saving / Cash flow measures 3. Growth Strategy for markets – India, China and Europe are different 3.1 Europe 3.2 India 3.3 China Rahul Razdan | rahulrazdan86@gmail.com 16
  • 17.
    Growth Strategy formarkets – China China Automobile market is expected grow due to strong domestic consumption and governments recent stimulus packages China vehicles production (in m Units) 15% 9.0 • Chinese auto-component is 23% 5.1 expected to grow to USD 115.6 b 4.2 • The market is expected to grow 2.5 3.1 2.2 at a stable rate of 18% per annum 2003 2004 2005 2006 2007 2011e China Automotive Stimulus Packages • Subsidies to rural residents to trade in old cars for new RMB 5 Million worth ones of subsidies • Lowering fuel retail prices • For research into: RMB 10 Million – Vehicle safety worth of subsidies – Alternate energy Source: A. T. Kearney; KPMG Rahul Razdan | rahulrazdan86@gmail.com 17
  • 18.
    Growth Strategy formarkets – China China has a cost advantage when compared to Brazil, Thailand and India Country Annual lending rate Country Labour cost (USD/hour) India 10-11% India 0.75 Brazil 13-14% Brazil 4.3 China 5-6% China 0.75 Thailand 7-8% Thailand 0.8 Country Power Cost per kwh (USD) India 0.14 Brazil 0.05 • China is competent with the other economies on low cost labor front China 0.03 • With India it has a overall cost Thailand 0.11 advantage of ~9%, due to lower power and funds costs Source: A. T. Kearney; IBEF 18 Rahul Razdan | rahulrazdan86@gmail.com
  • 19.
    Growth Strategy formarkets – China A manufacturer can enter/ accessthe Chinese market using a three- pronged strategy Strategy for China Serve the growing automobile market Realize the Chinese cost savings in in China manufacturing components • Tap the two-wheeler customer base • Enter into China through the route of Engines engineering in China, e.g. of Joint venture . Eg. Bharat Forge Loncin Group and FAW • Enter into China by directly investing Sourcing the components from the and setting up a company , Eg. Chinese markets Sundaram Fasteners • Set-up Purchase office in China to source low cost components Source: A. T. Kearney; IBEF 19 Rahul Razdan | rahulrazdan86@gmail.com
  • 20.
    THANK YOU Rahul Razdan| rahulrazdan86@gmail.com 20