Automobile Industry Analysis

1. AUTOMOBILEAUTOMOBILE
INDUSTRYINDUSTRY
Presented ByPresented By
Group 1Group 1

3. HISTORYHISTORY
• The first car ran on India's roads in 1897The first car ran on India's roads in 1897
• Embryonic automotive industry emerged in India inEmbryonic automotive industry emerged in India in
the 1940s.the 1940s.
• Mahindra & Mahindra under license from WillysMahindra & Mahindra under license from Willys
branched out into the manufacture of lightbranched out into the manufacture of light
commercial vehicles (LCVs) and agricultural tractorscommercial vehicles (LCVs) and agricultural tractors

4. EVOLUTIONEVOLUTION
• The Independence marked the evolution ofThe Independence marked the evolution of
Indian automotive industryIndian automotive industry
• The growth was relatively slow dueThe growth was relatively slow due
to nationalisation and the licenseto nationalisation and the license raj whichraj which
hampered the Indian private sectorhampered the Indian private sector
• Maruti Udyog – Japanese & Indian ventureMaruti Udyog – Japanese & Indian venture
firmed the sectorfirmed the sector

5. PILLARS TO INDUSTRIALPILLARS TO INDUSTRIAL
GROWTHGROWTH
• The economic liberalisation in 1991 and theThe economic liberalisation in 1991 and the
gradual weakening of the license rajgradual weakening of the license raj
• Tata Motors, Maruti Suzuki and Mahindra andTata Motors, Maruti Suzuki and Mahindra and
Mahindra, expanded their domestic andMahindra, expanded their domestic and
international operationsinternational operations
• The Indian government chose Suzuki for its joint-The Indian government chose Suzuki for its joint-
venture to manufacture small carsventure to manufacture small cars
• Bajaj , Hero Honda , TVS etc emerged as leadingBajaj , Hero Honda , TVS etc emerged as leading
two wheeler and three wheeler producers withtwo wheeler and three wheeler producers with
Hero Honda as largest shareholderHero Honda as largest shareholder

6. EXPORTS AND DATAEXPORTS AND DATA
• In the year 2009, India rose to be the fourth largestIn the year 2009, India rose to be the fourth largest
exporter of automobiles following Japan, Southexporter of automobiles following Japan, South
Korea and ThailandKorea and Thailand
• Monthly sales of passenger cars in India exceededMonthly sales of passenger cars in India exceeded
100,000 units100,000 unitsand has since grown rapidly to aand has since grown rapidly to a
record monthly high of 182,992 units in Octoberrecord monthly high of 182,992 units in October
20092009
• Predictions made by Ernst and Young havePredictions made by Ernst and Young have
estimated that the Indian passenger car market willestimated that the Indian passenger car market will
have a growth rate of about 12 percent per annumhave a growth rate of about 12 percent per annum
over the next five years to reach the production ofover the next five years to reach the production of
3.75 million units by the year 20143.75 million units by the year 2014

7. CURRENT STATUSCURRENT STATUS
• The automobile sector of India is theThe automobile sector of India is the
seventh largest in the worldseventh largest in the world
• The country is the largest manufacturer ofThe country is the largest manufacturer of
motorcycles and the fifth largest producermotorcycles and the fifth largest producer
of commercial vehiclesof commercial vehicles
• Many foreign brands are setting up roots inMany foreign brands are setting up roots in
Indian soilIndian soil
• India overtook China by emerging as theIndia overtook China by emerging as the
fourth largest exporter of cars in Asia.fourth largest exporter of cars in Asia.

8. MARKET SIZE OF AUTOMOBILEMARKET SIZE OF AUTOMOBILE
INDUSTRYINDUSTRY
• Grown at a spectacular rate on an average of 17% for
last few years
• Attained a turnover of USD $35.8 billion
• Has provided direct and indirect employment to 13.1
million people
• The projected size in 2016 of the Indian automotive
industry varies between $122 billion and $159 billion
including USD 35 billion in exports

9. MAJOR PLAYERS IN INDIA
• MarutiMaruti
• AudiAudi
• BMWBMW
• ChevroletChevrolet
• FiatFiat
• SkodaSkoda
• TataTata
• VolvoVolvo
• Honda
• Hyundai
• Mahindra
• Mercedes
• Mitsubishi
• Nissan Motors
• Toyota
• Volkswagen

10. MARKET SHARES
• Tata Motors - Commercial Vehicles 63.94%, PassengerTata Motors - Commercial Vehicles 63.94%, Passenger
Vehicles 16.45%Vehicles 16.45%
• Maruti Suzuki – 46.0 %Maruti Suzuki – 46.0 %
• Hyundyi Motors – 14.15 %Hyundyi Motors – 14.15 %
• Mahindra & Mahindra - Commercial Vehicles 10.01%,Mahindra & Mahindra - Commercial Vehicles 10.01%,
Passenger Vehicles 6.50%, Three Wheelers 1.31%Passenger Vehicles 6.50%, Three Wheelers 1.31%
• Ashok Leyland - 22 %Ashok Leyland - 22 %

11. MAJOR CHALLENGESMAJOR CHALLENGES
• Rising oil pricesRising oil prices
• Human resourceHuman resource
• Rise in disposable IncomeRise in disposable Income
• Highways not up to the markHighways not up to the mark
• Limited number of component suppliersLimited number of component suppliers
• Fall short in product developmentFall short in product development
• Customer Relationship managementCustomer Relationship management

12. IMPACT OF GLOBAL CRISISIMPACT OF GLOBAL CRISIS
• Global vehicle production fell by 3.7% from 2007 toGlobal vehicle production fell by 3.7% from 2007 to
20082008
• NAFTA and South America were most badly hitNAFTA and South America were most badly hit
• Employment conditions affected by internationalEmployment conditions affected by international
trade in motor vehicles and automotive componentstrade in motor vehicles and automotive components
and parts, flows and stocks of foreign directand parts, flows and stocks of foreign direct
investments.investments.
• Difficulty in obtaining loans for car purchaseDifficulty in obtaining loans for car purchase

13. • Value chains were in a dire stateValue chains were in a dire state
• Plants were shuttered temporarilyPlants were shuttered temporarily
• Huge debt loads, high fixed-capital costs, high laborHuge debt loads, high fixed-capital costs, high labor
costs, and immense pension and health carecosts, and immense pension and health care
commitments to retirees added to the immediacy ofcommitments to retirees added to the immediacy of
the damage.the damage.
• The high cost and growing longevity of motorThe high cost and growing longevity of motor
vehicles prompted buyers to postpone purchasesvehicles prompted buyers to postpone purchases

14. LATEST TRENDSLATEST TRENDS
• Remote keyless entryRemote keyless entry
• Drive by WireDrive by Wire
• Electronic suspensionElectronic suspension
• Adaptive cruise controlAdaptive cruise control
• Tire pressure monitoringTire pressure monitoring
• Navigation systemsNavigation systems
• Automotive digital electrical systems andAutomotive digital electrical systems and
onboard networksonboard networks

15. • CMOS logic gateCMOS logic gate
• PLDs reduce engineering devlopement timePLDs reduce engineering devlopement time
• Driver assistance applicationsDriver assistance applications
• Rear seat entertainment systemsRear seat entertainment systems
• High definition control systemsHigh definition control systems

16. LEADING PLAYERSLEADING PLAYERS
IN THE INDUSTRYIN THE INDUSTRY

17. MARUTI SUZUKIMARUTI SUZUKI
• Leader in car market
• Market share of 39.12 per cent in overall passenger vehicle
market
• Production of 1.5 million cars every year
• Net sales rose 21.3 per cent to Rs 426, 125 million in (US$ 6.83
billion) FY13 and Net profit up by 40.6 per cent to Rs 23,921
million (US$ 383.48 million) in FY13
• Its car offering starts from the entry level Alto, to hatchbacks like
A-Star, Wagon R, Swift, sedans like SX4, Dzire, Ciaz, MUVs and
SUVs like Ertiga, Grand Vitara and ‘C’ Segment vehicle Omni.

18. HYUNDAIHYUNDAI
• India's largest car exporter
• India's 2nd largest car manufacturer
• Debuted in India with Hyundai Santro
• More than 1000 service points across India
• State-of-the-art manufacturing plant in India
• It currently sells ten car models spanning segments –
Hatchbacks – Santro, i10, i20, Sedans – Verna, Elantra, Sonata
and Santa Fe in the SUV segment.

19. THANK YOUTHANK YOU