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The automotive industry designs, develops, manufactures, markets, and sells motor vehicles, and is one of the world's most important economic sectors by revenue. The term automotive industry usually does not include industries dedicated to automobiles after delivery to the customer, such as repair shops and motor fuel filling stations. The automobiles industry is made up from the passenger cars market, the light trucks market and the motorcycles market. The passenger car segment and the light trucks segment are valued at retail selling price (RSP). The motorcycles market consists of all classes of on- and off-road motorcycles including scooters and mopeds, valued at RSP.
The global automobiles industry grew by 4.9% and generated total revenue of $1,640 billion in 2010, representing a compound annual rate of change (CARC) of -0.8% between 2006 and 2010.
Industry consumption volumes increased with a CAGR of 1.8% between 2006 and 2010, to reach a total of 108 million units in 2010. The performance of the industry is forecast to accelerate, with an anticipated CAGR of 8.4% for the five year period 2010 - 2015, which is expected to drive the industry to a value of $2,449.2 billion by the end of 2015.
The global automobiles industry was hard hit by the global economic downturn and required significant government intervention in some countries. The industry did however return to growth in 2010 and is expected to see strong growth through to the end of the forecast period.
The Passenger Cars segment was the industry's most lucrative in 2010, with total revenue of $1,291.1 billion, equivalent to 78.7% of the industry's overall value. The
Light Trucks segment contributed revenue of $274.1 billion in 2010, equating to 16.7% of the industry's aggregate value.
17% Motorcycles
79%
Americas accounts for 35.6% of the global automobiles industry value. Asia-Pacific accounts for a further 30.8% of the global industry.
Americas RoW
30% 4%
Europe Asia-Pacific
Toyota is the leading player in the global automobiles industry, generating a 6.8% share of the industrys value. Volkswagen accounts for a further 6.7% of the industry.
Ford takes up 5.1% of market share. Others constitute 81.4% of market share.
The automobiles market will be analysed taking manufacturers of passenger cars, light trucks and motorcycles as players. The key buyers will be taken as independent dealers and distributors, and manufacturers of raw materials, assembled and semiassembled components, and providers of energy, freight and transportation as the key suppliers.
of suppliers for the majority of their inputs, meaning they are less reliant upon individual suppliers. Overall, supplier power is assessed as moderate.
Threat of Substitutes:
The main substitute to the automobiles industry is used cars. The recent economic crisis brought about a surge of used car sales, with people simply being unable to afford new cars, however many governments implemented scrappage schemes, whereby consumers gain money towards a new car when scrapping an old one, thus making new cars more affordable. New cars are also more reliable and economically friendly, with new regulations imposed on carbon emissions. A growing awareness in environmental issues could push more people into cycling or walking, however this is unlikely to happen on a mass scale, and therefore is unlikely to affect the industry as a whole. Instead, industry players are adapting and developing their products to become more environmentally friendly. Overall, there is a moderate threat of substitutes.
Rivalry:
The global automobiles industry is dominated by several multinational companies (such as Ford, Toyota and Volkswagen), meaning that competition is fierce.
The market was once dominated by US brands; however this is changing with companies from Japan becoming increasingly globalized. Due to the recent economic downturn, and earthquake in Japan, there has been a slowdown in car manufacturing, exasperating rivalry. Furthermore the cost of raw materials has also risen, increasing production costs as well. Car manufacturers are under increasing pressure to meet global environmental demands, which further increases rivalry, as each company is trying to gain an edge on their rival competitors. Forecasts also suggest an improvement in automobile sales which will help ease rivalry. Overall, rivalry within this industry is strong.
Volkswagen
One of the leading global automobile manufacturers. Operates 60 production plants in 15 European countries and a further six countries in the Americas, Asia, and Africa. Volkswagen sells its vehicles in more than 153 countries. In FY2009, the group delivered 6.3 million vehicles to its customers worldwide. The group's brands include Volkswagen passenger cars, Audi, Skoda, SEAT, Bentley, Scania, and Volkswagen commercial vehicles. The group operates through three business segments: passenger cars and light commercial vehicles, Scania, and Volkswagen financial services. The passenger cars and light commercial vehicles segment is engaged in the development of vehicles and engines, as well as the production and sale of passenger cars, commercial vehicles, and the genuine parts business. The group is made up of various brands, including: Volkswagen, Audi, SEAT, Skoda, Bentley, and Volkswagen Commercial Vehicles. The product range extends from low-consumption small cars to luxury class vehicles. In the commercial vehicle sector, the group offers pick-ups, buses, and heavy trucks.
In 2015, the global automobiles industry is forecast to have a value of $2,449.2 million, an increase of 49.3% since 2010. The compound annual growth rate of the industry in the period 201015 is predicted to be 8.4%. In 2015, the global automobiles industry is forecast to have a volume of 146.9 million units, an increase of 36% since 2010. The compound annual growth rate of the industry in the period 201015 is predicted to be 6.3%.
Strengths
The worlds major car manufacturers continue to invest in India and now the supplier segment is attracting private equity investment. Foreign joint ventures (JVs) ensure capacity building for local partners, as overseas firms bring expertise.
Weaknesses
Local demand is still skewed heavily towards low-cost vehicles, due to low income levels. The cost of production is generally higher than some other Asian states, such as China, although these costs can vary from state-to-state, according to the level of infrastructural development and electricity costs.
Opportunities
The premium segment is benefiting from higher levels of personal wealth, attracting investment from brands such as Audi, while Tata has expanded the Jaguar Land Rover division into India. The commercial vehicle segment stands to benefit from a number of new JVs announced recently, including Ashok Leyland and Nissan, and Isuzu and Swaraj Mazda, while the bus segment is also attracting investment.
Threats
High tariffs on imports stand to restrict the potential growth of the hybrid vehicle segment, as the cost of the technology is already expensive before taxes. Fees for local testing of new models, such as those being encountered by BMW as it attempts to launch the Mini brand, could deter some manufacturers.
The proportion of vehicles to the size of the population is very low, with less than 10% owning a passenger car. On the basis of present income trends, and an increased willingness to borrow money, the number of households able to buy cars could double by the end of the decade.
With such a high proportion of purchases financed by credit, however, much will depend on the countrys response to the global credit crisis. As a result of increased demand, competition is rising, with global giants seeking to gain a foothold in the region through joint ventures (JVs) with local firms. Indias auto sector achieved record growth of 31% year-on-year (y-o-y) in calendar year 2010, with car sales reaching 1.87mn units, compared with 1.43mn units in 2009 when sales fell dramatically during the financial crisis.
Manufacturer Maruti Suzuki (formerly Maruti Udyog) Hyundai Motor India Tata Motors Honda Siel Cars India
% chg y-o- Market Share y 28.5 29.1 17.4 16.7 52.2 16.2 12.0 3.1
25 Nov. 11: Extra strong yen threatens to break up auto industry: Toyota chief
"The entire auto industry has begun to collapse" due to historically high-levels of the Japanese yen against the U.S. dollar, said Toyota Motor Corp. President Akio Toyoda in an interview. He emphasized the importance of strengthening the industry's domestic foundation even while the yen is in the upper 70s to the dollar. "Our focus is on Japan. We need it as a venue to foster ultra-modern technology to compete in the global marketplace," he said.
Toyoda vowed the company will do all it can to cut costs and take other austere measures to stick to its stated policy of producing at least 3 million units domestically. But he expressed concern about an ongoing hollowing out of Japan's auto industry, saying even Toyota Motor may have to shift production abroad if the yen continues to strengthen against the dollar and there are no incentives in Japan to promote the growth of cutting-edge technology.
24 Nov. 11: Market getting difficult, may miss this year's sales target: BMW
BMW India today said it may miss the target of selling 10,000 vehicles in the domestic market as the luxury segment has also been affected by the slowdown witnessed in the automobile industry. BMW India President Andreas Schaaf said the month of October, which is usually one of the best months along with March in terms of sales, has not been as good as expected. Earlier this year, the company had increased production capacity of its Chennai plant to 11,000 from 10,000 units previously. Car sales in India have been declining this year and registered the steepest monthly decline in nearly 11 years in October, tanking by 23.77 per cent on account of a huge drop in output by the country's largest car-maker Maruti Suzuki due to labour trouble, coupled with high interest rates and rising fuel prices.
Toyota announces prices for all-new 2012 Yaris, Sequoia, Tundra & Sienna
Toyota Motor Sales, USA., Inc. has announced manufacturer's suggested retail prices, or MSRP, for the all-new 2012 nextgeneration Yaris subcompact, Tundra fullsize pickup truck, Sequoia large sport utility vehicle and Sienna van.
new Swift. Built on an all new platform, the new Swift is longer and wider than its predecessor, the company said.