INDIAN AUTOMOBILE INDUSTRY

Automobile Industry
Where it has been






Where its going
AUTOMOBILE Industry In India
Pre 1983 1983-1993 1993-2007



Era of globalisation
and
evolution of India as a
global
manufacturing hub
Closed market

Growth of market
limited by supply
Outdated models
Players
Hindustan Motors
Premier
Telco
Ashok Leyland
Mahindra & Mahindra
Japanisation - GOI- Suzuki
joint venture to form Maruti
Udyog
Joint ventures with
companies in commercial
vehicles and components
Players
Maruti Udyog
Hindustan Motors
Premier
Telco
Ashok Leyland
Mahindra & Mahindra
Delicensing of sector in
1993
Global major OEMs start
assembly in India (Toyota,
GM, Ford, Honda,
Hyundai)
Imports allowed from
April 2001; alignment of
duty on components and
parts to ASEAN levels
Implementation of VAT
Automotive Companies in India
Major Multi-national companies

Major Indian Companies

NODAL AGENCIES
ARAI
Provide research & development, testing,
certification and calibration support for
developing safe, reliable and eco-friendly
vehicles / components
SIAM
Apex Industry body representing 44 leading
vehicle and vehicular engine manufacturers in
India.
Future Prospects Of Indian
Automobile Industry
SKODA AUTO
SKODA Auto is planning to make India its regional
manufacturing hub.
Company plans to start to manufacturing in India from
2010 with a target of 50000 cars a year.
TATA MOTORS
TATA motors plan to manufacture 80000 units of its NANO
car in Pantnagar plant in UTTARAKHAND.
The Mother facility in SANAND, Gujrat may be fully
functional by 2010-11 with a capacity of 1.5 lakhs/year



RENAULT
RENAULT has entered into partnership with NISSAN Motors
to setup a manufacturing unit near Chennai.
Project costs around $ 901.35 millions and having Capacity
of 4lakh cars /year

HONDA MOTORS
Investing US $ 250 million in a new plant in Rajasthan
with capacity of 60,000 car per year
First car to rolled out in 2009


TOYOTA KIRLOSKAR
Toyota-Kirloskar motors planning to launch its own small
car in India by 2011

GENERAL MOTORS

New Capacity to manufacture small cars at its Talegaon,
Maharashtra plant with 80% local input.
Brought in Spark small car in 2007





Why India?
The Indian Auto Components Market
Original Equipment Manufacturers
(OEMs)
Replacement Parts Production and
Distribution : e.g. Air filters, oil filers and
replacement lights
Rubber Fabrication : tyres, hoses, belts
etc.
Estimated component market size is US$
6.7 bn
The exports of auto components industry
has grown at a rate of nearly 30 per cent
CAGR over the last four years.




The Indian Auto Components Market
Composition Of Indian Auto Exports

PEST ANALYSIS OF INDIAN
AUTOMOBILE INDUSTRY
POLITICAL
Indian govt. launched AUTO POLICY for its Self
Sustained growth.

Allowed Foreign Equity Investment up to 100%

Formulation of FUEL POLICY

Promotes for Vehicles propelled by AES



ECONOMIC
Weighted Tax Deductions up to 150% for in
house R&D activities.
Reduced Interest rates for export financing.
Economy has grown over 8.5% per annum for
last 5 years.
Manufacturing sector has grown 8-10 % for
last few years.
More than 90% CV purchase is on credit.


Social
Changed Lifestyle of people leads to increased purchase of
Automobiles

The Average family size is 4 which makes it favorable to buy a four
wheeler.

4
th
largest economy on PURCHASING PARITY INDEX

Increase in per capita income levels

Indian Customers are Highly educated and well informed and they
are price sensitive.

Preference for small and compact car

Preference for Fuel efficient cars with low maintenance


TECHNOLOGICAL
More & more emphasis on R&D.
Govt is promoting NATRIP(National
Automotive testing and R&D Infrastructure
Project) to support the growth of Auto
industry in India.
Customized solutions (Designer cars ets)can
be provided with proliferation of technology.
With Entry of global brands both product and
production process has been improved.

SWOT ANALYSIS OF INDIAN
AUTOMOBILE INDUSTRY
STRENGTHS
Automobile industry is established and
Evergreen industry.

India is the strongest player in small car segment

Indian Companies are best cost innovators

Assembly line manufacturing, and JIT inventory management,
the automotive industry has been able to achieve significant
gains in productivity.

Exceptional human resource base
WEAKNESS
India lack proper infrastructural facilities

Poor after sales service

the automotive industry lags behind other
sectors such as IT and financial services in
management training, reward
and retention.

Opportunities
Small cars is a future

Green cars

Auto financing

Royalty through Patents





THREATS
Global Crisis

Companies not focusing on R & D are under
great risk

High competition from foreign players

Lack of technology for Indian companies

Due to liquidity crunch buyers
stayed away

Mahindra & Mahindra
recorded a fall of about 40%,
Tata Motors showed 12%
decline in the car sales.

resulted into less production

Job Cuts



Impact Of Global Recession
INDIAN SUCCESS STORIES
TATA INDICA
Scorpio Success Story



Indias First Indigenously Developed SUV

It Was Designed To Target Urban Market To Fulfill The
Demand Of Passenger Car As Well As SUV Fans And
Having Comfort And Elegance

The UVs Design Fall Between Passenger Car And SUV
Called Car Plus









Why the project launched ?

From the year 1992company faced
tremendous competition specially from
Telco.
The sale from 1994 to 1997 was
Tata Sumo- 100000 units and M&M UV-
26321 units

M&Ms vehicles are more suitable for
rough terrain than on urban road, works
against it

Took benefit of the small size UV market
which is 15% of total vehicle market
compared to Asian average (40%)

Development of Scorpio
Made survey and collect customer preference
and perception for designee and feature .
Introduction of Quality Function
Development(QFD) Process.
Created a benchmark according to world class
SUVs
a) Big size
b)Latest technology
c)Affordable Price
d)Have thrill and passion in driving
e)Have Luxury
f)International vehicles defined image



It Was Launched With Three Models.
1000 Units Were Booked Within The Launch Of
First Week.
In 2003 Companies Income Rose By 22%.
Breaking The Tradition Of UV, Scorpio Is Being
Used Primarily As Personal Vehicle.
Survey In 2004 Shows That Scorpio Buyers Were
Satisfied.
It Extensively Tested, so It Has No Run Time
Defect After Launching In Market.
Launching Scorpio
Conclusion
Thus Scorpio has proved as a Milestone for
M&M and the Indian Automobile Industry. It
has given a unique place To M&M in Indian
market because ,It was innovated with High
Quality, Reliability, Flexibility, Style, Driving
Comfort etc.
In short it offered a customized product.
hence, again Operations components: Time,
quality & technology made A Success story.
CAREER OPTIONS AFTER MBA
IN
AUTOMOBILE SECTOR
CHENNAI IS CALLED AS DETROIT OF INDIA
Opportunities for All
Stream Designations Offered
HR HR Manager, Personnel Manager,
Compensation Analyst.

Marketing Sales Manager, Marketing
Manager, Product manager

Operations Production Manager, Purchase
Manager, Inventory Manager

Finance Financial Analyst, Risk Manager.
Interested in & around Mumbai?
MUMBAI: MAHINDRA AND MHINDRA.

PUNE: TATA MOTORS, TELCO, FORCE
MOTORS,LUCAS TVS, MAHINDRA &
MAHINDRA,VOLKSWAGON, GM,DAIMLER
CHRYSLER,FIAT INDIA,BAJAJ AUTO,EICHER,
KINETIC, BAJAJ TEMPO,HERO HONDA MOTORS
LTD,PIAGGIO,PREMIER Ltd,
Besides This Many Auto Component
Industries in Pune.