automobile industry sources

8/8/2019 Automobile Industry Sources

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http://en.wikipedia.org/wiki/Automotive_industry_in_India

The Automotive industry in India is one of the largest in the world and one of the fastestgrowing globally. India manufactures over 11 million 2 and 4-wheeled vehicles and exports

about 1.5 million every year.[1]

It is the world's second largest manufacturer ofmotorcycles,with annual sales exceeding 8.5 million in 2009.

[2]India's passenger car and commercial

vehicle manufacturing industry is the seventh largest in the world, with an annual productionof more than 2.6 million units in 2009.

[3]In 2009, India emerged as Asia's fourth largest

exporter ofpassenger cars, behind Japan, South Korea and Thailand.[4] According to theSociety of Indian Automobile Manufacturers, annual car sales are projected to increase up to5 million vehicles by 2015 and more than 9 million by 2020. [5]

As of 2009, India is home to 40 million passenger vehicles and more than 2.6 million carswere sold in India in 2009 (an increase of 26%), making the country the second fastestgrowing automobile market in the world.[6][7] By 2050, the country is expected to top theworld in car volumes with approximately 611 million vehicles on the nation's roads.

[8]A

major chunk of India's car manufacturing industry is based in and around the city ofChennai,also known as the "Detroitof India".

[9]with the Indian city accounting for 60 per cent of the

country's automotive exports.[10]Gurgaon and ManesarnearNew Delhi are hubs where all ofthe Maruti Suzuki cars in India are manufactured.[11] The Chakan corridor nearPune,Maharashtra is another vehicular production hub with General Motors, Volkswagen/ Skoda,Mahindra and Mahindra in the process of setting up or already set up facilities.[12][13]Halol inGujarat, Aurangabad in Maharashtra, Kolkatta in West Bengal are some of the otherautomotive manufacturing regions around the country.[14][15][16]

Production statistics

The production of automobiles has greatly increased in the last decade. It passed the 1 millionmark during 2003-2004 and has more than doubled since.[21]

Automobiles Last Updated: November 2010


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Introduction:

The growth of the Indian middle class along with the growth of the economy over the pastfew years has attracted global auto majors to the Indian market. India provides trained

manpower at competitive costs making the country a favoured global manufacturing hub. Theworld's major car manufacturers continue to invest in India and now the supplier segment isalso attracting private equity (PE) investments.

The government has claimed that the country has become the seventh largest vehicle

producing nation in the world, six years ahead of the set target. According to Mr B S Meena,Secretary, Ministry of Heavy Industry, "When we were making the Auto Mission Plan

(AMP) in 2006, we had projected India to become the seventh largest vehicle producingcountry in the world by 2016. We have already achieved this milestone good six years ahead

of the set target."

According to a study by global consultancy firm Ernst & Young, the Indian market will clock

the fastest compound annual growth rate between 2009 and 2020, more than double that ofChina and the triad of North America, Europe and Japan. India's CAGR between 2009 and2020 is expected to be 14 per cent compared with China's 6 per cent, other emerging markets'6 per cent (which includes BRIC nations) and the triad's four per cent.

Investments:

India has emerged as one of the favourite investment destinations for automotivemanufacturers in recent times.

y Maruti Suzuki India Ltd (MSIL) has announced an investment of US$ 411.45 millionfor setting up its third plant at Manesar in order to capitalise on the rapid growth ofthe Indian auto industry. This new production lineMaruti's sixth overall would have250,000 units annual capacity.

y Volvo-Eicher Commercial Vehicles (VECV) has announced an investment of US$61.51 million for a new engine plant at its existing facility at Pithampur, MadhyaPradesh. With this, India will now become a global manufacturing hub for Volvo'snew medium-duty engine platform, with the only other factory for the engine type

being present in Japan.y Toyota Kirloskar, which focused mainly in metros and urban areas, has drawn up

plans to sell 40 per cent of its cars in the rural markets. By end of 2010, the companyplans to have 150 dealers across the country and will invest US$ 698.46 million in asecond plant in Bidadi.

y Toyoto also plans to invest US$ 107 million to make engines and gearboxes forToyota's new small car, Etios that is expected to be launched by year-end.y India Yamaha Motor Limited is also planning to tap the rural market, which currently

accounts for around 15 per cent of its overall sale. The company has launched a newbike YBR 110 that will target the rural markets.

y Mercedes Benz has met its single largest orderof 150 cars worth US$ 14.7millionfrom the small industrial town of Aurangabad, Maharashtra.

y The Renault-Nissan alliance and Bajaj Auto have signed a memorandum ofunderstanding for developing a low-cost car. According to the MoU, the design,


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engineering, manufacturing and supply base expertise to create the product will beexecuted by Bajaj with the support of the Renault-Nissan alliance.

y Honda Siel Cars India (HSCI) has announced an investment of US$ 53.55 million forthe expansion of its power train facility at Tapukara, Rajasthan. Scheduled to be

completed by end-2010, the plant would become a low-cost production base for itsnew small car.

y Indo-Russian commercial vehicle joint venture (JV) Kamaz Vectra Motors plans tomore than double its annual capacity to 12,000 units at its Hosur plant by 2012 tocapture the fast-growing market in India.

y Ashok Leyland and Japanese car maker Nissan Motor Co Ltd have announced thelaunch of three light commercial vehicles (LCVs) from 2011 through 2013. The automakers also confirmed to be in talks to create a small car for the Indian market withinthe US$ 2,000 - US$ 6,000 price range.

y British luxury brand Jaguar Land Rover (JLR) plans to increase presence in India andwill tap parent Tata Motors for assistance in areas like logistics and service support.

y BMW, the luxury car maker, is planning to infuse US$ 15.76 million in its Indianoperations. Andreas Schaaf, President, BMW India, said that the company hadinvested US$ 24.77 million till September 2010 and this would be increased to US$

40.53 million by the end of 2012.y Luxury carmaker Mercedes-Benz India will set up a new facility for building of city

bus bodies at its Chakan plant in Pune. The new unit will become operational by mid-2011 and will have a capacity of 700 units a year.

Domestic Market/ Sales:

y According to data released by the Society of Indian Automobile Manufacturers(SIAM), the passenger vehicles segment during April-September 2010 grew at 32.91

per cent over same period last year. Passenger cars grew by 33.58 per cent, utilityvehicles grew by 20.69 per cent and multi-purpose vehicles grew by 49.32 per centduring this period.

y The overall commercial vehicles segment registered a growth of 41.59 per cent duringthe first half of 2010-11, as compared to the same period last year. While medium andheavy commercial vehicles registered growth of 61.59 per cent, light commercialvehicles grew at 26.90 per cent.

y Two wheelers registered a growth of 25.86 per cent during April-September 2010.Mopeds, scooters and motorcycles grew by 23.13 per cent, 44.95 per cent and 22.52

per cent, respectively.

Road Ahead:

Global auto companies are investing to tap the growing demand in India as investment

spending and the government's social programmes raise incomes in smaller cities and ruralareas too. "The Indian automobile industry is geared up to invest up to US$ 17.12 billion infresh capacity in the next four years," Vishnu Mathur, Director-General, SIAM said. Hefurther stated, "The components industry will also invest US$ 12 billion up to the end of theAutomotive Mission Plan."

Car and motorcycle sales in India are setting records with rising incomes, cheap lending by

banks and launch of new models such as Volkswagen's Polo and Fiat's Linea. Car


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manufacturing capacity is set to rise to 5.7 million units by 2015, according to consultantsErnst & Young.

Further, India aims to become the small car hub of the world by dethroning Japan, the biggest

maker of compact cars, a majority of which is consumed domestically. Last year, it hadpipped Brazil to become the second-largest producer of such cars. While Japan produced 3.4

million small cars between January and December in 2009, India manufactured 1.48 millionunits in the same period.

According to the annual forecast of the SIAM, passenger vehicle sales in the country will be21,96,791 units in 2010-11 as compared to 19,49,248 units in 2009-10.

While two-wheeler sales are expected to be up 9-10 per cent at 10,287,837 units from

9,368,230 units in 2009-10, commercial vehicle sales in India will grow 17-18 per cent at6,21,681 units vis--vis 5,31,395 units last financial year. Sales of three-wheelers are

expected to go up 7-8 per cent at 4,73,693 units in the current financial year as against4,40,368 units in 2009-10.

However, with demand outgrowing the supply in the market, the overall market growth for2010-11 is most likely to exceed SIAM's initial prediction of 10-14 per cent.

India's largest carmaker Maruti fights falling market share

http://economictimes.indiatimes.com/news/news-by-industry/auto/automobiles/Indias-largest-

carmaker-Maruti-fights-falling-market-share/articleshow/6193776.cms

MUMBAI: There is a lot of action at Maruti Suzuki head office in South Delhi as topofficials are holding a series of meetings and brainstorming sessions to find a way to check asteady slide in its market share.

The share of the countrys largest carmaker slipped below 50% for the first time in severalyears when it reported a 47% market share for the January-June period. The credit for thisgoes to a slew of cars that stormed the market at highly competitive prices from the worldscheapest car Tata Nano to Ford Figo, GM Beat and Hyundai i20.

With India emerging one of the hottest destinations for global carmakers, Maruti has its taskcut out.

The company is already on its feet, or rather wheels, to tackle the onslaught, says R CBhargava, chairman of Maruti Suzuki. The lower cost of ownership of our vehicles willoffset competitors aggressive pricing tactics.

It has swiftly installed some manual lines, added extra shifts in factories and made the paintshop operate 24/7 to keep pace with the demand and reduce waiting period for delivery of its


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popular

Maruti has also set aside close to Rs 3,000 crore to increase its manufacturing capacity by200,000 units to 1.2 million cars by 2011 and build a new research and development facility

at Rohtak, which will be Suzukis R&D hub for Asia operations.

Still, experts believe the market leader will not be able to keep selling every second car in thecountry for long.Marutis volumes will grow but its market share may come under pressure, says AbdulMajeed, auto practice leader at PricewaterhouseCoopers (PwC).

The biggest reason is India is one place where every carmaker wants to be. They all have settheir sights on the small car segment that accounts for about 80% of the Indian car market.Many new entrants in this segment such as General Motors Beat, Hyundai i20, Ford Figoand Volkswagen Polo are attracting consumers through aggressive pricing and promotionaloffers.

Nissan Micra and Toyota Etios will join the race later this year. Market watchers say the

Nissan Micra priced aggressively at Rs 4-5.3 lakh, on par with Maruti Swift hasalready clocked 2,000 pre-bookings. Honda will launch a new small car next year and

Hyundai is working on a 800cc car.

To add to all this, Tata Motors new Sanand plant in Gujarat will soon start rolling out morethan 20,000 Tata Nanos every month and ramp up its capacity further.

Clearly, Maruti has a tough race ahead.

But then, although the leading carmaker may not be able to hold on to its market share, it iswidely expected to retain its number one position for a long time yet.

In 1998, industry watchers had predicted doomsday for Maruti when Korean car majorHyundai launched its compact car Santro. More than a decade later, Maruti still holds about60% share of the small car segment.

Maruti Suzuki has a deep understanding of the Indian consumers psyche, it has a terrificdistribution and an enviable sales network built over the years, says JagdishKhattar, formerCEO of Maruti Suzuki who now heads car servicing venture Carnation Auto.

http://findarticles.com/p/articles/mi_m0KJI/is_3_118/ai_n16118939/

Center of Gravity Shifting in Indias Small-Car Market

By Sudhakar Shah

WardsAuto.com, Jan 6, 2010 9:00 AM


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http://wardsauto.com/ar/gravity_shifting_india_100106/

MUMBAI Indias 10th New Delhi Auto Expo, which opened Tuesday, is shaping up to bea battleground for design and innovation vs. a war of wits and marketing, as global auto

makers debut the latest in small cars and new engine technologies.

Japanese brands, for example, are pitting the refinement and reliability of their passenger

vehicles against the precision engineering and drivability of the German car makers. But theyalso are unveiling low-cost subcompacts designed with Indias price-sensitive market in

mind.

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Every auto maker in India is tussling for market share, as evidenced by the 20 new andexisting small compacts and smaller hatchbacks displayed at the show. However, theres also

a full-scale race among luxury vehicles, including small cars such as the Volkswagen NewBeetle.

The range of product introductions at the Auto Expo swings from the new sporty ChevroletBeat minicar priced at less than $8,500 to the Mercedes GL350 CDI SUV that will sell for$150,000.

One of four key emerging markets, India is Asias fourth-largest vehicle market and amongthe fastest growing, with a goal of reaching 3 million total vehicle sales by 2015, according to

a government forecast. Industry sales in the first 11 months of 2009 included 1,310,665 carsand 582,293 light trucks, Wards data shows.

The game starts with Advantage Japan, which currently holds a 47.8% share of the Indian

market. Maruti Suzuki India Ltd. is at the top with a 42.4% share, followed by ToyotaKirloskar Motor Ltd. and Honda Siel Cars India Ltd. Nissan Motor India Ltd. now arrives,

bringing aggressive designs for low-cost, small and electric cars.


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Maruti Suzukis market lead can be credited to its research and development base in India,providing the capability and understanding to build cars and make design alterations with a

short lead time in order to suit Indian preferences.

But the Auto Expo already is revealing thechallenges the auto maker is facing from its rivals.

Among them is General Motors India Pvt. Ltd.,which recently joined forces with the Reva ElectricCar Co. in Bangalore to develop low-cost electricvehicles for India and some export markets.

GM India also is working on low-emissions,alternative-fueled vehicles, powered by liquefied

petroleum gas and compressed natural gas, as wellas researching biofuels.

The auto maker produces seven cars under the

Chevrolet brand in India at two factories and is

planning a $500,000 expansion that includes a carplant and engine and transmission facility.

Parent General Motors Co. says it expects to sell100,000 vehicles in India this year. The auto makersold 60,845 cars and light trucks in the country inthe first 11 months of 2009, according to Wards data.

Stepping up its presence in India is Volkswagen AG, which recently took a 19.9% stake inSuzuki Motor Corp. and is looking to India for future small cars. The German brandreportedly is aiming at a 10% share of the Indian market.

VW has an added advantage of 10 years of Indian experience through its Skoda Auto IndiaLtd. subsidiary. Further, Indias luxury-car market is small in size but large in profit margin,giving VW an inside track with its Audi marque and fellowshipwith Porsche luxury cars.

GM Indias sporty Chevy Beat minicar one

of many new small cars unveiled at Auto

Expo.

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Plus, German car makers all have small common-rail, direct-injection diesel engines to offer, whereas Japanese car companies

in India are dependent on Fiat Automobiles SpAs small multi-jetdiesels.

All this has Maruti Suzuki worried. We are aware that India now

isnt in a situation where we can be the sole winner, companyspokesman Hideki Taguchi is quoted as saying. Even R.C.Bhargava, Maruti Suzuki chairman, concedes: It is going to be atough battle.

Maruti Suzuki currently offers seven small-car models with 30variants that it believes provide buyers ample choice. The automaker has said it is aiming to sell 1 million vehicles by theconclusion of the fiscal year ending March 31.

But these soon will be challenged by the VW Polo, upcoming Ford Figo, Toyota Etios

unveiled at the Expo and Honda Motor Co. Ltd.s unnamed new global compact car to be

introduced in India. Honda also recently began selling its compact Jazz (Fit) hatchback inIndia.

Fiat India already has three small cars here. And GM India will be bringing a compact carfrom its new joint venture with Shanghai Automotive Industry Corp.

The booming small-car segment also includes offerings from powerhouse Hyundai MotorIndia Ltd. and Tata Motors Ltd. Interestingly, the car that started the rush to low-costsubcompacts among global auto makers, the Tata Nano, has yet to make its impact felt in theIndian market.

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