Strong demand growing due to lifting incomes. turning in-between category. and a immature population is likely to impel India among the world’s top five auto-producers by 2015 Growth in export demand is besides set to speed up.
Tata Nano and the approaching Pixel have opened up the potentially big extremist low cost auto section Invention is likely to escalate among engine engineering and alternate fuels.
Advantage India
Rising investings
Policy support
India has important cost advantages ; car houses save 10-25 per cent on operations in India compared to Europe and Latin America A big pool of skilled work force and a turning engineering base will bring on greater investings.
The authorities aims to develop India as a planetary fabrication every bit good as R & A ; D hub There has been a broad array of policy support in the signifier of sops. revenue enhancements and FDI encouragement.
FY10
Market size: USD57. 7 billion
Notes: R & A ; D – Research and development. FDI – Foreign direct investing ; FY – Indian fiscal twelvemonth ( April – March ) ; FY16E – estimated figure for fiscal twelvemonth 2016 ; estimations are from the government’s Automotive Mission Plan ( 2006 – 2016 ) ADVANTAGE INDIA.
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3.
Automotives
AUGUST
2012
Contentss
? Advantage India ? Market overview and tendencies ? Growth drivers ? Success narratives: Maruti. Tata Motors ? Opportunities ? Useful information
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4
Automotives
AUGUST
2012
Development of the Indian automotives sector
20. 4 million units ( 2012 ) 11 million units ( 2007 ) 2008 onwards 0. 6 million units ( 1992 ) 1983 – 1992 0. 4 million units ( 1982 ) Before 1982 • Closed market • Merely 5 participants • Joint venture ( JV ) Indian authorities and Suzuki to organize Maruti Udyog ; started production in 1983 • Component makers besides entered via JV path • Buyer’s market 1993 -2007 • Sector de-licensed in 1993 • Major original equipment makers ( OEMs ) started assembly in India • Imports allowed from April 2001 • Introduction of value added revenue enhancement in 2005 • More than 35 participants in the market • Removal of most import controls • Indian companies deriving planetary individuality
• Long waiting periods and out-of-date theoretical accounts
• Seller’s market
Beginning: Tata Motors. Society of Indian Automobile
Manufacturers ( SIAM ) . Aranca Research. Notes: JV – Joint Venture MARKET OVERVIEW AND TRENDS
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5
Automotives
AUGUST
2012
The automotives market is split into four sections
Cars
Two-wheelers
Passenger vehicles
Commercial vehicles
Three-wheelers
Mopeds
Passenger autos
Light commercial vehicles
Passenger bearers
Water scooters
Utility vehicles
Motorcycles
Multi-purpose vehicles
Medium and heavy commercial vehicles
Goods bearers
Electric twowheelers
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Market OVERVIEW AND TRENDS
6
Automotives
AUGUST
2012
Grosss have been turning at a strong gait
>
Gross turnover of car makers in India expanded at a CAGR of 17. 7per cent over FY07-1 1 Excluding three Wheelers. autos account for the largest portion of grosss ( 66. 2 per centum in 2010 ) Revenue trends over the past few old ages in USD million
70. 0 60. 0 50. 0 40. 0 30. 5 30. 0 20. 0 10. 0 0. 0 FY07 FY08 FY09 FY10 FY11 66. 2 % 36. 6 33. 3 21. 5 % Trucks Cars 58. 6 CAGR: 17. 7 % 43. 3
>
Market* break-up by grosss ( 2010 )
12. 3 %
Two Sir mortimer wheelers
Beginning: SIAM. Datamonitor. Aranca Research
Note: *does non include three Wheelers
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Market OVERVIEW AND TRENDS
7
Automotives
AUGUST
2012
Sector’s turning strength evident from rise in entire production figures Entire production of cars in India ( million units )
16. 0
>
>
12. 0 7. 6 8 8. 4 10. 0 8. 0 6. 0 1. 3 0. 4 0. 4 1. 2 0. 4 0. 4 1. 6 0. 6 0. 5 1. 3 0. 5 0. 6 1. 8 2. 4 4. 0 6. 5 8. 5
Notes: CAGR – Compound one-year growing rate
10. 5
Passenger vehicles was the fastest turning section during that period with a CAGR of 14. 5 per cent
14. 0
13. 4
0. 8 0. 8
3. 0
2. 0
0. 0
FY05
FY06
FY07
FY08
FY09
0. 4 0. 5
FY10
0. 6 0. 6
FY11
FY12
Passenger Vehicle Three Sir mortimer wheelers
Commercial Vehicle Two Sir mortimer wheelers
Beginning: SIAM. Aranca Research
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Market OVERVIEW AND TRENDS
0. 8 0. 8
3. 1
15. 5
Cars production increased at a CAGR of 13. 2 per cent over FY05-12
18. 0
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Automotives
AUGUST
2012
Market break-up by production volume
>
Two Wheelers dominate production volumes ; in FY12. the section accounted for more than three quarters of entire automotives production in the state
Market portion by volume ( FY12 )
>
In fact. India is the world’s 2nd largest two Wheeler manufacturer ; the state is besides the 4th largest commercial vehicle manufacturer
4 % 4 % 16 % Two Wheelers Passenger Vehicle Commercial Vehicle Three Wheelers 76 %
Beginning: SIAM. Aranca Research
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Market OVERVIEW AND TRENDS
9
Automotives
AUGUST
2012
Market break-up of single sections by production volumes … ( 1/2 )
Shares in production of rider vehicles ( FY11 )
Shares in production of commercial vehicles ( FY11 )
11. 5 %
Passenger autos
8. 1 % 36. 0 % MCV & A ; HCV Passenger Carriers MCV & A ; HCV Goods Carriers LCV Passenger Carriers 49. 7 % 6. 1 % LCV Goods Carriers
Utility vehicles/multipurpose vehicles 88. 5 %
Beginning: SIAM. Aranca Research Notes: LCV – Light commercial vehicle ; MCV – Medium commercial vehicle ; HCV – Heavy commercial vehicle
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Market OVERVIEW AND TRENDS
10
Automotives
AUGUST
2012
Market break-up of single sections by production volumes … ( 2/2 )
Shares in production of three Wheelers ( FY12 )
Shares in production of two Wheelers ( FY12 )
15. 8 % Goods bearers
15. 6 %
5. 3 % Mopeds
Motorcycles Passenger bearers Scooters 84. 2 % 79. 1 %
Beginning: SIAM. Aranca Research
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Market OVERVIEW AND TRENDS
11
Automotives
AUGUST
2012
Exports have besides grown strongly … ( 1/2 )
>
Cars export volumes increased at a CAGR of 22. 4 per cent over FY05–FY12 Over this period. the fastest growing was in the two Wheeler section ( 25. 8 per cent ) followed by three Wheelers ( 21. 9 per cent )
Exports of cars from India ( million units )
2 1. 8 1. 6 1. 4 1. 2 1 0. 8 0. 6 0. 4 0. 2 0 2 0. 5 0. 6 0. 8 1 0. 5 1. 1 0. 5 1. 5 0. 4 0. 5 0. 3 0. 2 0. 03 0. 1
>
0. 2 0. 04 0. 1
0. 2 0. 05 0. 1
0. 2 0. 06 0. 1
0. 04 0. 2
0. 04 0. 2
0. 08 0. 3
FY05
FY06
FY07
FY08
FY09
FY10
FY11
FY12
Passenger Vehicle
Commercial Vehicle
Three Sir mortimer wheelers
Two Sir mortimer wheelers
Beginning: SIAM. Aranca Research
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Market OVERVIEW AND TRENDS
0. 1
0. 4
12
Automotives
AUGUST
2012
Exports have besides grown strongly … ( 2/2 )
>
Two Wheelers accounted for the largest portion in exports ( by volume ) at 67 per cent in FY12 Passenger vehicles account for a ample 18 per cent of overall exports
Exports portions by volume ( FY12 )
>
18 % Passenger Vehicle 3 % 12 % 67 % Commercial Vehicle Three Wheelers Two Sir mortimer wheelers
Beginning: SIAM. Aranca Research
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Market OVERVIEW AND TRENDS
13
Automotives
AUGUST
2012
Presence of a clear leader in each section of the market
>
The automotives industry is concentrated with market leaders in each section commanding a portion of over 40 per cent
Market Leader Passenger Vehicles MCVs & A ; HCVs LCVs Three Wheelers 45 % 16 %
Others
15 % 7 %
63 %
23 %
7 %
59 %
30 %
4 %
4 %
41 %
40 %
10 %
Motorcycles
Water scooters
59 %
24 %
7 %
6 %
51 %
21 %
14 %
Beginning: SIAM. Aranca Research
Notes: Data is for FY10
10 %
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Market OVERVIEW AND TRENDS
14
Automotives
AUGUST
2012
Noteworthy tendencies in the Indian automotives sector
• Large figure of merchandises available to consumers across assorted sections ; this
New merchandise launches
has gathered gait with the entry of a figure of foreign participants • Reduced overall merchandise lifecycle have forced participants to use speedy merchandise
launches
Bettering productdevelopment capablenesss
• Increasing R & A ; D investings from both the authorities and the private sector • Private sector invention has been a cardinal determiner of growing in the sector ;
two good illustrations are Tata Nano and Tata Pixel – while the former has been a success in India. the latter is intended for foreign markets
• In FY11. the CNG market was worth more than USD330 million and CNG autos
Alternate fuels
and taxis are expected to register a CAGR of 28 per cent over FY11-FY14 • The CNG distribution web in India is expected to increase to 250 metropoliss by
2018 from 30 metropoliss in 2009
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Market OVERVIEW AND TRENDS
15
Automotives
AUGUST
2012
Contentss
? Advantage India ? Market overview and tendencies
? Growth drivers
? Success narratives: Maruti. Tata Motors ? Opportunities
? Useful information
For updated information. delight visit World Wide Web. ibef. org
16
Automotives
AUGUST
2012
Sector has been profiting from strong demand and merchandise invention
Turning demand Turning demand
Policy support Strong authorities support
Increasing investings
Rising incomes. immature population
Inviting Greater handiness of recognition and funding options
Goal of set uping India as an automanufacturing hub
R & A ; D focal point ; GOI has set up engineering modernization fund Large domestic market Policy sops. FDI encouragement
Resulting in
Rising investings from domestic and foreign participants Greater invention in merchandises ; market cleavage
Strong growing in exports as good
Strong projected demand doing returns attractive
Notes: GOI – Government of India ;
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GROWTH DRIVERS
17
Automotives
AUGUST
2012
Rising incomes and a turning in-between category driving domestic demand growing Rising incomes ; turning in-between category
•
Changing income kineticss of India’s population
70 million families Aspirants: one-year income INR90. 000200. 000 Seekers: one-year income INR200. 000500. 000 Strivers: one-year income INR500. 0001. 000. 000 Globals: one-year income & gt ; INR1. 000. 000
Personal ( nominal ) disposable income is expected to lift yearly at 8. 5 per cent over FY11-15 Rising in-between category – size of the in-between category expected to touch 550 million by 2025 from 50 million in 2010 Favorable demographics – a immature population is besides driving up the demand for autos Demand for commercial vehicles have got a encouragement due to development of roadways and greater market entree
60
50 40 30 20 10 0 2005 Slaves 2010 Seekers 2015 Deprived
Deprived one-year income
