Globalization of Indian

Automobile Industry

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 Introduction

 3 e Indian automobile industry presents a

galaxy of varieties and model
model.. Some of t e
leading names in t e Indian automobile industry
include Maruti Suzuki, 3ata Motors, Ma indra
and Ma indra, Hyundai Motors, Hero Honda and
Hindustan Motors in addition to a number of
ot ers.
ers.
 During t e early stages of its development,
Indian automobile industry eavily depended on
foreign tec nologies but now time as been
c anged
anged..

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 3 e à
  
 
  is
t e sevent largest in t e world. world.
ve icles and exports of about 1.5
million.. In 2010
million 2010,, India emerged as
Asia's
Asia 's fourt largest exporter of
automobiles, be ind JapanJapan,, Sout

orea and 3 ailand.
ailand.

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 Classification of Automobile
Industry
1. 3wo w eelers
2. 3 ree W eelers
3. Passenger Ve icles
4. Commercial Ve icles

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 Growt of Automobile Industry
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3 is was t e pre-
pre-1980 era w ere t e manufacturing of
automobiles was subject to strict licensing, restrictive
tariff structure.
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In t e early 1990s, wit liberalization, some more
Japanese manufacturers entered t e Indian market.
Automobile Industry was delicensed in July 1991.
 
 
   
‰arly 2000 owever saw globalization of Indian auto
industry. Several policy c anges were introduced wit
focus on boosting t e auto exports. Foreign
manufactures started looking at India for sourcing auto
components.
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 à
 
 Mise in Per Capita Income
 Growt in Moad Infrastructure
 Hig GDP-
GDP-Hig er GDP means more
purc asing power
 Urbanization
 Finance Sc emes

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ey Players

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Growt C art of Indian Industry

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 3wo W eelers
 Motorcycles segment dominates wit an
80%
80 % market s are. are. Apart from t e
motorcycles t at are traditionally used by
men, t e Scooters (60cc 60cc upwards) ave
also contributed towards a spurt in two
two--
w eeler sales..
sales.. 3 en t ere are mopeds
t at are not ing but a sop isticated
motorized cycle.
cycle. And now a days scooties
for girls are t ere .
 
3 ree w eelers

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 Four W eelers
 3 e four w eeler segment comprises of
t e passenger ve icles and utility
ve icles.3 e passenger cars segment as
t e largest s are of 78%. Main key
players in t e market are Maruti Udyog
Ltd. 3ata Motors Ltd., Hyundai, 3oyota,
Honda, Ford and GM.
        


 



 
 


 
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 Competition from new companies

 dow Indian companies are getting

competition from Mercedes-
Mercedes-Benz, BMW
and Volkswagen. Its also affecting t e
Indian industry

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 Commercial Ve icles
 3 ere are about nine manufacturers of
commercial ve icles in India. ‰ic er Motors Ltd
Ltd,,
3ata Motors Limited,
Limited, As ok Leyland
Leyland,, Ma indra
and Ma indra Limited and Volvo Motors.
Motors.
 3ata Motors as s are of 62%, As ok Leyland
Ltd. wit a total market s are of 15%, M & M
Ltd. wit a total market s are of 11%, ‰ic er
Motors Ltd. wit a total s are of 6%, and
ot ers.

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 FDI in Automobile Sector

 3 e Indian automobile success story as

paved t e way for foreign investments,
making India an attractive destination for
global players like Japanese,
orean,
‰uropean, and American O‰Ms.
International carmakers are now s ifting
focus to India, from C ina, to establis
t eir manufacturing plants and units:

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 Merger & Acquisitions

 3ata Motors as boug t Jaguar and Land Mover

from US based Ford Motors.
 Ma indra & Ma indra Ltd and private equity firm
ICICI Venture Funds as signed an agreement
to buy Italian gear manufacturer Metalcastello.
 Daimler C rysler AG of Germany as taken a call
option to buy 26 per cent in Jaland ar-
ar-based
bus body builder Sutlej Motors.

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 India stands among t e Global
industry
 Indiaƞs dano (t e worldƞs c eapest car) and
ot er small cars are forcing t e world to go back
to t eir drawing boards
boards.. Indiaƞs Meva (electric
car) is very popular abroad as its environment
friendly.. Spark, t e compact car from General
friendly
Motors, will now come in an electric version,
t anks to a tie-
tie-up wit Bangaloreƞs Meva ‰lectric
Car Co.
Co. Indian auto industry is all set to grow
strong and become a visible and stronger power
in t e Global auto industry.
industry.

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 Future Prospective of Indian
Automobile sector

 By 2012 India is expected to witness over Ms

30,000 crore of
investment.
 Hyundai will bring in more t an Ms 3,800 crore
to India.
 3ata Motors will be investing Ms 2,000 crore in
its
small car project.
 General Motors will be investing Ms 100 crore
and Ford about Ms 350 crore.
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 Impact of Global Mecession on
Indian Car Industry
 India is one of t e few countries w ere
car sales ave been increasing in t e
course of t e worldwide economic
downturn.
 Mesearc and observations ave led to t e
conclusion t at in t e year 2008, t e car
market and t e car industry is expected to
witness 8-
8-9% fall
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 Problems of Automobile Sector
 ‰ffect of Mising Fuel Prices on Car
Sales
 3 e ike in petrol went
by 5% w ereas t e price of diesel
went up by 3%. 3 e rise in t e
price of t e fuel as depreciated
t e sales of cars by 8%.

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 Steps taken by Government to
overcome Mecession
 Ve icle makers cut prices following a
government reduction in value-
value-added tax
last December.
 A uge package of funds to elp t e
sector, and t e central bank as made a
series of rate cuts to spur t e
economy.

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 SWO3 AdALYSIS
   ` 1.Automobile industry is an
establis ed and an evergreen industry.
2. India is t e strongest player in t e small
car segment of t e global

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` 1.Companies are not
improving after sale services.
2. Lack of Proper Infrastructure. 3 is is
slowing t e pace of growt of auto
industry
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 --
 àà-
àà- 3 e automotive
ecosystem is in t e midst of
significant c ange, wit increasing
c allenges in Consumer demands,
tec nology dev., and globalization.

 
`

` Hig Competition, Lack
of 3ec nology and Global crisis a.nd
companies not focusing on M & D
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 3 e Future

 It is expected to grow to US $40 Billions

by 2015 and its expected to contribute
10% in GDP.
 Low cost of manufacturing s ould place
India in good Global position.
 It is expected to be t e largest automobile
industry in production by 2030.

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 Conclusion
 Indian Industry is in a good developed position
just because of Globalisation. Indian companies
adopt foreign tec nologies and made t eir own
tec nologies also and elp Indian Industry to
grow superbly.3 e industry expects t e growt
in t e automotive sector to continue. It is also
believed t at global automakers will continue to
allocate a rising proportion of t eir foreign direct
investment into India. If all going well t en
Indian Industry will be at top in future.

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