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August 2011
Executive Summary
Market
Since China joined the Organization 1, x years ago, its automotive industry has accomplished its most outstanding and fastest development in its history
Annual double digit percentage sales growth, nearly y%, has been achieved in the automobile sector from 20-- to 20--
China is the largest automaker in the world Drivers: Huge population and low penetration Rising urban middle class population Growing luxury car market Auto dealers to open more outlets Improved public transport infrastructure Availability of low-cost skilled labour
China promotes alternative energy vehicles Increasing market share of the domestic OEMs OEMs are expanding through mergers and acquisitions Support Programs of the Government 20-- - 20-zth Five-Year Plan for the Automotive Industry Government initiatives for EVs Market comprises of a large number of domestic players as well as foreign players mainly through JVs with their domestic partners Some of the major players in the market company 1, company 2, company 3, company 4, company 5, company 6, company 7, company 8, company 9, company 10, company 11 etc.
AUTOMOTIVE MARKET IN CHINA 2011.PPT
LE P M A S
Challenges: Unstable market position of each manufacturer Overcapacity Restrictions imposed on car ownership Reduced prices led by intensified competition High dependency on depleting oil reserves
Market Overview Export-Import Drivers & Challenges Trends Government Initiatives Competition Key Takeaways
a6 p% a4 a3 a1 a2 a5
LE P M A S
Automotive Segment 2 Sub-segment 2
20--
20--
20--
20--
20--e
20--e
Sub-segment 1 Sub-segment 2 b5 b7
Segment 1
b1
5
b3 b2 b4 b6 b8
Sub-segment 1
20--
20--
20--
Automobile manufacturers earn revenues by exporting their products to various countries around the world
Growth in Total Imports
USD mn
40,000 30,000 20,000 10,000 0
q% c3 c1 c2
20--
20--
20--
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c4 20-20-d5 d4 20-20--
c5
r% d3 d2 d1
20--
20--
20--
g2%
f1% f2% f4% f3% f5% f6% f7% f9% f8% f10%
Challenges Drivers
Huge Population and Low Penetration Rising Urban Middle Class Population Growing Luxury Car Market Auto Dealers to Open More Outlets Improved Public Transport Infrastructure Availability of Low-cost Skilled Labour Unstable Market Position of Manufacturers Overcapacity Restrictions Imposed on Car Ownership Reduced Prices Led by Intensified Competition High Dependency on Depleting Oil Reserves
Summary Trends
China promotes alternative energy vehicles
Trends
OEMs are expanding through mergers and acquisitions
Financial Performance
Revenue USD mn
5,000 4,000 3,000 2,000 1,000 0
Profit USD mn
800 600 400 200 0
20--
20--
20--
20--
Business Highlights
Company offers type 1 vehicles, type 2 vehicles,type3, type 4, type 5, type 6,type 7, type 8, and other components, as well as light, medium, and heavy-duty type 9 and it also provides special vehicles, including type 10, such as type11, type 12, and type 13; and type 14, which include type 15, type 16, type 17, type 18, type 19, type 20, type 21, and type 23 vehicle In Jul 20--, it is reported that the company is planning USD x mn investment together with subsidiary company 2
Company 2 will spend USD y mn on a R&D capability upgrading program on DCT automatic transmissions and company 1 will spend USD z mn on auto body mold fixtures of type 24 and USD w mn on auto body mold fixtures of type 25
In Dec 20--, company announced that it plans to set up type 26 Car Branch
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Business Highlights
It manufactures type 8 and type 9, including light type 10 and type 11, type 13 and type 14 vehicles It started construction of a new manufacturing base in Zengcheng
Company expects to finish the first phase of the manufacturing base, which has an investment of up to USD x mn, by the end of 20- New plant will mainly produce its own-brand vehicles, including type 15, type 16 and other type 17, and will eventually have an annual production capacity of y vehicles
Planning to buy a type 7 plant with its joint venture partner, the motorcycle maker company 3
In 20--, BAIC inaugurated a new plant in Zhuzhou, Hunan province and rolled out its first own-brand automobile, the brand 1
E L P M A S
Gagan Uppal
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