PRESENTATION ON AUTOMOBILE INDUSTRY

INTRODUCTION TO AUTOMOBILE SECTOR

It begins as early as 1769. The automobile sector is one of the key segments of the economy having extensive forward and backward linkages with other key segments of the economy. It contributes about 4 per cent in India's Gross Domestic Product(GDP) and 5 per cent in India's industrial production. Indian Automobile sales growth rate would be 9.5 % by 2010.

FACTS
9th largest automobile industry . 2nd largest two-wheeler market, 4th largest in Heavy Trucks. 2nd largest tractor manufacturer. 11th largest passenger car market and expected to become 7th largest by 2016. Sale of passenger cars in India is likely to grow at an average of 14.9% each year to touch 2.1 million mark by 2010.

KEY PLAYERS
Maruti Hyundai Ford Sonalika International Force M&M Skoda Mercedes Benz Volkswagon TATA Honda GM HM Toyota Kirloskar Fiat Audi BMW Mitshubishi

AUTOMOBILE

2 WHEELLER

3 WHEELLER

PASSENGER VEHICLE

COMMERCIAL VEHICLE

2 WHEELER

Market leader Hero Honda with market share 50%

3 WHEELER

Market leader Mahindra & Mahindra with market share 42%

PASSENGER VEHICLE

Market leader Maruti with market share 52%

COMMERCIAL VEHICLE

Market leader Tata Motor with market share 61%

Indian auto market growth rate

The automobile industry crossed a landmark with total vehicle production of 10 million units. Car sales was 8,82,094 units against 8,20,179 units in 2009-2010 The two-wheeler market grew by 13.6 % with 70,56,317 units against 62,09,765 units in 2009-10 Commercial vehicles segment grew at 10.1 % with 3,50,683 units against 3,18,430 units in 2009-10 The domestic automobile industry sales grew 12.8% at 89,10,224 units as against 78,97,629 units in 2009-10.

SEGMENTATION OF AUTOMOBILE INDUSTRY

Following is the segmentation that how much each sector comprises of whole Indian Automobile Industry.

RISK 2006-2007
3.5 3

2.5

YEAR 06-07 NIFTY

YEAR 06-07 AUTO 1.5

0.5

0 apr may jun jul aug sep oct nov dec jan feb mar

RISK 2007-2008
3.5 3

2.5

2 YEAR 07-08 NIFFTY YEAR 07-08 AUTO 1.5

0.5

0 apr may jun jul aug sep oct nov dec jan feb mar

RISK 2008-2009
6 5

YEAR08-09 NIFFTY YEAR08-09 AUTO

0 apr may jun jul aug sep oct nov dec jan feb mar

RETURN
0.6
0.4

0.2

0
apr -0.2 may jun jul aug sep oct nov dec jan feb mar

YEAR 06-07 NIFTY YEAR 06-07 AUTO

-0.4

-0.6

-0.8

GDP
Directly and indirectly it employs more than 10 million people.

The market value of Automobile Industry is more than US$8 billion. and Contribution in Indian GDP is near about 4% and will be double by 2016. The automobile industry in India grew at rate of 11.5 % over the past five years, but growth rate in last year2009-10was only 0.7%. FDI inflows in Automobile Industry 2009-10 was Rs.5,212 Cr an increase of 47.25% compare to 2009-10. In 2009, India emerged as Asia's fourth largest exporter of automobiles, behind Japan, South Korea and Thailand.

SWOT OF AUTOMOBILE INDUSTRY

STRENGTHS Large domestic market Sustainable labor cost advantage Government incentives for manufacturing plants Strong engineering skills in design Able to achieve significant gains in productivity WEAKNESSES Low labor productivity High interest costs and high overheads Rising cost of production Low investment in Research and Development

OPPORTUNITIES Commercial vehicles Heavy thrust on mining and construction activity Increase in the income level Cut in excise duties Rising rural demand

THREATS
Rising interest rates Cut throat competition Lack of technology for Indian Companies

FUTURE PROSPECT OF INDIAN AUTOMOBILE SECTOR

Automobile industry expert predicts that by 2050 every sixth car in the world will be for Indians. By 2010 India will take over Germany in sales volumes and Japan by 2012 The Indian automobile component industry is estimated to triple from USD 63 billion to USD 190 billion within a span of six years by 2012. Industry analysts predict this industry to touch USD 13000 million mark by 2010, a cumulative growth of 9.5% annually. It is said that for every Re 1 spent, the auto sector returns Rs. 2.24 to the Indian economy.

CONCLUSION
Industry across countries will have to meet challenges of newer technologies, alternative fuels and affordability of automobiles by people at large through constructive cooperation. The earlier we are able to achieve this the better it would be for the world performance.