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Automotive Industry

On Fast Track

Indian Automotive Industry

India - An Overview
Market and Growth Potential
Players
Opportunities
Why India?
Contact in India

India - An Introduction
Population

Over 1 bn

States/UTs

35

Geographical Area

3.3 mn sq kms

Languages recognised

22

Business language

English

Per Capita Income**

US$ 534

GDP**

US$ 650 bn

**(at factor cost & at current prices)


1USD=43.54 INR (as on July 4, 2005)

Source:CSO Statistics

India - Fast pace Growth


Largest democracy
4th largest economy by PPP index
6th largest energy consumer
ForEx reserves skyrocket from USD 42 bn (2001) to
US$ 133 bn ((February, 2005)
GDP growth to continue between 6-8%
3rd largest economy by 2050: Goldman Sachs
Leading in IT & BPO
Oil & Gas and Biotechnology sunrise industries

India - Leading the world


Hero Honda - largest manufacturer of motorcycles
Moser Baer - among the top three media manufacturers
in the world
Pharmaceutical Industry - 4th largest in the world
Walmart, GAP, Hilfiger sources more than
USD 1bn worth apparel from India
100 Fortune 500 have set R&D facilities in India
including GE, Delphi, Eli Lilly, HP, Heinz and Daimler
Chrysler

Indian Automotive Industry

India - An Overview
Market and Growth Potential
Players
Opportunities
Why India?
Contact in India

Passenger Car Market


2002-03 (A)
Total Units - 547,083
Premium &
Executive Luxury
Mid-size
2%
0%
17%

Mini
26%

2007-08 (P)
Total Units - 975,703

Mid-size
20%

Executive
2%

Premium &
Luxury
3%

Compact
56%

Compact
55%

Projected CAGR

12.3%

Mini
19%

Two Wheeler Market

Present estimated size


CAGR (last 5 years)

5.4 mn units per year


10%

Average two-wheelers per 1000 people


India
China

27
08

Auto Component Market

Estimated market size

US$ 6.7 bn

Estimated market size (2012) US$ 17 bn

Projected CAGR

15%

Auto Component Industry Structure

50 ~ 500
Mill US
$

5 ~ 50 Mill US $

1 ~ 5 Mill US $

16 Cos

149 Cos

237 Cos

Indian Automotive Industry

India - An Overview
Market and Growth Potential
Players
Opportunities
Why India?
Contact in India

Home to global players


Product
Cars/SUVs

Players
Suzuki, Honda, Toyota,
Mitsubishi, GM, Ford, DaimlerChrysler, Skoda, Fiat, Hyundai,
Tata, M&M
Two-wheelers TVS, Hero Honda, Bajaj, Yamaha,
Kinetic, LML
CVs
Tata, Ashok Leyland, Tatra, EicherMitsubishi, Swaraj-Mazda, M&M,
Volvo
Tractors
Escorts, M&M, L&T, Punjab
Tractors, New Holland, ITLRenault, John-Deere, Steyr

Manufacturing Hub for Vehicles


Hyundai - Export Base for Small Cars
Skoda - Hub for exports of Cars to neighbouring
countries
Ford exporting CKDs of Ikon to South Africa &
other countries
Mitsubishi & Yamaha - Hub for 125 cc Motorcycles
Maruti Suzuki- Exports cars to EU
HMSI - Hub for Two Wheelers Exports

Hyundai Motors India


Made India its global sourcing base for small cars

Second largest player in passenger car market


Market Share

20%

Turnover (approx.)

US$ 1 billion

Santro & Accent - Run away success stories

Indian Automotive Industry

India - An Overview
Market and Growth Potential
Players
Opportunities
Why India?
Contact in India

Invest in India
Twin Indian
Advantages
Scaling Costs
Optimising Resources

Excellent Source for IT based


Engineering Solutions - for Product &
Process Integration

India - Manufacturing Hub for Components

Toyota Motors Global Hub for Transmissions

Daimler Chrysler sourcing > 70 million Euro

Ford full fledged component sourcing team

Fiat sourcing components

Export from India


Passenger Cars

No. of Units

40000
35000
30000
25000
20000
15000

FY 2003
FY 2004

10000
5000
0
Hyundai
Santro

Ford
Ikon

Tata
Indica

Hyndai
Accent

Maruti
800
(Suzuki)

Export from India


Auto Components expand markets abroad

Australia
2%

Africa
11%

Others
4%

America
28%

Asia
27%
Europe
28%

Buy from India


Major OEMs/ Tier 1 suppliers buying
auto-components from India for their global requirements

General Motors, USA - Global Purchasing Team (Halol)

Volvo, Sweden - Global Buying Team (Bangalore )

International Truck & Engine Co - Global Purchasing

Cummins, USA - Global Purchase Team (Pune)

Caterpillar, USA - Global purchase staff (Delhi)

Delphi, USA - International Purchase Office

Motorola Automotive Electronics Division, USA

Visteon exporting India-made components worldwide

Sell to India
Large latent demand as

Low car penetration ratio


5 per thousand persons
This ratio projected to
double by 2007-08

Partner with India

OEMs leverage local manufacturers for


Contract Manufacturing

Mitsubishi and Ford tie-up with


Hindustan Motors
Kawasaki ties-up with Bajaj

Indian Automotive Industry

India - An Overview
Market and Growth Potential
Players
Opportunities
Why India?
Contact in India

Advantage India
Largest Two-Wheeler Manufacturer in the World
2nd Largest Tractor Manufacturer in the World
5th Largest Commercial Vehicle Manufacturer in the
World

# 1 Global Motorcycle Manufacturer is in India

4th Largest Car Market in Asia - crossed the 1 million


mark

Industry Milestones 2003-04

Car production crosses 1 million mark

Car exports cross US$ 1 million mark

Auto component exports cross US$ 1 bn mark

The Cost & Skills Advantage

India

China

Indias
Advantage
(%Difference)

1400

2500

-44%

300

800

-63%

Skilled Worker (1 yr)

61

125

-51%

Skilled Worker

42

65

-35%

USD per Month


Middle Management (> 5yrs)
Supervisor (5 yrs)

42

The Market Advantage


Fast paced urbanisation
to rise from 28% to 40% by 2020
Upward migration of
household income levels
Middle class expanding by
30 - 40 million every year

Growing working population

The Quality & Productivity Advantage


Auto Companies achieving high
productivity through best practices:
TQM
TPM
Six Sigma
Toyota Production Systems / Lean
Companies growing in ranks can offer
PPM levels of quality

The Policy Advantage


Auto Policy 2002 promotes an
integrated automotive sector
2001- Quantitative Restrictions were
removed
Incentives for R & D
Stringent environmental controls

Emission Compliance
Emission Standards Status
Cars

Two Wheelers

Already
introduced in
Metros:MiniMetros, from
Sept, 2003

From April 1,
2005

Bharat Stage III From April 1,

From April 1,
2008

Bharat Stage II

2005

Bharat Stage IV From April 1,


2010

Bharat Stage II, III, IV (Euro II, III and IV equivalent)

C Vs
Already
introduced in
Metros: MiniMetros from
Sept, 2003
From April 1,
2005
From April 1,
2010

Indian Automotive Industry

India - An Overview
Market and Growth Potential
Players
Opportunities
Why India?
Contact in India

Contact in India

Society of Indian Automobile Manufacturers


(SIAM)
Core 4B, 5th Floor, India Habitat Centre
Lodi Road
New Delhi - 110 003.India
Tel: 0091 11 24647810- 12, 24648555
Fax: 0091 11 24648222

Contact in India

Automotive Component Manufacturers Association of


India (ACMA)
6th Floor
The Capital Court,
Olof Palme Marg, Munirka,
New Delhi - 110 067
Tel.: 0091 11 2616 0315, 2617 5873, 2618 4479
Fax: 0091 11 2616 0317
E-mail: acma@vsnl.com
Website: www.acmainfo.com