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Section D Group 10:

Ashish Gautam - 2013PGP078

Jophin George - 2013PGP170

Mukul Kumar Singh - 2013PGP229

Rahul Chohan - 2013PGP301

Shantanu Pramod Awandhe - 2013PGP367

Sunit Nanda - 2013PGP412

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Automobile Sector

Contributes about 4% in Indias GDP

5% in Indias industrial production Generated about 4.5 lakh of direct employment

About 1 crore of indirect employment

India is the 7thlargest Passenger Cars Producers

Growth over last 20 years:

1. ProtectionI Phase till mid80s

2. LiberalizationII Phase post 19903. GlobalizationIII Phaseearly 2000

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Industry Overview

The passenger cars segment

78% of domestic four wheelers sales during FY2009-13

Growth rate 2.2 % during FY2013

Domestic passenger vehicle sales are expected to increase 3-5%

during FY2014

Indias passenger vehicle exports increased at 9.0% (YoY)

aggregating to 0.5 million units during FY2013

Expected to grow by 10-12 per cent in 2013-14 Total passenger vehicle sales volume showed reduced growth of

-6.7% during FY2013

Passenger vehicle penetration levels are low at around 4.7%

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Major Automobile Players in IndiaTata Motors Market share of 11.7%

The company offers products in the compact, midsize, andutility vehicle categories

The company has entered into joint ventures with a number offoreign car manufacturers such as Fiat and Daewoo

Since 1954, the company has manufactured and sold more than4 million cars in India

Some of the well-known cars manufactured by Tata Motors are:Tata Indica, Tata Indigo, Tata Indigo Marina, Tata Sumo and

Tata safari.Management Senior Vice President: Ankush Arora

CFO & President: C Ramakrishnan

Chairman & Non-Executive Director: Cyrus P Mistry

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Maruti Suzuki

Market share of 39.12% Biggest passenger vehicle company in India

Holds more than 45% of the market share of the domestic

vehicle market in India

Maruti is headquartered in New Delhi Some of Maruti's most popular cars are: Maruti 800, Alto,

Omni, Gypsy, Zen, Wagon R, Versa, Esteem, Baleno and Swift

Management Chairman: R C Bhargava

Managing Director & CEO: Kenichi Ayukawa

Managing Director: Toshiaki Hasuike

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Mahindra and Mahindra Market share of 11.56%

Presence all over the world majorly in China, UK and U.S.A

Mahindra and Mahindra is partners with two of the international

companies: Renault SA of France and International Truck and Engine

Corporation of U.S.A

The company entered the passenger car market quite later with

Logan in April 2007

The company has also entered into a joint venture with Ford named

Ford India Private Limited on built passenger cars

Mahindra and Mahindra also have a controlling stake in Mahindra

Reva an electric car

Management Chairman & Managing Director: Anand G Mahindra

Executive Director: Bharat Doshi

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Industry scenario in India

High inflation and slowing economy

Decrease in disposable income

Petrol prices increased substantially

Deferment of purchases and shift in demand to diesel vehicles

Increase in interest rates

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Opportunities & Risks

Opportunities Infrastructure Growth

Rural market penetration

Exports from IndiaRisks Deterioration in economic conditions

Interest rates and other inflationary trends

Input Costs / Supplies

Environmental Regulations

Intensifying Competition

Changes in tax, tariff or fiscal policies and regulations

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Key Govt. Policy Changes

Before 199 s: Low volumes, obsolete tech, no govt. attn.

Reforms in 91 tax reliefs, cut in export tariffs

Equity regulation and banking reforms Emission norms

Mid 9 s Opened up for foreign investments - 96

Ford, GM, Toyota etccompetitive landscape

Fuel specifications

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Key Govt. Policy Changes (contd)

Auto Policy 2002

For global competence, and increased contribution to GDP

Automatic approval for 100% Foreign Investments

Huge incentives for R&D Fuelled modernization of Auto Industry in India

Recent trendsFuel subsidy, auto hubs & tax free exports!!

Compliance to Global norms - Harmonization

Globalization of Auto Industry

GOI to align Indian norms with International regulations

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Competition from foreign players

Toyota, Ford, and General Motors have started penetrating the

small cars segment recognising the potential in this segment.

Major international players are now developing models

specifically to meet Indian consumers preferences and marketconditions

The new models have been priced at fairly aggressive price and

as new entrants ramp up their volumes small car segment will

face more competition.Many global players are setting up capacities to locally develop

engines and transmissions in India with vendor development in

India forming a key part of their strategy

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Growth in Passenger Car Segment

Source: Automobile Consul t ing Group -Passenger Vehicle Analysis Fiscal Year 2012-13

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Growth in Passenger Car Segment

over the years

Source: RBSA Advisors-Synopsis of Indias Automobile Sector FY 2012 13

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Contd.

Source : SIAM, ICRA Estimates

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All small cars-12 % excise duty (unchanged)

Concession for specified parts of electric and hybrid vehicles

extended up to 31 March 2015

Excise duty on SUVs increased from 27 to 30 percent. (Exception -

SUVs registered as taxies)

A 25 per cent hike in import duty for Completely Build Units (CBUs)

No increase in the service tax

Import duty on luxury cars increased from 75% to 100%

Union Budget (2013-2014)

affecting automobile industry:

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Impact

Demand for SUVs will get affected

High import duty will boost domestic production of cars

Rising costs of parts will lead to increase in car prices

Boost to Electric and hybrid cars

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References

http://autobei.com/blog/passenger-vehicle-analysis-fiscal-year-2012-13/

http://www.siamindia.com/upload/SIAM-Forecasts.pdf

http://www.etintelligence.com/etig/researchchannels/sectors/autoReport.jsp

http://www.researchandmarkets.com/reports/1191955/

https://www.crisilresearch.com/industryasync.jspx?serviceId=7&State=null#storyId#28179#sectionId#2594#newsFeedId#undefined

http://autobei.com/blog/passenger-vehicle-analysis-fiscal-year-2012-13/http://autobei.com/blog/passenger-vehicle-analysis-fiscal-year-2012-13/http://www.siamindia.com/upload/SIAM-Forecasts.pdfhttp://www.etintelligence.com/etig/researchchannels/sectors/autoReport.jsphttp://www.etintelligence.com/etig/researchchannels/sectors/autoReport.jsphttp://www.researchandmarkets.com/reports/1191955/https://www.crisilresearch.com/industryasync.jspx?serviceId=7&State=nullhttps://www.crisilresearch.com/industryasync.jspx?serviceId=7&State=nullhttps://www.crisilresearch.com/industryasync.jspx?serviceId=7&State=nullhttps://www.crisilresearch.com/industryasync.jspx?serviceId=7&State=nullhttps://www.crisilresearch.com/industryasync.jspx?serviceId=7&State=nullhttps://www.crisilresearch.com/industryasync.jspx?serviceId=7&State=nullhttp://www.researchandmarkets.com/reports/1191955/http://www.researchandmarkets.com/reports/1191955/http://www.etintelligence.com/etig/researchchannels/sectors/autoReport.jsphttp://www.etintelligence.com/etig/researchchannels/sectors/autoReport.jsphttp://www.etintelligence.com/etig/researchchannels/sectors/autoReport.jsphttp://www.siamindia.com/upload/SIAM-Forecasts.pdfhttp://www.siamindia.com/upload/SIAM-Forecasts.pdfhttp://www.siamindia.com/upload/SIAM-Forecasts.pdfhttp://www.siamindia.com/upload/SIAM-Forecasts.pdfhttp://autobei.com/blog/passenger-vehicle-analysis-fiscal-year-2012-13/http://autobei.com/blog/passenger-vehicle-analysis-fiscal-year-2012-13/http://autobei.com/blog/passenger-vehicle-analysis-fiscal-year-2012-13/http://autobei.com/blog/passenger-vehicle-analysis-fiscal-year-2012-13/http://autobei.com/blog/passenger-vehicle-analysis-fiscal-year-2012-13/http://autobei.com/blog/passenger-vehicle-analysis-fiscal-year-2012-13/http://autobei.com/blog/passenger-vehicle-analysis-fiscal-year-2012-13/http://autobei.com/blog/passenger-vehicle-analysis-fiscal-year-2012-13/http://autobei.com/blog/passenger-vehicle-analysis-fiscal-year-2012-13/http://autobei.com/blog/passenger-vehicle-analysis-fiscal-year-2012-13/http://autobei.com/blog/passenger-vehicle-analysis-fiscal-year-2012-13/http://autobei.com/blog/passenger-vehicle-analysis-fiscal-year-2012-13/http://autobei.com/blog/passenger-vehicle-analysis-fiscal-year-2012-13/http://autobei.com/blog/passenger-vehicle-analysis-fiscal-year-2012-13/

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