SCP Analysis of Automobile Industry. SCP - Structure Performance Conduct

1. AUTOMOBILE
INDUSTRY
GROUP 5
Gaurav Agarwal 527
Vivekkumar Degamadiya 556
Nitin Bhardwaj 566
Toshaan Kakkar 581
Arham Wahab 603

2. Indian Automobile Market Segmentation

3. Indian autoindustry:Among thetop10inworld
3rd
2nd
5th
Two Wheelers
Small Cars
Commercial Vehicles

4. Automobile Sector At a Glance

5. Automobile Industry – A Global Hub
• 15 manufacturers of passenger cars and multi-utility vehicles,
• 9 manufacturers of commercial vehicles,
• 16 manufacturers two/ three wheelers,
• 14 manufacturers tractors,
• 5 manufacturers of engines.

6. Current Market Leaders

7. Market Share in Automobile Industry

8. SWOTAnalysis
Strengths
Inflow of FDI.
Increase in exports.
Low cost & Cheap labour.
Rising middle class incomes.
Large Pool of engineers.
Weakness
Technology Constraints.
Low Investment in R&D.
High level of competition. Ex China.
High Overheads.
Opportunities
Growing Popularity of vehicles.
Focus from government in improving
infrastructure.
Increase in income & standard of living.
Increasing rural demand.
Women Drivers growth.
Threats
Low skilled labour.
High import tariff.
High cost of foreign technology.
Not fulfilling International standards.
High congestion in cities.

9. -InitialYears -1960’s and 1970’s
-Late 1980’s multinational automakers, such as, Suzuki andToyota of Japan and Hyundai of South Korea,
were allowed to invest in the Indian market
-100% FDI
THE JOURNEY

10. CONTRIBUTION TO GDP
The automotive industry in India is one of the
largest in the world with an annual production
of 23.37 million vehicles in FY 2014-15
The automobile industry accounts for 7.1 per
cent of the country's gross domestic product
(GDP) in 2015.

11. The twin phenomena of low car penetration and rising
incomes, when combined with increasing affordability
of cars, are expected to contribute to an increase in
India’s automobile demand.
THE BEST ISYETTO COME

12. PARAMETERS DETERMINING EMISSION FROM VEHICLES
• VEHICULAR TECHNOLOGY
The vehicle technology is at par with the international bench marks as Indian safety standards are being aligned with global technical regulations
(GTR) and UN regulations. India is a signatory to UN WP 29 1998 agreement which develops GTR. India actively patriciates in the UN WP 29 body
and contributes significantly so that the GTR reflect the driving conditions and requirements of the developing countries.
• FUEL QUALITY
In India we are yet to address the vehicle and fuel system as a whole. It was in 1996 that the ministry of environment and forests formally notified
fuel specifications. Maximum limits for critical ingredients like benzene level in petrol have been reduced continuously and was specified as 5% m/m
and 3% m/m for petrol in the country and metros respectively and stands now at 1% in line with international practices.
• INSPECTION & MAINTENANCE OF IN-USE VEHICLES
It has been estimated that at any point of time, new vehicle comprise only 8% of the total vehicle population. In India currently only transport
vehicles, that is, vehicles used for hire or reward are required to undergo periodic fitness certification. The large population of personalized vehicles
are not yet covered by any such mandatory requirement.
• ROAD AND TRAFFIC MANAGEMENT
Inadequate and poor quality of road surface leads to increased vehicle operation costs and also increased pollution. It has been estimated that
improvements in roads will result in savings of about 15% of vehicle operation costs.

13. MASS EMISSION STANDARDS FOR 2 & 3 WHEEL

14. REDUCTION OF AGGREGATE POLLUTANTS SINCE 1991
4 WHEEL

15. EMISSIONS/ SAFETY REGULATIONS PROGRESSION IN INDIA

16. VEHICULAR SAFETY STANDARDS & REGULATIONS
In India the Rules and Regulations related to driving license, registration of motor vehicles, control of traffic,
construction & maintenance of motor vehicles etc are governed by the Motor Vehicles Act 1988 (MVA) and the
Central Motor Vehicles rules 1989 (CMVR).
The Ministry of Shipping, Road Transport & Highways (MoSRT&H) acts as a nodal agency for formulation and
implementation of various provisions of the Motor Vehicle Act and CMVR.
In order to involve all stake holders in regulation formulation, MoRT&H has constituted three Committees to
deliberate and advise Ministry on issues relating to Safety and Emission Regulations, namely –
CMVR- Technical Standing Committee (CMVR-TSC)
Standing Committee on Implementation of Emission Legislation (SCOE)
Automotive Industry Standards Committee (AISC)

23. INDIAN AUTOMOBILE INDUSTRY MARKET STATUS
 The Indian automotive industry embarked a new journey in 1991 with de-licensing of the sector and subsequent
opening up for 100% foreign direct investment (FDI).
 Since then almost all global majors have set up their facilities in Indian taking the level of production from 2
million in 1991 to over 10 million in recent years.
 The exports in automotive sector have grown on an average compound annual growth rate of 30% per year for
the last seven years. The export earnings from this sector are over USD 6 billion.
 Even with this rapid growth, the Indian automotive industry's contribution in global terms is very low.
 This is evident from the fact that even thought passenger and commercial vehicles have crossed the production
figures of 2.3 million in the year 2008,
 yet India's share is about 3.28% of world production of 70.53 million passenger and commercial vehicles.
 India's automotive exports constitute only about 0.3% of global automotive trade.

24. REVIEW OF AUTOMOTIVE MISSION PLAN 2006 - 2016
“To emerge as the destination of choice in the world for design and manufacture of
automobiles and auto components with output reaching a level of US$ 145 billion
accounting for more than 10% of the GDP and providing additional employment to 25
million people by 2016.”
• 7.1% of India’s GDP
• 27% of India’s industrial GDP
• 4.3% of overall exports (second only to textiles & handicrafts)
• 13% of excise revenues
• Incremental employment generation in excess of 19 million since FY06
• Total investment in excess of US$ 35 bn of which US$ 24 bn is contributed by automobile companies while US$ 11 bn
is contributed by automotive component companies
• 8% of the country’s R&D expenditure
• Improvement in fuel efficiency of passenger vehicles resulting in fuel savings of 8.6 bn litres between FY06 and FY14

25. Expected changes in market conditions and
barriers

26. Prediction on the bases of GDP

27. The Road Ahead
Contribution in
GDP to increase
from 10% to 13%
Creation of
incremental 100
million jobs
Projected $80
billion in capex
investments.
BSV emission
norms to be
adopted by 2019 &
BSVI by 2023
AMP envisages to
implement ‘end of
life policy’ for old
vehicles