Overview->Growth
Sector-> Automobile & Auto Component
The Automobile Industry
performance in all its sectors has been encouraging.
According to an Assocham study, the global component
industry is likely to go up to about USD 1.9 trillion
by 2015. Out of this USD 700 billion is expected to
flow to low cost countries (LCC). This would present
an enormous business opportunity for auto component
manufacturers in India as tier 2 or tier 3 suppliers. Tier 1 suppliers are looking to set up
manufacturing facilities in India due to its cost advantage
and the availability of skilled labour and qualified
engineers.
Automatic approval has been granted to
foreign equity investment upto 100% for the manufacture
of automobiles and components. The Finance bill also
allows a 150% weighted deduction for in-house R&D expenditure
in the auto component industry.
The size of the Indian automotive industry
is estimated between US$ 120.09 billion and US$ 155.12
billion by 2016. The industry is expected to touch the
10 million mark, to which the Commercial Vehicle Segment
will be a major contributor. Industry experts peg the
Indian Automobile sales growth at a compounded annual
growth rate (CAGR) of 9.5 % by 2010.
o India in world automobile market:-
Two wheelers - 2nd largest in the world
Commercial Vehicle - 4th largest in the world
Passenger car- 11th largest in the world
GROWTH OF AUTOMOTIVE INDUSTRIES
April 2008
April 2007
Year-on-year
April Change (%)
Commercial vehicles
33,271
30,914
7.60
Passenger cars
98,740
84,283
17.10
Multi-purpose vehicles
9,070
6,118
48.20
Utility vehicles
22,203
16,862
31.70
Two-wheelers
616,038
570,381
8.00
Scooters/scooterettes
81,002
72,369
12.00
Motorcycles/step-through
501,592
463,091
8.30
Source: Society of Indian
Automobile Manufacturers
AUTO
COMPONENT INDUSTRY:-
As Indian automobile sector has grown
and matured, Indian auto components industry is also
showing a rapid growth, with a rate of 15% to become
an estimated production of US$ 10 billion. The huge
demand from domestic and international auto companies
has seen this sector emerging as one of the fastest
growing manufacturing sectors in India and globally.
The Auto components industry is divided
into five segments:
Engine parts
Drive Transmission & Steering Parts ·
Suspension & Brake Parts ·
Electrical Parts
Body and chassis
In 2006-07 total export from automotive
component industry was USD 3 billion and as per report
by ACMA this will increase to USD 5 billion in 2008-09
& in the next seven year it will touch to USD 20 billion
marks. Today India's share in global auto component
market is 0.3 % which will set to increase to 3-4 %.
Key advantages:-
a) The country provides skilled and cheap labor.
b) An Indian company has started working with automation
so as to meet worldstandard.
c) Due to adaptation of quality control tools like
TQM, TPM etc. manufacturing cost reduced significantly.
d) Less government obstacles for set up business in
India.
