“Procedural Study & Market Share Determination on Maruti Finance” at ICICI Bank
India enjoys a distinct cost advantage with respect to auto-ancillary manufacturingcapabilities. While developed nations’ labour cost component is 30-35 per cent of sales, Indianlabour cost is only around 8-9 per cent of sales.The number of vehicles manufactured in India has risen from 3 million units annually in 1999to 5 million units in 2002. This has also led to an increase in domestic demand for automotivecomponents.
Other global players in component manufacturing
Japanese and British component manufacturers are already operating JVs in India. Americancompanies, which have or are planning to set up plants in India, include Delphi (anautomotive components division of General Motors, USA), Delco Electronics, Textron andMagna International of Canada.Auto majors such as DaimlerChrysler, Volvo, Renault, Toyota and Honda are planning tooutsource their requirements from India.Automotive components manufactured in India are of top quality and used as originalcomponents for vehicles made by top international companies such as General Motors,Mercedes and IVECO among othersThe industry encompasses commercial vehicles, multi-utility vehicles, passenger cars, twowheelers, three wheelers, tractors and auto components. There are in place 15 manufacturersof cars and multi utility vehicles, 9 of commercial vehicles, 14 of Two/Three Wheelers and10 of Tractors besides 5 of engines. With an investment of Rs.50,000 crores, the turnover wasRs. 59,500 crores in Automotive Sector during 1999-2000. It employs 4,50,000 peopledirectly and 100,00,000 people indirectly and is now inhabited by global majors in keencontention.India manufactures about 38,00,000 2-wheelers, 5,70,000-passenger cars, 1,25,000 MultiUtility Vehicles, 1,70,000 Commercial Vehicles and 2,60,000 tractors annually. India rankssecond in the production of two wheelers and fifth in commercial vehicles.