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000 19.00.5% 3. two/three wheelers are the largest customer segment of auto-component market (around 34%).6%) 1274(37%) 1428(40%) 3100 2004-05 8700(29%) 1692(34%) 1902(33%) 3750 2005-06 12000(38%) 2469(47%) 2482 (30%) 4400 2006-07 15000(25%) 2873(16%) 3600 (31%) 5400 2007-08 18000(20%) 3615(24%) 5300(48%) 7200 2008-09 19000(6%) 3800(5. The autocomponent market is estimated to be US$19bn in 2008-09 in India. around 40%.1% 4.1% Source: ACMA. the global automotive component industry is estimated to be more than US$1trn .2% 3. Auto Components Industry Statistics 2003-04 Turnover Exports Imports Investments 6730(24.000 20.The Auto Components industry in India has the potential to grow at a CAGR of 13% to size up to USD 40 Billion by 2015 According to estimates available from industry association ACMA.www. India is one of the fastest growing low-cost manufacturers of auto components in the world. Out of the total autocomponent market in 2015.com/assets/PPT/CA4229118.60. rising income and export.5%) 6360 (20%) 7700 Employment Export as a % of Turnover 2. auto component manufacturers in India has potential to rise at a CAGR of 13% to touch US$40bn by 2015.autonews.75. followed by passenger cars contributed nearly 33% and commercial vehicle (CV) components account for almost 24% of the auto-component market. Exportradet Swedish Trade Council.9trn by 2015.000 18. Industry Interviews. With the growth in automobile sector.8bn is the export market.000 19. Page 2 .50.9% 2. Fordonskomponentgruppen.US$700bn market is expected to be driven by low cost countries globally.50. entry of new players in India.5% 2.00.000 20.000 20. In volume terms. of which US$3.It is forecasted to hit US$1.PPT Confidential & Proprietary © 2009 QCaliber-India Services Private Limited.
Paper. Agile Advisory. Aluminum. The auto components industry is dominated by SMEs. and unorganized sector accounting for rest Auto Component Industry Structure Assemblers /System Integrators Base Raw Material Producers (Steel. Total 575 organized player are adding value to 77% of Auto Component sector.ac. Dpncindia.in. Domestic Market OEM/ After Market Intermediaries End User International Market Process Oriented Suppliers Tier III Manufactures Moulding/Dying. Cable. Milling Polishing It has been estimated that approximately 4% of the auto-component manufacturing companies cater to 80% of the B2B demand arising from OEMs. Total 6. Casting. Major auto component manufacturing company’s are clustered in Indore in Central India. Forging. Stamping. JamshedpurKolkata in the East. Rubber. Foam) Tier I Manufacturers Semi Finished Material (Wiring.Industry is highly fragmented with organized sector contributing to 77% of total output. Manesar and Kanpur in the North. Dessenceconsulting. Non – Steel. © 2009 QCaliber-India Services Private Limited. Grinding. Source: Thomas Weisel International Estimates. Chennai in South India. Piston &Rings etc. Textile Paint. Cygnusindia . India logistics news Confidential & Proprietary Page 3 . Plastics. Glass.300 unorganized players mainly in replacement market. Hardware) Assembly OEM goods Module/ Component Suppliers Tier II Manufacturers Compressors. Extruding. Pumps. Pune in the West. or are Tier 3 and Tier 4 manufacturing players. IIM.
Aggressive Indian players as well as global companies are pitching in. Page 4 . hence making India a robust manufacturing & supply base Engines Die Making Gear Boxes Machining Plastics Stamping Moulds Engineering Casting Services Lamps Air brakes Indian Supply Base Exports Tier 1&2 Delphi Lear Visteon TRW Rico Bharat Forge Denso Minda TVS Bosch Amtek Meritor Global OEMs/JVs Maruti Suzuki Toyota Kirloskar Swaraj Mazda Volvo Foce Motors Hero Honda Skoda India Tatra Vectra Ford India General Motors Hyundai Mercedes Indian OEMs Tata Motors Ashok Leyland Hindustan Motors TVS Motors Atul Auto Bajaj Tempo Bajaj Auto Mahindra and Mahindra Confidential & Proprietary © 2009 QCaliber-India Services Private Limited.
replacement market and exports (contributing 20% each to the total market).PPT Confidential & Proprietary Page 5 .95 per cent. Source: ACMA.1 per cent © 2009 QCaliber-India Services Private Limited. Engine parts represents around one-third of the auto components manufactured in India The growth rate of components of different vehicle categories are as follows: 2/3Wheelers: 14. The auto components industry is dominated by SMEs. that is around 20.000 different products Auto Components Market Body & chassis 12% OEM Demand After Market Demand Exports Demand Others 7% Electrical parts 9% Engine parts 31% Auto Components Auto Accessories Drive transmission & steering 19% Equipments 10% Suspension & braking 12% Indian auto-component market is segmented in to OEMs (accounting for 60% of the total market).com/assets/PPT/CA4229118. Industry Interviews.Industry has sufficient resources for producing entire range of Auto Components.4 per cent. It has been estimated that approximately 4% of the auto-component manufacturing companies cater to 80% of the B2B demand arising from OEMs. Exportradet Swedish Trade Council. Fordonskomponentgruppen.www.autonews. Cars: 15. CVs: 26.
approximately 6000 suppliers are part Pune : of unorganized auto-component sector Automotive suppliers are mainly conentrated in . However. have urged the need for Joint ventures and M&A deals. is 1000 employees.Mumbai-Pune-Nasik-Aurangabad (in West).Greaves Cotton while component industry is growing at 17% It has been estimated that there are around ~ 500 organized T1+T2+T3 auto-component suppliers in India.TACO northern. © 2009 QCaliber-India Services Private Limited.RICO .autonews. Indore in Central India. Indian automotive suppliers Linked to the growth of Indian OEM industry: Major automotive clusters .Delphi .Lucas . Chennai -Bangalore-Hosur (in South).Denso Uttaranchal is emerging as an auto-hub in India because of the friendly government policy. Fordonskomponentgruppen.com/assets/PPT/CA4229118. which in return have achieved higher ROCE levels. which includes T2 & T3 suppliers. OEM industry is growing at a double digit rate of 15%.Sundraram Group .Visteon .TAFE Source: ACMA. .www. Exportradet Swedish Trade Council. has around 100 employees on an average.Increasing competition and cost advantage in India.Sona Koyo.Motherson Group . Mumbai: Kolkata: NRB . western and southern region of India Average employee size of suppliers in organised sector. However. DelhiGurgaon-Faridabad (in North).Asahi Noida: . . Industry Interviews.PPT Confidential & Proprietary Page 6 . the unorganised sector.Bharat Forge Chennai: . which mainly includes T1 & T2 suppliers. Jamshedpur-Kolkata in the East Gurgaon: . Shift in focus of Indian ancillary manufacturers from global after-market to global OEM market.
pdf Confidential & Proprietary © 2009 QCaliber-India Services Private Limited. Page 7 . Large and Growing Domestic Automobile Market of India Reforms in Government policy Proximity to Asian as well as Emerging economies like Africa Low Manufacturing and Labor cost accompanied by Availability of Manpower High Export Potential Market Acquisition in the foreign markets to further help India to acquire new set of skills. Capacity Expansion. under the EXIM policy. Factors Driving Growth in the Indian Auto component sector Increasing competitive pressure on global automakers forcing Auto components manufacturers to outsource from low cost manufacturers. besides investing in expanding capacities.org/download/Autocomponent_060109. Heavy Investments in R&D operations.” instead of “nice to have” factor. Government reforms to reduce the tax rates is under consideration. Proven R&D Capabilities High Quality Standards Source: http://www. Major focus on productivity and efficiency improvement. technology and customers.ibef. modeling. tool designing. which will reduce the tax burden on the auto component sector. drafting etc. Increasing domestic demand and competitive global market are forcing auto component manufacturers to technical and quality standards. carrying out activities like simulations. allowing automatic approval of foreign equity participation up to 100 percent for manufacture of auto components.Key Trends: Key focus areas are Research & Product Development. has designated auto components as a “Thrust Sector”. Government of India. and Global Competition Quality awareness has increased across all levels of management and is being viewed as a “must have. engineering animations.
etc Power cost in India is amongst the highest when compared with the other competing countries globally. Poor understanding of global business dynamics Less than five domestic players with revenues more than US$250mn. High interest rates in India as compared to other competing countries. mainly due to frequent fluctuations & instability in the prices of commodities & raw materials such as steel. Increasing need for technology up gradation /innovation to compete and survive in the global market High level of dependence on traders and agents to perform business in the overseas markets that threatens their competitiveness in the global market. Product substitutes due to emergence of new technologies.Key Challenges: Indian companies are facing challenges primarily due to low capital base. © 2009 QCaliber-India Services Private Limited. Confidential & Proprietary Page 8 . polymers. aluminum. and volatile factors of production Low capital base of players in the industry Limited generation of surplus funds for re-investment due to tight working capital cycle Lack of awareness of business opportunities Lack of experience to international environment Limited geographical diversity of markets Obsolete technology Poor infrastructure facilities Volatile factors of production. the industry has highly fragmented market. global competition. Direct and indirect taxes burden are relatively higher than the tax rates followed in other competing countries.
from US$3.2bn investment opportunity in India for auto-component manufacturers. Johnson Controls etc. It will further offer employment to 25mn people. Toyota. especially including the following: Metal intensive components: Forgings. This is expected to increase to US$20. etc.9bn by 2015-16. Leading low-cost auto-component manufacturer globally. More than 60% of Indian autocomponent exports are targeted to European and the US market indicating that the Indian firms are competent to meet the stringent quality and technical standards. Government support: Investment commission has decided on a target to attract US$5bn foreign investment for the next seven years. Indian technical skills recognized as among the finest in the world Large export market for Indian auto-component makers: Export market is forecasted to increase to around US$20bn-US$22bn by 2015-16. and auto-components manufacturers have established their own offices in India to source for their global operations. other electrical components Hi-tech components: Electronic fuel injectors Global hub for R&D: GM. Huge investment opportunities in auto-component Industry: Around US$7. have established development centers in India.6bn in 2007-08. High level of sourcing of auto-components from low cost countries (LCC’s) is expected to drive demand growth for products manufactured in India. Automatic approval for foreign equity investment of as much as 100% of manufacture of automobiles and components is permitted. The automobile industry has been de-licensed and there are no controls on import of components. Confidential & Proprietary Page 9 . © 2009 QCaliber-India Services Private Limited. stampings.Key Opportunities: To emerge as the preferred sourcing destination for large international auto-makers and be recognized as a key player in the global supply chain Sourcing destination for large foreign players: Auto manufacturers including GM. Suzuki. Ford. Automotive Mission Plan 2016 to encourage growth in the sector: Government aims to increase output to US$145bn that will represent 10% of the country’s GDP.5%. Daimler Chrysler. The government aims to expand the existing 0. castings Skilled labor-intensive components: Machining. wiring-harness.5% India’s share in global autocomponent market to 2. Bosch.
D-41. and Operational Management. thereby helping them select the most relevant business solution from amongst multiple choices potentially available. India Tel : +91 120 4087000 Fax : +91 120 4087001 Confidential & Proprietary © 2009 QCaliber-India Services Private Limited. The advisory services offered by 365 Business Days are powered by a team of expert professionals having deep industry knowledge and superior hands-on experience in areas of Business Planning. 2nd Floor. Sales Enhancement. Ltd. Noida – 201301 Delhi NCR. delivered through a convenient and costeffective online subscription-based business model. Page 10 . QCaliber-India Services Pvt. and senior management in critical decision-making process when faced with complex business challenges. business owners. Our service aids entrepreneurs.About Us – 365 Business Days 365 Business Days offers management consulting and business advisory services in the form of business query resolution. Sector 59. Cost Reduction.
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