Auto Components Industry

By: Rishi Ranjan

ƒ The industry is expected to touch the figure of almost $10 million mark. ƒ . ƒ Automobile sales growth at a CAGR of 9.5 percent by 2011. ƒ There have been 3 phases in this industry.Automotive Industry both globally and in India is one of the key sectors of the economy.

Today Indian Auto Industry had established itself globally so well that they have become Largest Three Wheeler market in the world y Second largest Two Wheeler market in the world y Fourth largest Passenger Vehicle market in Asia y Fourth largest Tractor Market in the world y Fifth largest Commercial Vehicle Market in the world y .

Mass Transport System y Increasing Road Development y Cheaper (declining interest rates) & easier finance Schemes y Replacement of ageing four wheelers y Graduating from two wheelers to four wheelers y Growing concept of Second Vehicle in Urban Areas y y .The Future Growth Drivers Higher GDP Growth India's huge geographic spread.

drive transmission & steering parts. y All manufacturing vehicles typically involve assembling of large no of components which are outsourced from auto-ancillary/component manufacturers. electricals. y ACMA classifies the auto ancillary industry into the following product segments: engine & engine parts. y .Started in 1940s supplying components to Hindustan Motors and Premier Automobiles. y One of the front runners for grabbing the global auto component outsourcing market and estimated to be worth US$ 700 billion by 2015. equipments & others.

y Abundant availability of raw materials. y Technically skilled workforce. the Indian auto spare has an established brand name.The advantages of Indian auto spare exporters: Connected to Middle East by sea route. y . y Relatively cheap labour. y Due to many domestic and international car manufacturing units. Low transportation cost and quick turn-around time.

Armenia. Kyrgyzstan. Iran. Tajikistan. Jordan. Syria. Turkmenistan . Uzbekistan. Israel. Saudi Arabia. Afghanistan. Turkey Pakistan. UAE. Kuwait.Distribution Center Saudi Arabia Iraq Iran Countries Supplied Bahrain. Oman. Qatar Iraq. Cyprus. Azerbaijan. Yemen. Lebanon.

$ 58. Approximately 60% of total market import for the UAE is reexported to other countries in the region. Many unorganized players. 60% of auto spares are imported and local market is only 40%.4 billion. About $ 4-6 billion of this market is from fake and duplicated spare parts.5 billion. The local auto spare market in 2009: $23.ƒ ƒ ƒ ƒ ƒ ƒ The value for automotive parts. . accessories and components is a multi-million dollar industry for UAE. Total auto spare market .

. So. The profit margins are good for the company assuming that break-even is achieved from the domestic market. my conclusion is that company should go for exporting the product to middle-east markets.ƒ The Middle-East market will act as distribution centre for other potential markets.

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