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AUTOMOBILE INDUSTRY IN INDIA Presented by- Raghvendra pratap Nishant kumar oraon Randhir kumar

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AUTOMOBILE INDUSTRY IN INDIA

Presented by-

Raghvendra pratap

Nishant kumar oraon

Randhir kumar

HISTORYThe first car ran on India's roads in 1897. Until the 1930s, cars were imported

directly, but in very small numbers.

An embryonic automotive industry emerged in India in the 1940s. Hindustan was launched in 1942, long-time competitor Premier in 1944. They built GM and Fiat products respectively.

Mahindra & Mahindra was established by two brothers in 1945, and began assembly of Jeep CJ -3A utility vehicles.

Following the independence, in 1947, the Government of India and the private sector launched efforts to create an automotive component manufacturing industry to supply to the automobile industry.

 In 1953 an import substitution programme was launched, and the import of fully built-up cars began to be impeded.

 By the 1980s, the automobile market was still dominated by Hindustan and Premier , who sold superannuated products in fairly limited numbers. During the eighties, a few competitors began to arrive on the scene.

LAND MARK OF INDIAN AUTOMOBILE INDUSTRY 1897 First person to own a car in India-Mr.Foster of M/s Crompton Greaves

Company, Mumbai

1901 First Indian to own a car in India-Jamsetji Tata

1905 First Women to drive a car in India- Mrs. Suzanne RD Tata

1945 Tata Motors

1947 Mahindra &Mahindra Limited

1981 Maruti Suzuki

1944 Mercedes-Benz

1995 Ford Motor Company

2005 BMW

2007 Audi

2009 Land Rover and Jaguar

MAJOR PLAYER OF PASSENGERS CARMaruti Suzuki

Hyundai India

TATA motors

 Mahindra & Mahindra

Toyota

GM

Ford

Honda

Volkswagen

Nissan

MARUTI SUZUKIMaruti Udyog Limited, is an automobile manufacturer in India.It is a

subsidiary of Japanese automobile and motorcycle manufacturer Suzuki.

Originally, 18.28% of the company was owned by the Indian government, and 54.2% by Suzuki of Japan.

Maruti Udyog Limited (MUL) was established in February 1981, though the actual production commenced in 1983 with the Maruti 800, based on the Suzuki Alto kei car.

Its first manufacturing facility was established in Gurgaon. Afterwards one more manufacturing facilities was established in Manesar ,Haryana.

Today, Maruti Suzuki alone makes 1.5 million cars every year. That’s one car every 12 seconds.

Maruti offer 17 brands and over 150 variants ranging from the people's car Maruti 800 to kizashi which costs around 18 lakhs.

BRANDS

SWOT ANALYSISStrengths

Maruti Udyog limited (MUL) is in a leadership position in the market with a market share of 45.4%.

Strong Brand Value and Loyal Customer Base are big strengths for MUL.

There are around 15 vehicles in Maruti Product portfolio. Has good product lines with good fuel efficiency like Maruti Swift, Diesel, Alto etc.

Major strength of MUL is having largest network of dealers and after sales service centers in the country.

MUL is the first automobile company to start second hand vehicle sales through its True-value entity.

Weaknesses

Low interior quality inside the cars when compared to quality players like Hyundai and other new foreign players like Volkswagen,Nissan etc.

Government intervention due to having share in MUL.

Younger generations started getting a great affinity towards new foreign brands

Maruti hasn’t proved itself in SUV segment like other players.

Opportunities

MUL has launched its LPG version of Wagon R and it was a good move.

MUL can start R&D on  electric cars for a much better  substitute of the fuel.

Maruti’s cervo 600 has a huge potential in tapping the middle class segment and act as a strong threat to Nano.

DZire from Maruti has captured the market share and is expected to create the same magic as Maruti Esteem(currently not available).

Export capacity of the company is giving new hopes in American and UK markets.

Economic growth of the country is constantly increasing and the government is working hard to increase the gdp to double digit.

Threats

MUL recently faced a decline in market share from its 50.09% to 45.4 % in the previous year.

Major players like Maruti Suzuki, Hyundai, Tata has lost its market share due to many small players like Volkswagen- polo. Ford has shown a considerable increase in market share due to its Figo.

Tata Motors recent launches like Nano 2012, Indigo e-cs are imposing major threats to its respective competitor’s segment.

China may give a good competition as they are also planning to enter into Indian car segment.

Launch of Hyundai’s H800 may result in the decline of Alto sales.

HYUNDAI INDIAHyundai Motor India Limited is a wholly owned subsidiary of

the Hyundai Motor Company in India. It is the 2nd largest automobile manufacturer in India.

Hyundai Motor India Limited was formed on 6 May 1996 by the Hyundai Motor Company of South Korea.

HMIL's first car, the Hyundai Santro was launched on 23 September 1998 and was a runaway success. Within a few months of its inception HMIL became the second largest automobile manufacturer and the largest automobile exporter in India. 

HMIL’s manufacturing plant near Chennai claims to have the most advanced production, quality and testing capabilities in the country.

To cater to rising demand, HMIL commissioned its second plant on February 2008, which produces an additional 300,000 units per annum, raising HMIL’s total production capacity to 600,000 units per annum.

The two manufacturing plant of Hyundai are in Sriperumbudur, Kanchipuram district, Tamil Nadu.

BRANDS

SWOT ANALYSISStrengths

Hyundai India has such a brand equity that it is almost assumed to be an Indian brand, with lot of good accolades for being India’s second most selling brand next to MUL in market share

Hyundai Motor India limited is the largest car exporter from Asian Market which showed a 10% growth compared to last FY

The domestic sales is increasing at an average rate of 19.1%

HMIL is known for its quality products which has better performance and it has constantly been ahead in the race with Maruti Udyog limited in many parameters

Weakness

HMIL took a long time to gain the market share as its not the first mover in India

In terms of most reliable and trusted brand; Maruti is more strong in Indian subcontinent.

Spare parts of Hyundai vehicles are comparatively priced higher and spare parts do not have PAN India presence

In SUV segment both Tucson and its next model Santa Fe didnt make a major impact

Opportunity

SIAM – Society of Indian automobile Manufacturers, have stated that there is steady increase in Car sales contributing a valuable share in India’s Gdp.

The export markets growth rate is 22.30% compared to last fiscal year.

The saving consumption pattern of India is an added advantage for any segment doing business in India. This was one of the major reason for Indian market to survive amidst global recession.

There is more scope of HMIL to enter into small car segment as its has dedicated R&D plant in Hyderabad, India. Hyundai is one of the very few companies that has widest R&D network across the world located in Korea, Europe, India, US, Japan.

Threats

Though Hyundai claims itself to have no direct competitors other than MUL, there are Indian players like Tata, Mahindra imposing a strong threat for Hyundai Motors India to expand its product category.

Foreign Direct Investments flowing in Indian automobile space are not good signs for already existing Giants like MUL and Hyundai.

Almost all major automobile players have started invading India to open up their market and their manufacturing plant in India.”Chennai” is referred to as the Detroit of Asia!

Hyundai faced a slight decline in market share due to tough competition from Ford’s Figo and Volkswagen- Polo.

TATA MOTORSTata Motors Limited (formerly known as TELCO, short for Tata

Engineering and Locomotive Company) is an Indian multinational automotive manufacturing company headquartered in Mumbai, Maharashtra, India and it is a subsidiary of the Tata Group. 

Tata Motors has auto manufacturing and assembly plants in Jamshedpur,Pantnagar, Lucknow, Sanand, Dharwad and Pune in India, as well as in Argentina, South Africa, Thailand and the United Kingdom.

It has research and development centres in Pune, Jamshedpur, Lucknow and Dharwad, India, and in South Korea, Spain, and the United Kingdom. 

Tata Motors' principal subsidiaries include the British premium car maker Jaguar Land Rover (the maker of Jaguar, Land Rover and Range Rover cars) and the South Korean commercial vehicle manufactuer Tata Daewoo.

CONTD… Tata has joint venture with Fiat which manufactures automotive components

and Fiat and Tata branded vehicles.

Founded in 1945 as a manufacturer of locomotives, the company manufactured its first commercial vehicle in 1954 in a collaboration with Daimler-Benz AG, which ended in 1969.

Tata Motors entered the passenger vehicle market in 1991 with the launch of the Tata Sierra, becoming the first Indian manufacturer to achieve the capability of developing a competitive indigenous automobile.

In 1998 Tata launched the first fully indigenous Indian passenger car, the Indica, and in 2008 launched the Tata Nano, the world's cheapest car. 

 Tata Motors acquired the South Korean truck manufacturer Daewoo Commercial Vehicles Company in 2004 and purchased Jaguar Land Rover from Ford in 2008.

BRANDS

SWOT ANALYSISStrengths

Wide & extensive distribution and service network.

Good market penetration in the taxi & rental segment.

Many associations like Jaguar Land Rover, Hispanso, Macropolo etc which increases international presence.

More than 60,000 employees.

Highly diversified product portfolio.

Weakness

 Sometimes faces alleged quality and durability issues.

Not much customer engagement programs and activities.

Opportunities

Expanding automobile market and available space for competitors.

Increasing per capita income and purchasing capability of potential customer base.

Leveraging customer engagement experience to acquire new customers.

Leveraging mergers and acquisitions to acquire newer technology.

Augmenting the distribution and service network in various countries.

Threats

Increasing fuel costs.

Competition from other big automobile giants.

Competitive products offering same level features at a lesser price.

Product innovations and frugal engineering by competitors.

MAHINDRA & MAHINDRAMahindra & Mahindra Limited (M&M) is an Indian multinational

automobile. It is one of the largest vehicle manufacturers by production in the India.

 The company was founded in 1945 in Ludhiana as Mahindra & Mohammed by brothers K.C. Mahindra and J.C. Mahindra and Malik Ghulam Mohammed.

 It eventually saw business opportunity in expanding into manufacturing and selling larger MUVs, starting with assembly under licence of the Willys Jeep in India.

Soon established as the Jeep manufacturers of India, the company later commenced manufacturing light commercial vehicles (LCVs) and agricultural tractors.

Mahindra & Mahindra is a key game player in the utility vehicle manufacturing and branding sectors in the Indian automobile industry with its flagship UV Scorpio it swiftly exploits India's growing global market presence in both the automotive and farming industries.

M&M also has controlling stake in REVA Electric Car Company and acquired South Korea's SsangYong Motor Company in 2011.At present M&M has 70% share of  SsangYong Motor Company.

BRANDS

SWOT ANALYSISStrength

Mahindra has been one of the strongest brands in the Indian automobile market.

Mahindra group give employment to over 110,000 employees.

Excellent branding and advertising, and low after sales service cost.

Sturdy SUV’s good for Indian roads and off-road terrain.

Weakness

Mahindra’s partnership with Renault did not live up to international quality standards through their brand Logan.

Opportunity

 Developing hybrid cars and fuel efficient cars for the future.

Tapping emerging markets across the world and building a global brand.

Fast growing automobile market.

Growing in the market through electric car Reva (controlling stake) and entry into two-wheeler segments.

Threat

Government policies for the automobile sector across the world.

Ever increasing fuel prices.

Intense competition from global automobile brands.

Substitute modes of public transport like buses, metro trains etc.

TOYOTAToyota is 7th largest automobile manufacturer of world.

Toyota motor corporation is headquartered in toyota city, Aichi.

Toyota has annual sales of 397.05 billion yen.

Produces 5.5 million vehicles every year.

Toyota in India operate as a joint venture between Kirloskar group and Toyota motors corporation.

In India Toyota Kirloskar Motor was established in 1997.

In India its production unit is in Bangalore. And its daily production capacity is 245 units.

With over 30 million sold, the Toyota Corolla is one of the most popular and best selling cars in the world.

BRANDS

SWOT ANALYSISStrengths

high profitability and revenue. high growth rate. existing distribution and sales networks. experienced business units.

Weaknesses

future debt rating. future profitability. cost structure. Productivity. competitive market. brand portfolio.

Opportunities

venture capital. growth rates and profitability. growing economy. global markets. new markets. income level is at a constant increase.

 

Threats

price changes. rising cost of raw materials. financial capacity. growing competition and lower profitability. increasing rates of interest. government regulations. external business risks.

GENERAL MOTORSGeneral Motors Company, commonly known as GM, is an American

multinational corporation headquartered in Detroit, Michigan that designs, manufactures, markets and distributes vehicles and vehicle parts and sells financial services.

General Motors produces vehicles in 37 countries under ten brands, including Chevrolet, Buick, GMC, Cadillac, Holden, Opel, Vauxhall, Wuling, Baojun,Jie Fang, UzDaewoo.

General Motors led global vehicle sales for 77 consecutive years from 1931 to 2007, longer than any other automaker, and is currently among the world's largest automakers by vehicle unit sales.

General Motors India Private Limited is a partnership between General Motors and SAIC that is engaged in the automobile business in India.

General Motors India started its journey in 1996 in India.

GMIPL operates vehicle manufacturing plants in Halol, Gujarat and Talegaon Dabhade, Maharastra, It maintains headquarters in Halol and Gurgaon and a large technical center in Bangalore.

BRANDS

SWOT ANALYSISStrength

Research and development in the automobile segment.

Efficient human resource management as it has over 300,000 employees globally.

Chevrolet is present in 6 continents and has a prominent presence in countries like USA, Canada, China, India, Japan, Middle East, Euope, Australia etc .

Has a huge variety of models ranging from hatchbacks to SUV’s.

Chevrolet is actively present in international racing competitions like NASCAR.

Weakness

Chevrolet brand was severely affected by bankruptcy of General Motors

Intense competition from international brands like Honda & Toyota who excel in product quality, price, branding and even servicing

Advertising and brand presence lesser as compared to other brands.

Opportunity

Developing hybrid cars and fuel efficient cars for the future.

Tapping emerging markets across the world and building a global brand.

Fast growing automobile market.

Threat

Government policies for the automobile sector across the world.

Ever increasing fuel prices.

Intense competition from global automobile brands.

Substitute modes of public transport like buses, metro trains etc.

FORDThe Ford Motor Company (also known as simply Ford) is an

American multinational automaker headquartered in Dearborn, Michigan.

It is described by Forbes as "the most important industrial company in the history of the United States.

Ford India Private Limited is a wholly owned subsidiary of the Ford Motor Company in India.

The modern Ford India Private Limited began production in 1996, although the roots trace back to 1907 when the Model A was launched.

Ford India Private Limited began production in 1926, but was shut down in 1954 as the company was in loss.

Production began again with the joint venture Mahindra Ford India Limited (MFIL) in October 1995, a 50-50 venture with Mahindra & Mahindra Limited. Ford Motor Company increased its interest to 72% in March 1998 and renamed the company Ford India Private Limited.

FIPL's main manufacturing plant located in Maraimalai Nagar, 45 km from Chennai.

BRANDS

SWOT ANALYSISStrength

One of the early market entrants and oldest car manufacturer.

Offers a wide range of cars to different set of customers.

Provides exclusive product features taking into consideration the targeted segments.

Invested efforts to go green in order to help the environment.

Weakness

Adversely affected by the global recession & Euro crisis.

Hasn't completely tapped emerging economies as compared to some other automobile giants.

Opportunity

Expanding automobile sector.

Improving business scenario due to expansion of consumer base.

Capitalizing on the models exclusively designed for different markets e.g. ford Ikon for India.

Threat

Competition from major international players.

Increasing usage of public transport and increased fuel costs.

Production problems in local plants due to labour and similar issues.

HONDAHonda Motor Company, Limited is a Japanese public multinational

corporation  primarily known as a manufacturer of automobiles and motorcycles.

Honda has been known as world's largest manufacturer of internal combustion engines measured by volume, producing more than 14 million internal combustion engines each year.

Honda Cars India Ltd. (HCIL) is a subsidiary of the Honda of Japan for the production, marketing and export of passenger cars in India. 

Formerly known as Honda Siel Cars India Ltd, it began operations in December 1995 as a joint venture between Honda Motor Company and Usha International of Siddharth Shriram Group.

 In August, 2012, Honda bought out Usha International's entire 3.16 percent stake for 1.8 billion in the joint venture. The company officially changed its name to Honda Cars India Ltd. (HCIL) and became a 100% subsidiary of Honda.

It operates production facilities at Greater Noida in Uttar Pradesh and at Bhiwadi in Rajasthan.

BRANDS

SWOTStrength

Excellent branding, advertising and after sales servicing .

Honda has over 180,000 employees globally .

Production System that is refined over the years along with High and powerful research and development R&D.

High brand equity and brand loyalty amongst customers.

Weakness

Cost structure of Honda is high as compare to other automobile manufacturers.

Caters to only the upper middle segment which limits the customer base.

Honda has to recall a few of their models for corrective measures which caused a lot of hue and cry.

Opportunity

Developing hybrid cars and fuel efficient cars for the future.

Tapping emerging markets across the world and building a global brand.

Fast growing automobile market.

Threat

Government policies for the automobile sector across the world.

Ever increasing fuel prices.

Intense competition from global automobile brands.

Substitute modes of public transport like buses, metro trains etc.

LUXURY CAR SEGMENTThis segment includes cars which are worth 50 lakhs or more.

Major players are of this segment are -BMWMercedesAudiRolls RoyceBentlee

Luxury market in India is gradually gaining attention.

The luxury market is growing at a rapid pace in India with a compounded annual growth of 25%.

At US$4.76 billion, the luxury market in India is set to touch three times its current size at US$14.72 billion by 2015.

The country has become the prime destination for top-notch global brands, while many high-end luxury brands have quickly set up their shops here.

UPCOMING CARS OF 2014

TRENDS OF CAR INDUSTRY IN INDIAOnly three decades back, Indian car buyers had just two models to choose

from. Both were local reproductions of European models that had disappeared from the western markets soon after World War II.

The introduction of a tiny hatchback in 1983 by Maruti Suzuki, jointly promoted by the Indian government and Japanese small car manufacturer Suzuki, was in many ways a defining moment in the development of the Indian automobile industry.

Robust growth in middle class income levels and easier credit availability have sustained demand growth for passenger cars. Most major global manufacturers are already present in the country, while some of the domestic manufacturers are entering overseas markets.

Despite increased competition, Maruti Suzuki, which is now majority owned by Suzuki Motor Corp, remains the market leader in India with a share of over 45%.

Luxury passenger cars have seen excellent demand growth, especially in recent years. However, the luxury segment now accounts for only about a percent of the total passenger vehicle market. Mercedes Benz and BMW have almost identical market shares while Audi has made rapid gains over the last year. 

CONTD…India is the second fastest growing automobile market in the world after

China.

Passenger vehicle production during the period April 2010 to August 2010 increased by nearly a third from a year ago. For the year ending March 2011, passenger vehicle output is expected to exceed 2.5 million.

India is emerging as a major production base for small cars, with output expected to reach 3 million units by 2016. The country is building a reputation in designing and manufacturing low cost cars.