[1]IntroductionThe automobile industry is one of India’s most vibrant and growing industries. This industry accounts for 22 per cent of the country's manufacturing gross domestic product (GDP). The auto sector is one of the biggest job creators, both directly and indirectly. It is estimated that every job created in an auto company leads to three to five indirect ancillary jobs.India's domestic market and its growth potential have been a big attraction for many global automakers. India is presently the world's third largest exporter of two-wheelers after China and Japan. According to a report by Standard Chartered Bank, India is likely to overtake Thailand in global auto-export market share by the year 2020.The next few years are projected to show solid but cautious growth due to improved affordability, rising incomes and untapped markets. With the government’s backing, and trends in the international scenario such as the decline in prices of natural rubber, the Indian automobile industry is slated to witness some major growth.Market sizeThe cumulative foreign direct investment (FDI) inflows into the Indian automobile industry during the period April 2000 – August 2014 was recorded at US$ 10,119.68 million, as per data by Department of Industrial Policy and Promotion (DIPP).Data from industry body Society of Indian Automobile Manufacturers (SIAM) showed that 137,873 passenger cars were sold in July 2014 compared to 131,257 units during the corresponding month of 2013. Among the auto makers, Maruti Suzuki, Hyundai Motor India and Honda Cars India emerged the top three gainers with sales growth of 15.45 per cent, 12 per cent and 11 per cent, respectively.The three-wheeler segment posted a 24 per cent growth to 51,461 units on the back of increased demands from the urban market. Total sales across different vehicle segments grew 12 per cent year on year (y-o-y) to 1,586,123 units.Scooter sales have jumped by 29 per cent in the ongoing fiscal, and now form 27 per cent of the total two-wheeler market from just 8 per cent a decade back. The ever-rising demand for scooters, which has far outstripped supply has prompted Honda to set up its first dedicated scooter plant in Ahmedabad.Tractor sales in the country is expected to grow at a compound annual growth rate (CAGR) of 8–9 per cent in the next five years making India a high-potential market for many international brands.

InvestmentsTo match production with demand, many auto makers have started to invest heavily in various segments in the industry in the last few months. Some of the major investments and developments in the automobile sector in India are as follows:

Ashok Leyland plans to invest Rs 450–500 crore (US$ 73.54–81.71 million) in India, by way of capital expenditure (capex) and investment during FY15. The company is required to manage Rs 6,000 crore (US$ 980.56 million) of assets in seven locations across the world, for which maintenance capex is needed.

Honda Motors plans to set up the world's largest scooter plant in Gujarat to roll out 1.2 million units annually and achieve leadership position in the Indian two-wheeler market. The company plans to spend around Rs 1,100 crore (US$ 179.76 million) on the new plant in Ahmedabad, and expand its range with a few more offerings.

Yamaha Motor Co has restructured its business in India. Now, Yamaha Motor India (YMI) will take care of its India operations. “The restructuring is part of Yamaha’s mid-term plan aimed at improving organisational efficiency,” as per Mr Hiroyuki Suzuki, Chief Executive and Managing Director. YMI would be responsible for corporate planning and strategy, business planning and business expansion, quality control, and regional control of Yamaha India Business.

Tata Motors plans to use the 'hub-and-spoke' model in which India will be the key manufacturing base while it will have mini-hubs in overseas markets. The company also plans to set up mini hubs in potential markets like Africa, Middle-East and South East Asia.

Hero Cycles through its unit OPM Global has acquired a majority stake in German bicycle company MitteldeutscheFahrradwerke AG (MIFA) for €15 million (US$ 19.11 million). The company plans to invest an additional €4 million (US$ 5.09 million) as capital expenses in restructuring the acquired company.

Government InitiativesThe Government of India encourages foreign investment in the automobile sector and allows 100 per cent FDI under the automatic

route. To boost manufacturing, the government had lowered excise duty on small cars, motorcycles, scooters and commercial vehicles to eight per cent from 12 per cent, on sports utility vehicles to 24 per cent from 30 per cent, on mid-segment cars to 20 per cent from 24 per cent and on large-segment cars to 24 per cent from 27 per cent.The government’s decision to resolve VAT disputes has also resulted in the top Indian auto makers namely, Volkswagen, Bajaj Auto, Mahindra & Mahindra and Tata Motors announcing an investment of around Rs 11,500 crore (US$ 1.87 billion) in Maharashtra.The Automobile Mission Plan for the period 2006–2016, designed by the government is aimed at accelerating and sustaining growth in this sector. Also, the well-established Regulatory Framework under the Ministry of Shipping, Road Transport and Highways, plays a part in providing a boost to this sector.The Government of India-appointed SIAM and Automotive Components Manufacturers Association (ACMA) are responsible in working for the development of the Indian automobile industry.

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HISTORY OF AUTOMOBILE SECTOR IN INDIA

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From the policy standpoint, the Indian automobile industry can be viewed in terms of the pre-1991 (before liberalization) and post-1991 (after liberalization) phase.

1880's & early 1900's:

About hundred years ago the first motorcar was imported and Import duty on vehicles was introduced. Indian Great Royal Road (Predecessor of the Grand Trunk Road) was conceived. First car brought in India by a princely ruler in 1898.

Simpson & Co established in 1840. They were the first to build a steam car and a steam bus, to attempt motorcar manufacture, to build and operate petrol driven passenger service and to import

American Chassis in India. Railways first came to India in 1850's. In 1865 Col. Rookes Crompton introduced public transport wagons strapped to and pulled by imported steam road rollers called streamers. The maximum speed of these buses was 33 kms/hr.

1942 Hindustan Motors Ltd incorporated and their first vehicle was made in 1950.

In 1944 Premier Automobiles Ltd incorporated and in 1947 their first vehicle was produced.

In 1947 the Government of Bombay accepted a scheme of Bajaj Auto to replace the cycle rickshaw by the auto and assembly started in a couple of years under a license from Piaggio.

Manufacturing Program for the auto and scooter was submitted in 1953 to the Tariff Commission and approved by the Government in 1959.

In 1953 the Government decreed that only firms having a manufacturing program should be allowed to operate and mere assemblers of imported CKD units be asked to terminate operations in three years.

Only seven firms namely Hindustan Motors Limited, Automobile Products of India Limited, Ashok Leyland Limited, Standard Motors Products of India Limited, Premier Automobiles Limited, Mahindra & Mahindra and TELCO received approval. M&M was manufacturing jeeps. Few more companies came up later. Government continued with its protectionism policies towards the industry.

1960’s:

In sixties 2 and 3 Wheeler segment established a foothold in the industry. Escorts and Ideal Jawa entered the field in the beginning of sixties. Association of Indian Automobile Manufacturers formally established in 1960.

1970`s:

Major factors affecting the industry's structure were the implementation of MRTP Act, FERA and Oil Shocks of 1973 and 1979. During this decade there was not much change in the four-wheeler

industry except the entry of Sipani Automobiles in the small car market. Girnar Scooters Ltd entered into the market in 1971 and its output was less than 5000 units until 1980. In the Two Wheeler Industry there were many entries during this decade. Scooter India established in 1972.

1980's:

The period of liberalized policy and intense competition Since the 80s, the Indian car Industry has seen a major resurgence with the opening up of Indian shores to foreign manufacturers and collaborators.First phase of liberalization announced and unfair practices of monopoly, oligopoly, etc slowly disappeared. It was beginning of Liberalization of the protectionism policies of the Government.Lots of new Foreign Collaborations came up in the eighties. Many companies went in for Japanese collaborations. Andhra Pradesh Scooters entered into collaboration with Piaggio for manufacture of Vespa model. Hindustan Motors Ltd. in collaboration with Isuzu of Japan introduced the Isuzu truck in early eighties. ALL entered into collaboration with Leyland Vehicles Ltd. for development of integral buses and with Hino Motors of Japan for the manufacture of W Series of Engines.

The Two Wheeler market increased. Since 1982 the Government had permitted foreign collaborations for the manufacturing of Two

Wheelers up to 100 cc engine capacity. Foreign Equity up to 40% was also allowed.

In 1983 MarutiUdyog Ltd was started in collaboration with Suzuki, a Japanese firm. Other three Car manufacturers namely, Hindustan Motors Ltd., Premier Automobiles Ltd., Standard Motor Production of India Ltd. also introduced new models in the market.

Post-1991: After Liberalization, the Freedom to Grow

Beginning with mid-1991 the government of India has made some radical changes in its polices bearing on trade, foreign investment, exchange rate, industry, fiscal affairs and so on. Mass Emission Norms were introduced for in 1991 for Petrol Vehicles and in 1992 for Diesel Vehicles. In 1991 new Industrial Policy was announced. It was the death of the License Raj and the Automobile Industry was allowed to expand. Further tightening of Emission norms was done in 1996. In 1997 National Highway Policy has been announced which will have a positive impact on the Automobile Industry. The Indian Automobile market in general and Passenger Cars in particular have witnessed liberalization. Many multinationals like Daewoo, Peugeot, General Motors, Mercedes-Benz, Honda, Hyundai, Toyota, Mitsubishi, Suzuki, Volvo, Ford and Fiat entered the market.

Various companies are coming up with state-of-art models of vehicles. TELCO has diversified in Passenger Car segment with Indica. Despite the adverse trend in the growth of the industry, it is resolutely trying to meet the challenges. Various issues of critical importance to the industry are being dealt with forcefully.

In 1999 The Hon’ble Supreme Court passed an order directing all car manufacturers to comply with Euro I emission norms (India 2000 norms) by the 1st of May 1999 in National Capital Region (NCR) of Delhi. The deadline was later extended to 1st June 1999.

The 90s have become the melting point for the car industry in India. The consumer is king. He is being constantly wooed by both the Indian and foreign manufacturers. Though sales had taken a dip in the first few months of 1999, it is back to boom time. New models like Maruti’s Classic, Alto, Station Wagon, Ford’s Ikon and the new look Mitsubishi Lancer have all been launched with an eye on the emerging market.

2.4. THE INDIAN AUTOMOBILE INDUSTRY AT PRESENT

The Indian automobile industry has come a long way since the first car ran on the streets of Mumbai in 1898. The initial years of the industry were characterized by unfavorable government policies.

The real big change in the industry, as we see it today, started to take place with the liberalization policies that the government initiated in the 1991. The liberalization policies had a salutary impact on the Indian economy and the automobile industry in particular.

The automobile industry in the country is one of the key sectors of the economy in terms of the employment opportunities that it offers. The industry directly employs close to around 0.2 million people and indirectly employs around 10 million people. The prospects of the industry also has a bearing on the auto-component industry which is also a major sector in the Indian economy directly employing 0.25 million people.

The automobile industry in India is gradually evolving to replicate those of developed countries. The trends are emerging in the industry across segments, namely, passenger cars, multi-utility vehicles, commercial vehicles, two-wheelers and tractors. The qualitative analysis of the various trends reveals that the industry offers immense scope even for allied industries and those looking at investing in the auto industry.

The Indian automobile industry is undergoing a revolution of sorts. The vehicle war is on. And it's a fight to the finish. Within the span of a few years, the vehicle market has displayed an array. Most of these new entrance all multinational companies that have joint venture with Indian companies. Multinational companies own more than 50% stake in their joint ventures, and sometimes this stake comes near to 100%. For example Italian Auto major, FiatAuto Spa has 94.77% stake in Fiat India Limited. A few of these new companies are fully subsidiary of foreign companies like Yamaha Motor India Ltd which is 100% subsidiary of Yamaha Motor Company of Japan.

Some Indian Automobile companies have several subsidiaries for manufacturing different vehicles, same as Eicher Ltd, SonalikaGroup, Escorts Ltd and Mahindra & Mahindra.Eicher Ltd includes Eicher Tractors Ltd for tractors manufacturing and Royal Enfield Motors Limited in motorcycles section. SonalikaGroup has International Tractors Limited for the manufacture of tractors (incorporated 1995) and Sonalika Agriculture Corporation (established in 1971) that has

approximately 80% share in Indian market of farm machinery. Escorts Ltd also includes Escorts Tractors Ltd and Escorts JCB Ltd. Mahindra & Mahindra has Mahindra Nissan Allwyn and Gujarat Tractors Corporation as subsidiaries.

Several companies in the Industry were declared sick during their life; because they have come under the Sick Industrial Companies (Special Provisions) Act, 1985. Thus they have been referred to the Board of Industrial and Financial Reconstruction (BIFR).

Finally 26 companies in the industry have been listed in Bombay Stock Exchange (BSE); and only 18 of them were listed in 2001 or before that date and were not delisted of BSE or not referred to BIFR. One company also has eliminated because of its negative values for average operating income during the period of the study.

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LIST OF AUTOMOBILE COMPANIES IN INDIA

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Changes in technology

Most people know that the Ford Model T was the first truly affordable automobile. But do you know what kind of engine it had? The original Model T, released in 1908, packed a 2.9-liter four-cylinder engine with just 22 horsepower.

That's a tiny output for its size compared to the engines of today, but it sure beat the engine in what's considered to be the first automobile -- the 1885 Benz Patent Motorwagen. That car had a single-piston engine and generated just two-thirds of a single horsepower.

As we can see, automobile engines have been in constant evolution since the very beginning of motoring. Today they are more powerful, quieter, more durable, less polluting and morefuel-efficient than they have ever been before, thanks to constant advancements in engine design and technology.

Automotive engineers are constantly working on ways to improve the internal combustion engine and carry it into the future. How many other inventions do you know that have been continuously refined for more 150 years?

Diesel vs. Petrol Vehicles

10 Year Old Diesel Vehicles Banned in Delhi

NGT (National Green Tribunal) is an Act of Parliament to expedite the resolution of issues related to Environmental Factors. 

NGT has cited a set of measures to put a stop on increasing Air Pollution of which 2 are noteworthy is:- 

» Complete Ban of Petrol Cars Manufactured more than 15 Years Old

» Ban on Diesel Vehicle Manufactured 10 Years Ago

The Ban has come in in form of

» New Fitness Certificate Renewal not allowed for 15 Year Old Petrol Cars

» Banned to Ply on Roads for Diesel Cars more than 10 Years Old or Petrol Cars 15 yrs+ Old and even having Fitness Certificate in Capital City Delhi

The move is applicable on all Kinds of Vehicle - Private or Commercial Vehicles. 

Basis NGT Recommendation - if any of these vehicles are found plying on roads / Parked in Public Places or Entering in New Delhi - Traffic Police will have the right to Seize the Vehicle and also simultaneously fine the Owner.

The Implementation of Order is getting Executed from 8th April - wherein Government agencies will set up Border Checks at :- Ghaziabad, Noida, Faridabad, Gurgaon for vehicles entering in Delhi. Even - further meetings to take place - wherein Fines and Public Notification will be released in Coming Days about Implementation or Order. The Objective is to Improve Deteriorating Air Quality - which is causing Serious Air Borne Diseases and is slowly impacting Health .

After Impact Consequences of 10 Year Old Diesel and 15 Year Old Petrol Cars

However - Some Important Questions - which yet to be addressed and needs to be answered

» There are many vehicles which are not causing pollution and have been maintained well even though they may be more than 10 years old. Similarly, there are vehicles that are polluting just 5 years after being bought. Can there be no Stringent Pollution Check Criteria instead of Ageing Factor

» There Could be a Petrol Car Driven Just 50000 Kms in 15 Yrs or Diesel Car Driven just 80000 Kms in 10 Yrs - well maintained with all Periodic Servicing done on time Vis a Vis Petrol Car Driven 1.2 Lakh Km in 10 Yr or Diesel Car Driven 1.5 Lakh Km in 5 yr without been Maintained well. The Decision seems considering not the entire Aspect

» If Ageing of the Vehicle is the Sole Criteria, then Whats the relevance of PUC Checks and Why is PUC Checks not been stringent enough

» What happens to people who have well maintained old vehicles and cannot afford new ones. Been - Car Value will Depreciate a Lot - who will bear in Loss

» Substantial Depreciation in Used Car Value with hardly any takers for 10 year+ Old Diesel Cars and 15 Yr+ Old Petrol Cars. Used Car Dealers will Probably only give Scrap Value on Exchange of 10 Year+ Old Diesel Car in Delhi, 15 Year+ Old Petrol Cars and sell in Other States

» Insurance Companies might Stop Renewing Car Insurance for Vehicles which will be more than 10 years Old in Delhi, leading to uninsured vehicles with suspectible uninsured cars.

» Last but not Least - Life Time Road Tax is Paid which is Valid for 15 Years from Date of Registration. How can the same be revoked within 10 Years Itself in case of Diesel Cars, is there any such clause in Motor Vehicle Act

http://www.mycarhelpline.com/index.php?option=com_easyblog&view=entry&id=217&Itemid=91

Diesel Vehicles

Diesel vehicles may be making a comeback. Diesel engines are more fuel-efficient and have more low-end torque than similar-sized gasoline engines, and diesel fuel contains roughly 10% to 15% more energy than gasoline. So, diesel vehicles can often go about 20% to 35% farther on a gallon of fuel than their gasoline counterparts. Plus, today's diesel vehicles are much improved over diesels of the past.

Better Performance

Improved fuel injection and electronic engine control technologies have

Increased power

Improved acceleration Increased efficiency

New engine designs, along with noise- and vibration-damping technologies, have made them quieter and smoother. Cold-weather starting has been improved also.

Cleaner

Today's diesels must meet the same emissions standards as gasoline vehicles. Advances in engine technologies, ultra-low sulfur diesel fuel, and improved exhaust treatment have made this possible.

Although emissions of particulates and smog-forming nitrogen oxides (NOx) are still relatively high, new "clean" diesel fuels, such as ultra-low sulfur diesel and biodiesel, and advances in emission control technologies will reduce these pollutants also.

Siam.com

Auto ancillary tiers

Tiers

Petrol price and diesel price table with difference

Bibliography

http://www.ibef.org/industry/india-automobiles.aspx [1 ] http://shodhganga.inflibnet.ac.in/bitstream/

10603/3722/13/13_chapter%204.pdf [2] Bombay Stock Exchange (BSE) official directory, companies’

annual reports, www.indiainfoline.com, www.the-infoshop.com , www.cybersteering.com [3]