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    UNIT IV BBMT

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    INDIAN AUTOMOBILE GIANTS!

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    AUTOMOBILE ASSEMBLY

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    Indian Automobile industryy The automobile industry in India happens to be the

    ninth largest in the world.

    y Following Japan, South Korea and Thailand, in 2009,India emerged as the fourth largest exporter ofautomobiles.

    y Several Indian automobile manufacturers have spread

    their operations globally as well, asking for moreinvestments in the Indian automobile sector by theMNCs.

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    INDUSTRY BACKGROUNDy Driving the most luxurious car has been made possible by the

    stiff competition in the automobile industry in India, withoverseas players gathering the same momentum as the domesticparticipants.

    y Every other day, we have been hearing about some new launches,some low cost cars all customized in a manner such that thecommon man is not left behind.

    y In 2009, the automobile industry is expected to see a growth rateof around 9%, with the disclaimer that the auto industry in Indiahas been hit badly by the ongoing global financial crisis.

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    Beginning of the Industryy The beginnings of automotive industry in India can be

    traced during 1940s.y After the nation became independent in the year 1947, the

    Indian Government and the private sector launched theirefforts to establish an automotive component

    manufacturing industry to meet the needs of theautomobile industry.y The growth of this segment was however not so

    encouraging in the initial stage and through the 1950s and1960s on account of nationalization combined with the

    license raj that was hampering the private sector in thecountry.y However, the period that followed 1970s, witnessed a

    sizeable growth contributed by tractors, scooters andcommercial vehicles. Even till those days, cars weresomething of a sort of a major luxury.

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    Contd..y Eventually, the country saw the entry of Japanese

    manufacturers establishing Maruti Udyog. During the

    period that followed, several foreign based companiesstarted joint ventures with Indian companies.

    y During 1980s, several Japanese manufacturers startedjoint-ventures for manufacturing motorcycles and

    light commercial-vehicles.y During this time, that the Indian government selected

    Suzuki for a joint-venture to produce small cars.

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    1991 Liberalizationy

    Experts have an opinion that during the early stages thepolicies and the treatment by the Indian government werenot favorable to the development of the automobileindustry.

    y However, the liberalization policy and various tax reliefs

    announced by the Indian government over the recent pasthave pronounced a significantly encouraging impact onthis industry segment.

    y Estimates reveal that owing to several boosting factors,Indian automobile industry has been growing at a pace of

    about 18% per year.y Therefore, global automobile giants like Volvo,

    General Motors and Ford have started looking at Indiaas a prospective hot destination to establish andexpand their operations.

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    Automobile industryy The economic liberalization that dawned in India in theyear 1991 has succeeded in bringing about a sustainedgrowth in the automotive production sector triggered byenhanced competitiveness and relaxed restrictions

    prevailing in the Indian soil. A number of Indianautomobile manufacturers including Tata Motors, MarutiSuzuki and Mahindra and Mahindra, have dramaticallyexpanded both their domestic and internationaloperations.

    y This segment has in fact invited a huge amount of India-specific investment by a number of multinationalautomobile manufacturers. As a significant milestone inits progress, the monthly sales ofpassenger cars inIndia exceeded 100,000 units in February 2009.

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    Transportation Systemy Like many other nations Indias highly developed

    transportation system has played a very important rolein the development of the countrys economy over the

    past to this day.y One can say that the automobile industry in the

    country has occupied a solid space in the platform ofIndian economy.

    y Empowered by its present growth, today theautomobile industry in the country can produce adiverse range of vehicles under three broad categoriesnamely cars, two-wheelers and heavy vehicles.

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    TURNOVERTurnover ofAutomobileManufacturers

    USD ($)

    Year In USD Million

    2002-03 14,880

    2003-04 16,544

    2004-05 20,896

    2005-06 27,011

    2006-07 34,285

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    DOMESTIC MARKET SHARE FOR 2008-09

    Passenger Vehicles 15.96%

    Commercial Vehicles 3.95%

    Three Wheelers 3.6%

    Two Wheelers 76.49%

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    Automobile companies in IndiayAudi

    y Bajaj Auto

    yBMW

    y Chevrolet

    y DaimlerChrysler(Mercedes)

    y Fiat

    y Ford

    y General Motors

    y Hindustan Motors

    y Hero Honda Motors

    y Hyundai Motors

    y Mahindra & Mahindray Maruti Udyog

    y San Motors

    y Skoday Tata Motors

    yYamaha Motors

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    Locally manufactured Automobilesof

    MNCsy Audi: A4, A6.

    y BMW: 3 Series, 5 Series.

    y Chevrolet: Spark, Aveo U-VA, Aveo, Optra, Cruze, Tavera.

    y Fiat: Palio, Grande Punto, Linea.

    y Ford: Ikon, Fiesta, Fusion, Endeavour

    y Honda: Jazz, City, Civic, Accord.

    y Hyundai: Santro, i10, Getz, i20, Accent, Verna, Sonata.

    y

    Mercedes-Benz: C-Class, E-Classy Mitsubishi: Lancer, Lancer Cedia.

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    Contdy Renault: Logan

    y koda: Fabia, Octavia, Laura.

    y Toyota: Corolla, Innova, Fortuner

    y Volkswagen: Jetta, Passat.

    y Cars sold in India as Completely Built Units

    y Audi: A8, TT, R8, Q5, Q7.

    y Bentley: Arnage, Continental GT, Continental Flying Spur, Arnage.

    y

    BMW: 6 Series, 7 Series, X3, X5, X6, M3, M5, M6 and Z4.y Chevrolet: Captiva

    y Fiat: 500.

    y Honda: Civic Hybrid, CR-V.

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    Contdy Hyundai: Tucson.y Jaguar: XF, XK.y Lamborghini: Gallardo, Murcilago.y Land Rover: Range Rover, Range Rover Sport, Discovery 4, Freelander 2.y Maybach: 57 and 62.y Mercedes-Benz: CL-Class, CLS-Class, S-Class, SL-Class, SLK-Class, M-Class,

    Viano.y Mitsubishi: Pajero, Montero, Outlander.y Nissan: Teana, X-Trail.y Porsche: 911, Boxter, Panamera, Cayman, Cayenne.y

    Rolls Royce: Ghost, Phantom, Phantom Coup, Phantom Drophead Coup.y koda: Superb.y Suzuki: Grand Vitara.y Toyota: Camry, Land Cruiser, Land Cruiser Prado.y Volkswagen: Touareg.y Volvo: S80, XC90.

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    Overview of Automobile industryy Starting its journey from the day when the first car rolled

    on the streets of Mumbai in 1898, the Indian automobileindustry has demonstrated a phenomenal growth to thisday.

    y Today, the Indian automobile industry presents a galaxy ofvarieties and models meeting all possible expectations andglobally established industry standards.

    y Some of the leading names echoing in the Indianautomobile industry include Maruti Suzuki, Tata Motors,Mahindra and Mahindra, Hyundai Motors, Hero Hondaand Hindustan Motors in addition to a number of others.

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    Current Scenarioy During the early stages of its development, Indian automobile

    industry heavily depended on foreign technologies.

    y However, over the years, the manufacturers in India have started

    using their own technology evolved in the native soil.y The thriving market place in the country has attracted a number

    of automobile manufacturers including some of the reputedglobal leaders to set their foot in the soil looking forward toenhance their profile and prospects to new heights.

    yFollowing a temporary setback on account of the globaleconomic recession, the Indian automobile market has onceagain picked up a remarkable momentum witnessing a buoyantsale for the first time in its history in the month of September2009.

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    Road Aheady The automobile sector of India is the seventh largest in theworld. In a year, the country manufactures about 2.6 million carsmaking up an identifiable chunk in the worlds annualproduction of about 73 million cars in a year.

    y

    The country is the largest manufacturer ofmotorcycles andthe fifth largest producer ofcommercial vehicles. Industryexperts have visualized an unbelievably huge increase in thesefigures over the immediate future.

    y The figures published by the Asia Economic Institute indicatethat the Indian automobile sector is set to emerge as the globalleader by 2012.

    y In the year 2009, India rose to be the fourth largest exporter ofautomobiles following Japan, South Korea and Thailand. Expertsstate that in the year 2050, India will top the car volumes of allthe nations of the world with about 611 million cars running on

    its roads.

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    Current Scenarioy At present, about 75 percent of Indias automobile industry is made up

    by small cars, with the figure ranking the nation on top of any othercountry on the globe. Over the next two or three years, the country isexpecting the arrival of more than a dozen new brands making

    compact car models.y Recently, the automotive giants of India including General

    Motors (GM), Volkswagen, Honda, and Hyundai, havedeclared significant expansion plans. On account of itshuge market potential, a very low base of car ownership inthe country estimated at about 25 per 1,000 people, and arapidly surging economy, the nation is firmly set on its wayto become an outsourcing platform for a number of globalauto companies. Some of the upcoming cars in the Indiasoil comprise Maruti A-Star (Suzuki), Maruti Splash(Suzuki), VW Up and VW Polo (Volkswagen), Bajaj small

    car (Bajai Auto), Jazz (Honda) and Cobalt, Aveo (GM) inaddition to several others.

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    Maruti Suzuki India Limitedy Maruti Suzuki India Limited subsidiary of Suzuki

    Motor Corporation of Japan, is India's largestpassenger car company, accounting for over 45% of thedomestic car market. The company offers a complete

    range of cars from entry level Maruti-800 and Alto, tostylish hatchback Ritz, A star, Swift, Wagon-R, Estilloand sedans DZire, SX4 and Sports Utility vehicleGrand Vitara.

    y It is the market leader in India and on 17 September 2007, MarutiUdyog Limitedwas renamed Maruti Suzuki India Limited. Thecompany's headquarters are located in Delhi.

    y Key people Mr. Shinzo Nakanishi, ManagingDirectorand CEO

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    CEOs

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    Mahindra & Mahindray Mahindra & Mahindra Limited (BSE: 500520) is partof the Indian Industrial Conglomerate MahindraGroup based in Mumbai.

    y In recent times the company is engaged in spreading its reach beyond

    its traditional markets. They entered into the two-wheeler segment bytaking over the Kinetic Motors in India[4]. M&M also has controllingstake in REVA Electric Car Company.[5] M&M has also been selected asthe preferred bidder for the acquisition of South Korea's SsangYongMotor Company.

    y The company was set up in 1945 in Ludhiana asMahindra & Mohammed by brothers K.C. Mahindraand J.C. Mahindra along with Malik GhulamMohammed..

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    Mahindra & Mahindra

    yAfter India gained independence and Pakistanwas

    formed; Malik Ghulam Mohammed moved to Pakistanwhere he became the nation's first finance minister.Now, with the Mahindra brothers as the whole sole ofthe company, its name was changed to Mahindra &

    Mahindra in 1948y Key people Keshub Mahindra (Chairman),Anand

    Mahindra (Vice-Chairman & Managing Director)

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    HYUNDAI MOTORS INDIA LTDy Hyundai Motor India Limitedwas formed in 6 May

    1996 by the Hyundai Motor CompanyofSouth Korea.

    When Hyundai Motor Company entered the IndianAutomobile Market in 1996 the Hyundai brand wasalmost unknown throughout India. During the entryof Hyundai in 1996, there were only five majorautomobile manufacturers in India, i.e. MUL, HM,PAL, TELCO and M&M. Daewoo had entered theIndian automobile market with Cielojust three yearsback while Ford, Opel and Honda had entered lessthan a year back.

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    Contd..y Hyundai Motor India Limited is a wholly owned

    subsidiary of the Hyundai Motor Companyin India. It

    is the 2nd largest automobile manufacturer in Indiaafter Maruti Suzuki.

    y Key people Mr. H.W. Park, MD

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    TATA MOTORS LTDy Tata Motors Ltd is a multinational corporation headquartered in

    Mumbai, India. Part of the Tata Group, it was formerly known asTELCO (TATA Engineering and Locomotive Company).

    y Tata Motors is Indias largest automobile company, with consolidatedrevenues of USD 20 billion in 2009-10. It is the leader in commercial

    vehicles and among the top three in passenger vehicles. Tata Motorshas winning products in the compact, midsize car and utility vehiclesegments. The company is the world's fourth largest truckmanufacturer, and the world's second largest bus manufacturer withover 24,000 employees. Since first rolled out in 1954, Tata Motors hasproduced and sold over 4 million vehicles in India

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    y Headquarters Mumbai, Maharashtra, India Key peopleRatan Tata, ChairmanR

    avi Kant, Vice ChairmanCarl Peter Foster, CEOPrakash Telang, MD (India Operations)Ravi Pisharody, President (CVBU)

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