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Page 1: India Automobile Industry

Term paperSub: Managerial economics

Topic- Performance of Automobile Sector

post liberalization regime

Submitted to: Submitted by:

Page 2: India Automobile Industry

Acknowledgement

I am thankful to Mr.Varun Nayyar for providing me the task of preparing the Term Paper on Performance of Automobile Sector post liberalization regime. We at Lovely believe in taking challenges and the term paper provided me the opportunity to tackle a practical challenge in the subject of economics. This term paper tested my patience at every step of preparation but the courage provided by my teachers helped me to swim against the tide and move against the wind.

I am also thankful to my friends and parents for providing me help at every step of preparation of the Term Paper.

Pallavi Modi

Page 3: India Automobile Industry

Index

1.About Indian Automobile Industry

2.Performance of automobile sector post liberalization regime.

3.Hypotheses

4.Indian automobile sector - A Booming Market

5.Auto sector set for a smooth drive

6.Automobile Sector advertising on TV in the year 2006

7.Bibliography

Page 4: India Automobile Industry

About Indian Automobile IndustryFollowing India's growing openness, the arrival of new and existing models, easy availability of finance at relatively low rate of interest and price discounts offered by the dealers and manufacturers all have stirred the demand for vehicles and a strong growth of the Indian automobile industry.The data obtained from ministry of commerce and industry, shows high growth obtained since 2001- 02 in automobile production continuing in the first three quarters of the 2004-05. Annual growth was 16.0 per cent in April-December, 2004; the growth rate in 2003-04 was 15.1 per cent The automobile industry grew at a compound annual growth rate (CAGR) of 22 per cent between 1992 and 1997. With investment exceeding Rs. 50,000 crore, the turnover of the automobile industry exceeded Rs. 59,518 crore in 2002-03. Including turnover of the auto-component sector, the automotive industry's turnover, which was above Rs. 84,000 crore in 2002-03, is estimated to have exceeded Rs.1,00,000 crore ( USD 22. 74 billion) in 2003-04. Automobile Dealers Network in India.In terms of Car dealer networks and authorized service stations, Maruti leads the pack with Dealer networks and workshops across the country. The other leading automobile manufactures are also trying to cope up and are opening their service stations and dealer workshops in all the metros and major cities of the country. Dealers offer varying kind of discount of finances who in tern pass it on to the customers in the form of reduced interest rates.

Major Manufacturers in Automobile Industry

Maruti Udyog Ltd. General Motors India

Ford India Ltd.

Eicher Motors

Bajaj Auto

Page 5: India Automobile Industry

Daewoo Motors India

Hero Motors

Hindustan Motors

Hyundai Motor India Ltd.

Royal Enfield Motors

Telco

TVS Motors

DC Designs

Swaraj Mazda Ltd

Government has liberalized the norms for foreign investment and import of technology and that appears to have benefited the automobile sector. The production of total vehicles increased from 4.2 million in 1998- 99 to 7.3 million in 2003-04. It is likely that the production of such vehicles will exceed 10 million in the next couple of years. The industry has adopted the global standards and this was manifested in the increasing exports of the sector.After a temporary slump during 1998- 99 and 1999-00, such exports registered robust growth rates of well over 50 per cent in 2002-03 and 2003-04 each to exceed two and- a-half times the export figure for 2001-02.

Automobile Export Numbers

Category 1998-99 2004-05 (Apr-Dec)

Passenger Car 25468 121478

Multi Utility Vehicles 2654 3892

Commercial Vehicles 10108 19931

Two Wheelers 100002 256765

Three Wheelers 21138 51535

Percentage Growth -16.6 32.8

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The Key Factors Behind This Upswing

Sales incentives, introduction of new models as well as variants coupled with easy availability of low cost finance with comfortable repayment options continued to drive demand and sales of automobiles during the first two quarters of the current year. The risk of an increase in the interest rates, the impact of delayed monsoons on rural demand, and increase in the costs of inputs such as steel are the key concerns for the players in the industry.

As the players continue to introduce new models and variants, the competition may intensify further. The ability of the players to contain costs and focus on exports will be critical for the performance of their respective companies.

Performance of automobile sector post liberalization regime.

Introduction

Developing an appropriate public policy towards the industrial sector has been animportant task for Indian policy makers for a long time. When India moved away from aninward looking industrialisation strategy to a more ‘open’ economy in 1991, industrial firmsneeded to restructure themselves to retain competitiveness. Much of these restructuring is

Page 7: India Automobile Industry

needed to correct the inefficiencies created by operating in a protected market. The automobilesector has been a major candidate in the industrialisation process since the beginning of planned development. The policy changes were in two doses and took the form of partialde-regulations introduced in 1985 and Liberalisation measures launched since 1991. The pre1985 regime could be described as an era of strict controls and regulations. The initial changes,introduced in 1985, eased the licensing requirements, broad-based the classification of vehiclesfor issue of licenses, allowed selective expansion of capacity and partially relaxed controls withregard to foreign collaborations, imports of capital goods, raw materials and spares. Thoughthese measures represented a "domestic Liberalisation", the policy environment continued beinggeared towards imposing trade and investment regulations, constraining the growth of bigbusiness houses and regulating exchange rates. It was only after 1991 that notable broad-basedchanges in policy that had far reaching implications actually came into being. These changesdispensed with the bulk of controls and regulations and for the first time since independenceassigned a central role to market forces. This paper analyses the behaviour of Indian automobile firms operating under regulated and liberal economic policy regimes. Results from the step-wise discriminant analysis presented in this paper reveal that the conduct and performance of firms in this sector differ significantly between the regulated [1985-86 to 1990-91] and liberal [1991-92 to 1995-96] economic policy regimes with respect to foreign equity participation, in-house R & D efforts,technology imports, capital intensity, advertisement, exports, growth and profits.

Policy Regimes, Firms' Conduct and Performance

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The automobile industry in India grew under a highly regulated and protected economicenvironment over the period 1950 to 1985. Automobile manufacturing firms were subjected tostrict product specific and capacity licensing and as a result very few firms dominated all theproducts. These restrictions provided no motivation or incentive for the firms to bring abouttechnological upgradation.The policy environment during the period 1985-86 to 1990-91 permitted a limitedincrease in technology inflow through various modes. Inflow of technology from abroadbrought about a shift in the technology frontier as well as a change in the technologicaltrajectories in which the firms had been operating. However, partial relaxation of this kindfailed to bring about a drastic change in the non-competitive environment in which the firmshad been operating for a long timeliberalisation of economic policies and the outward orientation introduced since 1991,on the other hand, brought about a dramatic change in this industry. These policy measures considerably transformed the environment in which the firms had been operating. As a consequence, the industry witnessed the entry of new firms and adoption of strategies by the already existing firms to introduce technological change and improve their performance. The new players brought in modern engineering, efficient processes and effective shop-floor layouts. The new manufacturing strategies include breaking up of the plant into modules and cells, reduce the complexity of purchasing logistics, reduction of inventories and product complexity, and creation of simpler processes by encouraging flexibility and teamwork. These firms also make extensive use of CAD/CAM in their plants.

On the whole, Indian Automotive sector grew at a much faster rate in the post 1991 era[14.31 % per annum] when compared to

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[8.56 % per annum] the period of 1985-91 [Table 1].The growth rate of all the sectors within the 4 wheelers and Commercial vehicles has been in double digit with the LCV sector registering the maximum [of 19.93 % per annum] in terms of the growth rate as well as increase over the earlier period. Medium and Heavy commercial vehicles sector also registered a growth rate of about 11% per annum, which is a 100% increase over the previous period, 1985-86 to 1990-91. In the 4-wheeled drives sector Jeeps [other utility vehicles] experienced the maximum increase in growth [from about 5.57 % per annum to 14.4 % per annum] between the two periods. The Car sector also had an increase of about 2.5 percent in its growth rate over the two periods. This was the only sector which had a double- digit growth rate during the first period [which can be attributed to Maruti] and has improved its performance during the 1990s.

ANNUAL AVERAGE GROWTH OF PRODUCTION OF AUTOMOBILES

Sector/Period 1985-86 to1991-92

1991-92 to1995-96

CARSJEEPSALL 4 WHEELERSM&HCVSLCVSALL CVsTOTAL

12.635.5711.10

5.397.336.038.56

15.1714.4014.84

11.3219.3313.9314.31

During this growth process, the industry experienced changes in the strategy adopted by many firms in that efforts were made to build up technology acquisition, product quality was improved and in general the industry became more competitive. Economic policy forces have an impact on the extent and direction of

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technological efforts of firms. While the technological efforts during import substitution era were generally directed at increasing the local content of products, the export-oriented policy induced the firms to direct efforts to reduce costs and improve quality by implementing changes that upgrade the production process. Rao [1993] found that the investment strategies for R & D, plant modernisation and expansion, material and machine tool inputs undertaken by Indian automobile firms are all related to the technological position of the firm on product and process dimension. Narayanan [1998] also found that inter-firm differences in competitiveness in the automobile sector in India, depended on technological trajectory advantages during the licensing regime and on the variables capturing technological paradigm shifts after the introduction of de-regulation policies during the mid 1980s. Before 1983 the passenger Car sector of the Indian automobile industry consisted of only three firms with limited capacity. In 1983, Maruti [which is a joint venture of the Government of India and Suzuki Motors, Japan] entered the industry and dramatically affected the market share of all firms. Maruti enjoyed as much as 50% of the market share during the first period of this study. Later Maruti, with its range of four wheeled vehicles, was able to push up its market share during the 1990s to 60%. Telco, a leading Commercial Vehicle manufacturer in India, also entered the Car segment after 1991 and introduced four wheeled passenger cars that are ideally suited for long distance travel on Indian roads. The entry of Telco virtually decreased the market share of the two formerly leading car manufacturers in India - Hindustan Motor and Premier Automobiles - to single digit. These two firms, Hindustan Motor and Premier Automobiles, continue to struggle for survival in the face of competition that has resulted from the entry of new subsidiaries of the world's leading auto manufacturers: General Motors and Ford Motor Company [from USA], Mercedes Benz [from Germany, Daewoo Corporation [from Korea] and

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Automobiles Peugeot [from France]. All these firms have entered into the Indian Car segment after this sector was de-licensed in 1993 and their products hit the market in 1996. Recently there are two more entrants in the Car segment - Honda [Japan] and Hyundai [Korea] - which have introduced small sized cars to compete with Suzuki. Market share of Maruti Suzuki has declined from as high as 89% during the early 1990s to 54% by the late 1990s. Telco also introduced a small sized car during 1998, keeping in mind the idiosyncrasies of the Indian market. The Car segment, therefore, has emerged as a leading competitive sector in India during the post Liberalisation period.

HypothesesOn the basis of these possible effects of Liberalisation on the behaviour of firms anddrawing upon the empirical knowledge, this study formulates hypotheses [in Section 3]concerning the nature of differences in the behaviour of firms across the two policy regimes.The parameters to capture the behaviour of firms have been classified into technologyacquisition, product improvements through imports of components, vertical integration, product differentiation and performance.

Technology Acquisition:Technology acquisition by a firm can be facilitated through imports [technology transferfrom abroad] and in-house R&D efforts. Technology acquisition from abroad consists oftechnology imports through the market or "arms-length" purchase of technology againstlumpsum and royalty payments [LR], intra-firm transfer of technology through foreign direct

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investment (foreign equity participation [FE]) and technology transfer through the supply ofmachinery and equipment, where the technology is embodied in the imported capital gooditself [IMCAP]. An in-house research and development effort of firms [RD] is one of theimportant methods of location, adaptation, assimilation and development of the importedtechnology. Following Ansal [1990], Basant [1997] and Narayanan [1998], it could be arguedthat the technological strategies adopted by a firm could be different during varying policyregimes. The present study examines the role of all the four technological factors identifiedabove during the two policy periods

Intra-firm Technology Transfer : Restrictions on foreign equity investment and selective permission allocate a limited rolefor intra-firm transfer of technology. Moreover, since most of the firms during the first period were established with minority foreign equity holding, diffusion of technological knowledge in India could also have been slower. With Liberalisation multinational firms could have majority equity holdings and therefore influence management of the firm as well. This ability to influence the management may have led to transfer of design and drawings which accelerated the diffusion of technological knowledge and also enabled such concerns to develop export markets in association with the Indian firms.

Disembodied Technology Imports : Restrictions on technology collaborations involving heavy lumpsum and royalty payments resulted in selective use of imports of disembodied technology during the first period.Liberalisation of restrictions on lumpsum and royalty payments could have led to an increase in the use of this mode of technology imports. The increasing presence of multinationals and

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transfer of better quality technology could have also led to an increase in technology [lumpsum and royalty] payments.

In-house R & D Efforts: The absence of competitive pressure and the perpetuation of sellers markets may lead tolow R & D activity in firms belonging to a developing country. Limited use of in-house efforts, either for adaptation of imported technology or in locating technology imports could also explain low R & D activity. With a more open policy environment, increasing competition and higher costs of technology imports, firms may realise that to catch up with technological frontier, they need to direct their efforts to build capabilities for technology generation, rather than depend on imports. As a result expenditure on in-house R & D would increase in a liberalized environment. Reddy [1997], on the basis of a survey of 32 R & D units of transnational corporations in India, found evidence suggesting an increasing trend of investments on R & D seeking to develop new products and processes. This, he argued, was facilitated by the availability of trained personnel. Since auto industry has been one of the major beneficiaries of multinational participation during the Liberalisation period, it may be appropriate to hypothesise an increasingly important role for R & D intensity

Technology Interaction: As stated earlier, firms operating in a restrictive regime directed their in-house R & D efforts either to complement imported technology to facilitate technological trajectory shifts or to locate their technology imports. Some firms in the process of diffusion of imported technology, as a result, could have used the interaction between technological imports and in- house efforts. With the entry of leading multinationals and transfer of design and drawings, the technological search activity during the post Liberalisation period may have resulted in bringing

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about cost reduction and technological upgradation of vehicles to face global challenges. This could have been undertaken by developing technological trajectory advantages. The study, therefore, analyses the difference in the role played by technology interaction [between imported technology and in-house R & D] variables over the two policy regimes. The means of all the three interaction variables [FE*RD, LR*RD and IMCAP*RD] are expected to be higher in the second period over the earlier one and emerge as important discriminants.

Imports of Components:Firms use imported components and parts either as a part of a 'package' in the transfer oftechnology or due to certain costs and quality advantages. In an era of domestic Liberalisation,restricted trade and strict exchange rate control, imports of components were used by somefirms as a source of technological upgradation of their product. Higher imports could also bebecause firms would choose the quicker option of importing the parts and components ratherthan encouraging parallel technology transfer to component manufacturers as well. With anacross the board change in trade policy, devaluation of the currency, move towards tariffcontrols and more realistic exchange rate, however, dependency on imports of components mayactually decline. This is because of the choice between importing at a higher price and domesticprocurement. To stay put in competition, firms may use the latter option. The study, therefore,expects a reduction in the dependency on imports of components [IMCOM] between the twopolicy regimes.Product Differentiation:Advertisement is an important aspect of non-price rivalry among firms. The absence of

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effective competition during the first period could have been a source of low advertisementintensity. The presence of a number of multinationals after the 1991 policy reforms, and theresultant scope for non-price competition may have led to an increase in advertisementxpenditures. Dunning [1981] has found an increasing dependency on advertisement for agiven rise in multinational participation. Since the automobile industry witnessed entry of anumber of multinationals during the post1991 period, it is only appropriate to hypothesise apositive and increased use of advertisement [AD] as a varying strategy over the policy changes.Vertical Integration:Following Williamson [1985] it could be argued that vertical integration [VI] takesplace in order to economise on transaction costs. The restricted policy environment during thesecond half of the 1980s would have encouraged firms to depend on the easier options of eitherimporting or procuring required components and parts from the market. Liberalisation ofeconomic and trade policies [especially with a more realistic exchange rate] can lead to highercosts of imported components and parts. In addition the emergence of non-price competitionmay cause firms to produce most of the components and parts themselves to ensure quality andtimely delivery. The study, therefore, postulates an increased vertical integration as a strategyby firms operating under a liberalised regime in contrast to their behaviour under the earlierpolicy regime.Performance:The performance of automobile firms operating under partially de-controlled andliberalised regimes has been compared in terms of price-cost margins [PCM], growth

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[GROWTH] and exports [EX]. Most of the studies linking Liberalisation to performance haveanalysed the impact of trade Liberalisation on productivity and efficiency of firms. Evidence on the relationship between trade Liberalisation and firm-level productivity improvements varyacross countries and industries [Tybout, 1992].

Price-Cost Margins:Competition seeking to maximise profits could be a preferred objective of all firms inthe short-run. During the initial period under study, which was characterised by extensiveregulations and unfulfilled demand, the price-cost margins of firms would have been quite high.However, introduction of products involving technological upgradation by new firms, couldlead to lower profits for older firms. As a result, during the first period, the average profits earned by all firms in this industry could be low. With Liberalisation and change in the macro environment, profit margins can be expected to have gone up. This is because most of the firms in all the segments of this industry would have already been established and new firms would not yet have garnered a large market share.

Growth:

Following Marris [1964], it could be argued that a shift to a higher growth and profitfrontier usually takes place with a change in the economic environment in which the firmsoperate. During the post1985 period, firms in this industry concentrated primarily on creatingcapacity and obtaining a large market share. With the intense competition that has come tocharacterise the industry since the 1991 policy changes, firms would have attempted to shift to a higher growth-profit frontier.

Exports:Growth through geographical diversification would have been a preferred strategy by

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firms, either due to insufficient domestic demand or to fulfil the export obligations that theGovernment has imposed from time to time. During the first period, increased production wasbasically aimed at catering to the requirements of unfulfilled demand. As a result, barring a few firms, which had been exporting their vehicles for a long time, achieving a high domesticmarket share was the preferred objective of most of the firms. However, with a more open. economic environment and introduction of new technological sophisticated vehicles by both the Indian as well as the multinational firms, there may have been some orientation towards external markets. Further, a fall in the value of Indian rupee would have made Indian vehicles cheaper internationally and could possibly have stimulated exports. The study, therefore, postulates an increased role for exports in the post Liberalisation period in contrast to the second half of eighties.

Indian automobile sector - A Booming Market

De-licensing in 1991 has put the Indian automobile industry on a new growth track, attracting foreign auto giants to set up their

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production facilities in the country to take advantage of various benefits it offers. This took the Indian automobile production from 5.3 Million Units in 2001-02 to 10.8 Million Units in 2007-08. The other reasons attracting global auto manufacturers to India are the country’s large middle class population, growing earning power, strong technological capability and availability of trained manpower at competitive prices.

In 2006-07, the Indian automotive industry provided direct employment to more than 300,000 people, exported auto component worth around US$ 2.87 Billion, and contributed 5% to the GDP. Due to this large contribution of the industry in the national economy, the Indian government lifted the requirement of forging joint ventures for foreign companies, which attracted global to the Indian market to establish their plants, resulting in heightened automobile production.Key Research Highlights - Passenger car production in India is projected to cross three million units in 2014-15.- Sales of passenger cars during 2008-09 to 2015-16 are expected to grow at a CAGR of around 10%.- Export of passenger cars is anticipated to rise more than the domestic sales during 2008-09 to   2015-16.- Motorcycle sales will perform positively in future, exceeding 10 Million units by 2012-13.- Value of auto component exports is likely to attain a double digit figure in 2012-13.- Turnover of the Indian auto component industry is forecasted to surpass US$ 50 Billion in 2014-15.

Auto sector set for a smooth drive

After the strenuous, but fairly good growth of about 14 per cent in the last fiscal, the automobile industry as a whole continues to be on a roll. Buoyed by the cut in excise duties announced in the Budget, and a general improvement in consumer confidence,

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domestic sales of passenger vehicles rose by 31 per cent during first two months of this fiscal compared to the corresponding previous period. Sales of motorcycles, the largest selling sub-segment of two-wheelers, grew by 6.7 per cent during the same period. And, cumulative sales of the commercial vehicles segment as a whole also went up by about 17 per cent.

Behind cars' rally: The key question is whether the kind of growth rates in the passenger vehicles segment is sustainable. The sharp spike in volumes in April and May has been influenced by a few developments the benefits of which may not be available through the rest of the year. For one, the expected cut in the excise duty on passenger cars and the subsequent 8 per cent reduction effected in the Budget, led to a substantial postponement of purchases by potential buyers. The over 35 per cent rise in car sales during April and May is attributable to this duty cut. On the other hand, the jump in sales could also have been due to customers advancing their purchase decisions before the expected round of price hikes is announced by the car manufacturers. In fact, price hikes, which may be slapped on by car makers as early as next month (Hyundai and Maruti Udyog have already hiked prices of some of their products once this fiscal), can potentially dent the benefit that the excise cut gave away to customers. From the manufacturer's point of view, the increasing cost of inputs, especially sheet metal, could prove to be the reason for a gradual increase in prices.

Utility vehicles on overdrive: Amongst passenger vehicles, the utility vehicles sub-segment is likely to sustain the scorching 23.8 per cent growth witnessed during the first two months of this fiscal. This is compared to a lower 16.5 per cent growth in the previous year. With the launch of a bunch of new upper end sports utility vehicles, such as the Chevrolet Forester, the Suzuki Grand Vitara XL-7, and the soon to be introduced Ford Explorer, this sub-segment will corner more sales volumes later this fiscal.

More models in store: Talking of new product introduction, the small car club could witness a further expansion

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in terms of number of models available, and in terms of total sales with the planned launch of at least two new cars.

They will include the Opel Corsa Sail from General Motors India and possibly one new top-end small car model each from Maruti Udyog and Hyundai Motor India by early 2004. Further, with the roll out of the Chevrolet Optra also next month, a C+ segment car, GM India alone is likely to inch up the market share ladder.

The export thrust: Apart from the developments in the domestic passenger car market, manufacturers could also get a leg up from the steadily increasing exports of these vehicles, especially in the small car segment. Korean Chaebol Hyundai Motors and Japanese auto giants Toyota Motor Corporation and Suzuki Motor Corporation are already sourcing out of or have indicated their intention to source out of their Indian operations and subsidiaries. The trend of increased exports from India even evident during 2002-03, when the total export of passenger vehicles from the country shot up by about 34 per cent compared to the previous year.

Monsoon drive two-wheelers: The prospects of the other most watched segment of the auto industry — two wheelers — should also improve with the expectations of a near normal monsoon this year. Teetering on the brink of negative growth rates during a few months of 2002, the motorcycles sub-segment has now been drumming up good sales numbers during the last four months. After a growth of over 30 per cent during the year ended March 2003, for the first two months of the current fiscal, motorcycles and step-throughs recorded a modest 6.7 per cent growth. The practice of price discounts, which had become rampant amongst bike dealers (at the behest of the manufacturers), has been on the decline, indicative of a revival of demand in the segment. Again, the two-wheelers segment as a whole is likely to be positively influenced by the improvement in the economy and new product introductions.

Top gear beckons: Commercial vehicles, widely considered to be the economy's barometer, have had a good start

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for the year. According to the Society of Indian Automobile Manufacturers (SIAM), the auto industry's growth is likely to be good this fiscal as industrial growth has been projected to grow at eight per cent in 2003-04 compared to the estimated 6 per cent last year. Overall, the auto industry's prospects look bright this year. A good monsoon with widespread precipitation may help automobile manufacturers ease into top gear.

Automobile Sector advertising on TV in the year 2006

Key Findings:

37 per cent rise in ad volumes of Automobile sector on TV in 2006 over the previous year.

Cars/Jeeps garnered half of the ad volumes of Automobile sector on TV in 2006.

Most of the ads of Automobile sector on Hindi News and Regional GEC.

Tata Motors topped advertising on TV.

Cars/Jeeps saw the maximum new brands launched in the year 2006.

General Motors and TVS Motor had the maximum share of endorsement advertising by Celebrities on TV.

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Automobile sector saw maximum share of endorsement by Aamir Khan in the year 2006.

Growth in advertising of Automobile Sector on TV in 2006 compared to previous year .

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37 per cent rise in ad volumes of Automobile sector on TV in the year 2006 compared to 2005.

Automobile sector used maximum ad volumes in the fourth quarter across the years 2005-2006 on TV.

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Share of sub-categories in Automobile Sector on TV in the year 2006.

50 per cent of the ad volumes in Automobile sector were contributed by Cars/Jeeps followed by Motorcycles with 35 per cent share on TV in the year 2006.

Scooterette and Commercial Vehicles had a share of 7 per cent and 4 per cent of ad volumes respectively.

Sub-categories in Automobile Sector with the maximum growth in ad volumes on TV in the year 2006 compared to 2005.

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Top New Automobile brands launched on TV in year 2006.

Among the Top 10 new brands on TV in the year 2006, six of them belong to Motorcycles and rest four belong to Cars/Jeeps.

Tata Indica V2 Xeta Petrol topped among the new Automobile entrants on TV followed by TVS Apache.

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Top Advertisers using Celebrities for endorsing their Automobile brands on TV in year 2006.

Top five advertisers contributed 87% share of advertising endorsed by Celebrities on TV in the year 2006.

Maximum share of Celebrity endorsed advertising by General Motors and TVS Motor Company.

Other three Top advertisers are Toyota Kirloskar Motor, Hero Honda Motors and Ford India.

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Profession of Celebrities endorsing Automobile brands on TV in year 2006.

Film Actors (7 are film actors out of 14 celebrities) had the maximum 52 per cent share in endorsing of Automobile brands on TV in the year 2006.

Film Actresses had a share of 26 per cent followed by 22 per cent share by five of the Sports celebrities.

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