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Old 6th April 2017, 00:32   #1
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Default IBEF report on the Indian automotive industry for FY 2015-16

Every year, the India Brand Equity Foundation (IBEF) comes out with their various annual reports on the Indian Economy and all of it's associated industries, including a detailed report on the Automotive sector.

For their annual report of FY 2015-2016, these are some of the highlights:

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IBEF report on the Indian automotive industry for FY 2015-16-16.jpg


Full Report - IBEF_Automobiles_March_2017.pdf


Some notable points:

- The automotive industry has attracted Foreign Direct Investment (FDI) worth US$ 15.79 billion during the period April 2000 to September 2016, according to data released by Department of Industrial Policy and Promotion (DIPP).

- Electric car maker Tesla Inc. is likely to introduce its products in India sometime in the summer of 2017.

-
South Korea’s Kia Motors Corp is close to finalising a site for its first factory in India, slated to attract US$1 billion (Rs 6,700 crore) of investment. It is deciding between Andhra Pradesh and Maharashtra. The target for operationalising the factory is the end of 2018 or early 2019.

- Several automobile manufacturers, from global majors such as Audi to Indian companies such as Maruti Suzuki and Mahindra & Mahindra, are exploring the possibilities of introducing driverless self-driven cars for India.

- BMW plans to manufacture a local version of below-500 CC motorcycle, the G310R, in TVS Motor’s Hosur plant in Tamil Nadu, for Indian markets.

- Honda Motorcycle and Scooter India (HMSI) has inaugurated its 900th Honda Authorised Exclusive Dealership in India, thereby taking its total dealership network to 4,800 across the country and further plans to increase its network to 5,300 by end of 2016-17.

- Hero MotoCorp Ltd seeks to enhance its participation in the Indian electric vehicle (EV) space by pursuing its internal EV Programme in addition to investing Rs 205 crore (US$ 30.75 million) to acquire around 26-30 per cent stake in Bengaluru-based technology start-up Ather Energy Pvt Ltd.

- JustRide, a self-drive car rental firm, has raised US$ 3 million in a bridge round of funding led by a group of global investors and a trio of Y-Combinator partners, which will be utilised to amplify JustRide’s car sharing platform JustConnect and Yabber, an internet of things (IoT) device for cars that is based on the company’s smart vehicle technology (SVT).

- Ford Motor Co. plans to invest Rs 1,300 crore (US$ 195 million) to build a global technology and business centre in Chennai, which will be designed as a hub for product development, mobility solutions and business services for India and other markets.

- Cummins has plans to make India an export hub for the world, by investing in top components and technologies in India.

- Suzuki Motor Corporation, the Japan-based automobile manufacturer, plans to invest Rs 2,600 crore (US$ 390 million) for setting up its second assembly plant in India and an engine and transmission unit in Mehsana, Gujarat.

- Mr Masayoshi Son, Chief Executive Officer, SoftBank Group, has stated that Ola Cabs may introduce a fleet of one million electric cars in partnership with an electric vehicle maker and the Government of India, which could help reduce pollution and thereby transform the electric mobility sector in the country.

- China’s biggest automobile manufacturer, SAIC Motor, plans to invest US$ 1 billion in India by 2018, and is exploring possibilities to set up manufacturing unit in one of three states – Maharashtra, Andhra Pradesh and Tamil Nadu.

- Suzuki Motorcycle India Pvt Ltd has started exports of made-in-India flagship bike Gixxer to its home country of Japan, which will be in addition to current exports to countries in Latin America and surrounding countries.

- FIAT Chrysler Automobiles has recently invested US$280 million in its Ranjangaon plant to locally manufacture Jeep Compass, its new compact SUV which will be launched in India in August 2017.

- The Government of India plans to introduce a new Green Urban Transport Scheme with a central assistance of about Rs 25,000 crore (US$ 3.75 billion), aimed at boosting the growth of urban transport along low carbon path for substantial reduction in pollution, and providing a framework for funding urban mobility projects at National, State and City level with minimum recourse to budgetary support by encouraging innovative financing of projects.

- Government of India aims to make automobiles manufacturing the main driver of ‘Make in India’ initiative, as it expects passenger vehicles market to triple to 9.4 million units by 2026, as highlighted in the Auto Mission Plan (AMP) 2016-26.

- The Government plans to promote eco-friendly cars in the country i.e. CNG based vehicle, hybrid vehicle, and electric vehicle and also made mandatory of 5 per cent ethanol blending in petrol.

- The government has formulated a Scheme for Faster Adoption and Manufacturing of Electric and Hybrid Vehicles in India, under the National Electric Mobility Mission 2020 to encourage the progressive induction of reliable, affordable and efficient electric and hybrid vehicles in the country.

- Leading auto maker Maruti Suzuki expects Indian passenger car market to reach four million units by 2020, up from 1.97 million units in 2014-15.

- Mr Young Key Koo, Managing Director, Hyundai Motor India Ltd, has stated that India is a key market for the company, not only in terms of volumes but also as a hub of small products for exports to 92 countries.

- Mr Joachim Drees, Global CEO, MAN Trucks & Bus AG, has stated that India has the potential to be among the top five markets, outside of Europe, by 2020 for the company, which is reflected in the appointment of its most experienced managers to India for increasing volumes and exports out of India.

- According to Mr Guillaume Sicard, president, Nissan India Operations, the income tax rate cut from 10 per cent to 5 per cent for individual tax payers earning under Rs 5 lakh (US$ 7,472) per annum will create a positive sentiment among likely first time buyers for entry level and small cars.

- The Indian automotive aftermarket is estimated to grow at around 10-15 per cent to reach US$ 16.5 billion by 2021 from around US$ 7 billion in 2016. It has the potential to generate up to US$ 300 billion in annual revenue by 2026, create 65 million additional jobs and contribute over 12 per cent to India’s Gross Domestic Product.


Further, according to IBEF, the sales of Passenger Vehicles, Commercial Vehicles and Two-Wheelers has grown by 9.17 per cent, 3.03 per cent and 8.29 per cent, respectively, during the period of April 2016-January 2017.

Last edited by RavenAvi : 6th April 2017 at 10:46.
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Old 6th April 2017, 11:00   #2
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Default Re: IBEF report on the Indian automotive industry for FY 2015-16

Thread moved from the Assembly Line (The "Assembly Line" Forum section) to the Indian Car Scene. Thanks for sharing!

The next 20 years belong to India! If you have spare cash, keep investing in the auto industry. Not just the car companies, but even manufacturers of 2-wheelers, tyres, spare parts etc.

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Old 6th April 2017, 16:37   #3
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Default Re: IBEF report on the Indian automotive industry for FY 2015-16

I think the numbers in this infographic is quite optimistic -

1) India's share in global car market to rise from 2.5% in 2015 to 8% in 2020.
2) Passenger vehicle production to triple between FY16 (3.4 million) and FY20E (10 million) @ 30% CAGR.

IBEF report on the Indian automotive industry for FY 2015-16-infographic.jpg

Where is the demand? Other than a handful of Maruti models, no manufacturer has a waiting list. Without demand, they will not produce so many cars.

I think what they have done is just added up numbers based on each company's 'future plans'. Eg:
- Honda / new factory / 250,000 per year production.
- GM /10 new models / 200,000 per year production.

However, a growth of 12% CAGR in sales over the next 10 years - this is believable.

IBEF report on the Indian automotive industry for FY 2015-16-info2.jpg

Adding 1 + 1, if the sales estimate for year 2026 is only 9.6 million, there is no way car manufacturers will produce 10 million cars in Year 2020.

Unless, we are talking about some kind of major export boom.

Last edited by smartcat : 6th April 2017 at 16:40.
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