PROFILE OF AUTOMOBILE SECTOR
The Indian automobile sector can be divided into several segments: 2 & 3 wheelers, Passenger cars, Commercial vehicles (Heavy CVs/ Medium CVs/Light CVs), Utility vehicles (UVs) and Tractors. Agricultural tractors and Earth Moving Machinery is an associated sector, which keeps the wheels of the agrarian economy moving. It is heavily reliant and aligned to the automobile and allied engineering sector and plays a significant role in India.
The automotive Industry in India is now working in terms of the dynamics of an open market. Many joint ventures have been set up in India with foreign collaboration, both technical and financial with leading global manufacturers. Also a very large number of joint ventures have been set up in the auto-components sector and the pace is expected to pick up even further.
The industry is characterized by a very high percentage (75%) of production in the 2/3 wheelers sector.
India ranks as the largest manufacturer of motorcycles and second largest in manufacturing of scooters in the world. India today is also the second largest manufacturer of tractors, as well. The industry has intense forward and backward integration.
The joint venture list indicates a wide variation ranging from 10% to 100%. The equity participation is not regulated by Government but is market driven. It depends upon the market perceptions of the joint venture partners and their business perceptions primarily in terms of technological, financial and market strengths of the partners.
The setting up of joint ventures has also led to enhanced capacity creation in the vehicle sector, particularly in the passenger car sector and the additional capacity is expected to mount by one million passenger cars in the next 4-5 years.
The large volumes of investment including foreign direct investment in the automobile manufacturing ventures and technical collaboration are propelling a quantum jump in up gradation of technology.
Domestic demand for passenger cars and multi utility vehicles is projected at 800,000 cars by 2004 A.D. With increased production and capacity creation in the passenger car sector, foreign countries may use India as an export hub. This tremendous growth is likewise triggering growth of the auto-component segment.
In India, the vehicle population, currently at sixty million, is growing at a rate of more than 9% per annum. Of this, 63 % are two/three wheelers. Growth rate has been very high for passenger cars and 2/3 wheeler vehicles. Performance of the sector in terms of production is depicted below
The Indian automobile sector can be divided into several segments: 2 & 3 wheelers, Passenger cars, Commercial vehicles (Heavy CVs/ Medium CVs/Light CVs), Utility vehicles (UVs) and Tractors. Agricultural tractors and Earth Moving Machinery is an associated sector, which keeps the wheels of the agrarian economy moving. It is heavily reliant and aligned to the automobile and allied engineering sector and plays a significant role in India.
The automotive Industry in India is now working in terms of the dynamics of an open market. Many joint ventures have been set up in India with foreign collaboration, both technical and financial with leading global manufacturers. Also a very large number of joint ventures have been set up in the auto-components sector and the pace is expected to pick up even further.
The industry is characterized by a very high percentage (75%) of production in the 2/3 wheelers sector.
India ranks as the largest manufacturer of motorcycles and second largest in manufacturing of scooters in the world. India today is also the second largest manufacturer of tractors, as well. The industry has intense forward and backward integration.
The joint venture list indicates a wide variation ranging from 10% to 100%. The equity participation is not regulated by Government but is market driven. It depends upon the market perceptions of the joint venture partners and their business perceptions primarily in terms of technological, financial and market strengths of the partners.
The setting up of joint ventures has also led to enhanced capacity creation in the vehicle sector, particularly in the passenger car sector and the additional capacity is expected to mount by one million passenger cars in the next 4-5 years.
The large volumes of investment including foreign direct investment in the automobile manufacturing ventures and technical collaboration are propelling a quantum jump in up gradation of technology.
Domestic demand for passenger cars and multi utility vehicles is projected at 800,000 cars by 2004 A.D. With increased production and capacity creation in the passenger car sector, foreign countries may use India as an export hub. This tremendous growth is likewise triggering growth of the auto-component segment.
In India, the vehicle population, currently at sixty million, is growing at a rate of more than 9% per annum. Of this, 63 % are two/three wheelers. Growth rate has been very high for passenger cars and 2/3 wheeler vehicles. Performance of the sector in terms of production is depicted below