Indian Auto Industry
Economic Diplomacy Division
Ministry of External Affairs
Where does India stand?
Largest TRACTOR manufacturer
Largest TWO WHEELER manufacturer
2nd Largest BUS manufacturer
3rd Largest HEAVY TRUCK manufacturer
6th Largest CAR manufacturer
6th Largest COMMERCIAL VEHICLE manufacturer
Source: SIAM
Vehicle Market Share
Segment
Market Share
Passenger Vehicles
14%
Commercial Vehicles
3%
Three Wheelers
3%
Two Wheelers
80%
Low Vehicle Penetration
Segment
Vehicle per 1000
persons
Passenger Vehicles
20
Two-wheelers
108
Buses
0.11
Cities: Delhi, Gurgaon, Noida,
Ghaziabad, Ludhiana, Haridwar
Eicher
Escorts
Hero Motor
Honda Motorcycle
Honda Cars
ICML
JCB
Maruti Suzuki
Bajaj Auto
Fiat
Force Motors
GM
John Deere
Mahindra
Suzuki
Ford
Honda Motorcycle
Auto Clusters
Mahindra
Mazda
New Holland
Suzuki
Motorcycles
Tata Motors
Yamaha
Cities: Baroda, Halol, Sanand,
Mumbai, Pune, Nashik, Aurangabad.
Mercedes Benz
Skoda
Tata Hitachi
Tata Motors
Volkswagen
Volvo Eicher
Illustrative list of
manufacturing facilities of
Indian and Global OEMs
North
Cities: Kolkata
Tata Cummins
Tata Motors
East
Cities: Chennai, Hosur, Bengaluru
West
South
Ashok Leyland
BMW
Caterpillar
Daimler
Ford
Hyundai
Nissan
Renault
Royal Enfield
Same Deutz
TAFE
Tata Motors
Toyota Kirloskar
TVS
Volvo Buses
Passenger Vehicles Production
 CAGR 2013-17: 4%
4,000
3,500
Units of vehicles expressed in ’000 units
Figures for financial year – April to March
3,234
3,087
3,221
3,792
3,465
3,000
2,500
2,000
1,500
1,000
500
0
2012-13
2013-14
2014-15
2015-16
2016-17
Units of vehicles expressed in ’000 units
Figures for financial year – April to March
Other Vehicles Production
Commercial Vehicles
833
850
 CAGR 2013-17: -1%
787
800
Tractors
810
 CAGR 2012-16: -3%
800
700
640
600
750
699
700
697
579
613
572
500
697
400
300
650
200
100
600
2012-13
2013-14
2014-15
2015-16
0
2016-17
2011-12
20000
 CAGR 2013-17: 6%
16584
17713
19439
 CAGR 2012-16: 3%
80
19764
2013-14
2014-15
2015-16
Construction Vehicles
Two & Three Wheelers
25000
2012-13
20712
70
66.4
55.9
60
60.7
68.2
76
50
15000
40
10000
30
20
5000
10
0
0
2012-13
2013-14
2014-15
2015-16
2016-17
2011-12
2012-13
2013-14
2014-15
2015-16
Top 5 players in Each Segment in 2016-17
Passenger Vehicles : +9.23%
Commercial Vehicles : +4.16%
Leading Players
Maruti Suzuki (47%)
Hyundai Motor (17%)
Mahindra (8%)
Tata Motors (6%)
Honda Cars (5%)
Leading Players
Tata Motors (43%)
Mahindra & Mahindra(25%)
Ashok Leyland (19%)
VECVs - Eicher (7%)
Force Motors (3%)
Two Wheelers : +6.89%
Three Wheelers : -4.9%
Leading Players
Hero MotoCorp (37%)
Honda MSI (27%)
TVS Motor (14%)
Bajaj Auto (11%)
India Yamaha (5%)
Leading Players
Bajaj Auto (50%)
Piaggio Vehicles(30%)
Mahindra (10%)
Atul Auto (7%)
TVS Motor (2%)
Note: FY means 12 month ending March
Auto Component Industry: 2015-2016
Turnover
• USD 39.0 billion
Contribution to GDP
• 3.5% - 4%
Foreign Exchange
Earnings/ Exports
• USD 10.81 billion
Share of India’s Exports • 4%
Domestic Aftermarket
• USD 6.8 billion
Direct Employment
• 1.50 million
Auto Component Industry Turnover: 2015-16
CAGR: 6%
40%
35.9%
2556 (39.0)
2500
2046 (42.2)
2000
2160 (39.7)
2348 (38.5)
30%
2117 (35.1)
1883 (41.3)
20%
1500
11.1%
8.7%
1000
8.8%
5.6%
0%
-2.0%
500
10%
0
Growth Rate in Rupee Terms
Turnover in INR’ 00 Crore (USD Billion)
3000
-10%
2010-11
2011-12
2012-13
2013-14
2014-15
2015-16
9
(Turnover includes supplies
to OEMs, aftermarket sales and exports)
Auto Components Supply to OEMs
Three-Wheeler
4%
HCV
10%
Backhoe Loaders
2%
Two-wheelers
21%
Others
2%
Tractors
7%
MCV
5%
LCV
4%
SCV
1%
Passenger Vehicles
44%
Small Commercial Vehicles (SCV)
Less than 2 T
Light Commercial Vehicle (LCV)
2 to 7.5 T
Maneuver Combat Vehicle (MCV)
7.5 to 16 T
Heavy Commercial Vehicle (HCV)
More than 16 T
OEMs consumption includes locally produced Components and Imports
Exports - Auto Component Industry: 2015-16
600
400
CAGR: 18%
615 (10.2)
60.7%
709 (10.8)
685 (11.2)
60%
527 (9.7)
427 (8.8)
40.7%
303 (6.7)
40%
23.3%
200
16.7%
20%
11.4%
3.5%
0
2010-11
North
America,
25%
New
Zealand &
Australia,
1%
2011-12
South
America,
4%
Europe,
36%
80%
2012-13
2013-14
Central
America,
3%
2015-16
Exports Destinations: Top 10 Countries in %
Africa, 6%
Asia, 25%
2014-15
0%
USA
25
Thailand
3.18
Germany
6.96
UAE
3.15
Turkey
6.22
France
2.99
UK
5.43
Brazil
2.62
Italy
3.86
Mexico
2.59
11
\
Turnover in INR’ 00 Crore
(USD Billion)
800
Increased Component Outsourcing
(Illustrative List)
Over 35 IPOs of Global OEMs & Tier 1 Procuring from India
OEMs
• BMW
• Caterpillar
• Ford
• FIAT
• GM
• John Deere
• MAN
• Mercedes-Benz
• Nissan
• Peugeot
• Renault
• Toyota
• Volkswagen
Tier 1 Component Manufacturers
• Bosch
• Continental
• Cummins
• DANA
• Delphi
• Denso
• Eaton
• Getrag
• GE
• Kohler
• Kolbenschmidt
• Magna
• Meritor
• TRW
• Valeo
Indian Auto components already driving on international roads
12
Strengths & Challenges of Indian Component Suppliers
Indian Suppliers’ Focus – Global Best Practices
Focus on Quality
OHSAS…
162
ISO 14001
287
TS 16949
546
651
ISO 9001
Deming Award –
16
Japan Quality Medal –
5
TPM Award –
15
Industry fast embracing modern
shop-floor practices:
 5-S; 7-W
 Kaizen
 TQM
 TPM
 6 Sigma
 Lean Manufacturing
Shingo Silver
Medallion - 2
Largest no. of Deming Award winning companies outside Japan
JIPM –
3
Increasing focus on Innovation and Research
Design & Research Centers of leading Global companies in India
• Bosch
• Honeywell
• Caterpillar
• Hyundai
• Continental
• Magna
• Cummins
• Mercedes Benz
• Ford
• Renault Nissan
• GM
• Suzuki
• Honda
• Valeo
(Illustrative List)
Auto Components Industry Aspirations
Objectives of Automotive Mission Plan 2026
Automotive
industry to be the
engine of “Make in
India”
Contribute
significantly to
“Skill India”
Focus on promoting
Mobility
• Achieve top-line of USD 260-300 billion
• Increase export intensity to 35 - 40%
• Attract investments of USD 70 - 90 billion
over the next decade
• Provide incremental employment to 65 million
persons
• Quality of employment a key feature of this
industry
• Focus on promoting safe, efficient and
comfortable mobility for every person in
the society, with an eye on environmental
protection through both public and personal
transport option
Promote India as a
preferred
destination for
every segment of
the automotive
value chain
• Foster the promotion of “Brand India” by
developing a sophisticated ecosystem of
research, design, engineering and
manufacturing that is conducive for a
variety of players - both mass market and niche
seekers.
• To rank within the top three of the world
in engineering, manufacture and export
of vehicles and components
Define a Road map
for Implementing
policies and
regulations
• India & EU norms from current 6-7 years
• Harmonisation: Clear roadmap to adhere to
1998 Agreement of UN Global Technical
Regulations (WP.29)
• Fuel Efficiency: Define clear roadmap for all
categories of vehicles
• Road Safety: Reduction in accidents and
fatalities as per norms specified in Road
Transport & Safety Bill.
Automotive Mission Plan 2026: Aspirations for Vehicle Industry
(million units)
Segment
2004-2005
2016-2017
2025-2026
Passenger Vehicles
1.2
3.7
9.4 - 13.4
Commercial Vehicles
0.39
0.8
2.0 - 3.9
Two Wheelers
7.6
18.5
50.6 - 55.5
Three Wheelers
0.43
0.95
2.8 - 3.0
Tractors
0.25
0.6
1.5 - 1.7
Total
9.87
24.55
66.3 - 77.5
Source: Automotive Mission Plan: 2016-26
19
Tax Structure/Regimes in India
Current Excise Duty Structure
Vehicle Category
Excise Duty
Small cars, Commercial Vehicles and Two/Three
wheelers
12.5%
Length >4m and engine capacity < 1500cc
24%
Length >4m and engine capacity > 1500cc
27%
SUVs/MUVs with Ground clearance >170mm
30%
Hybrid cars
12.5%
Specified components of Hybrid vehicles
6%
Electric cars, 2W & 3W and specified
components
6%
Basic Customs Duty
Vehicles
Completely Built Up
(CBU)
Completely Knocked
Down (CKD)
Passenger vehicles
100%*/60
10%/30%+
Two wheelers
75%**/60%
10%/30%+
Three wheelers
60%
10%/30%+
Commercial vehicles
20%
10%
Components***
7.5%-10%
* With CIF value >US $ 40,000 or engine capacity >3000 cc for petrol and >2500 cc for diesel
vehicles, or both.
** For motor cycles with engine capacity of 800 cc or more
+CKD containing engine or gearbox or transmission mechanism in pre-assembled form but not
mounted on a chassis or a body assembly
*** Some components progress down to nil on FTAs
Tax Category
Rate
Infra Cess
1%, 2.5%, 4%
R & D Cess
0.125%
National Calamity Contingent Duty
1%
Central Sales Tax (CST) for out of state sale
2%
State Value Added Tax (VAT)
Octroi (in one state only)
State Road/Registration Tax
12.5%
4%
4-20%
Infrastructure Cess:
• 1% on small petrol, LPG, CNG cars,
• 2.5% on small diesel cars of less than 1500 cc and
• 4% on other higher engine capacity vehicles and SUVs was levied
last year.
Rates Proposed Under GST
Vehicle Category
GST Rate
Passenger Vehicles (Petrol, Diesel, CNG)/Commercial
Vehicles/Three-wheelers/Two-wheelers
28%
Electric Vehicles
12%
Vehicles that would attract GST plus Cess. Cess as provided below:
Vehicle Category
Cess
>4m passenger vehicles (All)
15%
<4m passenger vehicles (petrol)
1%
<4m passenger vehicles (diesel)
3%
>350cc two-wheelers
1%
10 – 13 seater public transport vehicles
15%
Thank You