SupplierBusiness. The Indian Supplier Report

Transcription

1 SupplierBusiness The Indian Supplier Report

2 CONTENTS Executive Summary The Indian automotive industry Evolution of Indian automotive industry Two-wheelers dominate Three-wheelers Light vehicles Medium and heavy duty commercial vehicle Growing competition in all segments Moderation in vehicle sales High inflation and interest rates Rising fuel prices Frequent strikes Industry response Medium to long-term outlook remains bright Vehicle density remains abysmally low in India Vehicle sales and production forecast India continues to attract new players Investment plans of automakers India s automotive component industry Strong growth after global slowdown Growth moderation in Indian supplier industry continues to attract investment Investments Joint-ventures Mergers & Acquisitions OEM-supplier relationship Involvement of automakers in supplier development Direct involvement declines post-liberalisation Greater localisation driving better OEM-supplier relationship Technology remains a big challenge for Indian suppliers Automakers close-knit suppliers Cost, quality, delivery (QCD) India s emergence as a sourcing hub Automotive cluster development Northern region Southern region IHS Global Inc. 3

3 Western region Growth of clusters Gujarat emerging as major cluster Competition among clusters Challenges for the Indian Supplier Industry Demand fluctuations Capacity expansion Fluctuating raw materials prices Exchange rate volatility Rising operating costs R&D capabilities Trade practices Skilled manpower shortage Growing competition Government Policy Phase 1: Draconian regulations during Phase 2: Limited liberalisation during Phase 3: Economic reforms of 1991 and afterwards Policy environment Tax policy Union Budget for fiscal year Trade Policy Major bilateral and multi-lateral trade agreements State policies Labour laws Land Acquisitions Policy on fuel pricing Industry regulations Recent developments Auto Policy Automotive Mission Plan National Automotive Board National Manufacturing Policy Government Initiatives on skills development Infrastructure development Transportation Power India s competitiveness in term of infrastructure in BRICS countries IHS Global Inc. 4

4 Survey of Indian Supplier Industry Interviews Automakers Suppliers Michael Boneham, Managing Director and Sandeep Sanyal, Executive Director, Operations; Ford Motor India Rahul Bharti Head, Corporate Planning & Investor Relations, Maruti Suzuki Bharat Parekh, Chief, Strategic Sourcing, Tata Motors Neeraj Kanwar, Vice Chairman & Managing Director, Apollo Tyres Shvetal Vakil, Executive Director, Setco Automotive J Sivkumar, Pricol Shailandra Bohra, Marketing Director, Bohra Rubber Amit Mukherjee, Deputy Executive Director, Automotive Component Manufacturers Association of India (ACMA) Supplier Profiles Aisin Seiki Alicon Castalloy Amalgamations Group Amtek Auto Anand Group Apollo Tyres Ashai India Glass Ashok Iron Works Ashok Minda Group Auto Ignition Automotive Stampings Axles India Bagla Group Bajaj Motors Banco Products Bharat Forge Bharat Gears Bharat Seats Bhushan Steel Birla Corporation Birla Tyres Bohra Rubber Bosch India IHS Global Inc. 5

5 Brakes India Bridgestone India Caparo India Clutch Auto Continental DCM Engineering Delphi TVS Delphi Denso India Endurance Systems EXECY India Exide Industries Faurecia Federal Mogul Goetze Fenner India Fiem Gabriel India GKN Driveline India Goodyear India Guru Nanak Auto Halonix Harita Seating Hi-Tech Gears Imperial Auto IP Rings Jamna Auto Jay Bharat Maruti Jay-Ushin Jaya Hind JK Tyre JKM Automotive Johnson Matthey Kalyani Forge Kinetic Engineering Krishna Maruti LG Balakrishnan Lucas TVS Lumax Automotive Systems IHS Global Inc. 6

6 Lumax Industries Machino Plastics Madras Engineering Magna Magneti Marelli Mahindra Hinoday Mahindra Systech Mahindra Composities MAHLE Mark Exhaust MRF Manjal Auto Munjal Showa Neolite ZKW Lightings NK Minda Group NRB Bearings Omax Auto Panasonic Automotive Pricol Ramakrishna Forgings Rane Brake Linings Rane Engine Valves Rasandik Remsons Rico Auto Ring Plus Aqua RSB Transmissions Ruia Group Saint-Gobain Samvardhan Motherson Group Sandhar Technologies Setco Automotive Shriram Pistons & Rings Sigma Group SKF India Sona Koyo Steel Strips Wheels Sterling Tools IHS Global Inc. 7

7 Subros Sunbeam Auto Sundram Clayton Sundram Fasteners Suprajit Engineering Talbros Automotive Tata AutoComp Tata Ficosa Tata Johnson Controls Tata Steel Tata Toyo Radiator Timken TRW Automotive Tube Investments UCAL Fuel Systems Valeo Varroc Group Victor Gaskets Visteon WABCO India Wheels India ZF India LIST OF FIGURES AND TABLES Figure 1: Vehicle Sales and Production in India ( ) Figure 2: Two-wheelers dominates Indian automotive market both in term of sales and production Figure 3: Two-wheeler Sales and Production in India ( ) Figure 4: Three-wheeler Sales and Production in India ( ) Figure 5: Indian Light Vehicle Sales Figure 6: Indian Light vehicle Production Figure 7: Vehicles Sales Percentage segment in India (2011) Figure 8: Audi, BMW and Mercedes-Benz sales in India ( , 2016, and 2022) Figure 9: India Light Vehicles Sales Forecast Figure 10: India Light Vehicles Production Forecast Figure 11: Indian Medium & Heavy Commercial Vehicle Sales and Production ( ) IHS Global Inc. 8

8 Figure 12: Indian Medium & Heavy Commercial Vehicle Sales and Production Forecast ( ) Figure 13: Indian Vehicle Exports ( ) Figure 14: India's Consumer Price Inflation (Jan-09 to Jan-12) Figure 15: India's Central Bank Lending Rates (Jan-09 to Sep-11) Figure 16: Indian Petrol and Diesel prices (Mar-10 to Dec-11) Figure 17: BRIC GDP Forecast ( ) Figure 18: India has one of the lowest car densities in the world Figure 19: Vehicle Sales and Production Forecast in India ( ) Figure 20: Turnover of India's automotive parts industry Figure 21: Components Manufactured in India by use in Vehicle Figure 22: India s Auto Component Export Destinations Percent Share (FY ) Figure 23: India s Auto Component Export Destinations Percent Share (FY ) Figure 24: India s Auto Component Import Locations Percent Share (FY ) Figure 25: India s Auto Component Import Locations Percent Share (FY ) Figure 26: Indian export and import value in USD ( ) Figure 27: Two-wheelers and commercial vehicles continue to drive industry growth, passenger vehicles segment recorded impressive recovery Figure 28: Production of Light Vehicle Engines and Transmissions in India Figure 29: Indian Supplier Investments in USD ( ) Figure 30: Map of Automotive Clusters in India Figure 31: Raw Material Prices Figure 32: Exchange Rate INR against USD (Jan-10 to Jan-12) Figure 33: Exchange Rate INR against EUR (Jan-10 to Jan-12) Figure 34: Exchange Rate INR against JPY (Jan-10 to Jan-12) Figure 35: Cargo handled at major Indian ports from to Figure 36: Indian ranks third in terms of infrastructure among BRIC countries Figure 37: Survey More than 60% of suppliers expect India s automotive market to grow at 10-20% over the next five years Figure 38: Survey High inflation and interest rates very important challenges for suppliers Figure 39: Survey Retaining talent most challenging issue for suppliers Figure 40: Survey Volatility in OEM demand, input costs fluctuation weigh heavy on suppliers minds Figure 41: Survey Maruti Suzuki, Volkswagen most attractive OEMs among suppliers. 111 Figure 42: Survey Toyota, Volkswagen and Honda most exacting about testing and validation of components Figure 43: Survey Maruti Suzuki, Volkswagen and Toyota rank high on demanding supplier expansion Figure 44: Survey Hyundai ranks high on contract finalisation with suppliers Figure 45: Survey Maruti Suzuki, Hyundai quicker with supplier payments Figure 46: Survey All OEMs good in terms of payment terms negotiation with suppliers Figure 47: Survey Ford, Toyota rank high on return on investment they offer suppliers IHS Global Inc. 9

9 Table 1: Investment plans in India Table 2: Maruti Suzuki has 19 JV vendors, 11 of which are located in its Supplier Park enabling component delivery not only just-in-time but also just-in-sequence Table 3: List of Automotive Clusters in India Table 4: Indian Supplier s R&D Spend compared with Global Suppliers Table 5: Presence of major global suppliers in India Table 6: Budget : Highlight Table 7: Annual Energy Generation IHS Global Inc. 10