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EXTERNAL ANALYSIS OFAUTOMOBILE INDUSTRY
GROUP:5
DILEEP
VAIBHAV
FIROZ
JITENDRA
OBJECTIVE OF THE STUDY
To know that what external factors affects the automobile industry and upto what extent.
To identify the degree of influence of the five most influential factors for the industry.
To identify most suitable strategy after this analysis.
INDUSTRY OVERVIEW
Indian automobile industry has grown leaps and bounds since 1898,
a time when a car had touched the Indian streets for the first time.
At present it holds a promising sixth position in the entire world
with being # 1 in Two Wheelers and # 4 in commercial vehicles.
Withstanding a growth rate of 13% per annum and an annual
production of more than 2 million units, it may not be an
exaggeration to say that this industry in the coming years will soon
touch a figure of 10 million units per year.
It is expected that the Automobile Industry in India would be the
2nd largest automobile market within the year 2015.
AUTOMOBILE
2 WHEELER 3 WHEELERPASSENGER
VEHICLECOMMERCIAL
VEHICLE
Categories of Automobile Industry
AUTOMOBILE INDUSTRY
POLITICAL
ECONOMICALSOCIAL
TECHNICAL
IMPACT OF UNION BUDGET 2010-11 ON AUTO SECTOR The auto sector has seen significant rise in sales and the 22% rise
in sales for April-December 2009 period over the previous year.
The partial roll back of stimulus measures is anticipated very
much and so, the rise in excise duty from 8 to 10% across
board
The hike in excise duty on petrol and diesel may weigh negative on
the auto industry as such. But the rise in disposable income for the
consumer is expected to more than compensate for the above
negative factors as the demand for passenger vehicles and two
wheelers rises.
Neutral for stocks like Ashok Leyland, Mahindra & Mahindra.
Positive for stocks like Hero Honda, Bajaj, Maruti.
PORTER’S FIVE FORCES ANALYSIS
Automobile industry
Rivalry among
Competitors :>Rivalry in the
Indian auto sector is intense due to the entry
of foreign companies in the
market.>Product being
matched in a few months by the competitors
Threat of substitutes:>The threat of substitutes to
the automotive industry is fairly
mild. >The switching
cost may be high in terms of
personal time, convenience and
utility.
Bargaining Power of
Suppliers:>The industry is
comprised of powerful buyers
who are generally able to
dictate their terms to the
suppliers.
Barriers to entry :
>Regulatory framework
>The startup capital required
to establish manufacturing
capacity to achieve minimum efficient scale is
prohibitive.
Buyer/Customer Power :
>Buyer is having bargaining power
due to low switching costs associated with selecting from
among competing brands.
MARUTI SUZUKI INDIA LTD. Maruti Suzuki India Limited is a publicly listed
automaker in India. It was the first company in India to mass-produce
and sell more than a million cars. It is the market leader in India and on 17
September 2007, Maruti Udyog was renamed Maruti Suzuki India Limited.
SWOT ANALYSIS OF MARUTI SUZUKISTRENGTHS Established distribution and after-sales networks Understanding of the Indian market and ability to
liaison with the government Ability to design products with differentiating
features Brand Image Large product line
WEAKNESSES Foreign competitors with deep pockets Heavy Import tariffs
OPPORTUNITY Increased purchasing power of Indian middleclass
category Govt. subsidies Foreign collaboration
THREATS Threats from Chinese manufacturers Indian as well as foreign competitors
CONCLUSION They should come up with small cars like of Nano’s
segment. Repositioning of that model as a second car and
beginners car. Increased IT-enabled Automobile support systems
like GPS,ABS,ASR and Safety systems. Alternate fuel (Bio fuel, electricity) and environment
friendly green engines (Bharat emission norms). They have to meet challenges of newer
technologies, alternative fuels and affordability of automobiles by consumers.
REFERENCES:
www.google .com www.economywatch.com www.automobileindia.com automobiles.mapsofindia.com From “Hill & Jones”
Thank you
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