Analysis of Indian Transportation

7/30/2019 Analysis of Indian Transportation

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INDUSTRY ANALYSIS

OF

TRANSPORTATION


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TELEMATICS - INTRODUCTION

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Having established itself as an IT and ITES superpower in the global arena,India has registered robust growth in Telematics Industry as well. The

Telematics market in India is in nascent stage, but is growing robustly owing

to an increased use of the technology in fleet management, vehicle tracking ,

and transport navigational solutions. System integrators have been offering

vehicle tracking and fleet management system since 2001 and since then ithas registered tremendous growth.

Further, with fast paced infrastructure development and substantial increase

in the sale of commercial vehicles are also bolstering this evolving

technology to gain momentum and create a positive impression on the end

users business requirements. However the cardinal challenge in the seamlessadaptability and accessibility of these location-based services remains with

availability of high quality digital map data and Cost of the technology is key

to the price sensitive Indian consumers.


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TARGET SEGMENTS

3

Road

Public Transport

Private

Government

Logistics

Railway

Public Transportation

Freight Cars

Marine Logistics

Aviation Logistics

Transportation of

freight cargo

Road

61%

Rail

30%

Other

9%


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INTRODUCTION

4

Over the years, road transport has become vital to the economic development andsocial integration of the country. Road transport has attained a dominant position

within the transport sector and accounted for a share of 4.7 per cent in India's gross

domestic product (GDP) in 2010-11. Easy accessibility, flexibility of operations, door-

to-door service, reliability and the growing use of just in time strategies in

manufacturing have contributed towards a steady increase in the modal share of road

transport in the movement of both freight and passengers.

In a globalized world, an efficient road transportation system is vital for increasing

productivity and enabling the country to compete effectively in the world market. A

world class road transport system is essential for lending competitive edge to the

economy.

Sustained economic growth, increasing disposable income, and rising urbanizationhas led to rising demand for road transport and personalized mode of transport (cars

and two-wheelers), in particular. This is reflected in high annual compound growth in

vehicle population of 10 per cent during 2001-2011, which entails doubling of the

country's vehicle fleet every 6 to 7 years.


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A navigation system guides the user to a chosen destination. It typically uses GPS technology to acquire theusers current position and then directs him to his destination via a map display or via voice prompts.

Location based Service (LBS) comprise the group of applications that use positioning to add value to a service.often on a portable device.

Navigation and

Location-Based Service

In -Vehicle Infotainment refers to the digital application for the car using mobile and/or onboard devices.

Included are communication, satellite radio services, navigation, location based services, entertainment andinternet connectivity.In Car Infotainment

Intelligent Vehicle Safety (IVS) applications are those that helps to prevent collisions, or help to reduce theseverity of collision itself and the consequent damage and/or injury, by monitoring the local and the widerdriving environment.

Intelligent VehicleSafety

Commercial Vehicle Telematics (CVT) is the technology behind real time fleetmanagement system. Data is transmitted from the vehicle to back-office managementsystems and/or third parties such as 3PL, Shippers, customers or insurancecompanies.

Fleet Management

Asset monitoring as the group of applications that transform information from an asset (Vehicle, Cargo) to acontrol response center. This can be for maintenance purposes, exception handling, billing stolen vehicles

recovery etc.

Asset Monitoring

Telematics-enabled risk management is a specific area of commercial vehicle telematics that help insurancecompanies reduce their costs related to fraud and claims investigation.Risk Management


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Market Opportunity

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The Indian Logistics market is expected to reach Euro 90 Bn by 2014 with a CAGR of~10 % & transportation will account to 62% of this market

Indian 3PL market is expected to grow at around 20 percent per annum in the next 3-

5 years

The Intelligent Transport Systems (ITS) Market in India is estimated to reach Euro

0.375 Bn by 2015 growing with a CAGR of 5 to 10 %

Vehicle tracking and fleet management segment of the telematics market in India

earned estimated revenues Euro 61 Mn in 2011-12 and said to reach Euro 400 Mn by

2015-16

It is estimated that only 15 to 20 % of the fleets utilize telematics in India

The Indian commercial vehicle market will double to 1.6 million units in the period

between 2012- 2017


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MARKET SHARE OF TELEMATICS

7

Dhanus

Technologies 11%

Ashok Leyland 6%

E Logistics 11%

Bio enable

Technologies

5.60%

Arya Om nitalk

14%

TMT 22%

Others 8%

Market Share

The current market of installed telematics devices is approximately 40,000 Units on Commercial

Vehicles. However, currently only 20,000 of these units are operational.


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TELEMATICS DEVICE REVENUES

8

0

2

4

6

8

10

12

2008 2009 2010 2011 2012 2013

5.35.7 6.2

7.2

8.5

10.3

Revenues(USD

Millions)

The revenues from Telematics device are expected to increase from USD 5.3 million

in 2008 to USD 10.3 million in 2013


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STRENGTHS

Fast product development cycle times

Quicker development of cash flow

Internet based connection with developers Proliferation of handheld devices

Closer connection to customers

Large population of potential users

WEAKNESSES

Restrictions to information access by OEMs

Resistance to change by service providers

Individual product branding makes user aggregationtougher than vehicle branding by OEMs

Smaller companies may have harder time buildingtelematics partnerships

OPPORTUNITIES

Group products, services and companies together toprovide monitored telematics offerings

Adapt European and Asian products to USAapplications

Position cell phones as information transfer devices

Partner with ERP providers on fleet management

Work with NHTSA, EPA and CARB to developaftermarket information pipeline

Growing population of digitally literate new car buyers

Pass Right to Repair legislation

THREATS

OEMs further restrict access to information in aneffort to tie customers to dealers

Telephone companies raise price of communicationfrequency access

New communication technology obsoletes your

current platform NHTSA pushes for driver distraction legislation

SWOT


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Demand Analysis


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Growth in International& Domestic Trade

Investment inTransportationInfrastructure

Growth of 3PL, 4PL

Growth of MNCs

Growth in Organized

Retail

Globalization ofManufacturing Systems

DEMAND

DRIVERS


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2 Wheelers

72%

Cars14%

Buses

1%

Goods Vehicle5%

Others

8%

% Total


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2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Cars & Taxis 6,143 7,058 7,613 8,599 9,451 10,320 11,526 12,649 13,950 15,313 17,109

Buses 562 634 635 721 768 892 992 1,350 1,427 1,486 1,527

Goods Vehicles 2,715 2,948 2,974 3,492 3,749 4,031 4,436 5,119 5,601 6,041 6,432

Others 5,319 5,795 6,121 6,676 6,828 7,457 7,921 8,460 9,039 9,710 11,080

Two Wheelers 34,118 38,556 41,581 47,519 51,922 58,799 64,743 69,129 75,336 82,402 91,598

6,143

7,058

7,613

8,599

9,451

10,320

11,526

12,649

13,950

15,313

17,109

562

634

635

721

768

892

992

1,350

1,427

1,486

1,527

2,715

2,948

2,974

3,492

3,749

4,031

4,436

5,119

5,601

6,041

6,432

5,319

5,795

6,121

6,676

6,828

7,457

7,921

8,460

9,039

9,710

11,080

34,118

38,556

41,581

47,519

51,922

58,799

64,743

69,12

9

7

5,336

82,402 9

1,598

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

90,000

100,000

Registered Motor Vehicles in India: 2000-2011


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FLEET HELD BY SRTUs

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Maharashtra 19.00%

Andhra Pradesh

17.80%

Karnataka 17.40%

Tamil Nadu 16.20%

West Bengal 1.80%

Punjab 1.40%

Others 1.30%

SRTUs During 2010-11


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COST ANALYSIS OF SRTUs

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Staff 40.00%

Fuel & Lubricants

31.20%

Spares & Materials

2.30%

Interest 6.60%

Other

5.30%

Performance of State Road Transport Undertakings (2010-11)


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COMPETITION SCENARIO

1. Magneti marelli

2. Applied Electro Magnetics

3. Harman

4. Map My India

5. Automotive Infotronics (AL +Conti JV)

6. Tata Fleet Management

7. Volvo Fleet Management

8. Itrack

9. Mahindra Telematics

10. Delphi IBM

11. CMC Limited

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REVENUE MODELS

17

Revenue Models

License Maintenance Service


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Documents

Analysis of Indian Transportation