Automotive Tyre Manufacturers’ AssociationA Newsletter of
th
Issue TRACTION
Vol.-IX , Issue-5, Sep-Oct 2019
Editorial
Rajiv BudhrajaDirector General
Inside This Issue
l Industry Trends
mTyre (Pg…2)
mAuto (Pg…3)
mNatural Rubber (Pg…4)
mNR Global (Pg…5)
l Country Focus (Pg…6-8)
l Focus (Pg…9-10)
l Events (Pg…11-14)
l India Stats (Pg…15-16)
l Quotable Quotes (Pg…17)
l China Column (Pg... 18-19)
l Globe Watch (Pg... 20)
l Stat-o-Sphere l Guest Column
(Pg…21)(Pg…22)
have pleasure in presenting the I50th edition of Traction. It was in late 2011 that the idea of having a
regular newsletter was crystallised and the �rst issue rolled out in Nov.2011.
With your support, Traction has built a brand equity for itself over the years and is one of the most recognizable mouthpieces in the Auto domain. Also not to be missed is at the top right corner of Traction masthead. Department of Patents, Government of India has recognized Traction as intellectual property of ATMA and has just granted it a registered trademark status.
Much has changed ever since the �rst issue came out and much remains the same. There is an eerie resemblance of the economic situation as prevailing that time when Traction rolled out. Economic growth had slipped to 5.3% in the 4th quarter of 2011-12, lowest in 9 years. Moreover slowdown was attributed to weakening of industrial growth, much the same way the current slowdown is attributed to.
To mark the 50th edition, we have an article on global EV market outlook written exclusively for Traction by Frost & Sullivan. (Pg 22)
On the economic front, there is no letup in �ow of negative news and the GDP numbers for Q2 which are expected later this month are projected to be at best at the same level as Q1. However it is expected that economic de-growth will bottom out in Q3 and a slow and steady revival will mark FY21. Growth in sales of Passenger Vehicle and 2-wheelers in the month of Oct’19 has brought much needed respite to the sector after months of de-growth which had dampened the sentiment.
Hopefully the new reform measures announced by the Government especially the cut in corporate tax rates will help revive the sentiment. Reserve Bank of India is also aligned with the growth paradigm and has resorted to multiple rate cuts to increase liquidity.
Let me take this opportunity to thank you for being an integral part in the successful run of Traction. We would expect your continued feedback to remain at the cutting edge of new developments.
Wishing you Seasons’ Greetings.
Page 11
Tyre Industry Supply Chain in Sharp Focus at
ATMA Partners’ Summit 2019
®
1
Industry Trends - Tyre
2
Tyre Production - India
Tyre Exports - India
Having maintained previous year’s level in Q1 tyre Truck & Busproduction witnessed sharp fall in Q2 of FY 20.
Passenger Car tyre production has continued to remain in the negative territory in H1 of FY 20 though Sept. witnessed some
upward movement.
Motorcycle tyre production that weathered the slowdown successfully
during FY19 is witnessing a decline in the current �nancial year.
Overall tyre production has remained in the negative zone with a sharp fall in
Sept 19.
All Figs in Lakh Nos
FY19 FY20
Beginning the year on a strong positive note, tyre Truck & Busexports have continued to remain higher than previous year’s levels.
The month of Sept. witnessed a sharp rise in Passenger Car tyre exports from India.
In number terms, tyre overall exports went up by 11% in the H1 of FY20.
Note: Figs in brackets and indicate % change YoY
Apr-Sep'19 & YoY Comparison
104.7395.29
2019-20
223.93204.12
52.2257.77
14.55
16.00
11.50
13.16
Apr-Sep’19 & YoY Comparison
(Apr-Sep)
(Apr-Sep)
(Apr-Sep)
(Apr-Sep)
(Apr-Sep)
(Apr-Sep)
(Apr-Sep)
(Apr-Sep)
2018-19
2019-202018-19
2019-202018-19
2019-202018-19
2019-202018-19
17.93
12.44(-31%)
12
15
18
Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar
39.16
34.91(-11%)
25
35
45
Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar
60.12
55.59(-8%)
50
60
70
Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar
166.22
148.28- (-11%)
120
140
160
180
Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar
2.14
2.24(5%)
1.0
1.5
2.0
2.5
3.0
Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar
2.58
3.11(21%)
1.0
1.5
2.0
2.5
3.0
3.5
Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar
-9%
-9%
15%
10%
11%
(Apr-Sep) (Apr-Sep)
Industry Trends - Auto
3
Vehicle Production - India
All Figs in Lakh Nos.
FY 19 FY 20
Apr-Sep FY19 & YoY Comparison
Slowing economy and liquidity crunch continues to weigh down on the M&HCV production which contracted
by 72% in Sep.
Passenger Vehicles growth continues to remain in negative territory and declined by 16% in the �rst 6 months of FY20.
The de-growth in the LCVs has got pronounced lately.
Motorcycle production, has also been showing signs of weakness lately with Sept. production down by 19%.
The trend of contraction in the 2/3 Wheeler segment
continues in FY20.
Having witnessed a sharp drop in the �rst quarter Tractorproduction recouped in Q2 though remaining at lower level
than previous year.
4.82
89.19
21.06
2.23
1.38
17.70
79.86
4.05
Unit(s): 1 Lakh = 100,000; 10 Lakhs = 1 Million; 100 Lakhs/10 Million = 1 Crore.
FY19
FY19
FY20
FY20
FY20
FY20
-38%
-16%
-10%
-16%
FY19
FY19
(Apr-Sep) (Apr-Sep)
(Apr-Sep) (Apr-Sep)
(Apr-Sep) (Apr-Sep)
(Apr-Sep) (Apr-Sep)
0.44
0.12(-72%)
0.00
0.10
0.20
0.30
0.40
0.50
Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar
3.42
2.80(-18%)
2.00
3.00
4.00
Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar
15.90
12.89(-19%)
8
10
12
14
16
18
Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar
0.88
0.78(-12%)
0.50
0.60
0.70
0.80
0.90
1.00
Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar
0.58
0.42(-27%)
0.20
0.40
0.60
0.80
Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar
8.29
7.16(-14%)
4.00
6.00
8.00
10.00
Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar
Note: Figs in brackets and indicate % change YoY
Industry Trends - NR India
Natural Rubber - INDIA
4
Average have stood higher NR pricein Apr-Sep’19 YoY.
NR Stock at the end of Sep’19 stood higher at 296000 tonnes.
Export
Growth in has eased in view of lower offtake of tyres by Auto sector.NR Consumption
NR (RSS-4) Price
NR Imports have stood lower than previous year in the �rst half of FY20 and fell by a whopping 40% in Sept. as demand declined continue to be modest NR Exports
though showing upward trend.
Apr-Sep'19 & YoY Comparison
went up 5% in Sept. 19. Overall in the �rst six months NR Productionproduction went up by 11% in view of base effect.
FY19 FY20
11%
-8%
All Figs in MT
FY 19 FY 20
Import
277000
308000
614040567120
(Rs/Kg)
FY19 FY20
(Apr-Sep) (Apr-Sep)
65000
68000(5%)
20000
40000
60000
80000
Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar
103000
85000(-17%)
80000
90000
100000
110000
Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar
70887
42550(-40%)
10000
30000
50000
70000
Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar
233000
296000(27%)
200000
250000
300000
Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar
(Apr-Sep) (Apr-Sep)
Note: Figs in brackets and indicate % change YoY
694
933(34%)
0
500
1000
Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar
130.48
133.17(2%)
80
100
120
140
160
Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar
Industry Trends - NR Global
Global NR Overview (ANRPC* Countries)
5
Jan-Jun’19 & YoY Comparison
*ANRPC - Association of Natural Rubber Producing Countries
(Member countries : Cambodia, China, India, Indonesia, Malaysia, Papua New Guinea, Philippines, Singapore, Sri Lanka, Thailand & Vietnam)
NR Production in ANRPC countries stood lower than previous year in the �rst six months of 2019 calendar.
India
NR Consumption YoY (INDIA vs. CHINA)
China
NR Consumption stood at the same level as previous year with two curves nearly overlapping in the �rst six months.
NR consumption in and declined marginally in �rst half of India China current calender.
All Figs in ‘000 Tonnes
2018 2019
63805853
Jan-Jun'18
68756933
602590 2752 2730
-8%
1%
Jan-Jun'19
Jan-Jun'18 Jan-Jun'18Jan-Jun'19 Jan-Jun'19
Jan-Jun'18 Jan-Jun'19
1076
1175(9%)
700
900
1100
1300
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
('000 T)
2018 2019
1181
1164(-1%)
700
900
1100
1300
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
('000 T)
2018 2019
-2% -1%
Note: Figs in brackets and indicate % change YoY
6
Country Focus
Country Focus: Russia
Russia's Automotive IndustryRussia ranked 11th globally and �fth among European countries by volume of sales in 2018. The Russian government continued to provide direct support to car manufacturers and subsidize interest rates on car loans under Family Car and My First Car and other programs to drive consumption.
Sales of Passenger Cars and LCVs 000’ Units
LADA, Kia, Hyundai and Renault remain the leading car brands in Russia's car market accounting for more than half of sales.
205193
175
119118
131137
2012 2013 2014 2015 2016 2017 2018
Passenger Cars LCVs
27342585
2316
14831308 1465
1664
Sales of Passenger Cars and LCVs by Origin
Russian Makes
26%
Imported Foreign Makes
17%
Locally Made Foreign Makes
57%2018
Russia's automotive market has signi�cant potential, primarily due to low car penetration and ageing car parc.
Passenger Cars and LCVs
7
Country Focus
Country Focus: Russia
Share of Premium Models in Total Sales
Cars per 1000 Adults
Russia 371
Western Europe 642
North America 928
7% 7%
8%
9%
10%
9%
8%
2012 2013 2014 2015 2016 2017 2018
Despite growing premium brand sales that increased from 9500 to 146900 passenger cars, their share in total sales dropped for the second year in a row in 2018 as consumer demand shifted to cheaper brands.
Truck Sales Thousand Units
The Truck market grew by only 2.7% in 2018 compared with 50.8% a year earlier, which was due to the satisfaction of pent up demand and completion of large scale infrastructure projects.
127
109
88
51 53
80 8286
92100
2012 2013 2014 2015 2016 2017 2018 2019 F 2020 F 2021 F
Trucks
Average age of passenger cars & LCVs in Russia exceeded 13 years in 2018.
8
Country Focus
Country Focus: Russia
Bus Produc�on Thousand Units
5855
44
37
44 4348
2012 2013 2014 2015 2016 2017 2018
l Average age of Russia's Bus Parc in 2018 was 15 years with more than 45% of buses being far older.
l There was additional demand for buses in 2018 due to the FIFA 2018 World Cup in Russia
l 90% of buses run on engines under Euro 4 emission standardsl There is gradual growth in Electric bus adoption in public tranportation.
Share of Bus Sales by origin
69%
9%
22%
Russian Makes Imported Foreign Makes Locally Made Foreign Makes
2018
Buses
9
Focus
J.D Power 2019 India Customer Service Index (Mass Market) Study
Customer Service Index (Mass Market) Study
The J.D. Power 2019 India Customer Service Index (Mass Market) Study is based on responses from 7,177 new-vehicle owners who purchased their vehicle between March 2016 and August 2018. The study was �elded from March through August 2019.
The study measures new-vehicle owner satisfaction with the after-sales service process by examining dealership performance in �ve factors (listed in order of importance): service quality (30%); service initiation (18%); service facility (18%); service advisor (17%); and vehicle pick-up (17%). This study examines service satisfaction in the mass market segment. The study also includes the Net Promoter Score® (NPS) which measures new vehicle owners' likelihood to recommend their vehicle brand on a 0-10 point-scale.
(Based on a 1,000 point scale)
Service Quality Service Facility Service Advisor Vehicle Pick-up30% 18% 18% 17% 17%
Service Initiation
787
796
799
799
806
816
819
820
826
863
870
903
Mass Market Avg
Study Leaders
Highest Ranking Vehicle
Score (PP1000)
903
870
863
Hyundai
Tata
Mahindra
10
Focus
Key Findings of the Study
Fewer customers stay at the dealerships: More than one-�fth (21%) of customers stay at the service centre during their visit, a decline of 10 percentage points from 2018. However, satisfaction is typically higher among customers who wait for their vehicle service to be completed (837) vs. those who opt to leave and then return (821).
Reluctance to go digital: After-sales customers rarely use digital channels to set appointments despite indicating higher satisfaction when used. Satisfaction is 875 among the 1% of customers who use a manufacturers' app and 868 for the 2% who use a dealers' website. For the majority (81%) who still prefer to call a dealer, satisfaction is 831. Customers who walk in without an appointment (14%) are the least satis�ed (786) across all appointment types.
· Highly satis�ed customers return for post warranty service: For the customers who rate their experience in the top quartile of satisfaction (929 points and above on a 1,000-point scale), 89% are more likely to return for post-warranty service work. Similarly, 90% of customers in the top quartile will recommend the service centre to a friend or relative.
Customers spend less on service: The study �nds a 10% drop in the average amount spent per service visit compared with 2018. On average, customers spend ₹5,000 per service visit, compared with ₹5,600 in 2018. The decline is greatest among after-sales customers who are 39 years or older, whose spend declined 17% year over year. The decline in service revenue is signi�cant for dealers as 31% of their pro�ts are generated from after-sales vs. 25% from sales.
J.D Power 2019 India Customer Service Index (Mass Market) Study
Typically, dealers rely on service work to keep their businesses pro�table especially during a downturn in new-vehicle sales. A drop in average service spend bodes negatively for overall dealer pro�tability. More than ever, dealers need to focus on delivering an excellent service experience to retain customers and encourage loyalty and advocacy
“- Kaustav Roy, Director and Country Head for India, J.D. Power
`
Event
11
Tyre Industry Supply Chain in Sharp Focus at ATMA Partners’ Summit
ATMA Partners Summit 2019 gave a call for greater engagement between Tyre Industry and Raw Material partners with a view to collectively build on a more sustainable ecosystem and respond to the emerging challenges. The 4th edition of the iconic Tyre Industry event that took place at New Delhi witnessed largest participation of senior management from Tyre Industry and its Raw Material partners. This year’s Partners Summit assumed all the more importance as it was focused on key ingredients such as Carbon Black, Zinc Oxide, Rubber Chemicals and Silica.
Automotive TyreManufacturers’ Association
“ATMA Partners’ Summit celebrates the long-standing and time tested relationship between Tyre Industry and raw material partners. This year’s deliberations centered around environmental impact of operations. Both materials and technology need to move in the trajectory of reducing environmental footprint ” said Mr Roopesh R, Convener ATMA Supply Chain & Resources (SCR) Group in his welcome address.
The Chief Guest on the occasion, Mr Anil Srivastava Principal Consultant & Mission Director, Mission on Transformative Mobility, NITI Aayog stated, “India’s growth story is intact. India has retained its 'world’s fastest-growing economy' tag according to recent report by International Monetary Fund (IMF). We aspire to be $5 trillion economy by 2024-25. We need to move from consumption-led economy to manufacturing economy to reach India’s full potential. Value addition is the key to become a manufacturing economy which will lead to job creation and improve ease of doing business. India’s size and scale is an opportunity to be tapped”
(L-R) Rajiv Budhraja(DG ATMA), K M Mammen (Chairman ATMA), Anil Srivastava (Principal Consultant NITI Aayog), Anshuman Singhania(Vice Chairman ATMA), Roopesh R(Convener, ATMA SCR Group)
Anil Srivastava (Principal Consultant & Mission Director, Mission on Transformative Mobility, NITI Aayog) at ATMA Partners Summit 2019
(L-R) Roopesh R(Convener, ATMA SCR Group), Anshuman Singhania(Vice Chairman, ATMA), N. Sivasailam(Special Secretary -Logistics GOI), V K Misra(Chairman ITTAC) releasing CSR Compendium
12
Event
Tyre Industry Supply Chain in Sharp Focus at ATMA Partners’ Summit
In his keynote address, Mr K M Mammen, Chairman ATMA stated “ATMA Partners Summit is unlike any other industry conclave. The presence of so many raw material partners exchanging notes with Tyre Industry so as to make the entire sector globally competitive makes Partners Summit a special one which has few parallels in Indian industry.
“The industry is in urgent need to take a re-look at materials and processes and bring in new technologies to achieve sustainable manufacturing. The collaboration between the industry and raw material partners assumes all the more importance in this regard”, added Mr Mammen.
Welcoming Mr N Sivasailam, Special Secretary (Logistics), Government of India, Mr Anshuman Singhania Vice Chairman ATMA said, “There is little doubt that high logistics cost has been impacting price competitiveness of Indian industry, tyre companies being no exception to the same. As per official �gures, the cost of logistics in India is about 14% of the country’s GDP which is far higher as compared to other countries. We highly appreciate Government’s target to reduce it to 9% in the coming years”.
“Without tyres, logistics can’t be comprehended in India hence tyres and logistics are closely interlinked. One of our major targets is reduction of logistics cost as a percentage of business turnover however that should not be construed as shrinking of logistics sector. On the contrary, logistics need to be made much more competitive since high logistics cost impacts competitiveness of domestic goods in the international markets. As India aspires to be a $5 trillion economy in 5 years, the size of logistics sector will more than double to $500 billion. Multimodality of logistics is the need of the hour” said Mr N Sivasailam, Special Secretary (Logistics), Government of India.
N. Sivasailam, IAS (Special Secretary (Logistics) Ministry of Commerce & Industry, Government of India) at ATMA Partners Summit 2019
K M Mammen (Chairman ATMA) presenting keynote address at ATMA Partners' Summit 2019
13
Event
Tyre Industry Supply Chain in Sharp Focus at ATMA Partners’ Summit
On the occasion Tyre Safety awards were also conferred to those organisations who collaborated with ATMA closely in spreading the message of Tyre Care & Safety. Tyre safety corporate partner award was received by Indian Oil. Training partner award went to JP Research and Satyug Darshan Instt. of Engg. & Tech. (SDIET) Faridabad received educational partner award.
A Tyre Safety poster explaining Tread Wear Indicator (TWI) was unveiled. ATMA plans to spread awareness on TWI in collaboration with Ministry of Road Transport & Highways. Mr Sivasailam released a compendium on Corporate Social Responsibility (CSR) activities being undertaken by ATMA members.
Industry speakers and panelists travelled from far off places to be a part of the Summit and add to the width and depth of deliberations. Four experts made a presentation each on Carbon Black (Mr Kaushik Roy, Managing Director, Phillips Carbon Black Ltd), Zinc Oxide (Mr Bhuwan Purohit, WTD & COO Rubamin Ltd), Rubber Chemicals (Mr R M Gadgil, President-Marketing, NOCIL Ltd) and Silica (Mr Darshak Shah, Managing Director, Madhu Silica).
Shyam Bohra (Executive Director, Indian Oil) receving Tyre Safety Partner Award from Anil Srivastava (NITI Aayog) at ATMA Partners’ Summit 2019
Anil Srivastava (Principal Consultant NITI Aayog), unveiling Tyre Safety poster with K M Mammen (Chairman ATMA) and Anshuman Singhania (Vice Chairman ATMA)
Silica Panel- (L-R) John Thamburatnam(MRF), Darshak Shah(Madhu Silica), Harish K Rijhwani(Gujarat Multi Gas) Alexis Thoelen(Solvay), Deepak Khanna(Speciality Silica), Ashish Pandey(JK)
14
Event
Tyre Industry Supply Chain in Sharp Focus at ATMA Partners’ Summit
Besides ATMA members, top managers of a host of raw material partners, both national and international, were present on the occasion. Some of these companies included Phillips Carbon, Birla Carbon, Orion, Continental Carbon, Rubamin, NOCIL, Acmechem, TWC, OCCL, Madhu Silica, Gujarat Multi Gas Base Chemicals, SOLVAY and Specialty Silica.
Rubber Chemicals Panel (L-R) Tom Thomas (CEAT), R M Gadgil(NOCIL), Kishor Katkar (ACMECHEM), Abhishek Agarwal (TWC), Muneesh Kumar Batta (OCCL), Pravin Tripathi (Apollo)
K M Mammen (Chairman ATMA) presenting a memento to Anil Srivastava (Principal Consultant NITI Aayog) at ATMA Partners Summit 2019
Carbon Black Panel (L-R) V K Misra (JK), Kaushik Roy (Phillips Carbon Black), Shashank Awasthi (Birla Carbon), Morris Qian (Orion), T M Chen (Continental Carbon), Mohan Kurian (MRF)
India Stats
India Stats
Karnataka, Tamil Nadu, Maharashtra, Telangana and Haryana have been ranked as top �ve states in innovation in NITI Aayog's �rst Innovation Index. The index is based on seven pillars which include �ve enablers and two performance indicators some of which include human capital, investment, knowledge workers and knowledge output.
Most Innovative States
35.65
32.98
29.93
22.06
20.55
19.58
19.08
18.21
16.86
14.51
Karnataka
Tamil Nadu
Maharashtra
Telangana
Haryana
Kerala
U�ar Pradesh
West Bengal
Gujarat
Andhra Pradesh
Waste Tyre Imports : India
India is the biggest buyer of waste tyre, accounting for 32% of global imports. India buys majority of its waste tyres from Britain, a trading route that accounts for 13% of scrap tyre �ows worldwide.
Top 10 Waste Tyre Importing Countries in 2018(net weight in Million Kg)
631.6
247.6
153.7
106.9
98.8
97.2
96
90.1
46.9
45.1
India
South Korea
Turkey
Germany
Japan
US
Malaysia
Portugal
UK
Netherlands
Innovation Score
15
India Stats
16
The capacity created in India’s renewable energy sector may be impressive, but the pace has begun to slacken. Solar capacity installations in the country is at 25,000 megawatts (MW), or one-fourth of the 2022 target of 100,000 MW, according to Mercom India research. As of July, Indian Wind Turbine Manufacturers Association pegged operating wind capacity at 34,393 MW, or about 57% of the 60,000 MW target set by the government for the �ve-year period
India's Renewable Energy Capacity
India Stats
*wind installa�ons as of Jul 2019
21651 25000
100000
34145 34393
60000
Installed Capacity
as on Mar 2018
Installed Capacity
as on Sep'19*
2022 Target
Solar Wind
India's Renewable Energy Capacity impressive but way below 2022 targets
(megawa�s)
9.2
4
4
12
-0.2 -0.2 -0.2
Coal Wind Solar Hydro Nuclear Oil & Gas Others Total
Wind, Solar and Hydro account for 70% of growth in India's demand for Electricity (2019, H1)
The relative contributions to rising electricity demand in H1, 2019, with wind, solar and hydro meeting 70% of the increase and coal making up the remainder.
28.6
(change in output in H1, 2019, terawa� hours)
Quotable Quotes
17
Quotable Quotes
Several big personalities from the country met me and said they want to bring driverless vehicles to India. I clearly told them that till I am there, I shall not allow driverless cars in India. I was asked whether I oppose new technology. I said not at all. India has 40 lakh drivers and there is a shortage of 25 lakh drivers. I will not let the jobs of 1 crore people be snatched away.
Being a part of the global trade, there are gives and takes. What we are only saying is that the government should be mindful of two things. Any such thing (RCEP and free trade agreements) should not result in job losses and hurt 'Make in India'. No Completely Built-Up (CBU) import should be allowed (under the pact).
-Nitin Gadkari -Rajan Wadhera
-Nirmala Sitharaman
Union Minister for Road Transport & Highways and Micro, Small and Medium Enterprises
President, SIAM
Union Finance Minister
People's desire to buy new cars has not dampened. But I am bit concerned over the heavy vehicle truck segment, which has been hit hard. This segment relies on the transportation sector which would gain pace when the economy �ourishes.
Notwithstanding the very recent slowdown, India's potential growth rate in the coming years is much higher. With a prudent mix of policies, we are committed to have a sound macro-economic environment conducive to fuel growth and ensure inclusive development. Supported by �scal and monetary actions, an in�ation trajectory in line with the in�ation target and progressive structural reforms, we expect investment to revive, consumption to remain robust and growth to return to a higher trajectory soon
It is to our amazement how people who have spent their whole life making batteries or motors or just plain steel, suddenly want to put a coat on their stuff and manufacture electric vehicles as if it happens just with the click of your �ngers, but at least they are manufacturers. And you will be more amazed to see how sometimes people, who have done nothing but imported air conditioners, mobiles and refrigerators from China suddenly want to revolutionise our roads by making EVs out of thin air.
MD, Bajaj Auto-Rajiv Bajaj
MD, M&M-Pawan Goenka
I believe electric mobility is gradually evolving. However, its pace of growth and the adoption is still slow and depends on the country and its automobile growth. I believe that in India's electric vehicles population should be somewhat 8-9% over the next 5-6 years and that's good to start with.
-Gaurav GuptaChief Commercial Officer
MG Motors India
Purchasing power of rural and urban India has gone down and automakers can't do very much except to cut costs which they are doing. As far as cars are concerned, there is a huge difference between wholesale and retail. That's because dealers are heavily loaded with stocks.
- Ashish Harsharaj KalePresident, FADA
Across the Great Wall
China Column
China's outbound investment up 3.8% in Jan-Sept period
18
China's nation brand value surges 40% YoY
China's nation brand value increased by 40.4 percent to $19.5 trillion from 2018 to 2019, according to a report released on the annual study of national brands.
China continued to grow at a very healthy rate despite trade tensions with the United States, said the "Nation Brands 2019" report by Brand Finance, a London-based brand consultancy.
Defying the expectations of a slowdown, China's brand value has bene�ted from the glowing success of some of its most dominant and valuable brands, including ICBC, Huawei and Alibaba. Huawei and Alibaba, in particular, embraced strong marketing strategies adopted by their international counterparts.
China has come closer to the long-standing leader - the United States, which recorded a brand value growth of only 7 percent over the
past year. The difference in value between the two nations' brands has dropped from $12 trillion in 2018 to just over $8 trillion in 2019.
The report showed that the average year-on-year nation brand value growth of the developing economies was 13.9 percent, compared with mere 0.4 percent for the developed economies. "With general stagnation in Europe and North America, nations from the Middle East and Africa have claimed 11 out of the top 20 spots for brand value growth this year.
Although the United States retained its position as the leader among the world's 100 most valuable nation brands, second-ranked China is nevertheless narrowing the gap, as it continues to grow against all odds.
China's Brand Value jumps 40% in 2019
(US$ trillion)
13.9
19.5 (40.4%)
2018 2019
China's non-�nancial outbound direct investment (ODI) posted steady growth in the �rst three quarters of the year.
Non-�nancial ODI in 164 countries and regions amounted to 555.11 billion yuan ($78.5 billion) in the period, up 3.8 percent year-on-year, according to the Ministry of Commerce.
The pace accelerated from the 2.7-percent growth registered in the �rst eight months. In September alone, China's ODI jumped 14.2 percent year-on-year to 62 billion yuan.
Chinese companies enhanced cooperation with countries participating in the Belt and Road Initiative during the �rst nine months, adding a total of $10.04 billion of new investment in 56 countries in the initiative, accounting for 12.4 percent of the total ODI.
The structure of ODI continued to improve, with investment mainly going into sectors including leasing and business services, manufacturing, wholesale and retail, according to the ministry. No new ODI projects were reported in the sectors of real estate, sports and entertainment.
China's non Financial ODI(billion yuan)
534.79
555.11(3.8%)
Jan-Sep 2018 Jan-Sep 2019
China Column
China's Jan-Sept trade up 2.8% amid con�icts
China's foreign trade maintained stable performance during the �rst three quarters despite trade friction with the United States.
Foreign trade of the world's second-largest economy recorded stable growth from January to September, expanding 2.8 percent year-on-year.
China's total foreign trade volume reached 22.91 trillion yuan ($3.23 trillion) in the �rst nine months. Exports expanded 5.2 percent while imports dropped 0.1 percent.
Despite slower global economic growth and rising trade protectionism, China's foreign trade has remained resilient due to strong domestic consumption, expansion of private businesses, tariff cuts and market diversi�cation.
The country's trade with the European Union and the Association of Southeast Asian Nations, China's top two trading partners, hit 3.57 trillion yuan and 3.14 trillion yuan, respectively, in the �rst three quarters, up 8.6 percent and 11.5 percent year-on-year.
Due to the China-US trade dispute, the World Trade Organization recently lowered its projection for global trade in goods to 1.2 percent for 2019 from its earlier prediction of 2.6 percent made in April. This would be the weakest growth rate since 2009. China's trade with economies related to the BRI totaled up to 6.65 trillion yuan in the �rst three quarters of 2019, an increase of 9.5 percent year-on-year, which is 6.7 percentage points higher than the overall foreign trade growth rate during the same period.
China's Foreign Trade expands by 2.8% (Jan-Sep, 2019) (trillion yuan)
22.29
22.91 (2.8%)
Jan-Sep 2018 Jan-Sep 2019
China's GDP Growth sinks to 6% in Q3, lowest in 27 years
China's economy grew 6% in the third quarter (lowest in 27 years), landing right on the central government's full-year baseline target for gross domestic product, as business activity continues to deteriorate in the world's No. 2 economy.
Growth across the board cooled in the third quarter, despite some recoveries in industrial production and retail sales at the end of the quarter, according to data published by the National Bureau of Statistics.
But investment in �xed assets, a measure of construction activity that has long been a major economic driver but is becoming less so, was weaker in the �rst nine months, with a 5.4% rise from a year earlier. That compared with a 5.5% pace in the �rst eight months and was
down from 5.8% growth announced after the �rst half. Investment in the agricultural, manufacturing and industrial sectors retreated in September while infrastructure investment accelerated ahead of the Communist Party's celebration of its 70th year in power on Oct. 1.
Ding Shuang, an economist with Standard Chartered, said the pickup in infrastructure investment was attributable to greater bond issuances to �nance projects launched by local governments, though he said the acceleration in September's industrial production was probably due to the inclusion by the statistics bureau of previously missed data.
China's GDP Growth Rate %
19
6.86.7
6.56.4
6.2
6
Q1 Q2 Q3
2018 2019
Quickly...
China's capital city Beijing and �nancial center Shanghai ranked among the top 10 wealthiest cities worldwide in 2019, according to a report by wealth study company New World Wealth. Beijing grabbed the �fth place on the list with a total wealth of $2.1 trillion and Shanghai took the sixth spot with total wealth amounting to $1.9 trillion.
Landing in the same position as last year, China's Hong Kong remained eighth on the list, in which New York City claimed the crown with $3 trillion in total wealth as well as 65 billionaires and over 380,000 millionaires. Tokyo came in second with a total wealth of $2.5 trillion, followed by the San Francisco Bay Area and London, both of which held $2.4 trillion in total wealth. The "total wealth" mentioned in the report refers to private wealth held by all individuals including property, cash, equities and business interests. Government funds were excluded from the �gures, which were for June this year.
Beijing, Shanghai in world's top 10 wealthiest cities
20
IntelliTread internal tread sensor tested on aircraft tyres
Tyrata, Inc., a tyre sensor and data management company, has demonstrated that its patented IntelliTread™ Internal Tread Sensor (ITS) can effectively measure aircraft tyre tread depth in a laboratory setting.
Aircraft tyres are subjected to extreme operating conditions, and determining tread thickness in real-time will provide ground crews and aircraft tyre manufacturers with additional information to appropriately maintain tyre health for optimal performance and safety. Tyrata plans to carry out additional durability and in-tyre sensor �eld tests in the near future.
Aircraft tyres are complex, highly engineered structures designed to safely withstand heavy loads for take-offs and landings in a variety of weather conditions. Proper inspection and regular service in accordance to manufacturer's speci�cations ensure tyre performance and safety.
One aspect of tyre inspection is regular tread depth assessments. Tyrata's direct tread measurement with the ITS complements current tread-depth evaluation practices and contributes to improved tyre safety.
Tyrata is applying its technology to address a variety of customer needs for tyre tread wear monitoring and associated analytics. To meet these diverse needs, a comprehensive suite of tread-depth measurement systems and cloud-based analytical tools are being developed.
These tools range from �eet deployments in local centers or depots to highly distributed solutions for consumer, ridesharing, aircraft, and other applications. Tread-depth reports will be provided in real-time, anytime and anywhere.
Globe Watch
Globe Watch
Using Rubber from old tyres in the asphalt of a busy Melbourne road.
A trial will soon begin using rubber from old tyres in the asphalt of a busy Melbourne road.
A contract has recently been signed between Tyre Stewardship Australia (TSA), and the Australian Road Research Board (ARRB) which marks the beginning of this vital research. The project will be co-funded by TSA, the Victorian Department of Transport and ARRB.
Rubber is routinely used in rural road surfacing in Victoria. The aim of this project is to increase the opportunity to use crumb rubber in metropolitan roads.
The asphalt will be laid on a 1.5 km section of East Boundary Rd in Bentleigh East. It will be on the southbound carriageway, between Centre Rd and South Rd. This trial is a landmark opportunity in the development of the circular economy in Australia.
Tyre Stewardship Australia was formed �ve years ago to implement the national Tyre Product Stewardship Scheme which promotes the development of viable markets for end-of-life tyres.
Only 10 per cent of the almost 56 million tyres discarded annually in Australia are presently domestically recycled. The rest are either exported overseas or disposed to land�ll, stockpiled and illegally dumped. The study will be conducted by ARRB, the national transport research organisation. It will trial a range of innovative asphalt mixes that incorporate crumbed rubber on a key section of the road network and monitor the performance over time. It is a �rst of its kind trial based on the scale of the project and number of mixes trialled at the same time. Lab and �eld testing will be conducted at regular intervals with a �nal report due by mid 2022.
21
Stat-O-Sphere
Unit(s): 1 Lakh = 100,000; 10 Lakhs = 1 Million; 100 Lakhs/10 Million = 1 Crore.
Stat-O-Sphere
Global battery demand is expected to grow 25%
annually to reach in 2030. Between 2,600 GWh
2010-18, battery demand grew by and 30%
reached a volume of in 2018.180 GWh
Southeast Asia's growth in electricity demand, at
an average of per year, has been among the 6%
fastest in the world. Still, some people 45 million
there still lack access to electricity. The region is
well on the way to achieving universal access to
electricity by 2030.
At a time when new commercial vehicle (CV)
sales are coming down, those of used vehicles
are seeing some momentum. This is mainly
owing to a pick-up in light CV (LCV) and
Intermediate CV (ICV) demand. According to
industry estimates, while the organized sector
is selling a month, the 10,830 units
unorganized one is selling this.5 times
India has remarkably improved in ease of doing
business recording a jump of positions to the 14
63rd 190 countries among as per the World
Bank. India appeared among top-10 improvers
for the in a row.third time
India's forex reserves increased by USD 1.832
billion USD 442.583 to a new lifetime high of
billion in the week ended October 25, helped
by a jump in core currency assets and value of
gold, as per the RBI data.
India has moved down 10 places to rank 68th
on an annual global competitiveness index,
largely due to improvements witnessed by
several other economies, while Singapore has
replaced the US as the world's most
competitive economy.India's energy trade with the US is likely to touch
$10 billion in �nancial year 2019-20, with the
country having increased its import of crude oil,
LNG and coking coal. Last year, the bilateral
energy trade valuation stood at .$7 billion Twenty years ago, China's economy was a
10th 2/3rd the size of the US. In 2019, its as
big. In 2039 on current trajectory, it will be
more than bigger.10%Despite the slowdown in the economy and
sluggish credit offtake, credit card outstandings
have risen by to as on 24.4% Rs 97,650 crore
August 31, 2019, from a year Rs 78,499 crore
ago. According to data available from the
Reserve Bank of India, credit card outstandings
have spurted by in the last two years from 71%
Rs 57,100 crore in August 2017.
22
Special
Global EV Market Outlook by
Prajyot Sathe, Industry Manager, Mobility Practice, Frost & Sullivan
Infosheet is an attempt by ATMA Research to periodically bring out trends on macro-economic and sectoral issues.
Infosheets 2018-19
Automotive Tyre Manufacturers' Association (ATMA)
nfos
heet 11
18/0
3
Passenger VehiclePassenger VehicleSalesSalesPassenger VehicleSales Q1, FY19Q1, FY19Q1, FY19
Region-wiseRegion-wiseRegion-wise
23
+-
nfos
heet 02
19/0
1
Disclaimer:Automo�ve Tyre Manufacturers’ Associa�on (ATMA), has taken due care and cau�on in preparing this Report based on the informa�on/data obtained by ATMA from sources which it considers authen�c and reliable. However, ATMA does not guarantee the accuracy, adequacy or completeness of the Data / Report and is not responsible for any errors or omissions or for the results obtained from the use of Data / Report. This Report is not a recommenda�on to invest / disinvest in any company or sector covered in the Report. No part of this Report may be published / reproduced in any form without ATMA’s prior wri�en approval.
ATMA Research Automo�ve Tyre Manufacturers’ Associa�onNov 2019
24
About ATMA
Headquartered in New Delhi (India), Automo�ve Tyre Manufacturers’ Associa�on (ATMA) is amongst the most ac�ve and well known na�onal industry bodies in the country. Being a representa�ve body of eleven large tyre companies in India accoun�ng for over 90% of tyre produc�on, ATMA has been accorded status as the true voice of the Indian tyre industry.
ATMA works towards promo�ng and safeguarding the interests of the tyre industry in India primarily by ac�ng as conduit between the Government and the industry. The Associa�on strives to be an ac�ve par�cipant in policy making process and holds frequent mee�ngs with the Government departments to discuss the challenges being faced by the industry in the ever-changing economic environment.
The Associa�on acts as the industry’s interface with the media, opinion leaders, NGOs and other Industry associa�ons around the world so as to present the perspec�ve of Indian tyre industry on different issues.
ATMA Research
ATMA Research is a specialized in-house resource of Automo�ve Tyre Manufacturers’ Associa�on that aims at compiling, and analyzing informa�on on automo�ve tyres as well as upstream (Natural Rubber and other raw materials) and downstream (Automobile) sectors in India. The informa�on for analysis is sourced from authen�c and reliable sources including tyre majors, Government departments, regulatory bodies, other industry associa�ons and apex industry chambers.
Source: Rubber Board, ANRPC, China Daily, www.arrb.com.au, www.aerospace-technology.comJ.D. Power India Research, Frost & Sullivan, Ministry of new and renewable energy, India wind turbine associa�on, CEA Monthly data
25
TRACTION
26
Now Traction is a Registered Trademark of ATMA
Automotive Tyre Manufacturers’ Association (ATMA)
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Road Safety & Role of Tyres
Take a pledge to look after your tyres...
R RotationRegularly rotate Tyres to prolong tyre life by achieving more uniform wear of all tyres on a vehicle.
T TreadNever use tyres with tread depth of less than 1.6 mm (worn beyond tread wear indicators (TWI)
Have wheel alignment checked periodically or whenever there is an indication of uneven wear in tyres, pulling, vibrations etc.
A Alignment
PressurePMaintain recommended inflation pressure for safe driving, riding comfort and monetary savings.
R RepairSide wall repair should not be carried out. Also Tyres should not be repaired if the tread puncture is larger than 6mm.
5 Simple Steps for Tyre Safety
P A R R TTyre Care & Safety Drives
An initiative for safe driving by
do not have properly maintained tyre pressure
undermining safety & fuel efficiency
Over
60% of cars
Key Findings of
Optimallyinflated
38%
Severely under or overinflated
19%
Under or overinflated
43%
Potentially dangerous to drive
...Well maintained tyre is a life saver on the road.
ATMA-ITTAC
In Association with