in India The Indian automotive components industry - TeknikfÃ¶retagen

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Size and structure of the automotivecomponents industryThe automotive components manufacturing industry is highly fragmented with 500major companies that contribute 85 per cent of total output and 10 000 companiesin the unorganized sector that contribute the rest. An increasing amount of consolidationof the small and unorganized units is needed to be able to increase overallproductivity and enable higher growth of the industry.Division of the industry into tiers based on technology and qualityBased on technology and quality, the automotive components industry is classifiedinto three tiers, where Tier 1 consists of complete systems suppliers, followed byTiers 2 and 3 that supply sub-systems and single parts. Tier 1 suppliers mostly consistof multinational companies, Tier 2 suppliers consist of large and medium sizedindustrial units and Tier 3 suppliers consist of small and unorganized units. A largenumber of unorganized units also produce counterfeit parts. These counterfeit productsare sold in large volumes across the country under the brand names of Tier 1companies and OEMs, and pose a problem for the legitimate companies. 16End user classification of the automotive components industryBased on end user classification, the markets for automotive components are OEMs,exports and the after-sales market i.e. the replacement parts market. As per the AutomotiveMission Plan 2006–2016 (AMP) published by Ministry of Heavy Industriesand Public Enterprises, demand from OEMs accounted for 67 per cent of sales,the after-market accounted for 19 per cent of sales, while exports accounted for 14per cent. These figures are exclusive of tyres and batteries. 17Sources of demand for automotive components by segmentsThe two and three wheeler segments are the largest sources of demand for automotivecomponents followed by the passenger cars segment. Together with the passengercars segment the two and three-wheeler segments account for approximatelytwo-thirds of the automotive components market in India. 1816) Reference has been made to Ministry of Heavy Industries and Public Enterprises (2008) and Ministry of ExternalAffairs (11th April 2008)17) Reference has been made to Ministry of Heavy Industries and Public Enterprises (2006b)18) This information has been obtained from Indian Brand Equity Foundation (October 2007)14
SEGMENTWISE DEMAND FOR AUTOMOTIVE COMPONENTSThe table shown below is representative and may not be completely accurateTwo and three-wheelers 34 %Passenger cars 33 %Commercial vehicles 24 %Tractors 9 %Source: Indian Brand Equity FoundationProducts manufactured and their respective sharesin total productionThe Indian automotive components industry produces the entire range of components.Engine parts constitute the single largest share of components in total production,followed by drive, transmission and steering parts. The remaining productionis relatively evenly divided among the remaining product segments.Productwise shares in total components productionThe table below is representative of shares of the products in the year 2006–2007. Share for each of theproducts is given in percentage. 19Product descriptionShareEngine parts 31Drive, transmission and steering 19Body and chassis 12Suspension and braking parts 12Equipments 10Electrical parts 9Others 7Source: Automotive Components Manufacturers Association (2007)Engine partsThe largest segment of the automotive components industry is engine parts. In theyear 2005–2006, the segment is estimated to have contributed approximately 31 percent in value i.e. USD 3.76 billion. This segment can be divided further into threesub-segments. They are the following:19) Reference has been made to Automotive Components Manufacturers Association (2007)15
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