post recession performance of automobile sector
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8/4/2019 Post Recession Performance of Automobile Sector
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Post Recession
performance
OfAutomobile
Sector
By
Amit Samanta
8/4/2019 Post Recession Performance of Automobile Sector
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What is recession?
A part of business cycle.
A slowdown in economic activities.
GDP, employment, household income,business profits, inflation all FALLduring recession .
Bankruptcies, unemployment rate rise.
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A Brief Overview Of Financial
Crisis 2008:o Worst financial crisis since the great depression
of 1930s.
o Affected the whole world.
o Started: December 2007.
o Believed that it ended in june2009.
o Company failures: Lehman Brothers, net bank,terra securities, Mervyns, Washington mutualetc.
o Company bailed out:American InternationalGroup(AIG) (US$150 bn), Chrysler.
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Post recession performance : VICTROY PODIUM:
9 th largest automobile industry in the world.
World’s no 1 two wheeler market.
4 th largest exporter in Asia after Japan, S.Korea &Thailand.
Asia’s 3 rd largest passenger vehicle market.
5th largest bus &truck market in the world.2nd fastest growing automobile market in the world
after china.
A home of 40 mn vehicles.
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Domestic sales 2010:
76%
16%
4% 4%
Sales
Two Wheelers
Passenger Vehicles
Commercial Vehicles
Three Wheelers
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Growing automobile production:
0
2000000
4000000
6000000
8000000
10000000
12000000
2003-04
2004-05
2005-06
2006-07
2007-08
2008-092009-10
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Growing Automobile Export:
0100000200000300000400000500000
600000700000800000900000
2009-10
2010-11
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Projections Of Automobile Industry for
2015-16:Category Domestic
sales(mn)Export(mn)
Total(mn) Currentglobalposition
Globalposition in2016
Passenger Vehicle
3.00 1.10 4.10 9 7
Commercial Vehicles
0.70 0.08 0.78 11 4
Three Wheelers
0.97 0.50 1.47 1 1
Two Wheelers
32.00 3.00 35.00 2 2
Total 36.67 4.68 41.35 9 7
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SWOT Analysis of Indian Automobile
Industry: Strengths:
Large domestic market
Sustainable labor cost
Government incentives for manufacturing plants.
Strong engineering skills.
Weaknesses:Low labor productivity
Various forms of taxes push up the production cost.
Low investment in R&D.
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Cont….. Opportunities:
Commercial vehicles: SC ban on overloading.
Heavy thrust on mining and construction activities.
Increase in income level.
Rising rural demand.
Threats:Rising input costs.
Rising interest rate.
Cut throat competition.
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Conclusion:Companies are doing well in India.
Suffered minimal during recession times.
Will maintain its growth rate in recent future.Have a tremendous prospect in India.
Competition will rise.
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References:Documents from CII logistic summit 2010,New Delhi.
Society of Indian automobile(SIAM) forecasts.
Recession.orgGlobal financial crisis-Charles I. Jones
Thomas White international Ltd. Report onautomobile industry for BRIC cuntries-
www.thomaswhite.com
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