1. Economic Diplomacy Division Ministry of External Affairs
Indian Auto Industry
Economic Diplomacy Division
Ministry of External Affairs

2. Where does India stand? Largest TRACTOR manufacturer
Largest TWO WHEELER manufacturer
2nd Largest BUS manufacturer
3rd Largest HEAVY TRUCK manufacturer
6th Largest CAR manufacturer
6th Largest COMMERCIAL VEHICLE manufacturer
Source: SIAM

3. Low Vehicle Penetration
Vehicle Market Share
Segment
Market Share
Passenger Vehicles
14%
Commercial Vehicles 3%
Three Wheelers
Two Wheelers
80%
Low Vehicle Penetration
Segment
Vehicle per 1000 persons
Passenger Vehicles 20
Two-wheelers
108
Buses
0.11

4. Auto Clusters North East West South Eicher Mahindra Escorts Mazda
Hero Motor
New Holland
Honda Motorcycle
Suzuki Motorcycles
Honda Cars
ICML
Tata Motors
JCB
Yamaha
Maruti Suzuki
Cities: Delhi, Gurgaon, Noida, Ghaziabad, Ludhiana, Haridwar
Illustrative list of manufacturing facilities of Indian and Global OEMs
North
Tata Cummins
Tata Motors
Cities: Kolkata
East
Cities: Baroda, Halol, Sanand, Mumbai, Pune, Nashik, Aurangabad.
West
Ashok Leyland
Royal Enfield
BMW
Same Deutz
Caterpillar
TAFE
Daimler
Tata Motors
Ford
Toyota Kirloskar
Hyundai
TVS
Nissan
Volvo Buses
Renault
Cities: Chennai, Hosur, Bengaluru
Bajaj Auto
Mercedes Benz
Fiat
Skoda
Force Motors
Tata Hitachi GM
Tata Motors
John Deere
Volkswagen
Mahindra
Volvo Eicher
Suzuki
Ford
Honda Motorcycle
South

5. Passenger Vehicles Production
Units of vehicles expressed in ’000 units
Figures for financial year – April to March
Passenger Vehicles Production
CAGR : 4%

6. Construction Vehicles
Other Vehicles Production
Units of vehicles expressed in ’000 units
Figures for financial year – April to March
Commercial Vehicles
Tractors
CAGR : -1%
CAGR : -3%
Two & Three Wheelers
Construction Vehicles
CAGR : 6%
CAGR : 3%

7. Top 5 players in Each Segment in 2016-17
Passenger Vehicles : +9.23%
Commercial Vehicles : +4.16%
Leading Players
Maruti Suzuki (47%)
Hyundai Motor (17%)
Mahindra (8%)
Tata Motors (6%)
Honda Cars (5%)
Leading Players
Tata Motors (43%)
Mahindra & Mahindra(25%)
Ashok Leyland (19%)
VECVs - Eicher (7%)
Force Motors (3%)
Two Wheelers : +6.89%
Three Wheelers : -4.9%
Leading Players
Hero MotoCorp (37%)
Honda MSI (27%)
TVS Motor (14%)
Bajaj Auto (11%)
India Yamaha (5%)
Leading Players
Bajaj Auto (50%)
Piaggio Vehicles(30%)
Mahindra (10%)
Atul Auto (7%)
TVS Motor (2%)
Note: FY means 12 month ending March

8. Auto Component Industry: 2015-2016
USD 39.0 billion
Turnover
3.5% - 4%
Contribution to GDP
USD billion
Foreign Exchange Earnings/ Exports 4%
Share of India’s Exports
USD 6.8 billion
Domestic Aftermarket
1.50 million
Direct Employment

9. Auto Component Industry Turnover: 2015-16
CAGR: 6%
2556 (39.0)
2348 (38.5)
2160 (39.7)
2117 (35.1)
2046 (42.2)
1883 (41.3)
Turnover in INR’ 00 Crore (USD Billion)
Growth Rate in Rupee Terms
(Turnover includes supplies to OEMs, aftermarket sales and exports)

10. Auto Components Supply to OEMs
Small Commercial Vehicles (SCV)
Less than 2 T
Light Commercial Vehicle (LCV)
2 to 7.5 T
Maneuver Combat Vehicle (MCV)
7.5 to 16 T
Heavy Commercial Vehicle (HCV)
More than 16 T
OEMs consumption includes locally produced Components and Imports

11. Exports Destinations: Top 10 Countries in %
Exports - Auto Component Industry:
CAGR: 18%
685 (11.2)
709 (10.8)
615 (10.2)
527 (9.7)
427 (8.8)
Turnover in INR’ 00 Crore
(USD Billion) \
303 (6.7)
Exports Destinations: Top 10 Countries in %
USA 25
Thailand
3.18
Germany
6.96
UAE
3.15
Turkey
6.22
France
2.99 UK
5.43
Brazil
2.62
Italy
3.86
Mexico
2.59

12. Indian Auto components already driving on international roads
Increased Component Outsourcing
(Illustrative List)
Over 35 IPOs of Global OEMs & Tier 1 Procuring from India
OEMs
BMW
Caterpillar
Ford
FIAT GM
John Deere
MAN
Mercedes-Benz
Nissan
Peugeot
Renault
Toyota
Volkswagen
Tier 1 Component Manufacturers
Bosch
Continental
Cummins
DANA
Delphi
Denso
Eaton
Getrag GE
Kohler
Kolbenschmidt
Magna
Meritor
TRW
Valeo
Indian Auto components already driving on international roads 12

13. Strengths & Challenges of Indian Component Suppliers

14. Indian Suppliers’ Focus – Global Best Practices
Industry fast embracing modern
shop-floor practices:
5-S; 7-W
Kaizen
TQM
TPM
6 Sigma
Lean Manufacturing
Focus on Quality
Deming Award – 16
Japan Quality Medal – 5
TPM Award – 15
Shingo Silver Medallion - 2
JIPM – 3
Largest no. of Deming Award winning companies outside Japan

15. Increasing focus on Innovation and Research
Design & Research Centers of leading Global companies in India
Bosch
Caterpillar
Continental
Cummins
Ford GM
Honda
Honeywell
Hyundai
Magna
Mercedes Benz
Renault Nissan
Suzuki
Valeo
(Illustrative List)

16. Auto Components Industry Aspirations

17. Objectives of Automotive Mission Plan 2026
Achieve top-line of USD billion
Increase export intensity to %
Attract investments of USD billion over the next decade
Automotive industry to be the engine of “Make in India”
Provide incremental employment to 65 million persons
Quality of employment a key feature of this industry
Contribute significantly to “Skill India”
Focus on promoting safe, efficient and comfortable mobility for every person in the society, with an eye on environmental protection through both public and personal transport option
Focus on promoting Mobility

18. Define a Road map for Implementing policies and regulations
Foster the promotion of “Brand India” by developing a sophisticated ecosystem of research, design, engineering and manufacturing that is conducive for a variety of players - both mass market and niche seekers.
To rank within the top three of the world in engineering, manufacture and export of vehicles and components
Promote India as a preferred destination for every segment of the automotive value chain
India & EU norms from current 6-7 years
Harmonisation: Clear roadmap to adhere to 1998 Agreement of UN Global Technical Regulations (WP.29)
Fuel Efficiency: Define clear roadmap for all categories of vehicles
Road Safety: Reduction in accidents and fatalities as per norms specified in Road Transport & Safety Bill.
Define a Road map for Implementing policies and regulations

19. Automotive Mission Plan 2026: Aspirations for Vehicle Industry
(million units)
Segment
Passenger Vehicles
1.2
3.7
Commercial Vehicles
0.39
0.8
Two Wheelers
7.6
18.5
Three Wheelers
0.43
0.95
Tractors
0.25
0.6
Total
9.87
24.55
Source: Automotive Mission Plan: 19

20. Tax Structure/Regimes in India

21. Current Excise Duty Structure
Vehicle Category
Excise Duty
Small cars, Commercial Vehicles and Two/Three wheelers
12.5%
Length >4m and engine capacity < 1500cc
24%
Length >4m and engine capacity > 1500cc
27%
SUVs/MUVs with Ground clearance >170mm
30%
Hybrid cars
Specified components of Hybrid vehicles 6%
Electric cars, 2W & 3W and specified components

22. Completely Built Up (CBU) Completely Knocked Down (CKD)
Import Duty Structure
Basic Customs Duty
Vehicles
Completely Built Up (CBU)
Completely Knocked Down (CKD)
Passenger vehicles
100%*/60
10%/30%+
Two wheelers
75%**/60%
Three wheelers
60%
Commercial vehicles
20%
10%
Components***
7.5%-10%
* With CIF value >US $ 40,000 or engine capacity >3000 cc for petrol and >2500 cc for diesel vehicles, or both.
** For motor cycles with engine capacity of 800 cc or more
+CKD containing engine or gearbox or transmission mechanism in pre-assembled form but not mounted on a chassis or a body assembly
*** Some components progress down to nil on FTAs

23. Other Domestic Taxes Tax Category Rate Infra Cess 1%, 2.5%, 4%
R & D Cess
0.125%
National Calamity Contingent Duty 1%
Central Sales Tax (CST) for out of state sale 2%
State Value Added Tax (VAT)
12.5%
Octroi (in one state only) 4%
State Road/Registration Tax
4-20%
Infrastructure Cess:
1% on small petrol, LPG, CNG cars,
2.5% on small diesel cars of less than 1500 cc and
4% on other higher engine capacity vehicles and SUVs was levied last year.

24. Rates Proposed Under GST
Vehicle Category
GST Rate
Passenger Vehicles (Petrol, Diesel, CNG)/Commercial Vehicles/Three-wheelers/Two-wheelers
28%
Electric Vehicles
12%
Vehicles that would attract GST plus Cess. Cess as provided below:
Vehicle Category
Cess
>4m passenger vehicles (All)
15%
<4m passenger vehicles (petrol) 1%
<4m passenger vehicles (diesel) 3%
>350cc two-wheelers
10 – 13 seater public transport vehicles

25. Thank You