Study of emerging trends in Indian automobile industry

Abstract

The Contemporary Concerns Study aims to study the changing auto industry scenario in India, what it was in the years prior to liberalization of the Indian economy. We analyse in terms of the competitive forces in play, the advantages they had and the limitations they faced, and how these changed after the opening up of the Indian economy to multinational auto manufacturers. We then try to analyse the Indian Automobile Industry (from the perspective of passenger cars only) through the basic frameworks of Porter’s five forces and SWOT. This helped in understanding the current market and its basic overview in terms of the opportunities, threats, strengths of the Indian Auto industry, and its weaknesses too. The synthesis that we obtained was that Indian market is currently trying to overcome its weaknesses and building on the opportunities using the cost-effective methods like labour and other resources. The overall macro-economic environment has been made very conducive for the investors to invest in the form of FDI. It has also attracted almost all global giants to enter the Indian Auto market and invest or expand with range of product models. Apart from this, it has been observed that Indian auto makers are daring to invest in R&D and trying to come with better technology and environmental complaint models. They are trying to understand the customer taste and preferences and trying to stay price competitive. One of the examples would be the launch of Tata Nano which has led to creation of a new small car segment and other competitors have already started to invest in R&D to launch similar priced product. One of the most important observations is that the Indian Auto market has become highly competitive but at the same time they are all in the growth stage of the lifecycle. We have tried to analyse the trends in five broad categories: macro-economic, technology, consumer preferences, competition and associated industries. This has resulted in identifying the new offerings in terms of new segment creation, differentiators of the Study of Emerging Trends in Indian Automobile Industry players and also new norms that are likely to be the common platform for all the players to operate on. We have tried to identify the advantages that are pro-India and the growth drivers that are currently helping in creating the domestic demand. We have also tried to analyse the capabilities of the Indian auto players. In association with this we analyse the associate industry of ancillary, and auto components that are not only catering to the Indian B2B demand but also exporting to the other major global players. After the proper analysis we have tried to raise questions in terms of challenges that India is currently facing or likely to face. One major question that we have tried to address is the sustenance of the growth that Indian auto industry is facing. This leaves us with some thoughts on the future of Indian auto industry. We have tried to lay special emphasis on the surety of India becoming an export hub. Almost all the big Indian auto makers are seeking opportunity in the export of their product and trying their best to improve their brand image. In the process they are realizing the feasibility of becoming a global player sometime in the near future.