automobile indsustr

 An automobile is a passenger vehicle with four wheels and a gasoline or diesel internal
combustion engine that is designed for use on public roads.

 The automobile industry encompasses all those companies and activities involved in the
manufacture of motor vehicles, including most components, such as engines and
bodies, but excluding tires, batteries, and fuel.
Automobile Industries in India

 Before Independence, India did not have an automobile industry in the typical sense.
Only the imported parts were used for assembly.
 In 1928, General Motors (India) Ltd. opened a factory in Mumbai to assemble trucks and
cars.
 In 1930, Ford Motor Co. (India) Ltd. began assembling cars and trucks in Chennai, and
in 1931, in Mumbai.
 With the establishment of Premier Automobiles Ltd. in Kurla (Mumbai) in 1947 and
Hindustan Motors Ltd. in Uttarpara (Kolkata) in 1948, the industry began to take off.
 India's automobile industry has advanced significantly over the last three decades. It is
now one of the most thriving economic sectors.
 Since 1991, when the automobile industry was gradually liberalized, more and more
players have established manufacturing facilities in India.
 There are currently 15 manufacturers of passenger cars and multiutility vehicles, 9
manufacturers of commercial vehicles, 14 manufacturers of two/three-wheelers, and 14
manufacturers of tractors, as well as 5 engine manufacturers. More than Rs. 50,000
crore has been invested in the industry.
 The automobile industry had a revenue of over Rs. 1,00,000 crores in the fiscal year
2003-04.
 In addition, the industry has a lot of job openings.
 It currently employs 4.5 lakh people directly and about one crore people indirectly.
The auto industry's contribution to GDP increased from 2.77 percent in 1992-93 to 7.1
percent in present.
Locational Factors
Locational Factors
 Raw Materials: The automobile industry uses metallurgical industry finished products as
raw materials to manufacture automobile vehicles.
 Steel, nonferrous metals, window glass, plastic, rubber, wood, paint, textile, electronic
cables, seat cushions, and other industrial raw materials are all needed by the
automobile industry.
 Spare parts: To keep mass production on the assembly line going, there is a need for a
steady supply of spare parts and raw materials.
 As steel is the primary raw material used in the automobile industry, it tends to be
located near iron and steel-producing centers.
 The nearness of Assembly Parts: The proximity of plants that make tires, tubes,
storage batteries, paints, and other ancillary products is thought to be a plus.
 Ports: Port cities are also popular with this industry due to the import and export
facilities they provide.
 The automobile industry has recently become more market-oriented, favoring locations
with ready markets for manufactured vehicles.
 Government Policy: Some locations in remote and industrially backward areas are
given priority under the government's plans for the decentralization of industries.
 Low-cost labor: As this market is labor-intensive, labor should be readily available.
Production History
Production History
 The commercial vehicle industry is split into two categories:
o passenger vehicles
o goods vehicles
 State-owned transport undertakings (STUs) control the passenger segment, while
goods vehicles are mostly produced in the private sector.
 Commercial vehicle production began in the 1950s, and the industry experienced rapid
growth during the post-liberalization period as a result of government incentives.
 Commercial vehicle production increased from an insignificant 8.6 thousand in 1950-51
to 145.5 thousand in 1990-91.
 After 1996-97, however, different production trends were observed.
 India produced 275.1 thousand commercial vehicles in 2003-04.
 Buses and trucks are currently produced by seven major companies.
 TELCO (Tata Engineering and Locomotive Co. Ltd.) is India's largest manufacturer of
medium and heavy commercial vehicles, accounting for more than 70% of the
market.
 Light commercial vehicles are manufactured at four plants in Hyderabad, Pithampur
(M.P. ), Arson near Rupnagar (Punjab), and Surajpur in Uttar Pradesh.
 In addition to the aforementioned manufacturers, the Ministry of Defence produces
Shaktiman trucks, and Nissan Jeeps are produced in Jabalpur in collaboration with
Nissan of Japan.
Distribution
 The major automobile manufacturing centers are Mumbai, Chennai, Jamshedpur,
Jabalpur, and Kolkata.
 These facilities manufacture a wide range of vehicles, including trucks, buses,
passenger cars, three-wheelers, and two-wheelers.
 Faridabad and Mysore are also known for producing motorcycles.
 Lucknow, Satara, Akurdi (near Pune), Panki (near Kanpur), and Odhav also produce
scooters (Ahmedabad dist.).
 In 1983, Maruti Udyog Ltd. (MUL) in Gurgaon, Haryana, began producing passenger
cars.
 There are currently 38 automobile manufacturing units producing four-wheelers, three-
wheelers, and two-wheelers.
 Three distinct clusters have emerged in the automobile industry.
o In South India; around Chennai
o In West India; Ahmedabad to Pune
o In North India; Haryana, Delhi-NCR
 The Chennai region is the largest automobile industry hub accounting for 40% of
revenue and 60% of exports.
 Ford, Hyundai, Renault, Nissan, and MBW are some of the major companies that
operate.
 Chennai is also known as "India's Detroit."
Challenges
 Attracting talent: As the automobile manufacturing industry evolves, manufacturers will
need to continue attracting the best and brightest talent to keep up with the times.
 Overloading: Automobile manufacturing, like all businesses, experiences ups, and
downs.
 Overcapacity is a problem that arises when a manufacturer has already invested
resources such as labor and materials into building a specific quantity, only to discover
later that they do not need to produce as much as they had anticipated.
 As a result, there is an overspending problem that can deplete cash flow and lead to
waste.
 Globalization: Increased global competition means lower market prices for a variety of
vehicles: once again, most solutions call for increased efficiency to compensate for a
small income margin.
 Consumers are becoming increasingly concerned about sustainability.
 As a result, carmakers must work harder to produce more environmentally friendly
vehicles and improve their manufacturing skills.
 Urbanization: At the moment, consumers have a diverse set of car-buying criteria,
many of which are related to urbanization.
 They include vehicles that are smaller, more maneuverable and get better gas mileage.
Significance
Significance
 The automobile industry is a major contributor to the Indian economy.
 It is extremely important to India's economy and industrial development.
 Steel, metal, plastic, petrochemicals, rubber, glass, and other basic industries benefit
from the procurement of these industries.
 These industries provide people with more job opportunities, both directly and indirectly.
 This industry also contributes to the growth of foreign currency by exporting 1.5 million
vehicles on a yearly basis.

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 An automobile is a passenger vehicle with four wheels and a gasoline or diesel internal

combustion engine that is designed for use on public roads.

Automobile Industries in India

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