Automotive sector OEMs and auto component manufacturers Among OEMs, global conglomerates emerging, driven my M&As Component

omponent manufacturers are being tierised tier 1 are the component aggregators, tier 2 and 3 are component suppliers Growth in automobile market - ~14%, growth in auto components market ~20% Industry contributes ~4% to GDP, employs 0.45m directly, 10m indirectly Attractive market, as well as place to source auto components from 2 wheelers ~ 80%, passenger vehicles ~13% Manufacturing, although spread, concentrated in a few areas Chennai, Bangalore Pune NCR Jamshedpur/Kolkata Pitampur Suppliers located close to manufacturing locations of OEMs Highly fragmented components industry 6400 players, 6% organized 77% output Production ~ 8.5m , domestic sales ~ 7.9m units, fastest growth in commercial vehicles, but growth consistent in other categories Commercial vehicles, passenger vehicles, two wheelers, three wheelers Commercial vehicles Light, medium and heavy Growth facilitated by development of ports, highways, increase in construction and agri output Passenger vehicles ~ 12% growth Shift in demand to higher-end cars Two wheelers ~ 14.5% growth Driven entirely by motorcycles Indian auto component industry o $8.5bn industry, growth ~25%, investments $4bn, growing at ~20% o Exports $1.4bn, Americas+Europe ~ 60% Exports growing at 39%, spearheaded by passenger vehicles, though large chunk is still two wheelers o Cars Europe o Buses and trucks Africa o Two wheelers ASEAN 100% FDI allowed in auto component industry Custom duty on imports reduced