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    Auto Industry Scenario

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    saurabhsaraf
    The Indian economy grew slowly in the first quarter of FY 2013-14, with industrial production increasing just 0.1% and infrastructure growth down. Auto industry sales also declined, with overall volumes shrinking 2.1% and every segment except utility vehicles down compared to the prior year. Major factors were the economic slowdown, high inflation, and rising financing costs. While GDP is projected to rise to 6% in 2013-14, interest rates may be difficult to soften given inflation rising above 4.8% in June. A recovery in the auto industry, especially for medium and heavy commercial vehicles, is expected to be gradual as overcapacity and weak transporter viability persist.

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    Auto Industry Scenario

    Uploaded by

    saurabhsaraf
    15 views2 pages
    The Indian economy grew slowly in the first quarter of FY 2013-14, with industrial production increasing just 0.1% and infrastructure growth down. Auto industry sales also declined, with overall volumes shrinking 2.1% and every segment except utility vehicles down compared to the prior year. Major factors were the economic slowdown, high inflation, and rising financing costs. While GDP is projected to rise to 6% in 2013-14, interest rates may be difficult to soften given inflation rising above 4.8% in June. A recovery in the auto industry, especially for medium and heavy commercial vehicles, is expected to be gradual as overcapacity and weak transporter viability persist.

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    The Indian economy grew slowly in the first quarter of FY 2013-14, with industrial production increasing just 0.1% and infrastructure growth down. Auto industry sales also declined, with overall volumes shrinking 2.1% and every segment except utility vehicles down compared to the prior year. Major factors were the economic slowdown, high inflation, and rising financing costs. While GDP is projected to rise to 6% in 2013-14, interest rates may be difficult to soften given inflation rising above 4.8% in June. A recovery in the auto industry, especially for medium and heavy commercial vehicles, is expected to be gradual as overcapacity and weak transporter viability persist.

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    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    15 views2 pages

    Auto Industry Scenario

    Uploaded by

    saurabhsaraf
    The Indian economy grew slowly in the first quarter of FY 2013-14, with industrial production increasing just 0.1% and infrastructure growth down. Auto industry sales also declined, with overall volumes shrinking 2.1% and every segment except utility vehicles down compared to the prior year. Major factors were the economic slowdown, high inflation, and rising financing costs. While GDP is projected to rise to 6% in 2013-14, interest rates may be difficult to soften given inflation rising above 4.8% in June. A recovery in the auto industry, especially for medium and heavy commercial vehicles, is expected to be gradual as overcapacity and weak transporter viability persist.

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    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
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    Indian Economic Scenario FY 13-14

    IIP grew by 0.1% as compared to 0.6% growth in Q1 FY 2013-14.


    - In terms of Sectoral Classification of Industrial Output of Manufacturing grew
    0.11% in Q1 FY 2013-14.
    Infrastructure Index April May 2013-14 recorded 2.37% growth than against
    6.47% during corresponding period 2012-13.

    Auto Industry scenario FY13-14


    SIAM declared the Shrinkage of 2.10 % in overall sales volumes for the first quarter
    (Q1) of 2013-14 (FY14), compared to a growth projection of 6-8 % for the full fiscal
    year the industry would notch up smaller numbers this fiscal than in the last.
    Expect utility vehicles has grown by 5.27% (projection 11-13% for the whole year)
    every single segment has not only not met growth projections, but actually shrunk
    anywhere between 0.82 %(2 wheelers) and 17.58 % (M&HCV) compared to same
    quarter of the previous year.
    Major factor has been bad sentiment as a consequence of the economic slowdown,
    uncontrollable inflationary conditions, high finance rates.
    M&HCV sales has decline for the sixteenth straight month.
    Buses Sales in India down by 4.68% Q1 FY 2013-14 (Source ACG)
    - MHCV down by 7.53%
    - LCV down by 1.97%
    Indian Truck Market Sales declined at 8.74 % in Q1 FY 2013-14(Source ACG)
    - MHCV down by 17.58%
    - LCV down by 4.21%
    Average road freight rate index for Q1 (Apr-Jun) 2013-14 grew by 1.93% on a y/y
    basis, higher than 0.30% growth in Q1 of 2012-13 and 1.64% growth in Q4 of 201213.

    Future Scenario
    GDP is expected to pick-up to around 6% in 2013-14
    Softening of interest rate looking difficult especially when inflation has gone up to
    4.86% in June13 after falling to 4.70% in May13.
    Improvement in freight rates would be the key indicators.
    Global and Indian manufacturers are focusing their efforts to develop innovative
    products, technologies and supply chains in the industry.
    ICRA Expect M&HCVs volumes to remain weak in the near-term as underlying
    demand indicators continue to post a subdued picture. Surplus capacity in the
    trucking system and currently weak transporter viability suggest that recovery in
    the M&HCV demand is likely to be gradual.
    CV sales in FY14 are likely to rise 7-9 percent, with light truck sales growing 10-12
    percent. M&HCV sales will continue to see slow growth (1-3 percent growth forecast
    by SIAM).

    The fall of Rupee against Dollar, the increase in price for crude oil and fear of
    inflation will install bigger hurdles to the Indian automobile industry in the coming
    months.

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