The Indian Automotive Industry: an International Trade Perspective
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The Indian Automotive Industry: An International Trade Perspective EXPORT-IMPORT BANK OF INDIA WORKING PAPER NO. 59 THE INDIAN AUTOMOTIVE INDUSTRY: AN INTERNATIONAL TRADE PERSPECTIVE EXIM Bank’s Working Paper Series is an attempt to disseminate the findings of research studies carried out in the Bank. The results of research studies can interest exporters, policy makers, industrialists, export promotion agencies as well as researchers. However, views expressed do not necessarily reflect those of the Bank. While reasonable care has been taken to ensure authenticity of information and data, EXIM Bank accepts no responsibility for authenticity, accuracy or completeness of such items. © Export-Import Bank of India February 2017 1 Export-Import Bank of India The Indian Automotive Industry: An International Trade Perspective 2 Export-Import Bank of India The Indian Automotive Industry: An International Trade Perspective CONTENTS Page No. List of Exhibits 5 List of Tables 7 List of Boxes 7 Executive Summary 9 1. Introduction 19 2. Global Automobile Industry: An Overview 20 3. Global Auto-Components Industry 32 4. The India Scenario 38 5. Exports of Auto and Auto Components from India: An Analysis 49 6. Challenges and Strategies 64 Project Team Ashish Kumar, Deputy General Manager Shipra Dubey, Manager 3 Export-Import Bank of India The Indian Automotive Industry: An International Trade Perspective 4 Export-Import Bank of India The Indian Automotive Industry: An International Trade Perspective LIST OF EXHIBITS Exhibit No. Title Page No. 1 Product-wise Share in World Production of Automobiles (2015) 20 2 Trends in Global Production of Automobiles 21 3 Percentage Change in Global Automobile Production (2008-2015) 21 4 Country-wise Share in Global Vehicle Production for the Year 2015 21 5 Production of Motor Vehicles of Top Ten Countries in 2015 21 6 Share of Countries in Investments made in the Automobile Industry (2015) 22 7 Region wise Share in World Exports of Automotive Products (2014) 22 8 Segment wise Production of Automobiles in China (2015) 23 9 Segment wise Production of Automobiles in the USA (2015) 24 10 Segment wise Production of Automobiles in Japan (2015) 25 11 Segment wise Production of Automobiles in Germany (2015) 26 12 Segment wise Production of Automobiles in South Korea (2015) 27 13 Global Trade in Tractors– HS Code – 8701 29 14 Global Trade in Public Transport Type Passenger Vehicles – HS Code – 8702 29 15 Global Trade in Motor Cars and Motor Vehicles – HS Code – 8703 30 16 Global Trade in Motor Vehicles for Transport of Goods – HS Code – 8704 30 17 Global Trade in Special Purpose Motor Vehicles – HS Code – 8705 31 18 Global Trade of Motorcycles (Including Mopeds) and Cycles – HS Code – 8711 31 19 International Trade in Gear Boxes– HS Code – 870840 33 20 International Trade in Drive Axles – HS Code – 870850 34 21 International Trade in Steering Wheels in the World – HS Code – 870894 34 22 International Trade in Road Wheels & Parts & Accessories Thereof – HS Code – 870870 35 23 International Trade in Suspension Shock Absorbers – HS Code – 870880 35 24 International Trade in Clutches & Parts Thereof – HS Code – 870893 36 25 International Trade in Bumpers and Parts Thereof – HS Code – 870810 36 26 International Trade in Radiators – HS Code – 870891 37 27 Category-wise Share in Automobile Production in India (2015-16) 40 28 Automobile Production in India: Recent Trends 40 29 Trends in Domestic Sales of Vehicles in India: Segment wise 42 30 Trends in Production, Domestic Sales and Exports of Automobiles in India 43 31 Automobiles Exports as a Percentage of Production (Volume Terms) 43 32 Trends in Production, Domestic Sales and Exports of Commercial Vehicles in India 44 5 Export-Import Bank of India The Indian Automotive Industry: An International Trade Perspective LIST OF EXHIBITS Exhibit No. Title Page No. 33 Trends in Production, Domestic Sales and Exports of Passenger Vehicles in India 44 34 Trends in Production, Domestic Sales and Exports of Two Wheelers in India 45 35 Trends in Production, Domestic Sales and Exports of Three Wheelers in India 45 36 Segment-Wise Share in Production of Auto-Components in India 46 37 Turnover of Auto-Components Sector in India 47 38 Investments in the Auto-Components Sector in India 47 39 Trends in Export Orientation of Indian Auto Components Industry 48 40 Export Orientation of the Indian Automobile Sector 49 41 Category-wise Share of Vehicle Exports in India (2015-16) 50 42 Export of Tractors from India (2015-16) (HS Code – 8701) 52 43 Export of Public Transport type Passenger Motor Vehicles from India (2015-16) (HS Code – 8702) 52 44 Export of Motor Cars & Other Motor Vehicles from India (2015-16) (HS Code – 8703) 53 45 Export of Motor Vehicles for Transport of Goods from India (2015-16) (HS Code – 8704) 53 46 Export of Special Purpose Motor Vehicles from India (2015-16) (HS Code – 8705) 54 47 Export of Motorcycles (Including Mopeds) and Cycles fitted with an Auxiliary Motor, with or without Side-cars; Side-cars from India (2015-16) (HS Code – 8711) 54 48 Trends in Exports of Indian Auto-Components 55 49 Region-wise Break-up of Exports by India (2015-16) 55 50 Export of Gear Boxes by India (2015-16)(HS Code – 870840) 57 51 Export of Pneumatic Tyres by India (2015-16)(HS Code – 40112090) 57 52 Export of Brakes & Parts thereof from India (2015-16) (HS Code – 87083000) 58 53 Export of Drive Axles by India (2015-16) (HS Code – 870850) 58 54 Export of Transmission Shafts and Cranks by India (2015-16) (HS Code – 84831092) 59 55 Export of Reciprocating Piston Engines by India (2015-16) (HS Code – 84073410) 59 56 Export of Bumpers & Parts thereof from India (2015-16) (HS Code – 87081010) 60 57 Export of Road Wheels & Parts & Accessories thereof by India (2015-16) (HS Code – 870870) 60 58 Export of Suspension Shock Absorbers by India (2015-16) (HS Code – 870880) 61 59 Export of Radiators by India (2015-16) (HS Code – 870891) 61 60 Export of Steering Wheels, Columns & Boxes by India (2015-16) (HS Code – 870894) 62 61 Export of Clutches & Parts thereof by India (2015-16) (HS Code – 870893) 62 62 Export of Other Parts & Accessories of Bodies from India (2015-16) (HS Code – 870829) 63 6 Export-Import Bank of India The Indian Automotive Industry: An International Trade Perspective LIST OF TABLES Table No. Title Page No. 1 Leading Countries Investing in Automobile Industry (2015) 22 2 Export of Automobiles from China: By Type of Vehicles 24 3 Export of Automobiles from the USA: By Type of Vehicles 25 4 Export of Automobiles from Japan: By Type of Vehicles 26 5 Export of Automobiles from Germany: By Type of Vehicles 27 6 Export of Automobiles from South Korea: By Type of Vehicles 28 7 Category-wise Exports of Automobiles in the World 28 8 Category-wise Global Exports of Auto-Components 33 9 Category-wise Production of Automobiles in India 41 10 Category-wise Domestic Sales of Automobiles in India 42 11 Classification of Major Auto-Components Produced in India 46 12 Category-wise Exports of Indian Automobiles 50 13 Export of Select Automobiles in Value-terms from India 51 14 Export of Select Auto-components in Value-terms from India 56 LIST OF BOXES Box No. Title Page No. 1 Make In India: Sector Survey – Automobile 39 2 New Initiatives & Vision For The Future 70 7 Export-Import Bank of India The Indian Automotive Industry: An International Trade Perspective 8 Export-Import Bank of India The Indian Automotive Industry: An International Trade Perspective Executive Summary The automotive industry, comprising automobiles and motor vehicles worth nearly US$ 249 billion. Major auto components, has witnessed a continuous evolution importers of motorcars and motor vehicles during the ever since the development of the first few prototypes same year were USA (22%) and China (9%). back in the late nineteenth century. The industry has The second largest traded automobile segment was today emerged as a dynamic one, accounting for motor vehicles for transport of goods, with exports approximately one in ten jobs in industrialized countries. valued at 125 billion in 2014. Mexico, USA and Germany Even for developing countries, the automotive sector together accounted for 37% of world export of motor has emerged as a catalyst for growth opportunities, vehicles for transport of goods. Major importers of especially because of the vast linkages that the auto motor vehicles for transport of goods included USA industry has with other sectors. (19%), Canada (11%) and UK (6%). Global Scenario - Automobiles Exports of motorcycles (including mopeds) was During 2015, the turnover of the automobiles industry valued at US$ 22 billion. China exported motorcycles was estimated at Euro 1.9 trillion, with production of (including mopeds) valued at US$ 5.7 billion and was 90.8 million vehicles (excluding two/three wheelers), the largest exporter in the world accounting for 26% of recording a CAGR of 3.6% during the period 2008-15. global exports. Other major exporters of motorcycles China, USA and Japan were the largest automobile (including mopeds) were Japan (14%), India (9%) and manufacturers in the world, together accounting for Germany (8%). In terms of imports, USA, France and half of the global production during 2015. They were Germany were among the largest importers. followed by Germany, South Korea, India, Mexico, World trade in public transport type passenger vehicles Spain, Brazil and Canada. India holds a share of 5% in was estimated at US$ 17 billion in 2014. Japan was the global automobile production. the leading exporter in the world, with a share of 18% There has been a steady increase in global trade of followed by China (17%).