Upload
others
View
27
Download
0
Embed Size (px)
Citation preview
Manufacturing of
Electric Vehicles(Two Wheelers/Three
Wheelers/Passenger Cars)
Automobile and
Auto componentsGovernment of Gujarat
Page 2
Contents
Project Concept 3
Market Potential 4
Growth Drivers 7
Gujarat – Competitive Advantage 8
Project Information 10
- Location/ Size
- Infrastructure Availability/ Connectivity
- Raw Material/ Manpower
- Key Players/ Machinery Suppliers
- Potential collaboration opportunities
Project Financials 14
Approvals & Incentives 16
Page 3
Project Concept
Indian Auto Industry Overview
Indian Auto and Auto Components Industry Classification
Automobile
Passenger cars Two-wheeler Three-wheelerCommercial
vehicles (CV)
Cars
Utility vehicles
Multi Purpose
vehicles
Motorcycles
Scooters
Mopeds
Commercial
purpose
Passenger
carrier
Light CVs
Medium and
heavy CVs
Mining
equipment
and
earth moversAuto components
Engine and
engine parts
Powertrain
parts
Suspension
and
braking
parts
Lighting and
other
equipment
Accessories Others
Auto and auto components industry in India is growing and maturing at a fast pace in terms of
size, model variants and technological advancements in new cars. Some of the factors attributable
to this growth include a buoyant end-user market, improved consumer sentiment and return of
adequate liquidity in the financial system.
The Indian auto-components industry can be classified into - organised and unorganised sectors.
The organised sector caters to the Original Equipment Manufacturers (OEMs) and consists of
high-value precision instruments, while the unorganised sector comprises low-valued products and
caters mostly to the aftermarket category.
Sources:http://www.ibef.org/industry/autocomponents-india.aspx
The proposed unit involves manufacturing of electric vehicles (AC-induction motor based) in Sanand, Gujarat. The estimated project cost of the proposed unit is INR 1 billion including land, plant and machinery cost. The demand for such a facility is justified taking into consideration that, Less than 500,000 electric vehicles (EVs) presently exist in India.
More than 95% of electric vehicles are low speed electric scooters that do not require insurance, license or road tax. India is set to become the 3rd largest automotive market by 2020 and currently has one of the lowest vehicle penetration in the world making it a viable market for EVMs.
Project Overview
Page 4
Market Potential
Electric vehicles (EV) industry is at a nascent stage in India, comprising less
than 1% of the total vehicle sales, however it has the potential to grow
significantly in the coming years. Electric vehicle sales are expected to grow
at high double digit growth rates annually till 2020
0%
11%
89%
PHEVsBEVsHEVs
EV sales split by
type (2014)
2014
0.3%
2020
1.5%
Share of electric vehicles in total light duty vehicle sales
EV sales split by
type (2020)
11%15%
74%
PHEVsBEVsHEVs
EV sales split by type (2014)
723
3,056
3,845
5,519
6,7787,379
8,601
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000
2014201520162017201820192020
un
its
Battery Electric Vehicles
6,088 6,986
10,033
18,154
27,543
35,994
42,482
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
2014 2015 2016 2017 2018 2019 2020
Hybrid EV
Page 5
Market Potential
4 wheelers 2 wheelers
Currently, only Mahindra and Mahindra (M&M) and Toyota offer electric/hybrid
4-wheelers in the country, with several players having plans of launching new
products
Mahindra
Reva
Toyota
Tata Motors,
GM, Maruti
Suzuki,
Volkswagen,
Ford, BMW
Ampere
Electrot
herm
Hero
Electric
Lohia
Auto
► History: Founded in 1994 as the
Reva Electric Car Company in
which Mahindra Group acquired
majority stake in 2010
► Low sales: Currently sells the
e2o electric car (launched in
2013) that has sales of less than
500 units per year
► Two hybrid models on sale:
Currently offering completely
imported Toyota Prius and Camry
Hybrid
► Low sales: The company has
sold 170 odd units of Toyota Prius
since its launch in January 2010
► The companies either announced
plans to launch India specific EVs
or showcased these vehicles at
Auto Expositions but have not
commenced production yet
► <5,000 units
in FY13
► Capacity of
10,000 units
per months
► 8,000 units
sold in FY13
► Annual
Capacity of
60,000 units
► 150
dealerships
► 14,000 units
sold in FY13
► 80% low
speed models
► 204
dealerships
► 4,000 units
sold in FY13
Page 6
Market Potential
► Less than 500,000 electric vehicles (EVs) presently exist in India.
► More than 95% of electric vehicles are low speed electric scooters that do not require insurance, license or road tax.
► All electric two wheelers currently operate using lead-acid batteries
► The government is in the process of regulating e-rickshaws that has resulted in interest from many EV manufacturers to launch electric three-wheelers
Indian EV market dominated by two wheelers; regulation on e-rickshaws to boost sales
Currently only one model of Battery electric 4 wheeler on sale in India
► Mahindra Reva is the only company that currently offers Electric vehicle and its current model e2o uses Li-ion batteries
► Demand for Reva in India has largely been stagnant — with less than 500 cars sold in a year.
► Demand for hybrids is also low primarily due to lack of available models (currently only Toyota sells hybrid models, Prius and Camry)
Sales of electric vehicles largely dependent upon government incentives
► Government incentives widely influence the electric vehicle sales
► As a result of government’s incentive in FY11, electric vehicle sales (including two wheelers) registered a growth of 30% on a y-o-y basis.
► A withdrawal of the subsidy scheme led to a 50% drop in electric vehicles sales
Key characteristics of the Indian Electric vehicles’ industry
Page 7
Growth Drivers
Exchange rate used: USD/INR: 64.0240 (2015 calendar year average)
Demographic
potential
Rising energy
demand
Congestion and
driving patterns
Government
focus on
promoting EVs
► India projected to add 352 million people by 2035
► India has the lowest median age of 28 and rising individual wealth
Large domestic
market for
automobiles
Low
manufacturing
and operational
costs
► Energy demand expected to rise 70% in the next decade
► The percentage of imported oil to reach 92% by 2020
► A need to lower CO2 emissions to drive demand
► Lower labor costs and large pool of engineers to favor EV manufacturing
► Electric vehicles also have lower lifecycle costs
► India to become the 3rd largest automotive market by 2020
► It currently has one of the lowest vehicle penetration in the world
► Indian drivers have to drive at low speeds, make frequent stops and have short commutes
► Indian EVs can be designed for shorter range and lower speeds
► National Electric Mobility Mission Plan 2020 provides the roadmap for achieving significant penetration of electric vehicles in India by 2020
Page 8
Gujarat - Competitive Advantage
Sources:
“Manufacturing Sector – Profile”, Vibrant Gujarat website, 7 October 2014
“Gujarat – Growth and Prosperity for All”, Vibrant Gujarat website, 25 August 2014
Large auto clusters being developed
near Rajkot and Ahmedabad
500+ auto component
manufacturers in the Rajkot district
4–6 emergingAuto clusters will be
developed near Ahmedabad
Particular Symbol
Existing Auto Clusters
Emerging Auto Clusters
in SIRs by 2015
Emerging Auto Clusters
in SIRs by 2020
2–3 emergingAuto clusters will be
developed near Rajkot
Auto Cluster in the State
Special Investment Region (SIR)
► Gujarat is emerging as a key investment destination for the major auto players. The state is set
to become the country's automotive hub within the next few years.
► Gujarat government plans to increase the share of automotive industries in its overall
engineering output to 10% by 2020, from the current 3.7%.
► Gujarat expects to surpass the production capacity of top car manufacturing states like
Haryana, Maharashtra and Tamil Nadu, with an installed capacity to roll out 1 million units
annually within the next 3-4 years.
► Incremental manpower requirement in Gujarat for the manufacturing of engineering goods is
expected to be 53,580 during 2017-22.
Page 9
Gujarat - Competitive Advantage Skill development and training in auto sector is a focus area for
Gujarat government
Gujarat is a hub of
engineering industry, with
the manufacturing and
engineering sector in
Gujarat contributing over
27% to the state’s GSDP
and contributing 9%
overall to the national
engineering output.
The government has already
established
multiple CoEs (including one
on Industrial automation
in Mehsana itself) and is in
process of establishing more
across the state.
The Gujarat government
has recently passed the
Labour Laws Bill
(December 2015), to give
an impetus to
industrialization in the
State.
Gujarat has a strong
educational infrastructure in
automobile sector with 27
colleges providing technical
education in the sector with
annual intake capacity of
1,980, and additionally 111
colleges provide technical
education in mechanical field.
In addition to the
national level incentives,
the Gujarat government
is providing financial
incentive for setting up of
CoEs for the
manufacturing sector.
Gujarat is relatively less
congested and polluted
offering better standards of
living to the inhabitants.
Manufacturing
and engineering
sector growth
Government
focus to
develop CoEs
Favorable labor
policy
Well-developed
skill
development
industry
Financial
incentives
Better social
infrastructure
Sources:
http://www.narendramodi.in/maruti-to-invest-rs-4000-crore-at-bechraji-agreement-signed-with-gujarat-govt-4536
http://www.thehindu.com/news/national/gujarats-controversial-labour-laws-bill-gets-presidential-assent/article7938265.ece
http://www.vibrantgujarat.com/writereaddata/images/pdf/Skill-Ecosystem-Updated.pdf
http://www.business-standard.com/article/economy-policy/gujarat-govt-plans-incentive-scheme-to-boost-manufacturing-sector-
113022500549_1.htmls
Page 10
Project Information
► Sanand, Gujarat is an indicative location for establishment of Electric Vehicle
Manufacturing plant. Alternatively, the plant can be set up in any other suitable location in
Gujarat.
► 66 KV Vendor Park and 66 KV Chharodi substations are located approx. 4 km away from
the boundary of the estate
► A 400/220/66KV substation is planned within the Sanand Estate to be operational in 2-3
years
► For solid waste – two disposal facilities are available, Naroda & Vatva. The company has to
transport their solid waste to these sites themselves. The sites are around 50 km form
Sanand
► Gujarat State Petronet Ltd. would supply gas in the estate till the door step
► Port Connectivity is available with three ports – Kandla, Mundra & Pipavav
► Sanand has the advantage of a Broad Gauge (BG) railway network and NH–8A which
connects Ahmedabad to Saurashtra and Kutch passes through Sanand
► Ahmedabad International Airport is the nearest airport located at a distance of 30 kms from
Sanand
Project site – Sanand (Gujarat)
13.5 KL water/ha area
12+ auto ancillary units to
be setup
300 vendors expected to
setup
Project at a Glance
Project Name Automobile manufacturing (OEM)
Location Sanand, Gujarat
Area 2000 ha
Focus Sector
Engineering, Automobiles and ancillary
units, Engineering plastics,
Semiconductors, Electronics
Target Audience Tata, Ford, Bosch, Valeo, JBM, Visteon, Magna,
Page 11
Project Information
► National Highways: NH–8A, which connects Ahmedabad to Saurashtra and Kutch,
passes through Sanand.
► State Highways: SH–17 connects Ahmedabad to Sanand and joins NH – 8A leading
to Kutch. SH-144, SH-135 and SH – 74 are the other important linkages within
Sanand.
► Ahmedabad International Airport is the nearest airport located at a distance of 30
kms from Sanand .
► There are domestic airports located in Baroda and Surat.
► Sanand has the advantage of a Broad Gauge railway network
► The nearest railway station is at Ahmedabad at a distance of 40 km from the
Sanand.
► Port Connectivity is available with three ports – Kandla, Mundra & Pipavav.
► Mundra port is linked by NH – 8A and lies at a distance of about 400 kms from
Sanand.
Sanand is well-connected with other districts in Gujarat as well as
other cities in India
► Gujarat has a state-wide “water supply grid” spread across 1,20,769 km that aims to
serve 75% of Gujarat’s population.
► Gujarat Industrial Development Corporation (GIDC) is responsible for ensuring
consistent water supply in industrial areas
► Two disposal facilities are available, Naroda & Vatva, are available for solid waste.
The sites are around 50 km form Sanand
The State Government ensures robust physical/industrial
infrastructure & utility linkages
► Gujarat boasts of 24 hour – 3 - phase uninterrupted power supply
Sources:
http://www.mapsofindia.com/maps/gujarat/districts/mehsana.htm
http://www.nsdcindia.org/sites/default/files/files/gujarat-sg-report.pdf
Page 12
Project Information
Category Machinery / Equipment suppliers
Engine and Gear Boxes Bharath Forge Amalgamation Group Rane Group
Axels JBM Axles India Amtek
Door panels Dow AutomotiveTata autocomp
systems limitedJBM
Exhaust systems Faurecia Autoflex Emcon technologies
Heating, Ventilating, Air-
conditioning and CoolingDenso Sanden Subros
Seats Lear Johnson controls Netplast
BatteryTata autocomp
batteryMinda battery N/A
Tires Apollo Bridgestone MRF
Horn Hella Denso Minda
Dashboard IAC
Tata autocomp
systems limited -
interiors and plastics
division
Hyundai Mobis
Wiring Harness Delphi MothersonSumiTata yazaki
autocomp
Page 13
Key Considerations
Lack of
consumer
awareness
and price
sensitivity
According to
government
surveys, most
consumers are
unaware of
electric
vehicles
Most
consumers
have concerns
over range,
poor battery life
and high initial
price
Practically
non-existent
infrastructure
No formal charging
infrastructure exists
except for about 250
charging stations built
by Mahindra Reva
Most vehicles use
standard 15-amp
sockets to recharge
High reliance
on imported
components
from China
Due to low domestic expertise, a large number of
components for EV especially batteries are
imported from China, which are often of low
quality
Erratic
government
support
Unreliable
electrical
supply
Government’
s subsidy
program in
2010 was
poorly funded
and was
aborted soon
later
Government’
s current plan
has also
witnessed
long delays
Power outages and
blackouts are
common in India
Currently India has
an average power
deficit of 8%-10%
and is highly
dependent upon coal
Key Issues in the Indian Electric Vehicle market
Key considerations
► Low energy costs in order to remain competitive
► Uninterrupted Power supply
► Reduction in Startup and Operating Wastages
► Technology transfers are one of the key factors
that have driven the government’s promotion of
FDI
► A higher degree of technical skill for
assembling and testing
► Decline in the lithium ion battery price
► Expected rising demand due to stringent
emission standards
► Strong government focus and support
Page 14
Project Financials
Target 6-7 million electric
vehicles on road
by 2020
Save 2.2-2.5
million tonnes of
fuel
Pri
mary
in
vestm
en
t are
as o
utl
ined
in
NE
MM
P 2
020
INR140 billion
Investment from the government,
while balance to come from the
industry
~INR224
billion
Total
investment
required in the
Indian EV
market
Demand incentives~INR122-138
billion
Research and
development
Infrastructure
related
investments
~INR15-18
billion
► Government expected to
provide incentives to cover
35% of the cost differential
between electric vehicles
and conventional vehicles
Pilot projects
Supply incentivesLocalization
conditions
► Investment in the form of
setting up of testing and
R&D infrastructure
► Most investments expected
from industry
► Government investment for
pilot projects for charging
infrastructure
► The creation of local
manufacturing eco-system
boosted through firm
localization commitments
that will be pre-conditions
for demand incentives
Page 15
Project Financials
S. No Cost parameters Cost (INR billion)
1 Land in Acre 0.367
2Average land price in Sanand** per sq feet as per JLL
(INR hundred)375
3 Total land cost (INR billion) (Area X average land price) 0.6
4 Total investment including land (INR billion) 1
5Investments on plant, machinery, building, civil work etc
(Total investment – land cost) (INR billion)0.40
6 Shift operation Single Shift operation
7 Capacity (units/annum) 30,000
Estimated Project Cost
► Project cost: The estimated project cost is INR 1 Billion
► The proposed unit will be manufacturing AC-induction motor based electric vehicle where the
major components of the motor include. The case study of the Mahindra Reva Electric Vehicles plant in Bangalore, Karnataka has been considered to arrive at a ball park figure of the total project cost of the proposed unit.
** Assuming the land is purchased, not rented (in Sanand)
► Typical Electric Vehicles use many of the same type of systems and components as a CV,
especially in the body and chassis. However, the powertrain of an EV is completely different, and
its energy storage (replacing fuel tank) becomes a major sub-system.
► Absence of a continuously running engine affects such accessory systems as heating,
ventilation, and air-conditioning (HVAC), steering, and brakes and consequently requires
independent (electric motor) drives for them.
Sources: http://www.business-standard.com/article/companies/mahindra-reva-opens-new-car-making-unit-112082300035_1.html
Page 16
Approvals & Incentives
Aiming to reduce pollution, the Government announced a series of cesses under
the Union Budget 2016–17 to discourage the purchase of conventional fuel
vehicles and to promote hybrids/EVs
Potential impact on the industry
Infrastructure cess
exemption to
hybrid/EVs
The government proposed an
infrastructure cess,
• 1% on small petrol, LPG, CNG
cars
• 2.5% on diesel cars of certain
capacity vehicles
• 4% on other higher engine
capacity vehicles and SUVs
The hybrid/EV market is at a
nascent stage in India,
however, through government
support and policies it is slowly
creating opportunities
Allocation of funds
under the FAME
The government proposed the
allocation of RS200 crore funds
under the FAME
• The funds would be primarily
used for incentivising the
purchase of hybrids/EVs
• Whereas, 20-25% would be used
for building the technology and
infrastructure
• About 10% would be spent on
pilot project
Extension of fiscal sops
for EV/hybrid
technology
Extended the validity period of
concession on customs and excise
duty on select parts used in the
manufacture of Electric and hybrid
vehicles
The hybrid/EV market has
picked up since last year with
OEMs such as Maruti and
Mahindra focusing on hybrid
marques
It is expected by 2021,
domestic and global OEMs
could launch more than 25 EV
models
Sources:
National incentives
http://www.nsdcindia.org/csec/wp-content/uploads/2016/01/CSEC-Brochure.pdf
State incentives
http://electronicsb2b.efytimes.com/gujarat-governments-five-incentive-schemes-for-manufacturing-sector/
Page 17
Budget
allocation for the
scheme in the
first two fiscal
years
INR7.95
billion
Initial outlay for
the scheme
already
approved in this
year’s budget
INR 0.75
billion
Per unit
incentive for
four wheelers
sold under the
scheme
INR13,0
00 to
138,000
Per unit
incentive for two
wheelers sold
under the
scheme
INR1,80
0 to
29,000FAME* India
Scheme timelines and incentives
►To be
implemented
over a period of
six years, till
2020
►Phase-1 to be
implemented
over FY15-17
►Lower cost of
electric and
hybrid vehicles
for customers,
manufacturers
to claim the
incentive from
government
Scheme launch and
industry reaction
►Scheme effective from 1
April 2015, as a result,
automakers have
reduced prices
►Automakers call the
scheme a welcome
move, but argue that a
lot more needs to be
done. For eg. States
need to reduce multiple
taxes levied on electric
vehicles
Focus areas and
scheme review
►Focus areas:
Technology
development,
demand
creation, pilot
projects and
charging
infrastructure
►Scheme to be
reviewed after
March 31,
2017
* Faster Adoption and Manufacturing of Electric vehicles
Sources:
National incentives
http://www.nsdcindia.org/csec/wp-content/uploads/2016/01/CSEC-Brochure.pdf
State incentives
http://electronicsb2b.efytimes.com/gujarat-governments-five-incentive-schemes-for-manufacturing-sector/
Approvals & Incentives
Page 18
Concession/Exemption of
duties for EV automotive
battery/parts suppliers
Accelerated tax
deduction to promote
R&D in the industry
Specific state
government incentives in
form of tax rebates and
direct subsidies
Government pilot
projects to promote
investment in
infrastructure
Exemption from Basic
Customs Duty (BCD)
for manufacturers of
lithium ion automotive
battery packs
200% weighted tax
deduction for sums
paid to national
laboratory, institute of
technology for
scientific research
A weighted tax
deduction of 200% for
both capital and
revenue expenditure
incurred on scientific
research and
development.
Delhi
► 15% direct subsidy
► 0% VAT (value
added tax)
► 50% rebate in
registration tax
Rajansthan,
Uttarakhand,
Chhatisgarh
► 0% VAT (value
added tax)
Electric
bus pilot
project in
the state of
Gujrat
Concessional excise
duty of 6% extended
to March 2015 for
manufacturers of
batteries supplying to
producers of electric
vehicles
Last mile
connectivit
y to Delhi
Metro rail
passenger
s
Pilot
electric
two-
wheeler
project in
Goa
Sources:
National incentives
http://www.nsdcindia.org/csec/wp-content/uploads/2016/01/CSEC-Brochure.pdf
State incentives
http://electronicsb2b.efytimes.com/gujarat-governments-five-incentive-schemes-for-manufacturing-sector/
Approvals & Incentives
Page 19
Approvals & Incentives
Gujarat Industrial Policy 2015
Government of Gujarat has announced an ambitious Industrial Policy, in January 2015, with the
objective of creating a healthy and conducive climate for conducting business and augmenting the
industrial development of the state.
Category of
Project Location
(Taluka)
% of eligible fixed
capital investment
entitled for
Incentive
% of Net VAT
reimbursement to
the unit
% of Net VAT to be
paid to
Government
Incentive period
(no. of years)
1 100 90 10 10
2 80 80 20 10
3 70 70 30 10
Net VAT incentive will be reimbursed to the industrial undertaking in one financial year will not
exceed one-tenth of the total amount of eligible incentive.
Quantum of incentives
Net VAT incentives
Classification of the Project Amount (in INR billion)
Ultra Mega Industrial Unit 5
Mega lndustrial Unit 4
Large Industrial Unit 1.5
Micro, Small or Medium Industrial Unit 0.5
The incentives under this policy will be available to all the Talukas listed in Government Resolution
dated 25/7/2016 except municipal corporation areas.
Page 20
Approvals and Incentives
Approvals/clearance required Department to be approached and consulted
Incorporation of company Registrar of companies
Registration/Industrial license Secretariat if industrial assistance (SIA) for large and
medium scale industries
Allotment of land State industrial development corporation
No objection certificate (NOC) under
air and water pollution control acts
State pollution control board
Approval of construction and country
planning► Town and country planning
► Municipal and local authorities
► Chief inspector of factories
► Pollution control board
► Electricity board
Use and storage of explosives Chief controller of explosives
Finance For loans higher than INR 1.5 crore, all India financial
institutions like Industrial Development Bank of India(IDBI),
Industrial Credit and Investment Corporation of India(ICICI),
Industrial Finance Corporation of India(IFCI) etc.
Registration under state sales tax act
and Central and State excise act► Sales tax department
► Central and state excise department
Code number for export and import Regional office of director general of foreign trade
Environmental clearance Ministry of environment, forest and climate change after
conducting environment impact assessment (EIA) for any
project
Hazardous waste import and export
approval
Ministry of environment, forest and climate change
Industrial license for defense setting
up defence manufacturing unit
District Industries Centres (DICs), DIC will forward the
proposal to Industries Commissioner who will submit the
report to State Level Approver Committee (SLAC) for final
approval
Exiting business Ministry of corporate affairs
GoG has introduced single window facilitation portal for investors with undermentioned benefits:
► Centralized system to monitor applications
► User friendly and simplified application process for investors
► System for authorities and investors to check the status of applications
► Increased departmental ownership
► The unit shall be facilitated through ‘Investor Facilitation Portal’ for obtaining all the
necessary state approvals/ clearances - https://www.ifpgujarat.gov.in
Indicative List of Approvals
This project profile is based on preliminary study to facilitate prospective entrepreneurs to assess a prima facie scope.
It is, however, advisable to get a detailed feasibility study prepared before taking a final investment decision.
http://www.acma.in/index.php
Automotive Component Manufacturers
www.siamindia.com
Society of Indian Automobile Manufacturers (SIAM)
www.gidc.gov.in
Gujarat Industrial Development Corporation
Industries Commissionerate
Block No. 1, Udyog Bhavan
Sector 11, Gandhinagar – 382 017
Gujarat, INDIA
Ph.: 91-79-23252683, 23252617
Fax : 91(79)232 52683
Email ID: [email protected]
Website : www.ic.gujarat.gov.in