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TH E AU TO M O BILE IN DUSTR Y!

How did it started?• The automobile as we know it was not invented in The automobile as we know it was not invented in a single day by a single inventor -it evolved a single day by a single inventor -it evolved gradually over a period of time. Before the gradually over a period of time. Before the invention of the motor engine, some ran on steam, invention of the motor engine, some ran on steam, and such machines were slow and heavy. The first and such machines were slow and heavy. The first motor cars that were petrol driven were produced motor cars that were petrol driven were produced during the 1880's by German engineer Karl Benz.during the 1880's by German engineer Karl Benz.• In the 1930'scars were hand made by skilled In the 1930'scars were hand made by skilled craftsmen and cost more than 1,000 pounds, a craftsmen and cost more than 1,000 pounds, a huge sum of money. It was Henry ford who huge sum of money. It was Henry ford who introduced the moving assembly line, in which introduced the moving assembly line, in which workers add parts to the cars as they passed workers add parts to the cars as they passed along. This made it possible to manufacture cars along. This made it possible to manufacture cars quickly and cheaply, and made cars affordable for quickly and cheaply, and made cars affordable for ordinary people.ordinary people.

How did he make enough How did he make enough cars?cars?

• By 1918, half of all cars in America were Model Ts.

• To meet the growing demand for the Model T, the company opened a large factory at Highland Park, Michigan, in 1910.

• Here, Henry Ford combined precision manufacturing, standardized and interchangeable parts, a division of labor, and, in 1913, a continuous moving assembly line.

The Model T

What’s an Industry?1. Systematic labor especially for some useful purpose or the creation of something of value.2. A department or branch of a craft, art, business, or manufacture; especially : one that employs a large personnel and capital especially in manufacturing.3. a distinct group of productive or profit-making enterprises

Automobile Industry?

• It involves systematic labor to produce automobiles.– • It employs a very large personal

and has a large capital. Capital is seen in this instance as other assets, be it money or goods, which can be added to the long-term net worth of a company.

– • The automobile industry involves a lot of enterprises- such as glass, steel, and oil.

Then and Now

Investment in various sectors

12%

26%

15%

47%

Indirect M ateria ls

M achinary Spare s

T ools

Powe r, Fue l & Wate r

Segmentation of Automobile Industry:

• The automobile industry comprises of Heavy vehicles (trucks, buses, tempos, tractors); passenger cars; Two-wheelers; Commercial Vehicles; and Three-wheelers

Automotive Companies in India

Major Indian companiesMajor Indian companies Major multi-national companiesMajor multi-national companies

Conclusion Strengths: Large domestic market Sustainable labor cost advantage Competitive auto component vendor base Government incentives for manufacturing plants Strong engineering skills in design etcWeaknesses: Low labor productivity High interest costs and high overheads make the production uncompetitive Various forms of taxes push up the cost of production Low investment in Research and Development Infrastructure bottleneckThreats: Rising input costs Rising interest rates Cut throat competition

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