Dr. Pawan Goenka President SIAM President Automotive and Farm Equipment Sectors, Mahindra & Mahindra Ltd. OICA Round Table 22 October 2010 New Delhi

A SIAM Presentation  Introduction to SIAM  Overview of Indian Auto Industry ◦ Domestic Market Performance ◦ Exports Performance  Insights to Indian Market  India Opportunity and Growth Plan  Outlook

A SIAM Presentation  Apex national industry body representing all major vehicle manufacturers in India  46 members  Provides a window to the automobile industry in India ◦ Close working with stakeholders in the formulation of the policies, regulations and standards related to automobiles ◦ Link between the industry and other bodies including the media  Interacts with various international bodies ◦ OICA, IMMA, UN, APEC AD and counterpart associations like SMMT, VDA, JAMA, TAIA, AFM, ANFIA, ACEA, etc.

A SIAM Presentation To become a growth engine of the Indian economy by propelling the Indian Auto industry to a global $ 145 bn industry by 2016 whilst promoting sustainability by addressing the multiple challenges arising out of emissions, climate change, energy security and safety.

A SIAM Presentation

 Introduction to SIAM  Overview of Indian Auto Industry ◦ Domestic Market Performance ◦ Exports Performance  Insights to Indian Market  India Opportunity and Growth Plan  Outlook

A SIAM Presentation Global Rank by Automotive Production Source : OICA

A SIAM Presentation Cars UVs Source : SIAM MHCVs LCVs MPV W 2W Cars15 % CAGR UVs13 % CAGR MHCVs13 % CAGR LCVs23 % CAGR MPVs12 % CAGR

A SIAM Presentation Segment Growth Personal Vehicles26% Cars : 25% UV : 21% MPV : 41% Commercial Vehicles38% LCV : 43% MHCV : 34% Three Wheelers26% Two Wheelers26% Total Auto Industry26%

A SIAM Presentation Data for Jan – Aug 2010

A SIAM Presentation 33%42% 26%20%

A SIAM Presentation Source: Hindu Business Line, 9 Oct 2010

A SIAM Presentation  Good GDP Growth  High Consumer Confidence  Infrastructure spending  Thrust on rural employment  Stable Auto Finance Rates  New Launches Generate Excitement

A SIAM Presentation  Introduction to SIAM  Overview of Indian Auto Industry ◦ Domestic Market Performance ◦ Exports Performance  Insights to Indian Market  India Opportunity and Growth Plan  Outlook

A SIAM Presentation Source : SIAM PVs30 % CAGR CVs18 % CAGR 3W35 % CAGR 2W35 % CAGR 3W 2W CV PV

A SIAM Presentation 1%84 %100 % 52 %

A SIAM Presentation  Introduction to SIAM  Overview of Indian Auto Industry ◦ Domestic Market Performance ◦ Exports Performance  Insights to Indian Market  India Opportunity and Growth Plan  Outlook

A SIAM Presentation Car Sales ‘000

A SIAM Presentation  US is setting FE norms for Petrol Cars to achieve 35 mpg (14.8 kmpl)  Majority of Indian cars offer this FE

A SIAM Presentation

 Truck is Livelihood  Minimise Cost by all means  Maximise Returns by all means Source: Asian Institute of Road Transport and M&M Study IndiaUS Truck Holding Pattern

A SIAM Presentation LCV Goods < 3.5T Sales Volume in ‘000 40% CAGR

A SIAM Presentation 25 % 24 % 47 % 13 % LCV < 3.5 T GVW CV > 16 T GVW Sales Volume in ‘000

A SIAM Presentation  Introduction to SIAM  Overview of Indian Auto Industry ◦ Domestic Market Performance ◦ Exports Performance  Insights to Indian Market  India Opportunity and Growth Plan  Outlook

A SIAM Presentation Country Cars / 1,000 people Germany565 France480 US453 Japan451 Malaysia271 South Korea238 Mexico145 Brazil103 Thailand57 China27 Indonesia18 India10 Philippines9 Source: WARDS, 2009; All figures for 2008 Country 2W / 1000 people Thailand286 Malaysia258 Italy166 Japan100 Spain90 Indonesia90 Switzerland77 Germany69 China59 India43 US18 Country Vehicles /km Germany554 Thailand426 South Korea408 Mexico256 Malaysia205 Japan162 France99 US98 Indonesia51 China48 Philippines38 Brazil35 India10

A SIAM Presentation Source : IMF (World Economic Outlook April 2010)

A SIAM Presentation  Young Demographics  High Aspiration of Auto Ownership  Rising Disposable Incomes  Rural development ◦ Travel for employment, Trade etc.  Inadequate public transport system  Improving access to vehicle financing

A SIAM Presentation  Roads carry a dominant share of traffic ◦ 60% of freight and 85% of passenger  Infrastructure development  Growth in freight generating sectors ◦ Agriculture, Fertilisers, Mining, Cement, Retail  Development of Urban transportation system  Regulation ◦ Overloading, Scrap of old vehicles  Procurement by defense

A SIAM Presentation $145 bn byF16 byF16 $34 bn In F07 $34 bn In F07 Vision 2016 “By 2016, India will emerge as the destination of choice in Asia for the design & manufacture of automobiles and automotive components. The output of the India’s automotive sector will be $ 145 billion by 2016, contributing to 10% of India’s Gross Domestic Product and providing employment to 25 million persons additionally.” Source : SIAM & AMP % CAGR

A SIAM Presentation  Investment - Tariff Policy & Investment Support  Infrastructure  Expansion of Domestic Demand  Encouraging Exports  Support to Develop R&D  Long Term Emission Roadmap  Harmonization of Safety Standards & Road Safety  Incentivizing Modernization of Vehicle Fleet  Inspection & Certification Systems  Computerization of RTOs & Driver Licensing System  Ensuring Availability of Human Resource

A SIAM Presentation Mr. Kamal Nath Union minister of Road Transport & Highways I have set a target of 20 km of road per day leading to 7,000 km in a year. My job is to create a paradigm shift in attitude, kilometers and approach.”

A SIAM Presentation  Road Improvement  New Roads  Port connectivity  Hilly Roads Target: 49,987 km Completed: 14,382 km Under Impl.: 9,066 km Work to start: 26,381 km Status as on 31 Aug 2010 Source : nhai.org

A SIAM Presentation  Introduction to SIAM  Overview of Indian Auto Industry ◦ Domestic Market Performance ◦ Exports Performance  Insights to Indian Market  India Opportunity and Growth Plan  Outlook

A SIAM Presentation Source : SIAM, CRISIL Research

A SIAM Presentation  Over 2.4 million Passenger Vehicles  Over 600,000 Commercial Vehicles  Over 11 million Two wheelers  Over 500,000 Three Wheelers Source : SIAM, CRISIL Research

A SIAM Presentation SIAM Society of Indian Automobile Manufacturers