How to Start Automobile & Mechanical Industry

The Indian Automobile industry including component manufacturing is expects to reach at Rs. 16.16-18.18 trillion by 2026. The Auto industry in India is expected to record strong growth in 2021-22, after recovering from the COVID-19 effects.

Generally, the automobile industry include; two-wheelers, four-wheelers, passenger vehicles and commercial vehicles. The two-wheeler segment is dominating the automobile industry with a share of 80% in India.

 

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Fig: Car manufacturing robots


Similarly, Europe, China, the USA and Japan are core markets for the mechanical industry sector. The Mechanical Industry is considered as one of the dominant industries all over the globe. This industry is also making significant contributions to a country’s economy because of its high volume production all around the globe.

 

Related Projects:- Automobile Industry and Auto Components, Automotive components, Spare parts, Auto Parts, Car Parts, Replacement Parts, Tractor Parts, Motorcycle Parts, Auto Body Parts, Two Wheeler, Three Wheeler and Four Wheeler Parts, Accessories & Spares Projects

 

Regional Growth & Market Scope of Automobile and Mechanical Industry

The use of electric motors in automobile has been witnessing a steady rise over the past few years. Rising importance on optimizing design and manufacturing processes with the improvement in the efficiency for delivering better products is expected to bode well for the product demands. The market witness enormous growth imputes to the increase in automobile production and the number of motors that are used in a particular vehicle in the global market.

 

 

              Fig: U.S. Automobile Motor Market Share by vehicle type, 2018(%)


The measured market size, by revenue, of the Global Automobiles Manufacturing & Mechanical Industry is $2.7tr in 2021. The e-vehicle market is forecasted to grow at a robust CAGR of 43.13% from 2019 to 2030, which means the Automobile & Mechanical Industry will going to face a boost in the up-coming years as well.

 

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The automobile industry has made some significant leaps towards growth and development with the advancement of technologies like Artificial Intelligence, Robotic and Internet of things.

One of the most important drivers of economic growth of India is the ‘Automobile & Mechanical Industry’ and is also one with high participation in global value chains. India was the fifth-largest auto market in 2020, with ~3.49 million units combined sold in the passenger and commercial vehicles categories. 

 

Related Books:- Automobile Industry, Automotive Components & Allied Products Engine Parts, Piston, Pin, Piston Ring, Valve, Control Cable, Engine Mounting, Auto Lock, Disc Brake, Drum, Gear, Leaf Spring, Shock Absorber, Silencer, Chain, Cylinder Block, Chassis, Battery

 

According to IBEF, the Government of India and major automobile players in the Indian market are taking several initiatives to make India a leader in the two-wheeler and four-wheeler market in the world by 2020. Also, Passenger vehicle (PV) sales in India stood at 279,745 units in march 2021, compared with 2,17,879 units in march 2020, registering a growth of 28.39%.

The automobile industry is supported by various factors like:-

-availability of skilled labour at low cost,

-robust R&D centers,

-and low-cost steel production

 

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The Automobile & Mechanical Industry provides great opportunities for investment and direct and indirect employment to skilled and unskilled labor. Also, the Indian automotive industry (including component manufacturing) is expected to reach Rs. 16.16-18.18 trillion (US$ 251.4-282.8 billion) by 2026.

A study by CEEW Centre for Energy Finance acknowledged US$ 206 billion opportunity for electric vehicles in India by 2030.

 

Related Videos:- Production of Automobile Components. Auto Parts Manufacturing Industry.

 

Reasons of Growth

There are some major reasons that are shaping the future of Automobile & Mechanical Industry in the Global Market which are listed below;

·         Internet connectivity in cars: Cars with internet connectivity can communicate with other internet connected devices inside and outside the car. These technologies are going to make the driving experience more flawless than it ever has been.

·         Manufacturing of autonomous cars: A lot of R&D is being dedicated towards manufacturing autonomous cars so to avoid human mistake while driving.

 

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·         3D-LiDAR technology: 3D-LiDAR technology is being developed to move to the Level 3 of automation. The LiDAR system emits its own laser light and maps the surroundings according to the input car-mounted sensors receive from the reflected light. This system work well in situations where cameras fail.

·         Shared car services: Due to this service people wouldn’t have to invest substantial money into owning a car.

·         Invention of batteries and charging stations: With the invention of more powerful batteries and growing number of charging stations, the e-vehicle market is expected to grow at a robust CAGR of 43.13% from 2019 to 2030.

 

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Conclusion

Niir Project Consultancy Services (NPCS) provide detailed project reports, Business Plan, etc. for entrepreneurs. Get the detailed project report on “How to start Automobile and Mechanical Industry” all the project reports give reliable data & analysis.


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And before diversifying/venturing into any product, wish to study the following aspects of the identified product:


• Good Present/Future Demand
• Export-Import Market Potential
• Raw Material & Manpower Availability
• Project Costs and Payback Period


We at NPCS, through our reliable expertise in the project consultancy and market research field, Provides exhaustive information about the project, which satisfies all the above mentioned requirements and has high growth potential in the markets. And through our report we aim to help you make sound and informed business decision.

 

The report contains all the data which will help an entrepreneur find answers to questions like:

• Why I should invest in this project?
• What will drive the growth of the product?
• What are the costs involved?
• What will be the market potential?


The report first focuses on enhancing the basic knowledge of the entrepreneur about the main product, by elucidating details like product definition, its uses and applications, industry segmentation as well as an overall overview of the industry sector in India. The report then helps an entrepreneur identify the target customer group of its product. It further helps in making sound investment decision by listing and then elaborating on factors that will contribute to the growth of product consumption in India and also talks about the foreign trade of the product along with the list of top importing and top exporting countries. Report includes graphical representation and forecasts of key data discussed in the above mentioned segment. It further explicates the growth potential of the product.

The report includes other market data like key players in the Industry segment along with their contact information and recent developments. It includes crucial information like raw material requirements, list of machinery and manufacturing process for the plant. Core project financials like plant capacity, costs involved in setting up of project, working capital requirements, projected revenue and profit are further listed in the report.


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• This report helps you to identify a profitable project for investing or diversifying into by throwing light to crucial areas like industry size, demand of the product and reasons for investing in the product.

• This report provides vital information on the product like its definition, characteristics and segmentation.

• This report helps you market and place the product correctly by identifying the target customer group of the product.

• This report helps you understand the viability of the project by disclosing details like raw materials required, manufacturing process, project costs and snapshot of other project financials.

• The report provides forecasts of key parameters which helps to anticipate the industry performance and make sound business decision.

 

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• Our research reports broadly cover Indian markets, present analysis, outlook and forecast.

• The market forecasts are developed on the basis of secondary research and are cross-validated through interactions with the industry players. 

• We use reliable sources of information and databases.  And information from such sources is processed by us and included in the report.

 

Our Market Survey cum Detailed Techno Economic Feasibility Report Contains following information:

 

 

Ø  Introduction

·         Project Introduction

·         Project Objective and Strategy

·         Concise History of the Product

·         Properties

·         BIS (Bureau of Indian Standards) Provision & Specification

·         Uses & Applications

 

Ø  Market Study and Assessment

·         Current Indian Market Scenario

·         Present Market Demand and Supply

·         Estimated Future Market Demand and Forecast

·         Statistics of Import & Export

·         Names & Addresses of Existing Units (Present Players)

·         Market Opportunity

 

Ø  Raw Material

·         List of Raw Materials

·         Properties of Raw Materials

·         Prescribed Quality of Raw Materials

·         List of Suppliers and Manufacturers

 

Ø  Personnel (Manpower) Requirements

·         Requirement of Staff & Labor (Skilled and Unskilled) Managerial, Technical, Office Staff and Marketing Personnel

 

Ø  Plant and Machinery

·         List of Plant & Machinery

·         Miscellaneous Items

·         Appliances & Equipments

·         Laboratory Equipments & Accessories

·         Electrification

·         Electric Load & Water

·         Maintenance Cost

·         Sources of Plant & Machinery (Suppliers and Manufacturers)

 

Ø  Manufacturing Process and Formulations

·         Detailed Process of Manufacture with Formulation

·         Packaging Required

·         Process Flow Sheet Diagram

 

Ø  Infrastructure and Utilities

·         Project Location

·         Requirement of Land Area

·         Rates of the Land

·         Built Up Area

·         Construction Schedule

·         Plant Layout and Requirement of Utilities

 

Project at a Glance

Along with financial details as under:

 

  •     Assumptions for Profitability workings

  •    Plant Economics

  •    Production Schedule

  •    Land & Building

            Factory Land & Building

            Site Development Expenses

  •    Plant & Machinery

             Indigenous Machineries

            Other Machineries (Miscellaneous, Laboratory etc.)

  •    Other Fixed Assets

            Furniture & Fixtures

            Pre-operative and Preliminary Expenses

            Technical Knowhow

            Provision of Contingencies

  •   Working Capital Requirement Per Month

             Raw Material

            Packing Material

            Lab & ETP Chemical Cost

           Consumable Store

  •   Overheads Required Per Month And Per Annum

         Utilities & Overheads (Power, Water and Fuel Expenses etc.)

             Royalty and Other Charges

            Selling and Distribution Expenses

  •    Salary and Wages

  •    Turnover Per Annum

  •   Share Capital

            Equity Capital

            Preference Share Capital

 

  •    Annexure 1:: Cost of Project and Means of Finance

  •    Annexure 2::  Profitability and Net Cash Accruals

                Revenue/Income/Realisation

                Expenses/Cost of Products/Services/Items

                Gross Profit

                Financial Charges     

                Total Cost of Sales

                Net Profit After Taxes

                Net Cash Accruals

  •   Annexure 3 :: Assessment of Working Capital requirements

                Current Assets

                Gross Working. Capital

                Current Liabilities

                Net Working Capital

                Working Note for Calculation of Work-in-process

  •    Annexure 4 :: Sources and Disposition of Funds

  •    Annexure 5 :: Projected Balance Sheets

                ROI (Average of Fixed Assets)

                RONW (Average of Share Capital)

                ROI (Average of Total Assets)

  •    Annexure 6 :: Profitability ratios

                D.S.C.R

                Earnings Per Share (EPS)

               

             Debt Equity Ratio

        Annexure 7   :: Break-Even Analysis

                Variable Cost & Expenses

                Semi-Var./Semi-Fixed Exp.

                Profit Volume Ratio (PVR)

                Fixed Expenses / Cost 

                B.E.P

  •   Annexure 8 to 11:: Sensitivity Analysis-Price/Volume

            Resultant N.P.B.T

            Resultant D.S.C.R

   Resultant PV Ratio

   Resultant DER

  Resultant ROI

          Resultant BEP

  •    Annexure 12 :: Shareholding Pattern and Stake Status

        Equity Capital

        Preference Share Capital

  •   Annexure 13 :: Quantitative Details-Output/Sales/Stocks

        Determined Capacity P.A of Products/Services

        Achievable Efficiency/Yield % of Products/Services/Items 

        Net Usable Load/Capacity of Products/Services/Items   

       Expected Sales/ Revenue/ Income of Products/ Services/ Items   

  •    Annexure 14 :: Product wise domestic Sales Realisation

  •    Annexure 15 :: Total Raw Material Cost

  •    Annexure 16 :: Raw Material Cost per unit

  •    Annexure 17 :: Total Lab & ETP Chemical Cost

  •    Annexure 18  :: Consumables, Store etc.,

  •    Annexure 19  :: Packing Material Cost

  •    Annexure 20  :: Packing Material Cost Per Unit

  •    Annexure 21 :: Employees Expenses

  •    Annexure 22 :: Fuel Expenses

  •    Annexure 23 :: Power/Electricity Expenses

  •    Annexure 24 :: Royalty & Other Charges

  •    Annexure 25 :: Repairs & Maintenance Exp.

  •    Annexure 26 :: Other Mfg. Expenses

  •    Annexure 27 :: Administration Expenses

  •    Annexure 28 :: Selling Expenses

  •    Annexure 29 :: Depreciation Charges – as per Books (Total)

  •   Annexure 30   :: Depreciation Charges – as per Books (P & M)

  •   Annexure 31   :: Depreciation Charges - As per IT Act WDV (Total)

  •   Annexure 32   :: Depreciation Charges - As per IT Act WDV (P & M)

  •   Annexure 33   :: Interest and Repayment - Term Loans

  •   Annexure 34   :: Tax on Profits

  •   Annexure 35   ::Projected Pay-Back Period And IRR