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.

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.

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.

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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Introduction

Project Introduction
Project Objective and Strategy
Concise History of the Product
Properties
BIS (Bureau of Indian Standards) Provision & Specification
Uses & Applications

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

Raw Material

List of Raw Materials
Properties of Raw Materials
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List of Suppliers and Manufacturers

Personnel (Manpower) Requirements

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

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)

Manufacturing Process and Formulations

Detailed Process of Manufacture with Formulation
Packaging Required
Process Flow Sheet Diagram

Infrastructure and Utilities

Project Location
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Project at a Glance

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