1. THE TYRE MANUFACTURING INDUSTRY 2. PRESENTED BY: * NAME ROLL NO. * Arunn menon 1 3. INTRODUCTION * Faces huge competition, cost and price pressure. * The zooming auto industry has driven the growth. * The number of vehicles is swelling. * The truck and bus market is the largest segment in terms of value. 4. * Economic expansion and road development has made a contribution. * eg. The golden quadrilateral and the NSEW Corridor project. Though the volumes have increased the profitability has gone down due to the increase in raw material cost.
5. Five forces model 6. A 2 tier Industry * Tier 1 players * Present in all three segment – * 1)Replacement market * 2)Original equipment manufacture(OEMs) * 3)Export * Tier 2 player 7. Key Players 8. Major Sales Segment 9. Intensity of Rivalry : High * The tyre industry in India is fairly concentrated, with the top 5 companies accounting for more than 80% of the total production of tyres. 0. BARGAINING POWER OF SUPPLIERS – High 11. 12. * Number of Suppliers – Low * Availability/ acceptability of raw material substitutes – Low * Switching costs – High * Threat of forward integration – High * Tyre industry not the key customer 13.
Demand for Tyres 14. Bargaining Power of Buyers * OEM’s High * In Replacement Market Moderate * Switching Cost Low * Threats of Backward Integration Low 15. THREAT OF POTENTIAL ENTRANTS * LOW, due to HIGH ENTRY BARRIERS 16.
ENTRY BARRIERS * Highly capital intensive industry * Rs4bn for radial tyre plant with a capacity of 1. 5mn tyres * Rs1. 5-2bn for a crossply tyre plant of a capacity to manufacture 1. 5mn tyres * High raw material costs 17. * Shortage of raw material * Force of rivalry * High risk 18. THREAT OF SUBSTITUTES * Low, but increasing * Import of tyres * ISI mark made compulsory 19. Porter’s Model * Entry High returns * Barrier High risks * High * Low * High Low Exit Barrier
Cite this Tyre Industry in India
Tyre Industry in India. (2018, Aug 03). Retrieved from https://graduateway.com/tyre-industry-in-india/