External Analysis TVS Tyres
Tyre Industry
Contents
Overview of Indian Tyre Industry 3
Segmentation 4
Industry Analysis 6
COMPLEMENTORS AND NON-MARKET FORCES 9
Industry trends 11
Industry Composition 12
Strategic implications 14
Way Ahead 15
Overview of Indian Tyre Industry
The origin of the Indian Tyre Industry was marked by Dunlop rubber limited when it set up its first tyre plant in 1926 in West Bengal. This was followed by MRF in 1946 providing India its second tyre manufacturer. Since then, the Indian tyre industry has grown rapidly. The size of Indian tyre industry now is around Rs. 376 billion. The industry has grown at CAGR 12.8% driven by robust growth in Indian automobile industry. There are around 40
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Commercial Vehicle tyres (medium and heavy commercial vehicles, light commercial vehicles, tractors)
2. Passenger Vehicle tyres (passenger cars and MUVs, motorcycles, scooters)
3. Others (off-the-road, industrial, farm vehicles)
Commercial vehicles constitute around 67% of the total industry whereas the two-wheeler and the four-wheeler industry represent 12% of the industry respectively. The rest is represented by the industrial and the farm vehicles.
TVS tyre is present in all the three categories producing tyre for tractors, farm vehicles, agro vehicles, light trucks, three wheelers and motorcycle. The major focus of the firm is on the passenger vehicle tyres (mainly two-wheelers). The company currently caters to domestic after-market with a network of over 2,400 dealers and 34 depots. On the basis of market- tyre industry can be classified into three categories:
1. original equipment manufacturers (OEMs)
2. replacement
3.
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The two kinds of raw materials are:
Natural Rubber
• International natural rubber prices to decline as production outpaces supply
• Sale of natural rubber stockpiles increased supply; production cuts to restrict further price decline
• Availability of cheap imports to result in further decline in domestic NR prices
• Domestic natural rubber demand to continue to outpace production and hence domestic prices are expected to fall at a slower rate
Other crude based raw materials
• Decline in carbon black prices, with fall in feedstock prices
• NTCF prices to dip with decrease in caprolactam prices
• Synthetic rubber prices continue to decline
Demand side forces
• Replacement tyre demand to improve because of better economic activity and replacement cycle approaching for the vehicles sold 3-4 years back
• Sales of MHCV, passenger car and two wheelers to improve based on economic growth rate and consumer sentiments, which will result in an increase in OEM tyre demand
• Capacity additions by major players to increase radial tyres supply
• Tyre imports to grow because of huge demand of radial tyres and a few Chinese manufacturers getting the BIS
During 2014 there was an ethical dilemma that occurred at Canadian Tire. There was an employee named Samantha and she held the position of a Supervisor at Canadian Tire. Canadian Tire would give out Canadian Tire money to their clients depending on how much they have spent at the store and this was basically a marketing strategy for Canadian Tire whereby the clients could use the Canadian Tire money to purchase merchandise at the store. Samantha was in charge for restocking the Canadian Tire money at all times. Every time Samantha restocked the Canadian Tire money she would always withdraw few dollars out for herself and make adjustments on the paperwork and she would go to the Canadian Tire Gas station and purchase gas for herself. She went
Canadian Tires Supply Chain & Distribution teams guarantees their promise to their customers, to be their when they need them the most. For Canadian tire that means transporting excellent products from vendor to stores in the most effective and responsible way there is. Canadian Tire is always improving, they always tuning their capacity models, employing technology solutions, and building strong relationships with third party logistics and their product suppliers so they can do an excellent job at managing one of country’s deepest and most extensive supply chain network. They are always sharing long- term agreements with their partners. , They are always sharing forecast information and performing metrics so they can better
The automotive industry is without a doubt an industry that has massive implications relating to the United States economy as well as affecting every American household. Shifts in the supply and demand of automobiles influence the current and future household purchases. Households must determine what amount of their hard-earned income to allocate to certain necessities. Because most households have a budget, the amount spent on transportation it limited. While most industries have an effect on the economy, the automotive industry has far-reaching implications for most Americans. Not only are the workers affected but the many spin-off jobs created as well as the consumers that must purchase the automobiles manufactured.
Increased demand on a global scale due to increase in manufacturing across the world, opposite in U.
The automobile sector has been a robust sector that has experienced tremendous growth in the past seven to eight years. Apart from two years in particular -2008-09 & 2012-13, there is general trend of ten percent plus growth in various segments like passenger car, commercial vehicles, two and three wheelers. The following chart shows the growth rate of various years in each sectors.
...ill increase and the manufacturers will have to increase production. Interest rate is another factor that impact demand for this car. If the interest rate is low, more consumers will be able to purchase the car because the monthly payments will be low. However, if the interest rate is high, this will cause the monthly payments to be higher which may cause demand for cars to decrease. The forecasts that I would use for these indicators are www.federalreserve.gov, www.cbo.gov and www.mbaa.org. These economic forecasts can be used to predict future demands.
AutoZone has responded to changes in its' macro environment by placing stores in regions "that have large number of vehicles seven years old and older because of these cars' need for repairs and maintenance" (Wikinvest.com, 2012). Nationally, sales of new automobiles were at a 30-year low in 2009, but they have since rebounded slightly. Customers are still reluctant to buy new vehicles due to concern over high prices and general jitters about the economy. To combat this, many manufacturers have been offering discounts to lure consumers to purchase. As a result, AutoZone is facing a boon in the marketplace- "the cars and trucks in America's driveways have reached a record old age" (USAToday, 2012). In addition, there are more vehicles registered in the U.S. than previously.
The motor vehicle industry is quite massive. Close to 70% of all car parts from an irreparable automobile
It is no doubt that automobiles have become a way of life in the current society besides the transport sector contributing immensely to the economic growth of every cou...
Tata motors are leader in all segments of commercial vehicles and among the top in passenger cars awarded with compact, midsize car and utility segment.
This has a lot to do with international technology finding its way faster to Indian buyers. Earlier, products which were launched in global markets, took months before our streets could find them amidst tarmac. This has changed, due to growing awareness amongst manufacturers and the surge in need for world-class quality.
Automobile industry in the North America is a very established and was the world’s biggest automobile industry for many years, during the 20th century, which was started with a number of companies in the early 1900’s. But, as the time passed, many companies opted out the competition and some companies merged, and finally only three companies, namely Ford, General Motors, Chrysler stayed in the competition, taking advantage over other independent makers, because of their financial stability. The industry took different shapes and went through different phases-, the depression of the 30’s, the stricter government regulations for automobile manufacturing in the 1960’s
As the supply curve moves in the automobile industry, the equilibrium price and quantity sold will change with this shift. When the automobile manufacturers see this shift in supply, they will then raise their prices and the quantity sold will fall. Car manufacturers will also develop...
The price of cars will caused movements along the demand curve. In addition, shifts of the demand curve for cars will be caused by the price of complement goods, the appearance of substitute products, citizens’ income and the government policies.
One of the most important part of any car is the tires. Tires are in constant contact with the road, and like the Goodyear commercial says, “So much is riding on your tires.”