The Indian Passenger Vehicle Market has been growing at a CAGR of 12.6% over the last 7 years, with 15% of the growth concentrated in the Compact Car segment. Market forecasts indicate volumes to reach 3 million by 2015 with a CAGR of 8.6% over the next 5 years. With vehicle finance penetration facilitated by competition among banks and NBFCs, increase in disposable income and fuel efficiency vehicles will drive the demand for passenger cars.
Porter’s 5 Forces
Bargaining Power of Suppliers
The number of suppliers and the industry’s importance to suppliers are quite high. So are the industry’s threat of backward integration and the supplier’s threat of forward integration. Contribution to cost by the suppliers and costs of switching between suppliers are low, so is contribution to quality. Availability of substitutes is moderately low. Therefore, on the whole, bargaining power of suppliers is moderate.
Porter’s 5 Forces: Bargaining Power of Suppliers
Bargaining Power of Buyers
The number of buyers and their contribution to cost and quality are very high, since the buyer is quite educated and informative. The buyer’s threat of backward integration is low and the