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Study to Size the Counterfeit Market
for Auto Components in India
July 2006
Prepared For:
Prepared By: Business & Industrial Division, IMRB International
1
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Report flow
Research-based Consultancy for B2B
and technology Markets
• Background of the Study
– Need for Research
– Definition of Counterfeits
– Study Objectives
– Research Methodology & Sampling
• Approach to determine counterfeit market size in India
– Estimation of vehicle population
– Total expenditure on servicing
– Size of counterfeit component market in India
• State transport authorities
• Profile of respondents met
– Private vehicle owners
– Commercial vehicle owners
2
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Report flow (contd….)
Research-based Consultancy for B2B
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• Detailed information on vehicle servicing
– Amount spent on last service
– Choice of service destination
– Break-up of amount spent in the last service
• Information on channel members met
– General profile
– Key counterfeit hubs in India
– Stocking of counterfeits
• Attitude towards auto component replacement
• Attitude towards counterfeit components
• Annexure
3
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Background
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• India has been known for its large ‘unorganized’ market which
exists across industry segments
• A large part of this market caters to not just unbranded but also
counterfeit products
• Auto components is one such segment where it is estimated that a
large proportion of the market is invaded by counterfeit products
• Such low quality products have a negative impact on the brand
equity of automobile & automotive component manufacturers
4
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Need for Research
Research-based Consultancy for B2B
and technology Markets
• Therefore, Indian automobile manufacturers wanted to understand
and size the counterfeit market to:
– Develop intervention to curb this market
– Provide quality products to their consumers
– Curb the negative impact on their brands
– Curb the revenue losses suffered due to this market
• Under the aegis of Society of Indian Automobile Manufacturers
(SIAM), automobile majors formed a task force to address this
need
5
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Before outlining the methodology used it is imperative
to understand how we defined counterfeits for the
purpose of this study…
6
Several products from ‘unorganized’ sector
exist in the market today…
Type of Part
Genuine Imports
Genuine Discards
Used Parts
Unbranded Parts
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Research-based Consultancy for B2B
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Examples
Bosch spark plugs not meant for Indian models
These are the ones
Parts discarded from industrial products, ocean vessels, railway wagons etc
we have focused
on for purpose of
Parts refurbished and reused in vehicles by mechanics
this research
Parts with no markings or brand names
Branded Duplicates
1. Brands in original or copied packaging of OEM
2. Brands with similar sounding names like ‘Assahi’ vs. Asahi
3. Parts with fake markings for ISI/BIS/EN etc
Cross Category
Duplicates
Fenner clutch levers when Fenner does not make clutch levers
7
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Research-based Consultancy for B2B
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Research Objectives
Primary Objective of the study was to size the
counterfeit market for auto components in India
8
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Objectives of the research
Research-based Consultancy for B2B
and technology Markets
• Estimate the total repair and servicing aftermarket in India:
Authorized Vs other service stations
– By vehicle category
– Br geographies
– By age of the vehicle
• Estimate the total market of counterfeit auto components
– By vehicle category
• Understand the buying behavior of vehicle owners
– Reasons for choice of a service station
– Number of trips to a service station per annum
– Level of influence of the channel member
– Brand of auto component purchased most often
9
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Objectives of the research (contd…)
Research-based Consultancy for B2B
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• Gain an understanding of the market from the channel members
– Motivators for selling counterfeits
– Key counterfeit hubs in India
– Most counterfeited components
• Map the attitude of owners towards vehicle servicing and
counterfeit components
– Awareness about counterfeit components
– Knowledge about the damages caused by such components
– Actions to curb this menace
• Suggestions and Recommendations
– To reduce the menace caused by counterfeit auto components
10
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Research Methodology & Sampling
11
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Key stakeholders covered
Research-based Consultancy for B2B
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• Supply side: Automobile and auto-component manufacturers and
associations
• Demand side: Private and commercial vehicle owners
– Private vehicle owners
• Two and four-wheeler owners
– Commercial vehicle owners
• HCV, LCV, Three-wheeler, buses and taxies
• Auto component channel members
– Distributors
– Retailers/Wholesalers
– Roadside mechanic
– Authorized service stations
– Other service stations
12
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Information gathered from each stakeholder
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Supply Side:
1. Registered vehicle population
1. Automobile Component Mfrs
2. MORTH/RTO/Associations
2. Volumes & value of auto
components in the after market
Demand Side:
1. Components Bought & their details
1. Private Vehicle Owners
2. Purchase Cycle for Parts
2. Commercial Vehicle Owners
3. Motivators & Barriers to Purchase
Counterfeits
Channel:
1. Distributors, Dealers & Retailers
2. Mechanics
3. Service Stations
1. Type of brands stocked
2. Key components being
counterfeited
3. Motivators & Barriers to sell
counterfeits
13
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Research-based Consultancy for B2B
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Therefore, the research methodology involved
meeting each of these stakeholders to gauge extent of
counterfeiting…
14
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Module I – Supply Side
Research-based Consultancy for B2B
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• Desk Research
– Collation of information on industry available in public domain like
publications, websites etc
– Product portfolio of large organized auto component manufacturers
– Collation of information on initiatives taken by automobile and auto
component manufacturers to curb counterfeit menace
• Expert Interviews: Depth Interviews with the following
– Associations & Experts like SIAM, ACMA, Ministry of Road Transport &
Highways (MORTH) etc
– Manufacturers of Automobiles & Auto components
– State Transport Authorities
15
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Module I – Sample size covered
Segment
Sample
Automobile Manufacturers
10
Associations & Experts (SIAM, ACMA, MORTH etc)
2
State Transport Authorities Workshops
2
OEM Auto Component Manufacturers
10
Total
24
These interviews helped us understand:
• Fast moving & frequently replaced parts
• Universe of automobiles (2-wheeler, 4-wheeler etc)
• Size of organized auto component market
• Expert opinion on size of counterfeit market & its drivers
16
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Module II – Demand Side
• In this module, both private and commercial vehicle owners were
met across various identified locations mentioned below:Population
Classification
Cities
More than 40 lakhs
Metros
Delhi, Mumbai, Chennai and Kolkata
10 – 40 lakhs
Non-metros
Pune, Lucknow, Ludhiana and Kochi
5 – 10 lakhs
Other NM
1 – 5 lakhs
Small Towns
Chandigarh, Trichy, Guwahati and Jamnagar
Chapra and Gulbarga
17
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Module II – Demand Side
Research-based Consultancy for B2B
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• Private and commercial vehicle owners were grouped by type of
vehicle owned
• Face to face structured interviews were conducted with:– Private Vehicle Drivers & Owners
• Cars (Across various segments)
• Motorcycles
• Scooters
– Commercial Vehicle Drivers & Owners
•
•
•
•
•
Trucks
Buses
Three Wheelers
Light Commercial Vehicles
Taxis
– Four Wheeler
18
Module II – Demand Side: Segment of Private
cars covered during the survey
Vehicle Category
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Type of Vehicles
Segment A
Maruti 800, Premier Padmini
Segment B
Santro, Zen, Wagon R, Alto, Indica, Uno
Segment C
Esteem, Indigo, Palio, Ikon, Getz
Segment D
Opel Astra, Honda City, Lancer, Optra etc
Segment E
Mercedes, BMW etc
MUVs/SUVs
Tata Safari, Tata Sumo, Honda CRV, Chevrolet Tavera, Maruti Omni
19
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Sampling for Vehicle Owners – Module II
Research-based Consultancy for B2B
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• As service related information was to be gathered only those
vehicle owners were met whose vehicles were no longer under
original warranty
• Thus, interviews were conducted with the following vehicle owners:
– Private vehicles >3 years age
• Vehicle owner
• Vehicle Driver
– Commercial Vehicles > 1 years age
• Fleet Owners
• Vehicle Drivers
20
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Module III – Auto component channel members
Research-based Consultancy for B2B
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• The channel members covered during the study are:
– Distributor
– Wholesaler/Retailer
– Authorized service station
– Other service station
– Roadside mechanics
21
2321 private vehicle owners were met across 14
cities spread across 11 Indian states
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Research-based Consultancy for B2B
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Base: 2321 private vehicle
owners
Only 2-wheeler
Nonmetro
33%
16%
Other
NM
12%
13%
Only 4-wheeler
20%
20%
Both
13%
29%
51%
Small
6%
53%
51%
52%
58%
33%
34%
29%
Total
Metro
Non
metros
Metro
49%
Distribution of sample by town class
28%
Other NM
Small
Distribution of sample by vehicle
ownership
• Equal percentage of respondents representing metro and non metro (including Small towns) locations across the
country were covered
• Over 51% of all private vehicle owners met owned a four-wheeler only as compared to 33% owning only a twowheeler
–
Around 16% of the respondents met owned both vehicle types
22
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1089 commercial vehicle owners were met covering
over 2390 commercial vehicles of all types
Small
Other NM 5%
3wheeler
19%
9%
Non-metro
28%
Metro
58%
Distribution of sample by
town class
Taxis
22%
Base: 1089 commercial
vehicle owners
Buses
19%
LCV
20%
HCV
20%
Distribution of commercial
vehicle owners by vehicle type
• Over 58% of the commercial vehicle owners were covered in metropolitan cities
–
About 28% belonged to non-metros
–
Another 9% belonged to other NM and rest 5% to small towns
• Equal representation of owners owning different types of commercial vehicles in the sample covered
–
HCVs and taxis were further divided into categories based on the axle load and care segment respectively
23
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Research-based Consultancy for B2B
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Broad approach used for determination of
counterfeit components market size
24
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Total expenditure on vehicle servicing in India
- Private vehicles
- Commercial vehicles
25
Assumptions for calculation of vehicle
population
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Research-based Consultancy for B2B
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• Total number of registered vehicles in India till 2003 were collected
from MORTH
• Calculation of number of running vehicles
– Private 2 wheelers & 4 wheelers
• 80% of the vehicles purchased in last 20 years are still running
• 10% of the vehicles registered before that are still running
• Based on recent data estimates 10% of the 4 wheelers running are taxies
(IMRB in-house data)
• Almost 34 lakh 4 wheeler purchased in last two years not considered in the
calculation
– Commercial vehicles
• 80% of the vehicles purchased in last 10 years are still running
• 10% of the vehicles registered before that are still running
• The number of running vehicles thus are…
26
Estimated number of running vehicles in India By Geography
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All Nos in Thousands
Transport
Multi-axled/ articulated
trucks and lorries
LMV Goods
Buses
Taxis
LMV Passenger
Total
Non-transport
Two-wheeler total
Scooters
Motorcycles
Cars/Jeeps
Omni buses
Total
North
South
East
West
230
219
230
198
878
98
62
92
94
576
185
65
210
338
1018
30
36
108
86
491
177
46
126
311
858
491
209
536
829
2943
9339
6724
2615
1846
8
11192
6866
2197
4669
1324
44
8190
2930
1172
1758
671
1
3602
8121
3654
4466
1272
5
9393
27255
13747
13508
5113
58
32376
Total
27
Combined after-sales market for repair in India for
both private and commercial vehicles is in excess of
Rs.26000 crores
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Research-based Consultancy for B2B
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Total service aftermarket – By vehicle type
Motorcycles
37%
Seg A
13%
Seg B & C
14%
Scooters
36%
Buses
19%
LCV
20%
Seg D
0.004%
Private vehicles* = Rs.8542 crores
Taxies
15%
HCV
46%
Commercial** vehicles = Rs.17970 crores
*Note: Universe estimates for Segment E cars is not available
** Universe estimates of three-wheelers is not available
28
North, South and Western regions have almost equal
share in the total service aftermarket of private
vehicles however Eastern region is lagging far behind
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Research-based Consultancy for B2B
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Total service aftermarket – By geographies
West
29%
East
13%
South
28%
North
30%
Private vehicles = Rs.8542 crores
• Only 13% of the total service aftermarket is contributed by the Eastern region
–
This can be as a result of low automobile sales in the east
• Close to 30% of the service aftermarket is contributed by other 3 regions of the country
29
Around 60% of the total aftermarket service
expenditure for private vehicles is on components as
compared to 48% in case of commercial vehicles
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Research-based Consultancy for B2B
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Break-up of aftermarket service – By vehicle ownership
Labour
18% Consumables
22%
Components
60%
Private vehicles = Rs.8542 crores
Labour
20%
Consumables
32%
Components
48%
Commercial vehicles = Rs.17970 crores
30
Break-up of aftermarket service expenditure by
vehicle type
Private vehicles
23%
19%
59%
Scooter
24%
19%
18%
19%
Motorcycle
Commercial vehicles
28%
34%
31%
29%
19%
21%
21%
46%
48%
50%
46%
HCV
LCV
Buses
Taxies
15%
63%
Seg A
32%
17%
19%
57%
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Research-based Consultancy for B2B
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63%
Seg B & C
Components
57%
Seg D
Labour
22%
Consumables
31
Thus, combined expenditure on aftermarket component BIRD
purchase for both private and commercial owners is
more than Rs.13500 crores
Research-based Consultancy for B2B
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Total expenditure on components – By vehicle type
Motorcycles
36%
Seg A
14%
LCV
20%
Seg B & C
14%
Scooters
36%
Private vehicles = Rs.5074 crores
Buses
20%
Seg D 0.004%
Taxies
14%
HCV
46%
Commercial vehicles = Rs.8513 crores
32
At the same time share of authorized stations among
private vehicle owners is around 22% as compared to
15% of commercial vehicles
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Research-based Consultancy for B2B
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Total expenditure on components – By vehicle
ownership & service destination
Other stations
78%
Other stations
85%
Authorized
stations
22%
Private vehicles = Rs.5074 crores
Authorized
stations
15%
Commercial vehicles = Rs.8513 crores
33
No major variation across regions for private vehicle
owners in choice of service station for component
purchase
Private vehicles
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Research-based Consultancy for B2B
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Total expenditure on components – By geography
Authorised service station
Other service stations
79%
73%
75%
21%
27%
25%
North
East
West
83%
17%
South
• The share of authorized service stations across regions is in the range of 17% to 27%
–
Highest share of 27% is in the eastern region
–
Lowest share of 17% is in the southern region
–
In the case of northern region it is close to 21% and about 25% in the case of western region
34
Break-up of component expenditure in authorized
vis-à-vis other service stations – By vehicle type
Private vehicles
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Research-based Consultancy for B2B
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Commercial vehicles
Authorised service station
Other service stations
35%
46%
72%
88%
83%
85%
90%
85%
78%
65%
54%
28%
11%
Scooter
16%
Motorcycles
15%
Seg A
Seg B & C
Seg D
HCV
10%
LCV
15%
Buses
22%
Taxies
35
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Research-based Consultancy for B2B
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Counterfeit auto components market in India
- Private vehicles
- Commercial vehicles
36
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Definition of counterfeits?
Research-based Consultancy for B2B
and technology Markets
• Counterfeit components are the illicit duplicates of genuine
components being manufactured by unorganized sector players
illegally
• Counterfeit manufacturers do not pay any:
– Excise duties
– Sales tax/VAT
•
Cater to the after market replacement demand across the country
•
They infringe the IPR of organized sector component manufacturers
•
Have limited capital and technological knowledge
37
Assumptions used for estimation of counterfeit
component market
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Research-based Consultancy for B2B
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•
Vehicles going to Authorized service stations buy only genuine components
•
It is assumed that private vehicles in first three years and commercial vehicles in
the first year are under warranty and/or free service contract and hence, usually
do not visit unauthorized service station (this was also used as the pre condition
for interviewing)
•
A user with similar running habits and having vehicle of same age would be
spending similar amount on maintenance
•
A user will be purchasing similar brand of auto components each time he visits a
service station of his choice
38
BIRD
Research-based Consultancy for B2B
and technology Markets
Counterfeit auto components market in India
- Private vehicles
- Commercial vehicles
39
Case Study: Counterfeit auto component
market size estimation for scooters in India
BIRD
Research-based Consultancy for B2B
and technology Markets
Total expenditure on vehicle repair by private vehicle
owners in the last service (normal or accidental)
Percentage break-up on Components vs. Servicing
% break-up at Unauthorized Service Stations (non OEM
approved) vs. Authorized
Total number of trips to any service station (Unauthorized
or authorized) by vehicle owner per annum
Likelihood of buying a genuine component Vs a
counterfeit
Market Size for Counterfeit = % Vehicles serviced at unauthorized service stations x Average
spend on components x Estimated spent on counterfeits x
Total number of trips/annum x Vehicle Population
40
Case Study: Counterfeit auto component
market size estimation for scooters in India
BIRD
Research-based Consultancy for B2B
and technology Markets
Total expenditure on vehicle repair by private vehicle
owners in the last service (normal or accidental)
Percentage break-up on Components vs. Servicing
% break-up at Unauthorized Service Stations (non OEM
approved) vs. Authorized
Total number of trips to any service station (Unauthorized
or authorized) by vehicle owner per annum
Likelihood of buying a genuine component Vs a
counterfeit
Market Size for Counterfeit = % Vehicles serviced at unauthorized service stations x Average
spend on components x Estimated spent on counterfeits x
Total number of trips/annum x Vehicle Population
41
Expenditure per trip on service by scooter
owners – Authorized Vs Other service stations
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Research-based Consultancy for B2B
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Authorized service stations
Other service stations
Components
Rs. 369
Rs. 338
Labour
Rs. 154
Rs. 97
Consumables
Rs. 112
Rs. 125
Rs. 635
Rs. 542
Source: IMRB research
42
Case Study: Counterfeit auto component
market size estimation for scooters in India
BIRD
Research-based Consultancy for B2B
and technology Markets
Total expenditure on vehicle repair by private vehicle
owners in the last service (normal or accidental)
Percentage break-up on Components vs. Servicing
% break-up at Unauthorized Service Stations (non OEM
approved) vs. Authorized
Total number of trips to any service station (Unauthorized
or authorized) by vehicle owner per annum
Likelihood of buying a genuine component Vs a
counterfeit
Market Size for Counterfeit = % Vehicles serviced at unauthorized service stations x Average
spend on components x Estimated spent on counterfeits x
Total number of trips/annum x Vehicle Population
43
Percentage of scooter owners visiting
Authorized Vs Other service stations
Authorised service station
90%
89%
10%
11%
Total
North
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Source: IMRB research
Non-authorised service stations
96%
4%
East
86%
91%
14%
9%
West
South
• In case of scooters, only 10% of the vehicles were taken to company authorized service station in the last service
–
–
Highest percentage of 14% being in West followed by 11% in North
Only 4% of the scooter owners in the East took their vehicle to company authorized service station for last repair
• Scooter owners preference to other service stations is clearly highlighted by the above figures
44
Case Study: Counterfeit auto component
market size estimation for scooters in India
BIRD
Research-based Consultancy for B2B
and technology Markets
Total expenditure on vehicle repair by private vehicle
owners in the last service (normal or accidental)
Percentage break-up on Components vs. Servicing
% break-up at Unauthorized Service Stations (non OEM
approved) vs. Authorized
Total number of trips to any service station (Unauthorized
or authorized) by vehicle owner per annum
Likelihood of buying a genuine component Vs a
counterfeit
Market Size for Counterfeit = % Vehicles serviced at unauthorized service stations x Average
spend on components x Estimated spent on counterfeits x
Total number of trips/annum x Vehicle Population
45
Total number of trips to service station in a year
- Authorized Vs Other service stations
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Research-based Consultancy for B2B
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Source: IMRB research
Authorised service station
Non-authorised service stations
5
4.4
4.1
3.6
Total
4.2
3.3 3.4
3.2
North
4.4
4.3
East
West
South
Observation: Not only the owner buying components from un-authorized service stations
makes additional trips but also spend 3% higher on components in a typical years!
46
Case Study: Counterfeit auto component
market size estimation for scooters in India
BIRD
Research-based Consultancy for B2B
and technology Markets
Total expenditure on vehicle repair by private vehicle
owners in the last service (normal or accidental)
Percentage break-up on Components vs. Servicing
% break-up at Unauthorized Service Stations (non OEM
approved) vs. Authorized
Total number of trips to any service station (Unauthorized
or authorized) by vehicle owner per annum
Likelihood of buying a genuine component Vs a
counterfeit
Market Size for Counterfeit = % Vehicles serviced at unauthorized service stations x Average
spend on components x Estimated spent on counterfeits x
Total number of trips/annum x Vehicle Population
47
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Research-based Consultancy for B2B
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Likelihood of buying a genuine component
• Respondent was asked to describe the component fitted in the last
service
• The following statements were exposed to the respondent:
Statement describing the type of component purchased
Code
A genuine (original/certified by the manufacturer) component was
refitted such as Maruti Genuine Parts (MGP) in case of Maruti
1
A duplicate/refurbished/local component was fitted
2
A few were genuine components and rest were local/other brands
3
I am not too sure if the original/genuine component was fitted
4
48
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Weight-age given to each statement in order to
determine the market of counterfeit components
Research-based Consultancy for B2B
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• Scenario analysis: The following 3 scenarios have been
developed based on variation in weight-ages:
– Higher estimate
– Realistic estimate
– Lower estimate
Statement describing the type of component purchased
Scenario Analysis
Lower
Realistic
Higher
0%
25%
50%
A duplicate/refurbished/local component was fitted
100%
35%
100%
A few were genuine components and rest were local/other brands
50%
50%
50%
I am not too sure if the original/genuine component was fitted
100%
100%
100%
A genuine (original/certified by the manufacturer) component was refitted
49
Case Study: Counterfeit auto component
market size estimation for scooters in India
BIRD
Research-based Consultancy for B2B
and technology Markets
Total expenditure on vehicle repair by private vehicle
owners in the last service (normal or accidental)
Percentage break-up on Components vs. Servicing
% break-up at Unauthorized Service Stations (non OEM
approved) vs. Authorized
Total number of trips to any service station (Unauthorized
or authorized) by vehicle owner per annum
Likelihood of buying a genuine component Vs a
counterfeit
Market Size for Counterfeit = % Vehicles serviced at unauthorized service stations x Average
spend on components x Estimated spent on counterfeits x
Total number of trips/annum x Vehicle Population
50
BIRD
…and the counterfeit market is about …
CF Share of total Aftermarket
(Realistic estimate)
Rs. 1809 Cr
CF
Share,
41%
Genuine
Market,
59%
Research-based Consultancy for B2B
and technology Markets
CF Share of non Authorized
Aftermarket
Rs. 1628 Cr
CF
Share,
65%
Genuine
Market,
35%
The counterfeit market for scooters could be anything between 40-60% of the total
aftermarket i.e. Rs. 746 -1060 Crores
51
Counterfeit components constitute about 35% 51% of private vehicle components after market
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Research-based Consultancy for B2B
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Demand Estimation for CF components
Vehicles
type
2 Wheelers Scooter
Motorcycle
Cars
A
B+C
D
E
Total
Total Component
Aftermarket (in
Rs. Crore)
Lower
Realistic
Higher
Lower
Realistic
Higher
1809
1819
611
550
746
666
1061
1008
34%
30%
41%
37%
59%
55%
690
733
23
140
80
2
207
129
3
299
199
5
20%
11%
8%
30%
18%
14%
43%
27%
21%
1383
1751
2572
27%
35%
51%
CF Market (in Rs. Crore)
% of market that is CF
Universe estimates
not available
5074
The counterfeit market can be anywhere between Rs 1750 – 2572 crores which
constitutes around 35% - 51% of the total component aftermarket
52
BIRD
Research-based Consultancy for B2B
and technology Markets
Counterfeit auto components market in India
- Private vehicles
- Commercial vehicles
53
Almost similar methodology was used for
computation of counterfeit market for commercial
vehicles
BIRD
Research-based Consultancy for B2B
and technology Markets
Average annual expenditure on vehicle repair by
commercial vehicle owners (normal or accidental)
Percentage break-up on Components vs. Servicing
% break-up at Unauthorized Service Stations (non OEM
approved) vs. Authorized
Likelihood of buying a genuine component Vs a
counterfeit
Market Size for Counterfeit = % Vehicles serviced at unauthorized service stations x Average
spend on components x Estimated spent on counterfeits x
Vehicle Population
54
Only difference was capture of monthly service
expenditure against amount spent on the last service
BIRD
Research-based Consultancy for B2B
and technology Markets
•
All the assumptions specified earlier for computation of counterfeit components
market of private vehicles are applicable in the case of commercial vehicles also
•
Average monthly expenditure on service was captured and annual maintenance
expenditure was calculated for:
– Authorized service station users
– Non-authorized service stations
•
Respondents were then asked to recall last few component purchases and give
an approximate break-up of amount spent on the following brand of components
– OEM approved genuine parts
– Other brands
– Local brands
– Duplicate brands
55
BIRD
Weight-age given to each component brand for
determination of counterfeit market
Research-based Consultancy for B2B
and technology Markets
• Scenario analysis: The following 3 scenarios have been
developed again:
– Higher estimate
– Realistic estimate
– Lower estimate
Brand of auto component purchased
Scenario Analysis
Lower
Realistic
Higher
OEM approved genuine parts
0%
25%
25%
Other brands
50%
50%
100%
Local brands
50%
50%
100%
Duplicate brands
100%
100%
100%
56
In case of commercial vehicles, counterfeit components
account for almost 1/3rd of the total component aftermarket!
BIRD
Research-based Consultancy for B2B
and technology Markets
Demand Estimation for CF components
Vehicles
type
Total Component
Aftermarket (in
Rs. Crore)
Lower
Realistic
Higher
Lower
Realistic
Higher
3852
1740
682
323
1202
571
1689
815
18%
19%
31%
33%
44%
47%
1692
258
498
713
15%
29%
42%
1229
8513
228
1491
373
2644
533
3750
19%
18%
30%
31%
43%
44%
CF Market (in Rs. Crore)
% of market that is CF
CVs
HCV
LCV (p)
Private
Buses
Taxies
Total
The counterfeit market can be anywhere between Rs 2644 – 3750 crores which constitutes
around 31% - 44% of the total component aftermarket of commercial vehicles
57
The counterfeit component market in India could be
contributing more than 1/3rd but less that half of the
total aftermarket component sales
BIRD
Research-based Consultancy for B2B
and technology Markets
Demand Estimation for CF components
Vehicles
type
2 Wheelers Scooter
Motorcycle
Cars
A
B+C
D
CVs
HCV
LCV (p)
Private
Buses
Taxies
Total
Total Component
Aftermarket (in
Rs. Crore)
Lower
Realistic
Higher
Lower
Realistic
Higher
1809
1819
611
550
746
666
1061
1008
34%
30%
41%
37%
59%
55%
690
733
23
140
80
2
207
129
3
299
199
5
20%
11%
8%
30%
18%
14%
43%
27%
21%
3852
1740
682
323
1202
571
1689
815
18%
19%
31%
33%
44%
47%
1692
258
498
713
15%
29%
42%
1229
13587
228
2874
373
4395
533
6322
19%
21%
30%
32%
43%
47%
CF Market (in Rs. Crore)
% of market that is CF
The counterfeit market can be anywhere between Rs 4395 – 6322 crores which
constitutes around 32% - 47% of the total component aftermarket !
58
BIRD
Also according to experts, counterfeit components
should constitute not more than 30%-40% of the total
replacement market in India
Source: Depth Interviews
Research-based Consultancy for B2B
and technology Markets
•
Size of auto components industry in India : Rs.38200 crores (approx)
•
Share of OE sales and exports ~ Rs. 28000 crores (approx)
•
Share of replacement/after market ~ Rs. 12000 crores (approx)
– 30% of total replacement market ~ Rs 3600 crores
– 40% of total replacement market ~ Rs. 4800 crores
•
So according to the experts, the market of counterfeit components in India
should be somewhere between
Rs. 3600 to Rs. 4800 crores
•
The primary research estimates are slightly higher probably because older
vehicles are not going to authorized service stations
59
Factors causing high penetration of counterfeit
components in the replacement market
BIRD
Research-based Consultancy for B2B
and technology Markets
• Higher margins from counterfeit components
– Margins can be as high as 40% – 50% in case of some brands
– No pressure on the margins in future
• Short supply of OE components
– Irregular supply of components
– Higher turnaround time
• Aggressive pricing policy of the organized sector
– Price difference can be as high as 70% as counterfeit manufacturers evade
government taxes and use inferior material
– Mechanics and garages also gain as a result of selling counterfeit and
earning higher margins
• Lack of awareness among customers
– Inability of customers to differentiate
– Lack of education among the customers
60
Factors causing high penetration of counterfeit
components in the replacement market (contd)
BIRD
Research-based Consultancy for B2B
and technology Markets
• High trust placed on other service stations
– Blind trust on other service stations who tend to push counterfeit
components
• In case of commercial vehicles, lack of options available on
highways supplying genuine components
– Commercial vehicle owners have no option but to trust their drivers about
the brand of component purchased
• Easy availability of cheap scrap
– Partially destroyed components rejected by quality team of the OEM
– In case of commercial vehicles, scrap sales from STC and other government
institutions through auction
• Availability of second hand high quality printing presses
– Easy to copy any type of packaging
• Inadequate government regulations and norms
61
BIRD
Research-based Consultancy for B2B
and technology Markets
State Transport authorities – Are counterfeits
entering institutional sales also?
62
It seems that even state transport authorities are not
totally shielded from counterfeit components
BIRD
Research-based Consultancy for B2B
and technology Markets
State Transport Authorities
70 – 80%
Auto component/ Automobile
manufacturers
20 – 30%
ASRTU
(Association of State Road Transport
Undertakings)
• Components are broadly divided into 2 categories
– CFT : Critical function and safety related
– NCFT: Non-critical function related
• The former type are sourced directly from the automobile/auto
component manufacturer
– Latter is sourced from vendors chosen by ASRTU on rate contracts
– ASRTU has fixed norms for choosing the vendor
63
In case a commercial vehicle breaks down on a
highway, the driver has the authority to purchase the
component…the money can be taken from conductor
BIRD
Research-based Consultancy for B2B
and technology Markets
• Purchase process of components
– Through tenders for 18 month period
• Includes 6 month buffer stock
– Monthly delivery of components
– Random checks on components to check the quality of material
– In case of non-availability of components the regional spares in-charge has
the authority to arrange for components from outside
• Generally it happens in 1-2% of cases and counterfeit components can enter in
such cases
– In case of a sudden breakdown the driver can purchase the components
from outside and show the bill to reimburse expenses
• Although a mobile van facility is most often
64
BIRD
Research-based Consultancy for B2B
and technology Markets
Profile of the respondents
1. Private Vehicle Owners
- Two-wheeler owners
- Four wheeler owners
65
Motorcycles contribute to over 54% of the total twowheeler vehicle ownership…with scooters having the
rest 46% share
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 1288 two-wheelers
Distribution of sample by ownership type
Motorcycl
es
54%
First
hand
80%
Secon
d hand
20%
Scooter
46%
Distribution of sample by two-wheeler
segment
First
hand
86%
Secon
d hand
14%
• For the purpose of the study:
–
All types of scooters, scooterettes were clubbed under one broad head as scooters
–
Mopeds were not covered
• Share of first hand and second hand ownership is almost similar in the case of scooters as well as motorcycles
66
BIRD
This is because in recent past, the share of
motorcycles in the two-wheeler segment has
increased substantially
Research-based Consultancy for B2B
and technology Markets
Base: 1288 two-wheelers
46%
Scooter
Motorcycle
28%
25%
23%
16%
16%
13%
10%
7%
7%
4%
After 2002
2000-02
1997-99
1994-96
91-93
5%
Before 1991
• In the last 5 year period, the ownership of motorcycles has overtaken the ownership of scooters by a huge margin
–
In 2000-02 period, the ownership of motorcycles was more than 150% of the scoter ownership
–
After 2002 the percentage difference has increased to more than 250%
• The findings are in line with the change in trends in the last 5 year period in the automotive two-wheeler industry
67
BIRD
As anticipated average age of the primary user of
scooter is much higher than a motorcycle user
Research-based Consultancy for B2B
and technology Markets
Base: 1058 two-wheelers
Scooter
37
32
Total
39
37
36
32
31
Metro
Non-metros
Motrocycles
37
33
32
Other NM
Small
• Motorcycles are a vehicle for the young. This statement is vindicated by the fact that:
–
Average age of the primary user of scooter is 37 years as compared to just 32 years in the case of motorcycle
–
The trend is similar across different town classes
• Can age of the primary user have some significant impact on the type and source of auto component purchased.
We will try to find it out during the course of this presentation?
68
As a result average distance travelled by motorcycle
users per weekday is significantly higher as compared
to scooter users….
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 1058 two-wheelers
42.3
Motorcycles
35.9
33.8
30.9
30.8
27.4
Scooters
25.9
24.2
19.8
Total
Metro
Non-metro
Other NM
22.3
Small
• Average distance covered by a scooter per weekday across locations is 27kms/day but in case of motorcycles it
jumps to 34kms/day
–
The average distance covered by a scooter is highest in case of metro cities at 31kms/day and lowest in case of Small cities
at 20 kms/day
–
In case of motorcycles the average distance covered is highest in case of other NM cities at 42kms/day and lowest in case of
small cities at 22 kms/day
69
…also on weekends motorcycles cover higher
distance as compared to scooters
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 1058 two-wheelers
38.4
29.7
29.5
25.5
25.3
28.1
Scooters
Motorcycles
29.7
23.4
14.9 16.2
Total
Metro
Non-metro
Other NM
Small
• Average distance covered by a scooter per day on weekends across locations is 25kms/day but in case of
motorcycles it jumps to 30kms/day
–
The average distance covered by a scooter is highest in case of non-metro cities at 28kms/day and lowest in case of small
cities at 15kms/day
–
In case of motorcycles the average distance covered is highest in case of other NM cities at 38kms/day and lowest in case of
small cities at 16 kms/day
70
BIRD
Research-based Consultancy for B2B
and technology Markets
Profile of the respondents
1. Private Vehicle Owners
- Two-wheeler owners
- Four wheeler owners
71
BIRD
Fair representation of various four-wheeler
segments in the sample achieved
Research-based Consultancy for B2B
and technology Markets
Base: 1659 four--wheelers
E
2%
MUV/SUV
16%
A
24%
Nonmetro
34%
Other
NM
13%
D
10%
C
22%
B
26%
Distribution of sample by four-wheeler
segment
Metro
50%
Small
3%
Distribution of sample by city type
• Segment A, B and C constituted over 70% of the sample
–
10% of the vehicles covered belonged to Segment D
–
16% of the vehicles belonged to SUV/MUV segment and rest 2% of the vehicles belonged to Segment E
• Over 50% of all four-wheelers covered belonged to Metro cities and 34% to Non-metros
72
Weekend travel in case of four-wheelers is
significantly higher as compared to travel on
weekdays….except in small cities
In Kms/day.
37
35
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 1659 four--wheelers
37
Weekday
Weekend
31
26
21
Metro
Non-metro
Other NM
22
19
Small
• In case of metros, average distance covered by a four-wheeler per weekday is 26kms as compared to 37kms in
case of weekends
• In non-metros, average distance covered per weekday is 31 kms as compared to 35 in case of weekends
• In Other NM cities, weekday travel is at 21 kms/day compared to 37kms/day on weekends
• In small cities, weekday travel is at 22 kms/day compared to 19kms/day in case of weekends
73
BIRD
Research-based Consultancy for B2B
and technology Markets
Last Service Details of
Private vehicles
74
Maximum percentage of 4-wheeler owners preferred
company authorized service station for last service
…however 2-wheeler owners preferred other garages
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 1596 private vehicle
owners
43%
2-wheeler
40%
30%
4-wheeler
26%
25%
14%
8%
12%
1%
Company ASS
Some other garage
Road side mechanic
Large garage
1%
Self
• Over 40% of the four-wheeler owners took their vehicle to company ASS for last service as compared to just 14% owners
in case of two-wheelers
– Maximum percentage of 2-wheeler owners i.e. 43% preferred small/other garage for last service as compared to just 25% in the case of
four-wheeler owners
• After company ASS, over 26% of four-wheeler owners gave preference to large garages as compared to just 12% of the
two-wheeler owners
• Almost 1 out of every 3 two-wheeler owners took their vehicle to roadside mechanic for last service as compared to just
8% of the four-wheeler owners
75
Now lets look at the service destination choice of twowheeler owners by region…a high percentage of
owners in Western India prefer company ASS
Company ASS
1%
10%
Some other garage
3%
17%
16%
51%
Road side mechanic
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 635 2-wheeler
owners
Large garage
2%
Self
2%
5%
25%
24%
8%
43%
52%
60%
23%
15%
12%
North
East
22%
West
9%
South
• There is a startling difference in the choice of service stations between two-wheeler owners from different regions of the
country
– In North, although 15% of the owners went to company ASS for last service but more than 50% of the owners preferred road side
mechanic and another 23% went to other/small garage
– In East, the situation is a lot different. Over 52% of the respondents took their vehicle to small/other garage for repair and just 16%
preferred road side mechanics. Only 12% went to company ASS
– In South, only 9% of the owners went to company ASS and about 60% went to small/other garages. Around 24% of the owners went to
76
road side mechanics for repair
BIRD
In case of four-wheelers, the variation between
regions is not as high as two-wheeler owners
Research-based Consultancy for B2B
and technology Markets
Base: 954 fourwheeler owners
Company ASS
18%
14%
24%
Some other garage
2%
Road side mechanic
2%
20%
7%
Large garage
Self
3%
18%
46%
6%
31%
25%
1%
21%
44%
46%
North
East
30%
West
42%
South
• An equal percentage of four-wheeler owners went to company ASS in the last service across regions except in West where
the percentage drops by 12% - 14%
• In North, 24% owners preferred small/other garages and 18% went to large garages for servicing and the rest 14% went to
mechanics
– The above trend is very much similar in case of Eastern and Southern four-wheeler owners
• However, the four-wheeler owners in the Western region seem to be behaving differently from their counterparts in rest of
the country. More than 46% of Western owners went to large garages for servicing and just 30% in company ASS
77
Preference of company ASS decreases with the
increase in the vehicle age in case of two-wheeler
owners
44%
39%
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 635 2-wheeler
owners
2000-02
47%
1997-99
Before 1997
35%
31%
25%
21%
14% 11%
12%
9% 8%
1% 1% 1%
Company ASS
Some other garage
Road side mechanic
Large garage
Self
• About 21% of the two-wheeler owners who had purchased their vehicle between 2000-02 preferred company ASS for last
service as compared about 8%-9% owners having purchased their vehicle before 2000
• Preference given to other garages and road-side mechanics is highest in case of owners having purchased their vehicle
before 2000
• Above findings clearly indicate the decreasing interest of two-wheeler owners in availing the services of company ASS with
the increase in vehicle age
78
Although in case of four-wheelers high percentage of
owners prefer company ASS but the preference
decreases drastically with the increase in vehicle age
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 954 fourwheeler owners
47%
2000-02
1997-99
Before 1997
34%
33%
29%
23%
21%
27%
33%
23%
7%
9%
8%
2% 2% 2%
Company ASS
Some other garage
Road side mechanic
Large garage
Self
• About 47% of the four-wheeler owners who had purchased their vehicle between 2000-02 preferred company ASS for last
service as compared about 33% owners having purchased their vehicle between 1997-99 and just 23% in case of owners
owning a vehicle made before 1997
• Preference given to large garages is complete opposite to the preference given to company ASS by four-wheeler owners
• Use of road-side mechanics for servicing is very low among the owners of any vehicle type
79
Drive transmission and engine related problems have
been cited as the Top 2 reasons for last service by
both 2-wheeler and 4-wheeler owners
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 1596 private vehicle
owners
Drive Tsn
4-wheelers
30%
2-wheelers
31%
Engine
Suspension/Braking
Electrical
30%
25%
Equipments
13%
17%
16%
15%
Others
7% 3%
9%
4%
• An equal percentage i.e. 30% of four-wheeler owners have cited drive transmission and engine related problems for the
last service followed by 17% of the owners who faced suspension problems
–
About 13% of the owners had electrical problems and the rest 10% faced equipments or other problems
• About 31% of two-wheeler owners have cited drive transmission problems as the reason for the last service followed by
25% who faced engine related problems
–
Close to 16% of the owners faced suspension and electrical problems respectively
–
About 9% owners faced equipment problems and the rest 4% faced other issues
80
Both 2-wheeler and 4-wheeler owners spent 65% of
their total expenditure on purchase of components in
the last service
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 1596 private vehicle
owners
Consum
ables
20%
Labor
15%
Consum
ables
19%
Compo
nents
65%
Labor
16%
Rs. 797/Two wheelers
Compo
nents
65%
Rs. 3759/Four wheelers
• The above figures include both accidental as well as normal repair
• The percentage expenditure on labor and consumables in case of both two-wheeler and four-wheeler owners is
almost similar
• Further break-up of service expenditure in company ASS Vs. other service stations for both two-wheelers and fourwheelers is given later in the presentation
81
In case of two-wheelers, the average expenditure on
service decreases with the increase in the vehicle age
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 635 2-wheeler
owners
Components
156
122
Labour
Consumables
115
123
172
115
560
536
Rs. 838/-
Rs. 806/-
Rs. 742/-
2000-02
1997-99
Before 1997
455
• This can be as a result of decrease in owners interest towards vehicle servicing with the increase in vehicle age
–
•
Also, more preference is given to other service destinations such as road side mechanics, small garages etc as the age of
the vehicle increases
Expenditure on components is the highest in case of vehicles purchased between 2000-02 and lowest in case of
vehicles purchased before 1997
–
However, the expenditure on consumables is highest in case of vehicles purchased before 1997
82
The trend is absolutely same in case of four-wheelers
also…expenditure on consumables is highest in case
of vehicles purchased before 1997
Components
619
602
Labour
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 954 fourwheeler owners
Consumables
667
575
689
462
2457
2414
1845
Rs. 3678/-
Rs. 3656/-
Rs. 2996/-
2000-02
1997-99
Before 1997
• This again can be attributed to the decrease in owners interest towards vehicle servicing with the increase in
vehicle age
–
Also as indicated earlier more preference is given to other service destinations such as large and small garages etc as the
age of the vehicle increases
• Expenditure on components is almost similar in case of vehicles purchased between 2000-02 and 1997-99
–
However, the expenditure is lowest for vehicles purchased before 1997
83
In two-wheelers, although the expenditure in company
ASS is the highest but the percentage difference w.r.t
other service destinations is not very high
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 635 2-wheeler
owners
Consumables
Labor
154
Component
128
137
152
180
120
142
94
569
538
Rs. 860/Company ASS
Rs. 818/Large garage
430
Rs. 730/Other garage
390
Rs. 626/Roadside mechanic
• For two-wheeler owners who went to company ASS, the average expenditure on last service was Rs.860/- out of
which Rs.569/- was spent on purchase of components
–
In case of large garages, the average expenditure was Rs.818/- out of which Rs.538/- was spent on components which is
just 5% less than average expenditure on components in company ASS
–
In case of other garages the % difference in spent on components w.r.t. to company ASS is around 24% whereas the
difference in total expenditure is just 15%. In case of mechanics, it is 32% and 27%
84
BIRD
Research-based Consultancy for B2B
and technology Markets
Detailed information on the last
service for Two-wheelers
- Scooters
- Motorcycles
85
BIRD
Around 69% of two-wheeler users have cited
normal breakdown as reason for the last service
Research-based Consultancy for B2B
and technology Markets
Metro
22%
Never
25%
All
71%
34%
60%
6%
Accidental
6%
26%
5%
69%
13%
1%
Small
Other NM
Normal
69%
7%
Non- Metro
Base: 1058 two-wheelers
86%
• In case of metro cities, over 71% of the users have cited normal breakdown as reason for the last service
followed by 7% of the users who took their vehicle for service as a result of accidental break down
–
In non-metros, 60% cited normal breakdown and 6% as accidental breakdown
–
In other NM, 69% cited normal breakdown and 5% as accidental
–
In small cities, 86% cited normal breakdown and just 1% as accidental
• Over 25% of all two-wheeler owners claim to have never experienced any type of breakdown
86
In scooters, drive transmission problems has been the
primary nature of repair across all locations followed
by engine related issues
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 327 scooters
Drive Tsn
Total
Engine
Electrical
34%
Suspension/Braking
27%
Equipments
15%
14%
Others
7%
3%
Metro
29%
30%
16%
16%
5% 5%
1%
Non-metro
Other NM
44%
30%
17%
24%
13%
18%
16%
9%
9%
12%
6%
2%
Small
38%
38%
14%
5% 3%
• In case of metro cities, more than 30% of the vehicles were serviced last time as a result of engine related problems as
compared to just 17% in non-metros
–
But in metros only 29% of the vehicles were serviced due to drive transmission problems as compared to over 44% vehicles in NM
• In case of other NM cities, around 24% of the vehicles were serviced due to engine problems compared to 38% in small
towns
–
In case of other NM around 30% of the vehicles were serviced due to drive tsn problems compared to 38% in small
87
And in case of motorcycles also drive transmission
problems has been cited as the primary reason for
repair
Drive Tsn
Total
28%
Metro
27%
Non-metro
Other NM
Small
24%
31%
34%
Engine
Suspension/Braking
Electrical
24%
17%
37%
9%
31%
26%
14%
9%
Others
14%
16%
14%
Base: 315 motorcycles
Equipments
20%
25%
BIRD
Research-based Consultancy for B2B
and technology Markets
11% 3%
13%
3%
11%
4%
14%
14%
8% 3%
9%
9%
• In case of non-metro cities, maximum number of vehicles i.e. 37% have cited suspension/braking problems as the primary
reason for repair last time
–
In case of metro cities this percentage is only 16% and ranks fourth in reasons cited for last service
• In case of other NM cities and small cities, drive transmission and engine related problems are the top 2 problems cited for
last service
–
Electrical and suspension/braking related problems rank 3rd and 4th respectively
88
In case of scooters, percentage of users who took
their vehicle to Company ASS for the last service is
just 10%...highest being in non-metros
Some other garage
Road side mechanic
1%
10%
12%
1%
8%
16%
34%
29%
Large garage
1%
14%
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 327 scooters
Company ASS
12%
Self
5%
14%
8%
18%
56%
81%
43%
Total
52%
46%
21%
Metro
Non metros
Other NM
Small
• In case of metros, only 8% of the vehicles were taken to company ASS for last service as compared to 14% in case of nonmetros
–
In case of other NM cities it is 12% and just 5% in case of small cities
• In case of metro cities, maximum number of vehicles i.e. 46% went for repair to small garages compared to 21% in case of
non-metro cities
–
Because over 56% of the non-metro users preferred road-side mechanics for repair as compared to 29% in case of metros
• In case of other NM cities and small cities, a very high percentage of users preferred small garages for repair
89
…and Year of Make of the scooter has very less
bearing on the servicing destination chosen by the
vehicle users
Some other garage
16%
Road side mechanic
1%
6%
9%
2%
4%
10%
Large garage
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 327 scooters
Company ASS
16%
1%
10%
10%
36%
36%
8%
Self
16%
26%
44%
42%
40%
2000-02
1997-99
31%
53%
1994-96
40%
43%
1991-93
Before 1991
• Year of make of the vehicle has very little bearing on the selection of the service destination:
–
Around 16% of vehicles made in 3 year period of 2000-02 were taken to Company ASS for repair as compared to 10% of vehicles
made before 1991
–
Over 9% of vehicles made in 3 year period of 1997-99 were taken to large garages for repair as compared to 10% of the vehicles
made in 1994-96
–
Again over 36% of vehicles made before 1993 were taken to road side mechanics for the last service
90
But in case of motorcycles, the percentage of vehicles
serviced at Company ASS is comparatively higher…
however not as high as other service options
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 315 motorcycles
Some other garage
Road side mechanic
Company ASS
Large garage
4%
1%
13%
1%
14%
10%
19%
20%
19%
Self
6%
8%
3%
19%
25%
21%
44%
42%
Total
44%
23%
Metro
Non metros
28%
83%
28%
Other NM
Small
• In case of metros, over 20% of the vehicles were taken to company ASS for last service as compared to 19% in case of
non-metros
–
In case of other NM cities it is 19% and just 8% in case of small cities
• In case of metro cities, maximum number of vehicles i.e. 44% went for repair to small garages compared to 23% in case of
non-metro cities
–
Because over 44% of the non-metro users preferred road-side mechanics for repair as compared to 21% in case of metros
• In case of other NM cities all the service options were given almost equal importance but in small cities more than 83%
users preferred small garages
91
In case of motorcycles, the age of the vehicle has
some impact on the decision of taking the vehicle to
company ASS for servicing
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 315 motorcycles
Some other garage
2%
24%
Road side mechanic
4%
14%
14%
Large garage
14%
Company ASS
14%
14%
19%
27%
24%
Self
12%
23%
12%
20%
25%
65%
37%
2000-02
48%
45%
43%
1997-99
1994-96
1991-93
Before 1991
• Around 24% of vehicles made in 3 year period of 2000-02 were taken to Company ASS for repair as compared to none in
the case of vehicles made before 1991
• For rest of the service destinations the weight-age given is almost equal
–
Over 48% of vehicles made in 3 year period of 1997-99 were taken to small garages for repair as compared to 45% of the vehicles
made in 1994-96
–
Again over 24% of vehicles made before 1993 were taken to road side mechanics for the last service
92
In scooters, average expenditure on components is
highest in non-metros….as a result of higher
percentage of vehicles being serviced in Company ASS
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 327 scooters
Rs.332
7%
Rs.388
14%
13%
4%
12%
21%
20%
7%
51%
Metro
In Rs
0-200
3%
5%
Rs.227
3%
Rs.235
17%
11%
7%
18%
72%
64%
Other NM
400-600
600-800
Small
>800
51%
Non metros
200-400
• In case of metros and non-metros, over 51% of the users spent less than Rs.200 on purchase of components in last
service
–
But in case of non-metros over 13% of the users spent more than Rs.800 on purchase of components compared to just 7% in the case
of metros
• In case of other NM, over 72% of the users spent less than Rs.200 on auto components as compared to 64% in the case
of small
–
Also in case of small cities more than 11% of the users spent more than Rs.800 on components compared to just 3% in the case of
other NM
93
As scooter users spend approximately 50% higher on
components in company ASS as compared to other
service options
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 327 scooters
Components
Labour
Consumables
517
Might be a very big deterrent to price sensitive
Indian vehicle users.
344
In Rs.
311
296
154 161
115 113
Authorised SS
Large garages
137
110
94
87
Some other garages
Mechanic
• Users who took their vehicle to company ASS for last service spent on an average Rs.517 on purchasing components as
compared to:
–
–
–
Rs.344 in case of large garages
Rs.311 in case of small garages
Rs.296 in case of road side mechanics
• Expenditure on labor and consumables is also highest in case of company ASS
–
This might be a big deterrent for scooter users to avail the services of company ASS
94
But in case of motorcycles, the average spent on
components is highest in other NM….followed closely
by metros and non-metros locations
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 315 motorcycles
Rs.484
9%
7%
9%
32%
43%
Metro
In Rs
0-200
Rs.486
11%
8%
12%
21%
48%
Non metros
200-400
400-600
3%
4%
Rs.496
Rs.381
18%
17%
4%
8%
18%
57%
Other NM
600-800
21%
50%
Small
More than 800
• In case of metros over 43% of the users spent less than Rs.200 on purchase of components in last service as compared to
48% in case of non-metros
–
And in case of non-metros over 11% of the users spent more than Rs.800 on purchase of components compared to just 9% in the
case of metros
• In case of other NM, over 57% of the users spent less than Rs.200 on auto components as compared to 50% in the case
of small
–
Also in case of other NM more than 18% of the users spent more than Rs.800 on components compared to 17% in the case of small
cities
95
As there is very little gap between the average
expenditure on components in Company ASS Vs other
service stations in case of motorcycles
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 315 motorcycles
Components
448
Labour
435
418
Consumables
In Rs.
300
127
148
Authorised SS
133 144
Large garages
137
124
106
91
Some other garages
Mechanic
• Users who took their vehicle to company ASS for last service spent on an average Rs.448 on purchasing components as
compared to:
–
–
–
Rs.418 in case of large garages
Rs.435 in case of small garages
Rs.300 in case of road side mechanics
• Expenditure on labor and consumables in case of company ASS is almost comparable with other service options
–
As a result the average expenditure on components is higher in Other NM and non-metros as compared to metros
96
A large percentage of all two-wheeler users claim to have BIRD
purchased genuine components in last service…but did
they?
Research-based Consultancy for B2B
and technology Markets
Base: 1058 two-wheelers
Genuine
2%
10%
9%
12%
67%
Total
Few genuine and rest local
2%
8%
7%
12%
72%
Metro
Duplicate/Refurbished
15%
18%
10%
12%
10%
63%
60%
Non metros
Other NM
Not sure
13%
Others
4%
16%
20%
60%
Small
• In case of metros over 72% of the users claim to purchase genuine components in last service as compared to 63% in
case of non-metros
–
And in case of non-metros over 10% of the users purchased duplicate components compared to 7% in the case of metros
• In case of other NM and small cities, over 60% of the users claim to purchase genuine components
–
Also in case of small cities more than 16% of the users purchased duplicate components compared to 10% in the case of other NM 97
BIRD
Research-based Consultancy for B2B
and technology Markets
Last Service Details for
Four-wheelers
98
Owner of the vehicle is the primary decision maker
about service requirements…only 6% of the vehicles
are taken by driver for repair
Owner
95%
Owner
85%
Family
members
User
2%
3%
Primary decision maker about repair
and service requirements
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 1550 four--wheelers
Family
members
4%
Driver
6%
User
5%
Who takes the vehicle for servicing?
• Over 95% of the vehicle owners take the decision about repair and servicing requirements
–
In case of 3% of the vehicles, primary users take the decision about servicing
–
And in only 2% of the vehicles, family members are responsible for service decisions
• Again when it comes to taking the vehicle for servicing a majority i.e. 85% of the owners do it themselves
–
6% of the vehicles are taken by the driver for servicing and 5% by the users
–
Only 4% of the vehicles are taken by family members
99
Around 57% of four-wheeler users have cited normal
breakdown as reason for the last service…followed by
10% accidental cases
BIRD
Research-based Consultancy for B2B
and technology Markets
Accidental
10%
All
61%
10%
Non- Metro
Normal
57%
29%
45%
43%
12%
18%
6%
76%
Small
Never
33%
Other NM
Metro
Base: 1550 four--wheelers
43%
51%
6%
• In case of metro cities, over 61% of the users have cited normal breakdown as reason for the last service
followed by 10% of the users who took their vehicle for service as a result of accidental break down
–
In non-metros, 43% cited normal breakdown and 12% as accidental breakdown
–
In other NM, 76% cited normal breakdown and 6% as accidental
–
In small cities, 51% cited normal breakdown and just 6% as accidental
• Over 33% of all four-wheeler owners claim to have never experienced any type of breakdown
100
BIRD
Normal break-down frequency in case of fourwheelers ranges between 5.5 – 6.5 months
Research-based Consultancy for B2B
and technology Markets
Base: 961 four--wheelers
5.74 mths
3%
6.04 mths
5%
10%
6%
15%
6%
5.45 mths
6.46 mths
13%
12%
1%
8%
14%
14%
29%
32%
34%
39%
52%
42%
44%
21%
Metro
4 - 6 mths
Non-metro
1 - 3 mths
Other NM
6 - 9 mths
9 - 12 mths
Small
>12
• In case of metro cities, over 52% of the users have reported 4-6 months as frequency of normal breakdown as
compared to 42% in the case of non-metros
–
Around 30% of the vehicle owners in both metros and non-metros have reported 1-3 months as frequency
• In case of Other NM cities, over44% of the users have reported 4-6 months as frequency as compared to just 21% in
the case of small
–
Over 12% of the vehicle owners in small towns have reported more than 12 months as frequency
101
Like in the case of two-wheelers, engine and drive
transmission related problems were the primary
reason for repair in four-wheelers also
Engine
Total
Other NM
Small
Electrical
29%
Metro
Non-metro
Drive Tsn
25%
33%
22%
Suspension/Braking
25%
28%
36%
27%
18%
13%
18%
16%
7%
11%
Others
10%
12%
18%
16%
Base: 961 four--wheelers
Equipments
17%
24%
BIRD
Research-based Consultancy for B2B
and technology Markets
10%
9%
13%
10%
6%
4%
6%
9%
28%
• In case of metro cities, more than 33% of the vehicles were serviced last time as a result of engine related problems as
compared to just 22% in non-metros
–
–
Also in metros around 24% of the vehicles were serviced due to drive transmission problems as compared to over 25% vehicles in NM
Suspension/braking and equipment problems were the other key areas of concern
• In case of other NM cities, around 28% of the vehicles were serviced due to engine problems compared to 36% in small
towns
–
In case of small cities, over 28% of the vehicles were serviced as a result of other problems
102
Maximum percentage of vehicles across locations
were serviced at Company ASS…use of road side
mechanics for servicing is minimal
Company ASS
Large garage
8%
7%
25%
24%
26%
32%
Some other garage
10%
29%
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 961 four--wheelers
Road side mechanic
10%
21%
50%
19%
19%
25%
41%
Total
37%
42%
Metro
Non metros
50%
25%
Other NM
Small
• In case of metro cities, more than 37% of the vehicles were serviced at company ASS as compared to 42% in the case of
non-metros
–
Over 32% of metro vehicles were serviced at large garages compared to 19% in non-metros
• In case of other NM cities, around 50% of the vehicles were serviced at company ASS compared to 25% in small towns
–
Also in case of other NM cities, equal percentage of vehicles were serviced at large and small garages
–
But in case of small towns, more than 50% of the vehicles were serviced at small/some other garages
103
Percentage of vehicles serviced at company ASS
increases as we move up the four-wheeler category
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 961 four--wheelers
Company ASS
Large garage
6%
8%
23%
6%
20%
Some other garage
8%
18%
34%
25%
25%
Road side mechanic
14%
19%
14%
27%
21%
30%
30%
46%
49%
53%
67%
29%
28%
Seg A
Seg B
Seg C
Seg D
Seg E
MUV/SUV
• Only 28% of segment A vehicles were serviced at company ASS compared to 67% in case of Segment E vehicles
–
Gradual increase in percentage of vehicles being serviced at company ASS when we move from Segment A to Segment E
• In case of segment E, after company ASS the next preferred service destination is small garages and road-side mechanics
–
None of the Segment E car owners availed the services of a large garage
–
Thus, it can be said that owners either prefer spending heavy amount by taking the vehicle to company ASS or prefer saving money
completely by availing the services of mechanics and small garages
104
BIRD
As a result average expenditure on last service also
increases as we move up the four-wheeler category
Research-based Consultancy for B2B
and technology Markets
Base: 961 four--wheelers
In Rs.
5414
3863
2446
2413
1821
A
B&C
D
E
MUV/SUV
• All the figures include both accidental and normal repair
• Average expenditure in last service for Segment A cars is Rs.1821 and in case of Segment B & C cars it jumps by 35% to
reach a figure of Rs.2446
–
Average expenditure for SUVs/MUVs is around Rs.2413 which is very similar to the figures of Segment B & C cars
• In case of segment D cars the average expenditure is more than 50% higher as compared to four-wheelers belonging to
Segment B & C
• As expected the average expenditure in case of Segment E cars is the highest at Rs.5414
105
Average expenditure on components is more than
50% higher in company ASS as compared to the other
service options
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 961 four--wheelers
Components
Labour
Consumables
2964
In Rs.
1889
1823
1594
920
723
687
429
Authorised SS
Large garages
450 441
Some other garages
373 331
Mechanic
• Users who took their vehicle to company ASS for last service spent on an average Rs.2964 on purchasing components as
compared to:
–
–
–
Rs.1889 in case of large garages
Rs.1823 in case of small garages
Rs.1594 in case of road side mechanics
• Expenditure on labor and consumables is also highest in case of company ASS
–
This acts as a deterrent to price sensitive owners who own lower segment four-wheelers
106
BIRD
Research-based Consultancy for B2B
and technology Markets
Additional Regular Service Details for
Four-wheelers
107
Awareness about various maintenance and service
contracts is lacking….especially in the case of small
cities
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 1550 four--wheelers
AMC
Equipment contracts
47%
Extended warranty
47%
39%
32%
33%
30%
22%
20%
13%
2%
Metro
Non-metro
Other Nm
Small
• In case of metro cities, over 39% of the users are aware about AMCs and over 32% are aware about extended warranty
–
Around 20% of the users are also aware about equipment contracts
• In case of non-metro cities, over 47% of the users are aware about AMCs and extended warranty
–
Around 33% of the users are also aware about equipment contracts
• In case of other NM cities, over 30% of the users are aware about AMCs and over 22% are aware about extended warranty
–
Around 13% of the users are also aware about equipment contracts
108
Out of those who are aware only 16% have
subscribed to such contracts across locations
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 612 four--wheelers
Have contracts
Don't have contracts
84%
82%
85%
87%
16%
18%
15%
13%
Total
Metro
Non metros
Other NM
• In case of metro cities, over 18% of the users have subscribed to either of the maintenance contracts
• In case of non-metro cities, over 15% of the users have subscribed
• In case of other NM cities, over 13% of the users have subscribed
• In case of small cities, none of the users had subscribed to such maintenance contracts
109
Assurance of genuine spares and low hassle of
maintenance are the top 2 motivators for subscribing
to a maintenance contract
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 174 four—wheeler
users
All
Metro
Non-metro
Top Box score
Other Nm
65%
46%
43%
37%
31%31%
30%31%
36%
29%
28%
24%
17%
Genuine spares
35%
27%
22%
27%
28%
21%
13%
Low maintenance
Trained manpower
Trust on OEM
Value for money
• In case of metro cities, over 31% of the users have given assurance of trained man-power in company ASS as the most
important for entering into a maintenance contract
–
In case of non-metros, the percentage of such users increases 43%
–
In case of other NM, it is 17%
• Assurance of trained man-power, trust on OEM and value for money are the other important motivators
110
Expensive contracts and costly genuine spares are
the key de-motivators preventing users from
subscribing to such contracts
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 600 four—wheeler
users
All
Metro
Non-metro
Other Nm
Top Box score
42%
37%
42%
29%
39%
29%
25%
18%
Expensive contracts Genuine spares are
expensive
34%
27%
22%
15%
Used for general
purposes
33%
26%
33%
25%
20%
17%
Existing relationship
17%
17%
Promptness of
service
• In case of metro cities, over 42% of the users perceive such contracts to be expensive and hence do not subscribe
–
Another 39% of the users consider genuine spare parts being used in company ASS to be expensive
• In case of non-metro cities, over 29% of the users perceive such contracts to be expensive and in case of other NM cities
this percentage increases to 42%
• Use of vehicles for general purpose, existing relationship with OSS and promptness of service are other key de-motivators
cited by the respondents
111
BIRD
Research-based Consultancy for B2B
and technology Markets
Profile of the respondents
2. Commercial Vehicle owners
- Buses
- HCVs and LCVs
- Taxis
- Three-wheelers
112
BIRD
Research-based Consultancy for B2B
and technology Markets
1089 commercial vehicle owners were met covering
over 2390 commercial vehicles of all types
3-wheeler
19%
Small
Other NM 5%
Taxis
22%
9%
Non-metro
28%
Metro
58%
Buses
19%
HCV
20%
LCV
20%
Base: 1089
commercial vehicle
owners
Distribution of commercial vehicle
owners by vehicle type
3-wheeler
10%
Base: 1089 commercial
vehicle owners
Taxis
15%
Buses
31%
LCV
14%
Distribution of sample by
town class
HCV
30%
Base: 2394
commercial vehicles
Distribution of total number of
commercial vehicles covered by type
• Over 58% of the commercial vehicle owners covered belonged to metropolitan cities
–
About 28% belonged to non-metros
–
Another 9% belonged to other NM and rest 5% to small towns
• Equal representation of owners owning different types of commercial vehicles in the sample covered
–
HCVs and taxis were further divided into categories based on the axle load and care segment respectively
113
Further classification of HCVs and taxis owners
met during the course of the study
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 221 HCVs owners
229 Taxis owners
12-16.2 tones
25%
7.5 - 12 tones
60%
B
47%
16.2-25 tones
11%
>25 tones
4%
Break-up of HCVs
covered by axle load
C
24%
A
25%
D
3%
E
1%
Break-up of Taxis
covered by segment
• In case of HCVs, over 60% of the vehicle owners covered owned 7.5 – 12 tones axle load HCV
–
About 25% owned 12-16.2 tones axle load category
–
About 11% owned 16.2-25 tones axle load category and rest 4% in more than 25 tones category
• In case of taxis, more than 47% of the vehicle owners owned Segment B cars which includes Indica, Uno
–
25% belonged to Segment A which includes Omni, Fiat
–
And about 24% in Segment C which includes Indigo, Contessa, Ikon, Esteem and Baleno
114
Approximately 69% of all the commercial vehicle
owners covered owned only 1 vehicle…16% owned 23 vehicles
1
2 to 3
3%
5%
7%
16%
7%
12%
4 to 5
6 to 10
1%
6%
9%
7%
19%
1%
6%
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 1089 commercial
vehicle owners
More than 10
19%
3%
14%
73%
79%
LCV (216)
Taxis (229)
1%
8%
20%
20%
69%
91%
58%
43%
Total (1089)
Buses (211)
HCV (221)
3-wheeler (212)
• In case of bus owners, about 43% owned only 1 vehicle:
•
–
Around 20% owned 2-3 vehicles and about 19% owned 4-5 vehicles
–
Over 19% owned more than 5 vehicles
In case of HCVs, about 58% owned only 1 vehicles:
–
Around 20% owned 2-3 vehicles and rest 22% owned more than 3 vehicles
• Over 73% LCV owners, 79% taxi owners and 91% 3-wheeler owners owned only 1 vehicles
115
BIRD
Over 48% of all commercial vehicles are
primarily being used for intrastate travel
Research-based Consultancy for B2B
and technology Markets
Base: 1089 commercial
vehicle owners
Intrastate
21%
31%
Interstate
13%
36%
24%
Both
28%
2%
17%
35%
35%
26%
39%
81%
48%
52%
Total
Buses
38%
41%
33%
HCV
LCV
Taxis
3-wheeler
• In case of buses, about 52% of the vehicles are used for intrastate travel, followed by 35% of the vehicles being used for
interstate and the rest 13% for both
• In case of HCVs, only 38% of the vehicles are used for intrastate travel, followed by 36% of the vehicles being used for
both inter and intrastate; rest 26% for interstate travel only
• In case of LCVs, 41% being used for intrastate and 25% for interstate; rest 24% for both
• In case of taxis, 33% being used for intrastate and 39% for interstate; rest 28% for both
116
BIRD
Research-based Consultancy for B2B
and technology Markets
Service Details for Commercial Vehicles
117
Only 23% of all commercial vehicle owners are aware
about service contracts…and out of those only 3% are
subscribing to such contracts
Have contracts
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 1089 commercial
vehicle owners
Don't have contracts
36%
23%
22%
30%
21%
18%
14%
20%
20%
6%
3%
Total
Buses
15%
20%
2%
3%
1%
2%
HCV
LCV
Taxis
3-wheeler
12%
• Maximum awareness is among the bus owners, where about 36% of the respondents are aware of such contracts and
about 6% have entered into such contracts
–
A high percentage of bus owners covered owned more than 1 vehicle
• In case of HCV owners, about 22% are aware of such contracts and only 2% have entered
• In case of LCV owners, 18% are aware and 3% have entered
• In case of taxis also 21% are aware of such contracts but only 1% have entered
–
This can be because over 79% of the owners covered owned only 1 vehicle
118
Average distance travelled in a month is
highest in case of busses followed by HCVs
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 1089 commercial
vehicle owners
In kms/month.
9504 kms
7461 kms
4354 kms
5%
3956 kms
2%
15%
18%
21%
34%
41%
33%
56%
25%
39%
46%
6%
14%
2%
6%
4%
Buses
HCV
LCV
Taxis
27%
•
•
•
•
•
25%
29%
33%
Atleast 1k
2719 kms
3%
1k - 3k
3k-5k
5k-10k
16%
Three-wheeler
More than 10 k
Average distance traveled by a bus (including inter and intrastate) in a month is 9504 kms
In case of HCVs, the average distance traveled by a vehicle in a month is 7461 kms
In case of LCVs the average distance drops down to 4354 kms/month
In case of taxis (including all segments), average distance traveled in a month is 3956 kms
Average distance traveled in a month is lowest in the case of three-wheelers at 2719 kms
119
BIRD
Average distance covered by HCVs of different
capacities ranges from 6500 – 9300 kms per month
Research-based Consultancy for B2B
and technology Markets
Base: 221 HCV owners
In kms/month.
6530 kms
9342 kms
8083 kms
14%
7555 kms
21%
29%
22%
38%
33%
54%
44%
27%
17%
4%
9%
7.5-12
12-16.2
Atleast 1k
45%
18%
1k - 3k
25%
3k-5k
16.2-25
5k-10k
>25
More than 10 k
• In case of HCVs with axle load between 7.5-12 tones, average distance covered in a month is 6530 kms
• And in case of HCVs with axle load between 16.2-25 tones, it increases to 8083 kms/month
• In case of HCVs more than 25 tones of axle load, average distance covered is 7555 kms/month
• The highest average distance covered in a month is 9342 kms by HCVs of axle load 12-16.2 tones
120
BIRD
As a result of heavy travel, the frequency of service in
case of buses is highest at once a week
Research-based Consultancy for B2B
and technology Markets
Base: 1089 commercial
vehicle owners
1-2 weeks
3 weeks
4 weeks
6 weeks
> 6 weeks
23%
43%
41%
26%
36%
6%
16%
15%
14%
12%
34%
Buses
11%
17%
28%
32%
19%
19%
24%
12%
11%
12%
13%
6%
9%
21%
HCV
LCV
Taxis
Three-wheeler
• In case of buses, around 34% of the vehicles are serviced (includes normal tuning, washing) atlleast once a week
–
Around 12% of vehicles are serviced once in 3 weeks and another 15% once in a month
• In case of HCVs, the maximum number of vehicles i.e. 43% are serviced once in more than 6 week period
–
In case of LCVs, taxis and three-wheelers the trend is quite similar
121
Large and small garages are most preferred service
destinations for most of the commercial vehicle
owners…use of company ASS is highest in taxis
Large garage
10%
Small garage/petrol pumps
10%
14%
14%
Company ASS
5%
Base: 1089 commercial
vehicle owners
In-house/Self
3%
12%
7%
23%
38%
31%
12%
17%
Mechanic
BIRD
Research-based Consultancy for B2B
and technology Markets
11%
26%
27%
10%
46%
40%
31%
38%
32%
Buses
HCV
13%
16%
14%
LCV
Taxis
Three-wheeler
• In case of buses, only 17% of the vehicles are sent to company ASS for repair
–
Maximum vehicles i.e. about 57% of the vehicles are sent to large and small garages for repair
• In case of HCVs, about 12% of the vehicles are sent to company ASS, maximum vehicles being serviced at large and small
garages
• In case of taxis, over 23% of the vehicles are sent to company ASS for repair
–
About 46% are being serviced at small garages and about 16% in large garages
122
As expected, average maintenance expenditure
per Km is highest in HCVs followed by buses
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 1089 commercial
vehicle owners
Maintenance expenditure/ Km
(INR)
2.27
1.25
1.06
1.08
0.4
Buses
HCV
LCV
Taxis
3-wheeler
• In case of buses, average maintenance expenditure per km is Rs.1.25
–
This included both inter and intra state buses
• In case of LCVs, the average expenditure is at Rs.1.06
• In case of taxis, it is at Rs.1.08 and in case of 3-wheelers is at Rs.0.40
123
And it has definite impact on the average monthly
expenditure on maintenance which is again highest in
case of HCVs
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 1089 commercial
vehicle owners
Maintenance expenditure/ month
(INR)
12860
10210
4070
3254
940
Buses
HCV
LCV
Taxis
3-wheeler
• In case of buses, average monthly expenditure on maintenance is about Rs.10200/• In case of HCVs, average monthly expenditure is the highest at about Rs.12800/• In case of LCVs, average monthly expenditure is almost 1/3rd of an HCV at Rs.4070/• For taxis, average monthly expenditure is around Rs.3200
• In case of 3-wheelers, it is the lowest at Rs.940/- only
124
About 50% of the monthly expenditure incurred
on maintenance is spent on components
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 1089 commercial
vehicle owners
Components
29%
21%
50%
Labor
Consumables (including tyres)
34%
32%
32%
30%
20%
20%
22%
22%
46%
48%
46%
48%
Buses
HCV
LCV
Taxis
Three-wheeler
• In case of buses, about 50% of the monthly expenditure incurred on maintenance is spent on components
–
About 21% on labor and rest 29% on consumables
• In case of HCVs, about 46% is spent on components
–
About 20% on labor and rest 34% on consumables
• In case of other commercial vehicles also, the trend is very similar
125
Drive transmission and suspension related
components are replaced most often…engine
components take the third spot
Drive Trsn
Suspension/Braking
Buses
HCV
43%
33%
LCV
Taxis
3-wheelers
Engine
40%
Base: 1089 commercial
vehicle owners
Electrical
25%
24%
40%
31%
BIRD
Research-based Consultancy for B2B
and technology Markets
17%
17%
22%
22%
14%
Equipments
10%
5%
21%
14%
24%
29%
5%
15%
20%
14%
5%
3%
3%
• In case of buses, about 43% of the vehicles face engine related problems most often
–
About 25% face suspension problems
• In case of HCV, about 33% of the vehicles face engine related problems most often
–
About 24% face suspension problems
• The trend is more or less similar for other type of components also
126
About 60% of the total expenditure on components is
on OEM genuine type…claim commercial vehicle
owners
OEM Genuine
Other brands
Buses
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 1089 commercial
vehicle owners
Local Brands
68%
Duplicates
18%
11%
HCV
64%
17%
13%
LCV
63%
19%
12%
Taxis
3-wheeler
60%
63%
19%
13%
13%
16%
3%
6%
6%
8%
8%
• In case of buses, about 18% of the amount is spent on purchase of other brands and about 11% on local brands
–
Around 3% is spent on purchase on duplicate components
• In case of HCVs, the trend is almost similar except the spent on duplicate components which increases to 6%
–
•
The trend in LCVs is also very similar
In case of taxis and 3-wheelers, the average expenditure on duplicate components increases to 8%
127
BIRD
Research-based Consultancy for B2B
and technology Markets
Additional Service Details for
Commercial Vehicle commuting on highways
128
In case of an emergency breakdown on a highway,
owner of the vehicle takes the decision about the
servicing requirements in majority of the cases
Owner
27%
73%
Buses
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 661 commercial
vehicle owners
Driver
19%
17%
81%
83%
HCV
Taxis
• About 73% of the bus owners are responsible for taking servicing decision in case of an emergency
–
In rest 27% of the cases, salaried driver of the vehicle takes the decision himself
• In case of HCVs, around 81% of the owners take such a decision
–
In 19% of the cases, the driver is given the freedom to take a decision
• In case of taxis also, the trend is almost similar to HCVs
129
Maximum percentage of vehicles were serviced at
small garages and road-side mechanics when such an
emergency had happened last time
Small garage/petrol pumps
5%
16%
Mechanic
Large garage
Company ASS
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 661 commercial
vehicle owners
In-house/Self
3%
5%
9%
16%
28%
13%
27%
21%
15%
37%
30%
47%
28%
Buses
HCV
Taxis
• Although in case of buses and taxis, about 16% of the owners/drivers took the vehicle to company ASS for servicing but
still maximum preferred small garages and road-side mechanics
–
Can this be a case of poor network of company ASS on some of the national highways across the country
• Only 9% of the HCV owners/drivers took their vehicle to company ASS
–
About 30% of the owners took their vehicle to small garages and road side mechanics
130
In maximum percentage of emergency cases for HCV
and bus owners, the driver showed a kuccha bill to the
owner for reimbursement of service expenses
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 661 commercial
vehicle owners
38%
24%
20%
23%
Buses
HCV
Taxis
36%
25%
19%
15%
12%
15%
13%12%
13%
10%
7%
4%
I am owner/driver I
make payment
Driver shows
kuccha bill
Driver shows
permenant bill
Full faith on driver
so no bill reqd
9%
5%
Given a limit to
driver
Case to case
basis
• In case of taxi owners, about 38% were driving the vehicle when it happened last time and made the payment then and
there
–
But after that about 20% of the owners reimbursed the expenses to the driver when a kuccha bill (made by mistry) was shown
• About 25% of bus, 19% of HCV and 12% of taxi owners reimbursed the expenses only when the driver showed a
permanent bill which can be a proof of servicing at either company ASS or large garages
131
About 10% - 20% commercial vehicle owners admit
purchasing duplicate/refurbished component in such
an emergency situation
OEM Genuine
Buses
Genuine if critical component else others
57%
52%
Taxis
Base: 661 commercial
vehicle owners
Duplicate/refurbished
60%
HCV
BIRD
Research-based Consultancy for B2B
and technology Markets
21%
10%
16%
20%
19%
15%
Not sure
8%
8%
14%
• In case of buses, about 60% owners claim to have purchased genuine components
–
About 21% had purchased genuine if components were critical else local
• In case of HCVs, about 57% owners claim to have purchased genuine components
–
About 19% purchased duplicate components and about 16% purchased genuine only if it was critical
• In case of taxis, about 52% owners claim to have purchased genuine components
–
About 15% of the owners purchased duplicate and about 14% were not sure about the type of component fitted
132
Maximum percentage of commercial vehicle owners
have full faith on their drivers and do not check to
ensure whether the component fitted is original
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 661 commercial
vehicle owners
Buses
HCV
Taxis
38%
31%
23%
26%
23% 22%
17%17%
29%
26%
19%
12%
7%
Full faith on drivers
Driver collects the Personally call the
Physically check
packaging
retailer
• In case of buses, about 23% of the owners have full faith on their drivers
–
4% 5%
Tie-ups with service
stns
However a larger number i.e. about 29% physically check the components also equal number of owners ask their drivers to collect the
packaging
• In case of HCVs, about 38% of the owners have full faith on their drivers
–
Also about 22% of the owners ask their drivers to collect the packaging of the component
• In case of taxis, about 31% of the owners have full faith on the drivers but another 26% physically check and also call the
133
retailer
BIRD
Research-based Consultancy for B2B
and technology Markets
Profile of the respondents
3. Auto component channel members
- Distributor
- Wholesaler/Retailer
- Authorized service station
- Other service station
- Roadside mechanics
134
BIRD
Over 866 auto component channel members
were met across locations
Research-based Consultancy for B2B
and technology Markets
Base: 866 channel members
Metro
Distributor
11%
Mechanics
40%
5%
7%
21%
Non metros
5%
11%
21%
Wholesaler/Retailer
22%
67%
Other stations
18%
Authorized stns
9%
Distributor
Distribution of sample by line of
business
63%
4%
11%
28%
57%
Wholesaler Authorized
stn
Other NM
Small
6%
14%
6%
11%
28%
33%
52%
Other stns
50%
Mechanics
Distribution of sample by city type
• Around 40% of the total sample covered were roadside mechanics
–
Close to 11% were distributors and about 22% were retailers/wholesalers
–
Over 9% of the sample constituted of authorized service stations and around 18% owned other service stations/garages
• Close to 3/4th of the sample covered were located in metro and non-metro locations
135
BIRD
Further classification of channel members
covered during the survey
Research-based Consultancy for B2B
and technology Markets
Base: 866 channel members
Wholesaler/Retailer
1
2 to 3
1%
2%
12%
7%
7%
Distributor
31%
35%
1%
32%
26%
20%
2%
6 to 10
> 21
1%
3%
14%
1%
5%
15%
36%
11 to 25
26 to 50
27%
24%
20%
19%
7%
5%
1 to 5
24%
11 to 20
58%
14%
<1
6 to 10
15%
16%
23%
4 to 5
28%
27%
3%
> 50
All figures in INR lakhs
Distribution of sample by annual sales
from auto components
Distributor
Wholesaler/
Retailer
14%
Authorized
stations
58%
42%
21%
4%
Other
stations
Mechanics
Distribution of sample by number of
employees per outlet
• Close to 50% of the auto component distributors covered claimed to have an annual sales turnover of more than Rs. 10
lakhs from auto components
–
However, only 17% of wholesalers/dealers had sales of more than Rs. 10 lakhs
• A high percentage of the distributors, authorized and other service stations employ more than 5 employees per outlet
–
However, in case of mechanics and wholesalers/retailers majority of the respondents employ less than 3 employees
136
“….since we also need customers to come back to us
we provide them with counterfeits…” Large Distributor
BIRD
Research-based Consultancy for B2B
and technology Markets
• High percentage of channel members confess stocking and selling
counterfeit components:
–
–
–
–
–
Distributors: 14%
Wholesaler/Retailer: 31%
Authorized service station: 10%
Other service stations: 55%
Roadside mechanics: 43%
• Key counterfeiting hubs identified in India – By City:
– Chennai
•
•
•
•
•
Mount Road
G P Road (General Ports Road)
Pudupet
Loot Road
MANNADI
137
“…greediness of dealers, retailers and mechanics
force us to supply counterfeits to them…” Distributor
BIRD
Research-based Consultancy for B2B
and technology Markets
• Key counterfeiting hubs identified in India – By City:
– Delhi
•
•
•
•
•
•
Kashmere Gate
Karol Bagh
Darya Ganj
Jheel
Mayapuri
Mori Gate market
– Mumbai
•
•
•
•
Ulhas nagar
Bhivandi
Sion
Vashi
– Kolkata
• Mallick bazar
138
“…authorized dealers also purchase components from
us for use in service stations…”
Retailer
BIRD
Research-based Consultancy for B2B
and technology Markets
• Key counterfeiting hubs identified in India – By City:
– Kolkata
• Central avenue
• Richi road
• Bhawani pur
– Other cities
•
•
•
•
•
•
•
•
•
•
Nana peth (Pune)
Pimpri Chinchwad (Pune)
Nigadi (Pune)
Lal Bagh (Lucknow)
Cant Road (Lucknow)
Alambagh (Lucknow)
Miller Ganj (Ludhiana)
Samrala Chowk (Ludhiana)
Kaloor (Kochi)
Edapally (Kochi)
139
“…majority of the counterfeit components are
supplied by authorized dealers of OEMs…” Mechanic
BIRD
Research-based Consultancy for B2B
and technology Markets
• Key counterfeiting hubs identified in India – By City:
– Other cities
•
•
•
•
•
•
Sector 38, 43, 48 and 22 (Chandigarh)
Kashi Vishwanath Market (Jamnagar)
Rajkot and surrounding areas
Municipal chowk (Chapra)
Gunj and super market (Gulbarga)
Vidhu Nagar (Guni)
140
BIRD
Research-based Consultancy for B2B
and technology Markets
Brand of components being stocked and sold
by channel members covered
141
BIRD
Fair percentage of distributors & retailers stock
counterfeits for various component types
OEM
No n-OEM
6%
26%
5%
4%
Lo cal
OEM
Co unterfeit
6%
6%
23%
Base: 283 channel members
No n-OEM
23%
30%
16%
Research-based Consultancy for B2B
and technology Markets
18%
31%
60%
48%
53%
97%
94%
94%
Engine
Electrical
Distributor
Suspension
20%
18%
59%
57%
57%
71%
79%
83%
90%
86%
89%
Electrical
Suspension
80%
91%
93%
Drive Trsn
51%
44%
87%
98%
Co unterfeit
14%
60%
55%
Lo cal
Equipments
Drive Trsn
Engine
86%
Equipments
Wholesaler/Retailer
• Counterfeits of drive transmission, suspension and equipments seem to be popular among distributors and
wholesalers/retailers
• Although few channel members confess to stocking counterfeits of engine parts also but they are lesser in
number
142
BIRD
Surprisingly, authorized stations also confess of
stocking local and counterfeit components
OEM
No n-OEM
Lo cal
OEM
Co unterfeit
Research-based Consultancy for B2B
and technology Markets
Base: 226 channel members
No n-OEM
Lo cal
Co unterfeit
4%
12%
26%
4%
5%
16%
3%
3%
8%
5%
5%
25%
4%
23%
37%
27%
27%
55%
47%
44%
77%
100%
99%
100%
99%
Engine
Electrical
Suspension
35%
39%
53%
54%
81%
71%
77%
85%
84%
87%
Electrical
Suspension
81%
99%
95%
Drive Trsn
34%
Equipments
Drive Trsn
Engine
Authorized stations
80%
Equipments
Other service stations
• Almost all authorized service stations stock OEM approved genuine components. But, few authorized stations
covered in the study stocked local and counterfeit components also
• More than 1/3rd of other service stations confess to stock counterfeit components
–
Local/unbranded components are also stocked by 50% of other stations covered
143
As expected, almost 50% of the roadside mechanics
covered stocked counterfeit components
OEM
No n-OEM
Lo cal
48%
52%
31%
37%
82%
86%
Drive Trsn
73%
80%
71%
Engine
Electrical
Roadside mechanics
Base: 357 mechanics
Co unterfeit
41%
41%
51%
54%
32%
43%
61%
BIRD
Research-based Consultancy for B2B
and technology Markets
83%
79%
81%
74%
Suspension
Equipments
• Counterfeits of drive transmission components are stocked by majority of the roadside mechanics covered
–
Suspension and equipments are the next most counterfeited components
• Local components are also being stocked by close to 50% of the mechanics met
• Majority of the respondents claim to stock OEM and Non-OEM genuine components
144
BIRD
Research-based Consultancy for B2B
and technology Markets
Attitude towards auto component replacement
- Private vehicle owners
- Commercial vehicle owners
145
BIRD
Research-based Consultancy for B2B
and technology Markets
Attitude towards auto component replacement
- Private vehicle owners
- Commercial vehicle owners
146
For majority of two-wheeler owners, desired source of
purchase for various components is not company ASS
but other service options
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 1141 two-wheeler owners
Company ASS
2%
15%
Small garage
Large garage
Mechanic
Self
3%
3%
3%
3%
21%
22%
23%
24%
15%
17%
16%
15%
24%
24%
26%
25%
37%
34%
32%
33%
Drive
Electrical
Suspension
Equipments
16%
20%
47%
Engine
• In case of engine components, maximum number of two-wheeler users i.e. 47% would like to purchase from company ASS
–
Rest 53% of the users still prefer to purchase components from other service options
• In case of drive transmission, the percentage of users who would purchase from company ASS drops to just 37%
–
Although drive transmission problems were faced by the maximum number of users, still they would not go to company ASS for
repair/purchase
• For all other categories of components the percentage of users going to company ASS for purchase keeps on decreasing
147
On the contrary, four-wheeler owners would prefer
purchasing all types of components from company
ASS…share of small garages also goes down
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 1550 four—wheeler owners
Company ASS
8%
20%
Small garage
Large garage
Mechanic
11%
10%
11%
12%
22%
23%
21%
21%
12%
15%
14%
13%
54%
51%
51%
52%
Drive
Electrical
Suspension
Equipments
9%
62%
Engine
• In case of engine components, maximum number of two-wheeler users i.e. 62% would like to purchase from company ASS
–
This shows the importance given to such components by the users
• In case of drive transmission, the percentage of users who would purchase from company ASS drops to 54%
–
Around 12% would prefer going to small garages and about 22% to large garages
• For all other categories of components the percentage of users going to company ASS is hovering around 51%
148
BIRD
Research-based Consultancy for B2B
and technology Markets
Attitude towards auto component replacement
- Private vehicle owners
- Commercial vehicle owners
149
Choice of auto components purchase source among
commercial vehicle owners is highly fragmented
BIRD
Research-based Consultancy for B2B
and technology Markets
Base:1089 commercial
owners
Company ASS
Small garage
Large garage
Mechanic
Self
9%
10%
10%
10%
10%
23%
27%
28%
29%
29%
19%
19%
17%
16%
27%
25%
27%
27%
17%
18%
17%
17%
Drive
Electrical
Suspension
Equipments
20%
23%
25%
Engine
• In case of engine components, maximum number of owners i.e. 25% would like to purchase from company ASS
–
Around 23% prefer small garages and road side mechanics
• In case of other type of components, the percentage of owners who would purchase from company ASS drops to just 17%
- 18%
–
Maximum percentage of owners would like to purchase such components from road side mechanics
–
The next best option for the owners are small garages
150
Discounts offered and promptness of service offered
by other service stations are key factors preventing
the use of company authorized stations
BIRD
Research-based Consultancy for B2B
and technology Markets
Base:1089 commercial
owners
Top Box score
43%
Discounts offered
42%
Expensive services of
company ASS
42%
Promptness of service
36%
36%
Existing relation with
other service stns
Genuine components
are costly
• Over 43% of the commercial vehicle owners have given maximum weight age to discounts offered by other service stations
as a key determining factor in choice of such stations over company authorized service station
• Another 42% of the respondents have given high importance to promptness of service (of other service stations) and high
cost of services in company authorized service station as next 2 important factors
–
Over 36% of the respondents perceive genuine components to be costly
• It seems existing relationships with other service stations has an important role to play in the final choice of service
destination also
151
BIRD
Research-based Consultancy for B2B
and technology Markets
Attitude towards counterfeit components
152
BIRD
Methodology used for mapping attitude
towards counterfeit components
Research-based Consultancy for B2B
and technology Markets
• Battery of statements were exposed to the respondent and level of
agreement was sought
• The following scale was used to capture the level of agreement by
the respondent
Level of agreement
Code
I strongly agree with this statement
1
I somewhat agree with this statement
2
I neither agree nor disagree with this statement
3
I somewhat disagree with this statement
4
I completely disagree with this statement
5
153
Around 11% of private owners and 19% of commercial
owners confess to purchase of counterfeit
components intentionally
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 2314 private owners
1089 commercial owners
Private
owner
Somewhat agree
Commercial
owner
Strongly agree
18%
25%
33%
29%
52%
27%
31%
24%
16%
48%
10%
6%
5%
26%
21%
22%
38%
30%
33%
9%
Many times I intentionally
buy counterfeits
I am aware about
damages caused by
counterfeits to my vehicle
I feel cheated when
counterfeits are pushed when
I have paid for original
Many times counterfeits
are sold as originals
Quite frequently original
spare parts are not
available
• Surprisingly, majority of the private and commercial vehicle owners seem to be aware about the damages caused by
counterfeit components to their vehicle
• Also, more than 50% of the respondents feel that quite frequently original spare parts are not available which forces the
channel members to push counterfeits
154
Majority of the private and commercial owners
strongly agree that use of counterfeits increases
frequency of repair
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 2314 private owners
1089 commercial owners
Private
owner
Somewhat agree
Commercial
owner
Strongly agree
19%
26%
27%
22%
24%
28%
27%
27%
64%
50%
50%
41%
Use of counterfeits
reduces the vehicle life
Use of counterfeits causes
frequent break-down of
the vehicle
53%
48%
38%
Use of counterfeits worsen
the overall driving experience
44%
Use of counterfeits increases
frequency of repair
• Majority of the private and commercial vehicle owners seem to be aware about the fact that use of counterfeits reduces the
useful life of the vehicle and causes frequent breakdowns
• Also, most of the vehicle owners agree that use of counterfeits has a negative impact on the overall driving experience
155
Close to 80% of both private and commercial vehicle
owners felt the need of increase in number of
company authorized service stations
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 2314 private owners
1089 commercial owners
Private
owner
Somewhat agree
Commercial
owner
Strongly agree
23%
21%
20%
27%
23%
28%
60%
58%
Repair in authorized
service stations should be
made cheaper
65%
25%
65%
50%
Number of company
authorized service stations
should be increased
26%
57%
48%
Counterfeit manufacturers
should be dealt with strictly
45%
Re-furbishing of inferior auto
components should not be
allowed
• More than 75% of both private and commercial vehicle owners felt that the repair in company authorized service stations
should be made cheaper so as to attract more and more vehicle owners
• Also, a high percentage of vehicle owners felt re-furbishing of auto components should be banned as they are inferior in
156
quality
Cheap price and easy availability are the key reasons
for purchase of counterfeit components
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 2314 private owners
1089 commercial owners
Private owners
Commercial owners
87%
81%
54%
48%
44%
31%
24% 23%
Cheap price
Easy availability
Discounts
Word of mouth
24%
18%
Past
experiences
13%
Non-availability
of genuine
• About 81% of private owners and around 87% of commercial vehicle owners feel that cheap price of such components
motivates people to purchase them
• About 50% of all vehicle owners also feel the easy availability of such components in the market is also a key reason
• Other reasons cited are discounts, word of mouth and past experiences
157
BIRD
Research-based Consultancy for B2B
and technology Markets
Some Suggestions to curb
the growing menace
158
Public-private partnership for education of customers
against evils of using such components is
imperative…
BIRD
Research-based Consultancy for B2B
and technology Markets
• Jaago Grahak Jaago
– This famous tag-line being used by consumer protection cell can also be
replicated in the case of counterfeit components
– As large percentage of customers are buying such illicit duplicates under the
impression of being genuine
– And as we all know, the kind of danger the consumer and his loved ones are
exposed to on using such duplicate components
– Spreading education and awareness among the customers is most
important and this effort has to be jointly supported by public and private
stakeholders
• Education of channel members and law enforcement agencies
– In addition to the education of the customers, the channel members and law
enforcement agencies need to be educated
– This would help in identification and removal of counterfeits from the supply
side
159
OEM backed service stations/mobile vans need
to provided on National Highways
BIRD
Research-based Consultancy for B2B
and technology Markets
• According to experts a high percentage of counterfeit components
for commercial vehicles are being pushed on National Highways
– It is estimated that truck-owners in India spend Rs.220 bn annually on
maintenance of trucks (Source: The Elgi Magazine)
• Despite such huge expenditure, the truck owners had access only to spurious
low quality spares and maintenance by untrained mechanics
– The drivers purchase spurious components and claim bills for original components. Though the
fleet owner are aware of such malpractices but they do not have any other option
• In our primary survey also, majority of truck owners have recommended
expansion of network by the vehicle manufacturers
– In developed countries, there are special services targeted at commercial
vehicles commuting on the highways
– Such services offer monthly preventive maintenance and emergency vehicle
repairs which are just a phone-call away
• Infrastructure provided includes workshops on highways in addition to mobile
vans
160
Sharing of market intelligence among the various
vehicle manufacturers through associations will
definitely help in curbing this menace
BIRD
Research-based Consultancy for B2B
and technology Markets
• As different vehicle manufacturers, are operating from different
geographies the market intelligence is bound to differ
– Sharing of market intelligence will help in reduction of counterfeits in the
market fulfilment resulting in better future
• Rationalization of taxes and duty structure
– Price difference between an original and counterfeit component can range
between 50% - 150% for high end vehicles
– Reduction in the taxes might act as a de-motivator for counterfeit
manufacturers
• Organized retail chains
– One-stop shop for various types of genuine components especially in
Northern region where counterfeiting is being done at a very large scale
• Non-metros and small towns to be given equal importance if not
more in terms of education
161
BIRD
Research-based Consultancy for B2B
and technology Markets
Summarizing…
162
BIRD
Key take-out
Research-based Consultancy for B2B
and technology Markets
Improve awareness of counterfeiting and damages caused among
private and commercial vehicle owners
Current awareness levels are rather moderate at around 40% awareness only. The
message needs to be reinforced continuously by way of an extensive PR activity
Suggested game plan
Promote use of original equipment and authorized service centres
Suggestion 1
through advertisements in suitable media (auto magazines, general
magazines, newspapers, etc.) and articles.
Get new car owners hooked to authorized service stations by hoardings
Suggestion 2
and materials in the service station, TV messages in waiting rooms,
pamphlets, etc.
Suggestion 3
Suggestion 4
Target not only owners but also car drivers and auto-mechanics on the
benefits of genuine components and how it is more beneficial in the
long-run to use genuine components
Messaging clearly needs to highlight the financial benefits (low
breakdown rate leading to lower maintenance cost) and conevnience
aspect (lesser number of trips to service station, avoid embarassment on
the road)
163
BIRD
Research-based Consultancy for B2B
and technology Markets
Suggested action plan
Awareness
Interest
Desire
Through
advertisements in T.V.,
radio, Internet and
industry magazines
Through detailed
articles and
customer
experience
studies on
websites,
newspapers, T.V.
auto shows, etc on
the benefits of
genuine
components
By offering value
for money warranty
offerings, reaching
out to even for
second hand and
old vehicles by way
of loyalty programs
Action
By improving the
distribution
infrastructure of
auto components,
network of
authorized service
stations, allow
buying `only
components’ from
service stations
164
BIRD
Research-based Consultancy for B2B
and technology Markets
Thank you!
165
BIRD
Research-based Consultancy for B2B
and technology Markets
Annexure
166
BIRD
Research-based Consultancy for B2B
and technology Markets
Share of counterfeit components by vehicle category
- Private vehicles
- Commercial vehicles
167
In case of scooters, just about 10% of the total
expenditure on components is in authorized service
station
Scooters running : 137 Lakhs
Service Destination
South
16%
North
48%
West
27%
BIRD
Research-based Consultancy for B2B
and technology Markets
% Going to
non ASS
90%
% going to
ASS
10%
East
9%
Components Aftermarket (Rs. cr)
Expenditure per trip (Rs.)
400
369
At Authorized Service Stations
Others
319
300
200
154
97
100
112
125
Non
Authorized,
1628
Authorized ,
181
0
Components
Labour
Consumables
168
BIRD
But it goes up to 15% in case of motorcycles…
Motorcycles running : 135 Lakhs
Service Destination
North
20%
South
34%
% Going to
non ASS
81%
East
13%
West
33%
Expenditure per trip (Rs.)
400
300
280
At Authorized Service Stations
338
200
Research-based Consultancy for B2B
and technology Markets
116
108
% going to
ASS
19%
Components Aftermarket (Rs. cr)
Others
122
138
Non
Authorized ,
1539
Authorized ,
280
100
0
Components
Labour
Consumables
169
About 1/3rd of total expenditure on components in
case of Segment A cars is in authorized service
stations
Segment A cars running : 12 Lakhs
South
26%
Service Destination
North
36%
West
25%
% Going to
non ASS
% going to
73%
ASS
27%
East
13%
Expenditure per trip (Rs.)
2,000
1,500
At Authorized Service Stations
1,613
1,490
Components Aftermarket (Rs. cr)
Others
Non
Authorized ,
500
1,000
417
500
433
BIRD
Research-based Consultancy for B2B
and technology Markets
473
466
Authorized ,
190
0
Components
Labour
Consumables
170
As expected share of authorized service stations
increases to almost 50% in case of Segment B & C
cars
Segment A cars running : 9 Lakhs
South
26%
Service Destination
% Going to
non ASS
53%
North
36%
West
25%
% going to
ASS
47%
East
13%
Expenditure per trip (Rs.)
3,000
2,500
2,000
1,500
At Authorized Service Stations
2,481
Components Aftermarket (Rs. cr)
Others
Non
Authorized ,
336
1,661
1,000
670
500
454
BIRD
Research-based Consultancy for B2B
and technology Markets
723
530
Authorized ,
396
0
Components
Labour
Consumables
171
Expenditure on components in company authorized
service station is the highest in case of Segment D
cars
Segment A cars running : 18000
South
26%
Service Destination
% Going to
non ASS
47%
North
36%
West
25%
% going to
ASS
53%
East
13%
Expenditure per trip (Rs.)
5,000
4,000
At Authorized Service Stations
3,924
Components Aftermarket (Rs. cr)
Others
Non
Authorized ,
8
3,000
2,000
1,838
2,114
1,242
1,138
1,000
BIRD
Research-based Consultancy for B2B
and technology Markets
426
Authorized ,
15
0
Components
Labour
Consumables
172
Summarizing the figures of component expenditure in
authorised station for private vehicles
BIRD
Research-based Consultancy for B2B
and technology Markets
Private vehicles
Authorised service station
Non-authorised service stations
46%
78%
88%
83%
72%
54%
22%
Total
11%
16%
Scooter
Motorcycles
35%
65%
28%
Seg A
Seg B & C
Seg D
• In case of cars, the expenditure on components of Segment D cars in company authorized service station is the
highest at 65% and lowest being in the case of Segment A cars at 28%
–
It seems that as we move up from one segment to other in case of cars, the share of company authorized service stations
increases significantly
• In case of scooters the share is 11% and close to 15% for motorcycles
173
BIRD
Research-based Consultancy for B2B
and technology Markets
Share of counterfeit components by vehicle category
- Private vehicles
- Commercial vehicles
174
For all commercial vehicles, expenditure on components
in authorized service stations is very low at 15%
BIRD
Research-based Consultancy for B2B
and technology Markets
Commercial vehicles
Authorised service station
85%
Rs. 8513 cr
85%
Rs. 3852 cr
Non-authorised service stations
90%
Rs. 1740 cr
85%
Rs. 1692 cr
15%
15%
10%
15%
Total
HCV
LCV
Buses
78%
Rs. 1229 cr
22%
Taxies
• In case of four-wheeler taxies, the expenditure on components in company authorized service station is highest at
22%
–
•
On the hindsight in case of LCVs it is the lowest at 10%
For HCVs and buses the share of authorized stations is 15%
175
BIRD
Research-based Consultancy for B2B
and technology Markets
Entry of counterfeit components in the auto
component after-market in India
176
Structure of auto component replacement
market in India
Auto Component
Manufacturers
BIRD
Research-based Consultancy for B2B
and technology Markets
OE sales
Authorised
In the Distributors
recent past, the sales
Institutional
sales
to OEMs for aftermarket
has been increasing. The
OEMs now prefer to
Wholesalers
interact with their
customers directly rather
than through their vendors
Company ASS
Retailer
Mechanic
Customers
177
How do counterfeit components enter the
market?
Auto Component
Manufacturers
Authorised Distributors
•
BIRD
Research-based Consultancy for B2B
and technology Markets
Different respondents have different view
points. However, one thing which was
common was that majority of such
components enter the market through the
channel:
Wholesalers
Some also believe that
wholesalers push it
Retailer
Majority believe that it
enters at the retailer level
Mechanic
Few say mechanics
are also involved
Customer
178
Vicious cycle forcing channel members to push
counterfeits
BIRD
Research-based Consultancy for B2B
and technology Markets
• Want to deal with
customers directly
• Contracts
with
autocomponent manufacturers for
supply of components at
decreasing prices in future
• Bear the brunt of
reducing margins
• Temptation to earn
higher margins
• No incentives for
being a faithful
member
the
Channel
Automobile
members
manufacturers
Counterfeits
• Forced to maximize profits
from replacement market
• Aggressive pricing policy
Auto component
manufacturers
• Do not consider economic
feasibility of channel at times
• In recent past have squeezed
margins of channel in order
to become more competitive 179
Counterfeit manufacturers are exclusively into the
business of manufacturing such components
BIRD
Research-based Consultancy for B2B
and technology Markets
Source of Counterfeits
• Domestic counterfeit manufacturers
• Imports
– Have tie-ups with retailers and wholesalers
– Mainly from China and
– Source second hand cheap machinery
other Asian countries
– Have manufacturing at one place and
Illegally enter the
Key hubs in India:– Punjab
printing at another
country
(Ludhiana, Jalandhar)
• Gather both at one place and pack them as Delhi and Tamil– Nadu
Most of the time
original
components come
– Fast moving components are being copied
unbranded and
unpacked
– Dies are counterfeited by reverse
engineering
– Quality comparatively
better
– Capacity to duplicate any component within
3-4 days after change in packaging
180
Counterfeit components have a negative impact on the
brand image and trust placed by the customers on
OEMs and their partners
•
BIRD
Research-based Consultancy for B2B
and technology Markets
Customers are under the impression that they are purchasing genuine
components but in actual counterfeit components have been pushed:
– Such components underperforms with respect to the expectations resulting in
negative brand association and ultimately negative word of mouth
– It also has a negative impact on the sales of the organized sector player
– In addition to the domestic market users, the export market is also affected by
counterfeit components
• Major auto component manufacturers have conducted raids and caught export
consignments containing counterfeit components under their brand name to key hubs
across the world especially Dubai
– Mico Bosch caught an export consignment worth Rs.50 crores containing
fast moving counterfeit components under their brand name
– Though most of the stakeholders have taken some kind of initiatives in this regard
181
Key initiatives taken to curb the menace of counterfeit
components by various stakeholders
BIRD
Research-based Consultancy for B2B
and technology Markets
•
Investing resources to have a separate brand protection cell within the
organization
•
Use of inventive holograms in packaging
•
Educating the customers, channel about the change in packaging through
exhibitions/ campaigns/ mobile vans/ melas etc
•
Hiring specialized agencies to conduct raids on counterfeit manufacturers and
sellers
•
Getting closer to the customer by supplying components to the after market
directly rather than through the vendors
•
Opening company owned showrooms in key urban areas in order to provide
genuine components to the customers
•
Regular stock audits carried out on the channel members in order to instil a
sense of discipline
•
Dealing with large institutional buyers directly and not through channel
182
BIRD
Some quotes to be shared…
“….CF manufacturers copy anything which sells…..”
Research-based Consultancy for B2B
and technology Markets
- large auto component manufacturer
“….channel members also want to eat chicken and drink alcohol, but at the current margins
they are not able to do that…..thus they sell CF components….”
- large auto component manufacturer
“…social ethics need to created against the purchase of CF….as all the customers purchase
such components on the assumption that they are purchasing genuine components….”
- large OEM & Association
“…change in packaging is a viscous cycles, it results in more confusion in the market among
the channel and customers….also within 3-4 day period it is again copied…”
- large auto component manufacturer
“…there could be some counterfeit components being passed through company ASS in
remote locations when supply is irregular….”
- large OEM
“…government should place adequate checks in order to ensure supply of genuine
components in case of large institutional purchases…”
- large auto component manufacturer
183
BIRD
Research-based Consultancy for B2B
and technology Markets
Detailed profile of the respondents met
184
BIRD
Research-based Consultancy for B2B
and technology Markets
Profile of the respondents
1. Private Vehicle Owners
- Two-wheeler owners
- Four wheeler owners
185
BIRD
1288 two-wheelers and 1659 four-wheelers of all types
were owned by private vehicle owners covered… their
ownership by town class
Research-based Consultancy for B2B
and technology Markets
Base: 1288 two-wheelers
1659 four-wheelers
47%
2-wheeler
50%
4-wheeler
35% 34%
10%
13%
8%
3%
Metro
Non-metro
Other NM
Small
• Private vehicle owners in metros owned over 47% of the total two-wheelers encountered during the study
followed by non-metros at 35%
• Similarly in the case of four-wheeler, ownership of the private vehicle owners in metros contributed to over 50% of
the total followed by non-metros at 34%
186
BIRD
Maximum percentage of vehicles owned were
purchased in the 3 year period from 2000-02
Research-based Consultancy for B2B
and technology Markets
Base: 1288 two-wheelers
1659 four-wheelers
2-wheeler
4-wheeler
55%
38%
25%
18%
18%
11%
5%
After 2002
11%
9%
5%
2000-02
1997-99
1994-96
3%
91-93
4%
Before 1991
• Over 38% of all two-wheelers owned were manufactured in that period as compared to 55% of the four-wheelers
• In case of two-wheelers over 18% of the vehicles were purchased after 2002 as compared to just 5% in fourwheelers
187
More than 2/3rd of all the vehicles encountered were
first hand purchases…with non-metro cities having
the highest percentage of first hand ownership
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 1288 two-wheelers
1659 four-wheelers
First hand
17%
83%
Total
19%
81%
Metro
Second hand
12%
88%
Non
metros
17%
83%
Other NM
First hand
23%
25%
28%
77%
75%
72%
Small
Total
Metro
Two-wheelers
Second hand
20%
80%
Non
metros
23%
77%
Other NM
36%
64%
Small
Four-wheelers
• In case of two-wheelers over 83% of the vehicles are first hand purchases
–
The percentage of first hand vehicles is highest in the non-metros at 88%. Purchasing power of people in most of these
non-metro cities have increased significantly in the recent past
–
As expected the percentage of first hand vehicles in the case of Small towns is comparatively lesser
• In case of four-wheelers over 75% of the vehicles are first hand purchases
–
Again the highest number of first hand purchases are in non-metros and the lowest in Small towns
188
BIRD
Around 68% of two-wheelers and 72% of fourwheelers were first time purchases
Research-based Consultancy for B2B
and technology Markets
Base: 1288 two-wheelers
1659 four-wheelers
First time purchase
15%
17%
Additional
14%
16%
14%
68%
70%
Total
Metro
22%
64%
Non
metros
Two-wheelers
Replacement
19%
5%
20%
15%
66%
Other NM
First time purchase
13%
15%
Additional
7%
16%
16%
14%
75%
72%
70%
Small
Total
Metro
Replacement
4%
3%
20%
17%
77%
Non
metros
93%
63%
Other NM
Small
Four-wheelers
• In case of two-wheelers over 70% of vehicles purchased in metro cities are first time purchases for a household
–
However, in case of non-metro cities only 64% of the two-wheelers purchased are first time purchases
–
As expected the percentage of first time purchases in the case of Small towns is highest at 75%
• In case of four-wheelers over 70% of the vehicles purchased in metro cities are first time purchases
–
However, in case of non-metro cities over 77% of the four-wheelers purchased are first time purchases probably proving the
increase in expenditure by the people in such locations
–
As expected the percentage of first time purchases in the case of Small towns is highest at 93%
189
On an average 4-wheelers cover a distance of 39
kms/day in a weekday as compared to 31 kms/day for
2-wheelers…highest being in other NM cities
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 1288 two-wheelers
1659 four-wheelers
47.3
Four-wheeler
39.3
38.6
36.1
33.6
30.9
Two-wheeler
34.5
28.5
21.2 22.4
Total
Metro
Non-metro
Other NM
Small
• In case of two wheelers average distance covered per weekday (working days):
–
Is highest in the case of Other NM cities at 34 kms/day
–
Is lowest in the case of Small towns at 21kms/day
• In case of four-wheelers average distance covered per weekday:
–
Is highest in the case of other NM at 47 kms/day
–
Is lowest in the case of Small towns at 22 kms/day
190
Similarly, other NM vehicle owners cover
maximum distance per day on weekends……
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 1288 two-wheelers
1659 four-wheelers
52.5
42.3
27.8
Four-wheeler
43.7
40.2
27.6
Two-wheeler
28.9
31.9
15.6
Total
Metro
Non-metro
Other NM
19
Small
• In case of two wheelers average distance covered per day on weekends (Holidays) is 22kms/day
–
This is much lower than the average distance covered per weekday which stood at 31kms/day
•
Probably people choose to rest or travel with entire family on the weekend for which two-wheeler might not be the suitable vehicle always
• In case of four-wheelers average distance covered per day on weekends is 42kms/day
–
This figure is slightly higher than the average distance covered per weekday which is 39kms/day
•
Probably four-wheelers are used for family travel/visits on the weekends
191
BIRD
Research-based Consultancy for B2B
and technology Markets
Regular Service Details for
Two-wheelers
- Scooters
- Motorcycles
192
BIRD
Paid routine service was the primary nature of last
regular service among all two-wheeler owners
Research-based Consultancy for B2B
and technology Markets
Base: 1058 two-wheelers
Paid routine service
Because of malfunction
1%
2%
32%
Accidental repairs
1%
25%
8%
30%
92%
65%
Metro
74%
69%
Non metros
Other NM
Small
• In case of metros over 65% of the users took their vehicle for paid routine service as compared to 74% in non-metros
–
Also in metros 32% of the users took their vehicle for regular service because of malfunction as compared to 25% in the case of nonmetros
• In case of other NM over 69% of the users took their vehicle for paid routine service as compared to 92% in small cities
–
Also in case of other NM more than 30% took their vehicle for regular service as a result of malfunction compared to just 8% in case of
small cities
193
Frequency of regular service ranges from 4.5 – 5
months in all locations except small cities where it
increases to once in every 4 months
4.96 mths
2%
4.58 mths
1%
7%
4%
3%
2%
5.32 mths
3%
10%
4%
1%
36%
39%
58%
Metro
4 - 6 mths
Non-metro
1 - 3 mths
48%
Other NM
6 - 9 mths
Base: 1058 two-wheelers
3.98 mths
3%
51%
35%
48%
BIRD
Research-based Consultancy for B2B
and technology Markets
45%
9 - 12 mths
Small
>12
• In case of metro cities, over48% of the users have reported 4-6 months as frequency of regular service as compared
to 58% in the case of non-metros
–
More than 1/3rd of the vehicle owners in both metros and non-metros have reported 1-3 months as frequency
• In case of Other NM cities, over48% of the users have reported 4-6 months as frequency of regular service as
compared to just 45% in the case of small
–
Over 35% of the vehicle owners in other NM and 51% in small have reported 1-3 months as frequency of regular service
194
When it comes to regular service in case of scooters,
higher percentage of vehicles are been taken to
company ASS in comparison to normal service
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 327 scooters
Some other garage
13%
17%
Road side mechanic
3%
17%
8%
Large garage
2%
13%
Company ASS
3%
Self
5%
7%
21%
19%
40%
51%
Metro
32%
Non metros
26%
85%
38%
Other NM
Small
• In case of metros over 13% of the users took their vehicle for regular service to company ASS compared to 17% in the
case of non-metros
–
However, small garages and road-side mechanics are still the favorite service destinations among the users
• In case of other NM over 13% of the users took their vehicle for regular service to company ASS as compared to just 5% in
case of small cities
–
Small garages are preferred by 85% of the users in small cities as compared to 38% in case of other NM
195
In case of motorcycles almost 1/3rd of the vehicles are
being taken to company ASS for regular service in
case of metros and non-metros
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 315 motorcycles
Some other garage
3%
27%
Road side mechanic
Large garage
1%
Company ASS
2%
27%
32%
Self
9%
9%
2%
6%
13%
20%
11%
39%
Metro
31%
25%
35%
Non metros
78%
30%
Other NM
Small
• In case of metros and non-metros over 27% of the users took their vehicle for regular service to company ASS
–
Percentage of vehicles being serviced at small garages and road side mechanics are slightly lesser as compared to scooters
• In case of other NM over 32% of the users took their vehicle for regular service to company ASS as compared to just 9% in
case of small cities
–
Small garages are preferred by 78% of the users in small cities as compared to 30% in case of other NM
196
Two-wheelers owners who regularly purchase
components from non-company authorized service
stations claim to spend 70% on genuine components
OEM Genuine
Metro
Non-metro
Other NM
Small
Other brands
Local Brands
71%
66%
Base: 650 two-wheelers
Duplicates
18%
20%
76%
69%
BIRD
Research-based Consultancy for B2B
and technology Markets
9%
10%
16%
13%
2%
4%
7% 1%
16%
2%
• In case of metros and non-metros on an average users spend 70% on purchase of genuine components
–
Approximately 2%- 4% of the expenditure is on duplicate components
–
Rest is on local or other brands of components
• In case of other NM and small cities the trend is almost similar
–
Approximately 20% of the expenditure is on other or local brands of components
197
Average expenditure on components has been the
highest in case of metro cities…although in
motorcycles the difference is not very high
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 1058 two-wheelers
In Rs.
357
Scooters
341
334
234
Motorcycles
324
232
151
120
Metro
Non-metro
Other NM
Small
• In case of metros, the average expenditure on components by scooter users was Rs.334 and in case of motorcycle users it
was Rs.351
• In case of non-metros, the average expenditure on components by scooter users was Rs.234 and in case of motorcycle
users it was Rs.341
• In case of other NM, the average expenditure on components by scooter users was Rs.232 and in case of motorcycle
users it was Rs.324
• In small cities, average expenditure by scooter users was Rs. 120 and Rs. 151 by motorcycle users
198
In case of regular service also, company ASS are
almost 50% more costlier than other service options
for scooter users
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 327 scooters
Components
Labour
Consumables
383
In Rs.
285
274
205
122 126
102
117
100
120
74
Authorised SS
Large garages
Some other garages
84
Mechanic
• Users who took their vehicle to company ASS for last regular service spent on an average Rs.383 on purchasing
components as compared to:
–
–
–
Rs.285 in case of large garages
Rs.274 in case of small garages
Rs.205 in case of road side mechanics
• Expenditure on labor and consumables is also highest in case of company ASS
–
This again might be a big deterrent for price-sensitive users who take their vehicle for regular servicing
199
BIRD
Regular service of motorcycles in company ASS is not
as costly compared to other service stations
Research-based Consultancy for B2B
and technology Markets
Base: 315 motorcycles
Components
396
Labour
In Rs.
Consumables
335
255
161
246
136
94
Authorised SS
113
Large garages
103
125
Some other garages
96
112
Mechanic
• Users who took their vehicle to company ASS for last regular service spent on an average Rs.396 on purchasing
components as compared to:
–
–
–
Rs.255 in case of large garages
Rs.335 in case of small garages
Rs.246 in case of road side mechanics
• Expenditure on labor and consumables is highest in case of company ASS
–
It seems that the motorcycle manufacturers are not charging a very high premium for normal or regular service
200
A fair percentage of the users have purchased few
genuine and few local components…although majority
still claim to have purchased genuine components
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 1058 two-wheelers
Genuine
7%
8%
8%
12%
Few genuine and rest local
13%
14%
7%
Duplicate/Refurbished
Not sure
Others
6%
9%
9%
11%
13%
65%
56%
Other NM
Small
11%
20%
21%
65%
45%
Metro
Non metros
• In case of metros over 65% of the users claim to purchase genuine components in last service as compared to 43% in
case of non-metros
–
And in case of non-metros over 7% of the users purchased duplicate components compared to 8% in the case of metros
• In case of other NM and small cities, around 60% of the users claim to purchase genuine components
–
Also in case of small cities more than 11% of the users purchased duplicate components compared to 9% in the case of other NM
201
BIRD
Research-based Consultancy for B2B
and technology Markets
Regular Service Details for
Four-wheelers
202
Paid routine service was the primary nature of last
regular service among four-wheelers owners across
locations
Paid routine service
3%
Because of malfunction
4%
8%
20%
5%
Under warranty
3%
Base: 1519 four--wheelers
Accidental repairs
3%
14%
BIRD
Research-based Consultancy for B2B
and technology Markets
4%
18%
29%
93%
69%
Metro
73%
54%
Non metros
Other NM
Small
• In case of metros over 69% of the users took their vehicle for paid routine service as compared to 73% in non-metros
–
Also in metros 20% of the users took their vehicle for regular service because of malfunction as compared to 18% in the case of nonmetros
• In case of other NM over 54% of the users took their vehicle for paid routine service as compared to 93% in small cities
–
Also in case of other NM more than 29% took their vehicle for regular service as a result of malfunction compared to just 4% in case of
small cities
203
When it comes to regular service, percentage of
vehicles being serviced at company ASS increases
substantially….specially in case of small towns
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 1519 four--wheelers
Company ASS
3%
Large garage
8%
20%
29%
20%
Some other garage
3%
16%
10%
Road side mechanic
12%
32%
20%
71%
48%
52%
Metro
Non metros
56%
Other NM
Small
• In case of metro cities, almost 50% of the vehicles were serviced at company ASS as compared to 52% in the case of nonmetros
–
Around 30% of metro vehicles were serviced at large garages compared to 20% in non-metros where an equal number were serviced
at small garages also
• In case of other NM cities, around 71% of the vehicles were serviced at company ASS compared to 56% in small towns
–
Also in case of other NM cities, over 16% vehicles were serviced at small garages
–
But in case of small towns, more than 32% of the vehicles were serviced at large garages
204
Respondents who regularly purchase components from BIRD
non-company authorised service stations claim to
spend maximum on purchase of genuine components
Research-based Consultancy for B2B
and technology Markets
Base: 1060 four--wheelers
OEM Genuine
Other brands
Metro
Non-metro
Local Brands
Duplicates
81%
12%
72%
Other NM
17%
89%
Small
5% 2%
7% 4%
7% 4%
98%
2%
• In case of metros on an average users spend 81% on purchase of genuine components compared to 72% in the case of
non-metros
–
Approximately 2%- 4% of the expenditure is on duplicate components
–
Rest is on local or other brands of components
• In case of other NM and small towns almost majority of the users claim to purchase genuine components only
205
Average expenditure on components in case of
regular service is lower as compared to normal
service
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 1060 four--wheelers
In Rs.
3116
2242
2098
1738
1197
A
B&C
D
E
MUV/SUV
• As normal service included comparatively higher percentage of accidental cases
–
Also the base of respondents in case of regular service is higher which might have averaged out the exceptional cases encountered
• The average expenditure on components in the last regular service ranges from Rs.1197 in the case of Segment A cars to
Rs.3116 in the case of Segment E cars
206
Gap between expenditure on components in Company
ASS Vs other service stations reduces in case of
regular service
BIRD
Research-based Consultancy for B2B
and technology Markets
Base: 1519 four--wheelers
1695
Components
Labour
In Rs.
1256
Consumables
1310
981
766
510
509
382
322
394
333
224
Authorised SS
Large garages
Some other garages
Mechanic
• Users who took their vehicle to company ASS for last regular service spent on an average Rs.1695 on purchasing
components as compared to:
–
–
–
Rs.1256 in case of large garages
Rs.1310 in case of small garages
Rs.981 in case of road side mechanics
• Expenditure on labor and consumables in company ASS is also comparable with other service options
207