Automotive (Light Engineering) SectorTHE MARKET AND THE GROWTH POTENTIAL

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Market Composition

Sourcing> Import

> Manufacturing

Sales> New> Used

After Sales> Spare Parts

> Service

Market Composition Production

◦ 0% Manufacturing◦ Assembly & Fabrication Mostly Bus,

Truck and 2 Wheelers

Automobile Sales 2014

CBU Import50%

Assembly50%

Sales Qty

CBU Import69%

Assembly31%

Sales Value

Small71%

Medium20%

Large9%

Vehicle Sales By Type

Private67%

Commercial33%

*Data Source BRTA 2014-15

Market size & GrowthAutomobile Business Types

Automobile Sales◦ Sales Operation◦ Assembly & Fabrication◦ Manufacturing

After sales Service

Spare Parts◦ Sales ◦ Production

6%

26%

68%

BDT 188 Billion in 2014

Service Spare Parts Sales

US$ 2.41Billion

1.4% of GDP

Estimation & Calculation based on BRTA data

Market size & GrowthREFLECTS THE GROWTH IN COMMERCE AND INDUSTRY

Year

2004

Year

2005

Year

2006

Year

2007

Year

2008

Year

2009

Year

2010

Year

2011

Year

2012

Year

2013

Year

20140

10000

20000

30000

40000

50000

60000

-50.00%

0.00%

50.00%

100.00%

150.00%

200.00%

-31%

23%29%58%

-2%

147%

-2%-13%-18%

35%

Growth (%) Commercial

PERSONAL VEHICLES ARE DISCOURAGED TO REDUCE TRAFFIC CONGESTION

Year

2004

Year

2005

Year

2006

Year

2007

Year

2008

Year

2009

Year

2010

Year

2011

Year

2012

Year

2013

Year

20140

20000400006000080000

100000120000140000160000

-20.00%-10.00%0.00%10.00%20.00%30.00%40.00%50.00%60.00%70.00%63%

21%

58%

14%

-1%

16%

-3%-13%-13%

10%

Growth (%) PrivatePolitical Turmoil Effect

High Tax on private vehicles

Exports and FDI Bangladesh is not exporting Automobiles as finished goods.

◦ However automobile components are being produced in Bangladesh by foreign companies in EPZ for Export.

Our Vehicles are mostly imported from Japan and India. ◦ Cars & SUVs from Japan ◦ Commercial Vehicles and 2/3 Wheelers From India◦ Korean, Chinese and Thailand made vehicle import is increasing in recent

years

Industry Growth PotentialGROWTH PROSPECT AND OPPORTUNITIES

Growth PotentialMOTOR VEHICLE PER 1000 PER CAPITA INCOME

*Data Source World bank

1/3rd vehicle on road compared to

Regional Markets

Growth Potential The market has a suppressed Demand of at least 200% of Current size.

It Will grow exponentially with GDP and per capita income levels over the next 15 years.

Hundreds of Thousands Jobs will be created for skilled and unskilled manpower.

Technological growth of the country.

Challenges

◦ Lack of infrastructure◦ Affordability◦ Massive population concentration in

Capital◦ Instability in policy

Opportunity Maximization◦ Develop the Infrastructure to allow

more vehicles – Roads & Parking Facilities

◦ Implement order on the road to increase efficiency◦ Awareness generation & Law

enforcement

◦ Overall Decentralization◦ Mass Transit system development

◦ Reduction of interest rates to increase affordability

◦ Produce Spare parts to ensure backward & Forward integration

◦ When market size reaches optimum condition◦ Heavily invest in local production◦ Market protection through

regulation

Business Opportunities Financing for consumers

◦ Expand affordability◦ Expand market size

Financing for parts Manufacturing◦ Create backward linkage for production◦ Meet local market needs for parts◦ Export to producers abroad

Financing for vehicle Manufacturing◦ Vehicle production for Domestic use◦ Vehicle export abroad taking advantage of

cheaper production costs in Bangladesh

Mobility

GDP & Business

Job Market

Export

Just Need a Push to start

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