Indian Scenario:

Refrigerants in MACs and

the importance of Fuel
Efficiency

Vijay Kanwar
Sanden Vikas (I) ltd
1
 INTRODUCTION

• CENTRAL THRUST TO PROVIDE THE STATUS IN INDIA

• REPRESENTATIVE OF THE SCENARIO IN THE
DEVELOPING WORLD
• I WILL TOUCH UPON :

1. CAR PRODUCTION AND SALES.

2. THE MAC PRODUCTION SCENARIO
3. THE ENVIRONMENTAL ASPECTS :
a. PHASING OUT OF ODS - LEGISLATION & STATUS
b. PRESENT & PROJECTED DEMAND OF CFCs AND
HFC-134a
c. FUTURE ACTIONS - ALTERNATIVE
REFRIGERANTS AND NEED FOR R&D TO
PRODUCE FUEL EFFICIENT MACs. 2
 INDIAN CAR INDUSTRY
1947 INDEPENDENCE, ECONOMY + FOREIGN
EXCHANGE IN BAD SHAPE, CAR PRODUCTION
PRACTICALLY NON-EXISTENT.

TILL TWO MAJOR CAR PRODUCERS

1983 PRODUCTION LEVEL 30000/YEAR
NO AIR CONDITIONED CARS
NO IMPORTS
CLOSED SOVIET STYLE ECONOMY.

1983 MARUTI SET UP (SUZUKI COLLABORATION)

AC CARS INTRODUCED
PRODUCTION PICKED UP

1993 CAR PRODUCTION 200000

3
 CARS PER 1000 PEOPLE-1997

600

489 485
500

400 372

300

200

93 82
100

28
4
0
USA AUSTRALIA JAPAN MEXICO UAE THAILAND INDIA
4
SINCE CAR INDUSTRY RECEIVED A FURTHER BOOST
1997
FACTORS:

• ECONOMY LIBERALISED +OPENED UP

• LEADING GLOBAL CAR PRODUCERS SET UP

SHOP (USA, JAPAN, EUROPE, KOREA )

• IMPORT DUTIES + EXCISE REDUCED

• ECONOMIC UPTURN. ($ 110b F.E. RESERVES,

10.4% GROWTH IN LAST QUARTER)-
GREATER PURCHASING POWER OF AN
EXPANDING MIDDLE CLASS

• LOWER INTEREST RATES + EASIER LOANS.

5
CAR MANUFACTURERS IN INDIA
FORD INDIA LTD
TATA MOTORS LTD
FIAT INDIA PVT LTD
MARUTI UDYOG LTD
SKODA INDIA PVT LTD
HINDUSTAN MOTORS LTD
HYUNDAI MOTOR INDIA LTD
HONDA SIEL CARS INDIA LTD
GENERAL MOTORS INDIA ( P ) LTD
DAIMLER CHRYSLER INDIA PVT. LTD
TOYOTA KIRLOSKAR MOTOR ( P ) LTD

6
 CAR SALES
CAR SALES IN INDIA GROWTH IS
22.4% IN
YEAR 2003-
1000000 04 COMPARE
TO 2002-3

800000

600000

400000

200000

0
1996-97 1997-98 1998-99 1999 - 00 2000 - 01 2001-02 2002-03 2003-04

YEAR 1996-97 1997-98 1998-99 1999 - 00 2000 - 01 2001-02 2002-03 2003-04

CAR SALES 506301 518029 493565 755073 712149 705781 735644 900607
7
MAC INDUSTRY
QUALITATIVE CHANGE -

EARLIER

• AIR-CONDITIONED CARS CONSIDERED THE

HEIGHT OF LUXURY

• UNAFFORDABLE, LOW PURCHASING POWER

• LACK OF PRODUCTION FACILITIES

• OURS WAS THE FIRST COMPANY TO SET UP

AC MFR IN 1984

• TILL 1995 - ONLY 2 PRODUCERS.

8
A.C. MANUFACTURERS IN
INDIA

SANDEN VIKAS
BEHR INDIA
VISTEON
SUBROS
DELPHI
DENSO

9
 CAR A.C.SALES IN INDIA

800000

600000

400000

200000

0
1996-97 1997-98 1998-99 1999 - 00 2000 - 01 2001-02 2002-03 2003-04

YEAR 1996-97 1997-98 1998-99 1999 - 00 2000 - 01 2001-02 2002-03 2003-04

CAR A.C.SALES 202520 259015 278224 369617 464881 459834 488558 10 616242
 A.C.MANUFACTURER MARKET SHARE IN 2003-04
2%
4%
5%

SUBROS
12% VISTEON
42% BEHR
SANDEN
IMPORTED
13% DELPHI
DENSO

22%

SUBROS VISTEON BEHR SANDEN IMPORTED DELPHI DENSO

257161 137715 78232 71455 31714 27000 12965
11
NOW

• LAST YEAR 68% OF ALL CARS PRODUCED

AIR-CONDITIONED

• EXPECTED TO GO UP TO 85% BY 2005

• NO. OF AIR-CONDITIONED CARS

PRODUCED DOUBLED IN LAST FIVE
YEARS.

• LAST YEAR GROWTH OF AIR-

CONDITIONED CAR PRODUCTION 26.13%

• NO. OF MAC PRODUCERS NOW: 6

• AC CARS NOW CONSIDERED THE NORM &

NECCESSITY FOR INDIA'S CLIMATE

• FUTURE GROWTH PROSPECTS :

12
SUBSTANTIAL
ENVIRONMENTAL ASPECTS

STEPS ALREADY TAKEN

WITH INCREASING MAC POPULATION ENVIRONMENTAL

ASPECTS ASSUME GREATER SIGNIFICANCE.

IN PURSUANCE OF MONTREAL PROTOCOL COUNTRY

PROGRAM FOR PHASING OUT ODS INITIATED IN 1993.

349 ODS PROJECTS COMPLETED THROUGH $ 137 m

MULTILATERAL FUNDS

MANUFACTURE OF CFC BASED MACs DISCONTINUED

EFFECTIVE JANUARY 1, 2003
13
 TRENDS OF REFRIGERANT USE

• PRODUCTION OF CFCs REDUCED FROM 22364 t IN 1999

TO 15014t IN 2003 AND TO BE ZERO BY 2010.

• IN 2005 REFRIGERANT DEMAND FOR MAC SECTOR

FORECAST AS 1299t HFC-134a AND 529t CFCs.

• ACTION ON THE OZONE FRONT FOR MACs

SATISFACTORY AND IN LINE WITH MONTREAL
PROTOCOL.

14
 PRODUCTION AND CONSUMPTION OF CFCs IN INDIA

25000
PRODUCTION
20000 TO BE ZERO
BY YEAR 2010

15000
PRODUCTION
CONSUMPTION
10000

5000

0
1999 2000 2001 2002 2003

YEAR 1999 2000 2001 2002 2003

PRODUCTION 22364 20410 18679 16890 15014
CONSUMPTION 3990 4429 3883 3536 3782
15
 FUTURE ACTIONS

THE FOLLOWING ASPECTS SHOULD RECEIVE PRIORITY

ATTENTION IN INDIA

• AWARENESS OF GLOBAL WARMING POTENTIAL

(GWP) OF REFRIGERANTS.

• GREATER REALIZATION RE THE LIMITATIONS OF

HFC-134a [LEAKAGE, GWP, FUEL CONSUMPTION]

• NO GOVERNMENT POLICY DECISION YET TAKEN TO

POSSIBLE PHASING OUT OR REPLACEMENT OF HFC-
134a BY SUPERIOR ALTERNATIVES IN MAC SECTOR.

• IMPROVEMENT OF FUEL EFFICIENCY ATTRIBUTABLE

16
TO MACs.
 FU E L E FFIC IE N C Y O F M A C s
• IN C R EA SE A W A R EN ESS O F LIN K A G E B ETW E EN M A C
EFFIC IEN C Y A N D EN V IR O N M EN T [G R E EN H O U SE ]

• IN C R EA SED R & D EFFO R TS FO R IM PR O V IN G FU EL

EFFIC IEN C Y BY B ETTER D ESIG N OF A IR -
C O N D ITIO N ER S.

• B A SIC R & D A C TIV ITIE S IN IN D IA , A S IN O TH ER

D EV E LO PIN G C O U N TR IES, O N LIM ITED SC A LE D U E TO
LO W PR O D U C TIO N V O LU M ES A N D SC A R C ITY O F
R ESO U R C E S.

• W H ILE R ELIA N C E W O U LD H A V E TO B E PLA C ED O N

FU N D EM EN TA L R & D EFFO R TS M A D E IN TH E
D EV E LO PED W O R LD , G R EA T B EN EFITS C O U LD
A C C R U E B Y SU PPLEM EN T IN G TH IS W ITH LO C A L
EFFO R T S.

• TH IS W O U LD H O W EV ER , R EQ U IR E FU N D IN G SU PPO R T
A S W A S D O N E IN TH E C A SE O F M U LTIL A TER A L
FU N D IN G FO R PH A SIN G O U T O D S. 17