The automotive
industry in India is one of the largest automotive markets in the world.
It was previously one of the fastest growing markets globally, but it is
currently experiencing flat or negative growth rates. In 2009, India
emerged as Asia's fourth largest exporter of passenger cars, behind Japan,
South Korea, and Thailand, overtaking Thailand to become third in 2010. As
of 2010, India was home to 40 million passenger vehicles. More than 3.7 million
automotive vehicles were produced in India in 2010 (an increase of 33.9%),
making India the second fastest growing automobile market in the world (after
China). India's passenger car and commercial vehicle manufacturing
industry recently overtook Brazil to become the 6th largest in
the world with an annual production of more than 3.9 million units in 2011. From
2011 to 2012, the industry grew 16-18%, selling around three million units. According to the Society of Indian Automobile
Manufacturers, annual vehicle sales are projected to increase to 4 million by
2015, not 5 million as previously projected.
In
2011, there were 3,695 factories producing automotive parts in all of India.
The average firm made US$6 million in annual revenue with profits close to
US$400 thousand.
Weighed
down by crippling economic slowdown and high interest rates, car sales in 2014
fell below the numbers sold even in the year 2010, highlighting the depression
in the Indian car market, once seen as the brightest spot in the global
automotive space.
So
what ails the Indian car market and why have the numbers moved in reverse
gear? RC Bhargava, Chairman of Maruti Suzuki, reasons that lack of focus on
manufacturing is among the major reasons that kept the Indian economy from
taking off. "Had the previous governments focused on boosting the
manufacturing sector and ushered in crucial reforms, the car industry would
have also flourished," Bhargava told TOI as he lauded the Modi's
government's efforts to promote manufacturing through campaigns like 'Make in
India'.
The
poor run of the Indian car market has also seen some of the relatively-new
investments go sour. Europe's top carmaker Volkswagen, that started a new
factory in India in 2010 amidst much fanfare, has failed to take off
meaningfully. The company has drastically cut its 2018 group market share
target for India to single digit from the high 18% targeted earlier.
With
the increasing growth in demand on back of rising income, expanding middle
class and young population base, in addition to a large pool of skilled
manpower and growing technology, will propel India to be among the world's top
five auto-producers by 2015.
The
automobile industry accounts for 22 per cent of the country's manufacturing
gross domestic product (GDP). The auto sector is one of the biggest job
creators, both directly and indirectly. It is estimated that every job created
in an auto company leads to three to five indirect ancillary jobs.
India
is expected to become a major automobile manufacturing hub and the third
largest market for automobiles by 2020, according to a report published by
Deloitte.
India
is currently the seventh-largest automobiles producer in the world with an
average annual production of 17.5 million vehicles, and is on way to become the
fourth largest automotive market by volume, by 2015.
With
the increasing growth in demand on back of rising income, expanding middle
class and young population base, in addition to a large pool of skilled
manpower and growing technology, will propel India to be among the world's top
five auto-producers by 2015.
The
automobile industry accounts for 22 per cent of the country's manufacturing
gross domestic product (GDP). The auto sector is one of the biggest job
creators, both directly and indirectly. It is estimated that every job created
in an auto company leads to three to five indirect ancillary jobs.
India
is expected to become a major automobile manufacturing hub and the third
largest market for automobiles by 2020, according to a report published by
Deloitte.
India
is currently the seventh-largest automobiles producer in the world with an
average annual production of 17.5 million vehicles, and is on way to become the
fourth largest automotive market by volume, by 2015.
The
growth story for the Indian automobile industry in 2014 rode on the two-wheeler
segment. The segment has clocked positive growth at 12.9 percent year-on-year
to reach sales of nearly 13.5 million units by October 2014.
India's
automobile sector has also picked up pace, with eight of the country's leading
manufacturers' reporting combined passenger vehicle sales of 198,427 in
November 2014, a 10 per cent annual rise. The rise in sales in November 2014
was led by Maruti Suzuki, whose sales increased 17 per cent to 100,024 units in
the domestic market.
The
commercial vehicles (CV) industry in India has registered an increase of 8.59
per cent in September 2014, as fleet owners have started to buy trucks in the
anticipation of an improved economic activity.
The
automobile sector in Andhra Pradesh has a potential for US$ 1 billion
investment and US$ 1.50 billion output, according to a recent analysis by
Automotive Components Manufacturers’ Association of India (ACMA) and city-based
Andhra Chamber of Commerce and Industry Federation (ACCIF).
India
is probably the most competitive country in the world for the automotive
industry. It does not cover 100 per cent of technology or components required
to make a car but it is giving a good 97 per cent, highlighted Mr Vicent Cobee,
Corporate Vice-President, Nissan Motor’s Datsun.
The
vision of AMP 2006-2016 sees India, “to emerge as the destination of choice in
the world for design and manufacture of automobiles and auto components with
output reaching a level of US$ 145 billion; accounting for more than 10 per
cent of the GDP and providing additional employment to 25 million people by
2016.”