A remarkable growth of 18% was seen by the Indian auto industry over the last year with total sales reaching around 10 million vehicles till November 2006 as against 9.3 million in 2005. Pushed by a huge demand from the market, the increase in production is set to improve further driven by a buoyant economy, with increasing purchasing power, new product launches, coupled with attractive finance schemes from automobile manufacturers and financial institutions.
The domestic passenger car market witnessed a historic 21 per cent growth in April-December, 2006, second only to the 28.56 per cent in fiscal 2003-04. It is believed that the industry will close fiscal 2006-07 with around 25 per cent growth, against just 16 per cent in 2005-06. The Indian automotive industry has been growing for the third year in succession at over 25%. The number of persons per car is 200, which is very huge in contrast to other emerging markets like Korea and Brazil which have about 12 persons per car.
India is rapidly emerging as a manufacturing base for car exports. According to the Society of Indian Automobile Manufacturers (SIAM), overall automobile exports during April 2006-February 2007 grew by 26.47 per cent, with passenger vehicles at 12.7 per cent, CV at 24.22 per cent, two wheelers at 21.61 per cent and three wheelers at 91.52 per cent.
The Indian automobile sector has witnessed a slew of investments in the first half of 2006, dominated by plans for new plants and ramped up capacities. Sweden-based bus manufacturer Volvo is setting up its proposed bus body-building unit in Bangalore. Japan's Nissan Motor Company, along with Mahindra & Mahindra (M&M) and Renault of France is investing US$ 904.4 million in a tripartite integrated facility in Tamil Nadu to make passenger cars and utility vehicles. Pierburg, the auto component subsidiary of euro 3.5 billion German group Rheinmetall, is looking at setting up a manufacturing facility in India. DaimlerChrysler, the world's second-largest luxury car maker, plans to set up a new factory in India to assemble cars. German car maker Volkswagen plans to invest up to US $511.1 million to set up a plant in India.
This year, the Indian automobile market will see no less than 25 new launches, spanning everything from affordable hatchbacks to mid-size models to super luxury high-end cars and SUVs. Mercedes, BMW, Porsche, Audi, Bentley and Rolls Royce are already here. Now, the Italian marquee Lamborghini is also planning to enter the country. The Italian marquee plans to launch the Gallardo. German luxury car maker Audi AG is preparing to drive into India a range of sporty, lifestyle cars like S8 and RS4. The year 2007 will also mark Audi's entry into merchandising in Indian car bazaar. General Motors launched the Aveo and GM plans to bring in a sporty variant of the Chevy Optra to add to its existing line-up. |
