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01-05-2010, 01:56 AM #1
Indian Auto Industry Shows Significant Growth Despite Global Gloom
As per the reports, the Indian auto industry showed a significant growth by announcing new models despite global gloom in economic growth. Most of the global companies collapsed during 2009 and the auto majors were also in backtrack due to the depression.
During the year 2009, several new commercial launches happened, but the significant one was the commercial rollout of the world's cheapest car, Tata Nano. We also saw some of the most expensive models like Phantom (about $750,000) and the Ghost ($250,000) from Rolls Royce and Volkswagen's famed Beetle ($40,000).
During the year, the overall car market grew around 15 % over 2008, and a similar pattern is expected in the coming year too.
Neeraj Garg, Volkswagen India group sales director, said, "Car manufacturers are betting on hatchbacks in the B+ segment. We expect the segment to constitute nearly 75 percent of volumes in the coming years."
According to Garg, the B+ segment is expected to grow 30% by virtue of new launches from Nissan (unnamed model), Ford (Figo), Volkswagen (Polo), and General Motors (Beat).
Spark, the compact car from General Motors, will now come in an electric version. It has tied up with Bangalore's Reva Electric Car Co. to come up with a new version.
"We expect the electric Spark to be launched next November. We will provide the battery kit and use GM's dealer network to distribute our models," said Reva co-founder Chetan Maini.
A slew of other models have also been launched this year apart from Tata’s Nano.
The auto market also saw a series of other models including Jazz (Honda), the multi-purpose Xylo (Mahindra and Mahindra), Grande Punto from Italy's Fiat. Apart from that, Tata Motors had also introduced the iconic British brands including Jaguar and Land Rover into other markets.
The other big companies like Maruti Suzuki, Hyundai and Toyota also marketed their new models. Maruti Suzuki debuted its Ritz, while South Korea's Hyundai launched the diesel i20 and the Czech Republic's Skoda showcased the new Laura. Japan’s auto major Toyota introduced the latest version of sports utility vehicle Land Cruiser in the same year.
As per Ernst and Young’s report, the Indian passenger car market is expected to grow at 12% annually over the next five years and the annual production may also touch 3.75 million units by 2014 from the present.89 million units.
Several analysts forecast, "The industry's turnover is estimated to touch $155 billion by 2016."
If the trend continues like this, then the Indian auto industry would be the seventh largest auto industry in the world. It would also be the third largest in that sector by 2030, after China and the US.
As per India’s Automotive Mission Plan, India can be the leading car maker within the next five years. At present, Indian car industry contributes over 5% in that sector and it can then touch to 10% by 2016.
In the coming years, India is also expected to strengthen its position as an automobile hub, with the sale of about 2.75 million units in the overseas and about one million units in the domestic market.
Pawan Goenka, president of the Society of Indian Automobile Manufacturers (SIAM), said, "India and China are the only markets that have remained profitable."
It has been noticed that, the Indian auto industry is growing at 15-25% annually for the past five years, due to market demands from the class people. It might be due to growing disposable incomes in the people.
The auto industry expects the government to supply more funds for roads and highways, which would also boost the industry sector. The two-wheeler industry is leading the growth chart with scooters and motorcycles.
Some of the companies including Mahindra and Mahindra also learnt to be quitting the two-wheeler business. Still, some of the market players in the commercial vehicles segment are also upbeat about the market revival.
"With the economy reviving and growth predicted at over 7%, commercial vehicle segment can expect good times ahead," said Ashok Leyland COO Vinod Dasari.