Consumar Behaviour in Small Car Market

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Buyer Behavior in the Small Car Market
(A Case Study of Vijayawada City, Krishna District, AP)


The Indian passenger car industry had a sheltered existence till the early 80’s. Until 1981, there were two dominant players in the Indian scene – Hindustan Motors and Premier Automobiles. In 1982, Maruti Udyog, a 50:50 joint venture between Suzuki Motors and the Indian Government introduced a hatch back car at an affordable price. Gradually, Maruti introduced different new models creating different segments and overtook HM and PAL with attractive prices and fresh designs. Within a short span of time, MUL occupied number one position in the car market. In the mean time, the opening up of the economy in 1991 attracted several multi-national companies. Besides this, some domestic majors also entered into the passenger car market. As a result, India has become one of the fastest growing car markets in the world. In fact, it holds a promising ninth position in the entire world and growing with a cumulative annual growth rate (CAGR) of about 14 percent, ready to surpass many developed markets. Today, almost every major car maker of the world is present in India where Maruti Suzuki is the market leader with over 50 percent market share. It is to be noted that in the car market, there are three major segments, out of which small car segment constitutes almost 81 percent of the Indian passenger car industry. It shows that there is immense growth potential to small cars and the future growth looks very promising due to various factors and forces. Some of them are low penetration, good economic growth, buoyant rural markets, growing middle class, poor public transport system and fuel efficiency of small cars.


The major players in the small car market are Maruti, Hyundai, Tata, Fiat, GM Honda, Skoda etc. Among these major players, Maruti is the leader with more than 50% market share with its...
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