Indian Automobile Industry

Topics: 2000s automobiles, Front wheel drive vehicles, Maruti Suzuki Pages: 7 (1484 words) Published: March 21, 2013
Introduction to Automobile Industry


Indian automobile industry has grown leaps and bounds since 1898, a time when a car had touched the Indian streets for the first time. At present it holds a promising tenth position in the entire world with being # 2 in two wheelers and # 4 in commercial vehicles. Withstanding a growth rate of 18% per annum and an annual production of more than 2 million units, it may not be an exaggeration to say that this industry in the coming years will soon touch a figure of 10 million units per year.

Reasons of Growth

Economic liberalization, increase in per capita income, various tax relief policies, easy accessibility of finance, launch of new models and exciting discount offers made by dealers all together have resulted in to a stupendous growth of India automobile industry.


Automobile industry of India can be broadly classified under passenger vehicles, commercial vehicles, three wheelers and two wheelers, with two wheelers having a maximum market share of more than 75%. Automobile companies of India, Korea, Europe and Japan have a significant hold on the Indian market share. Tata Motors produces maximum numbers of mid and large size commercial vehicles, holding more that 60% of the market share. Motorcycles top the charts of two wheelers with Hero Honda being the key player. Bajaj by far is the number one manufacturer of three wheelers in India.

Passenger vehicle section is majorly ruled by the car manufacturers capturing over 82% of the total market share. Maruti since long has been the biggest car manufacturer and holds more that 50% of the entire market.

Global recession has impacted, the Indian automobile industry also and can be seen clearly in the sales figures of the last financial year. Even then this industry has high hopes in 2009-2010, as banks have reduced loan interest rates and the major chuck of automobile customers belong to the middle income group who are becoming economically stronger with every passing day.

* The first automobile in India rolled in 1897 in Bombay. * India is being recognized as potential emerging auto market. * Foreign players are adding to their investments in Indian auto industry. * Within two-wheelers, motorcycles contribute 80% of the segment size. * 2/3rd of auto component production is consumed directly by OEMs. * India is the largest three-wheeler market in the world. * India is the largest two-wheeler manufacturer in the world. * India is the second largest tractor manufacturer in the world. * India is the fifth largest commercial vehicle manufacturer in the world. * The number one global motorcycle manufacturer is in India. * India is the fourth largest car market in Asia - recently crossed the 1 million mark.


Among the two-wheeler segment, motorcycles have major share in the market. Hero Honda contributes 50% motorcycles to the market. In it Honda holds 46% share in scooter and TVS makes 82% of the mopeds in the country.

40% of the three-wheelers are used as goods transport purpose. Piaggio holds 40% of the market share. Among the passenger transport, Bajaj is the leader by making 68% of the three-wheelers.

Cars dominate the passenger vehicle market by 79%. Maruti Suzuki has 52% share in passenger cars and is a complete monopoly in multi purpose vehicles.

In utility vehicles Mahindra holds 42% share.
In commercial vehicle, Tata Motors dominates the market with more than 60% share. Tata Motors is also the world's fifth largest medium & heavy commercial vehicle manufacturer


Hyderabad, the Hi-Tech City, is going to come up with the first automobile mall of the country by the second half of 2008. It would be set up by city-based Prajay Engineers Syndicate in area of more than 35 acres. This 'Autopolis' would have facilities for automobile financing institutions and insurance services to create a...
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