Scenario of Car Industry in India

Published: 27th January 2011
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Not quite lengthy ago, the only cars that have been accessible in India have been the Ambassador as well as the Premier Padmini. The Ambassador is really a replica of the Morris Oxford - an old British vehicle, even though the Premier Padmini was a Fiat 1100 assembled in India.

All that was in pre-liberalisation India, which existed before 1991, when the first liberalization measures had been announced. Earlier, the production of the Maruti Suzuki 800 hatchback vehicle in 1983 - a joint venture between Government of India and Suzuki Motors of Japan, paved the way for a renaissance in the Indian automobile sector.

Post liberalization, India is on each and every car manufacturer's map. The reasons aren't challenging to notice. At present, India may be the second biggest two-wheeler market along with the fourth biggest commercial car marketplace on the planet. Not simply it's the eleventh biggest passenger automobile marketplace globally, however it is also expected to be the seventh largest by 2016.

Post liberalization, numerous foreign manufacturers have lined up and have setup base in India. Other domestic manufacturers have also enhanced production levels and are in the race for producing greater models also.

Some of the auto producers who have set up base in India are Audi, BMW, Chevrolet Fiat, Ford, Honda, Hyundai, Mahindra, Maruti, Mercedes, Mitsubishi, Skoda, Suzuki, Tata, Toyota, Volkswagen, and Volvo. India's economic growth is booming at present. These manufacturers have setup manufacturing facilities in India, or are importing cars and spares to meet the demands of this growing marketplace.

For instance, businesses like Ford are planning to create India a regional hub for exports of both small cars as well as engines. Based on Mr. Michael Boneham, President Designate for Ford India, the company plans to export the tiny vehicle along with the engine for markets abroad. He indicated that one of the markets would be chiefly Ford Asia Pacific Area even though other markets are under consideration presently.

There are several reasons for the impressive development of the Indian car business. A few of these are comparatively effortless availability of automobile finance, attractive rates of interest, and convenient installments.

Competitors has forced producers to be innovative and responsive to client demands and wants. Now that India just isn't alien to quality and perfection, consumer expectations have soared to increased levels. Depending upon customers needs, 4 segments - little, midsize, premium and sports utility vehicles at present represent the car market in the nation.

A niche idea cars segment is also emerging wherein reputed re-modellers like DC Chhabria cater to people who wish to remodel their vehicles to produce idea cars for their use. Contrarily, a segment is also emerging comprising of individuals who wish to upgrade to cars from two wheelers. Tata already is within the process of launching the small auto Nano to suit this segment's requirements. A lot of other automobile manufacturers such as Bajaj Auto are also following suit and are inside the approach of coming up with their particular versions to cater to this segment.

At the moment, there is high demand for cars across all these segments. With the growing economic system, individuals left having a lot of disposable earnings spend it towards meeting their mobility wants like cars. Banks as well as other economic institutions have an assortment of automobile loan schemes with appealing rates of interest and convenient installments.

These schemes encourage men and women to go in for loans to obtain cars of their choice. In addition, a convenient union spending budget inside the current economic year (2008-09) has worked in favour of the automobile sector, which has observed an uptrend in sales across different segments.

The most recent trend of new cars on Indian road has led to the emergence of an entirely new marketplace in second hand cars too. A lot of entrepreneurial and skilled dealerships have sprung up in numerous cities in India dealing in second hand cars.

The growth of the second hand market is just not surprising. The new car market has grown at an incredible pace in India. As mentioned, loans are effortlessly obtainable in the nation for purchase of new cars. Moreover, numerous individuals are now upwardly mobile. Consequently, individuals who had been earlier component of the little auto segment now have moved over to the premium automobile segment, and these in this segment have moved over to the luxury automobile segment.

As a result, the trend is to eliminate the cars that defined them as part of the earlier segments and purchase cars that identify them with the newer segments. Apparently, the desire for newer cars and models is yet yet another reason. People get attracted by newer models, which prompt them to acquire them. This makes them sell their present cars for reasonable resale values.

This phenomenon advantages people who wish to buy cars, but will not be capable to afford new ones. Numerous firms like Maruti Suzuki (Maruti Correct Value) have also established resale showrooms where people can purchase genuine, good problem, second hand cars at reasonable costs.

With the emergence of favorable trends inside the automobile sector in India, what remains to be observed is how these developments will go a extended approach to transform the mobility needs of the ordinary Indian.

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