Industry Overview

Since the first car rolled out on the streets of Mumbai (then Bombay) in 1898, the Automobile Industry of India has
come a long way. During its early stages the auto industry was overlooked by the then Government and the policies
were also not favorable. The liberalization policy and various tax reliefs by the Govt. of India in recent years has
made remarkable impacts on Indian Automobile Industry. Indian auto industry, which is currently growing at the pace
of around 18 % per annum, has become a hot destination for global auto players like Volvo, General Motors and
Ford.

A well developed transportation system plays a key role in the development of an economy, and India is no exception
to it. With the growth of transportation system the Automotive Industry of India is also growing at rapid speed,
occupying an important place on the 'canvas' of Indian economy. 

Today Indian automotive industry is fully capable of producing various kinds of vehicles and can be divided into 03
broad categories : Cars, two-wheelers and heavy vehicles.

Driving the most luxurious car has been made possible by the stiff competition in the automobile industry in India,
with overseas players gathering the same momentum as the domestic participants. 

Every other day, we have been hearing about some new launches, some low cost cars – all customized in a
manner such that the common man is not left behind. In 2009, the automobile industry is expected to see a growth
rate of around 9%, with the disclaimer that the auto industry in India has been hit badly by the ongoing global financial
crisis. 

The automobile industry in India happens to be the ninth largest in the world. Following Japan, South Korea and
Thailand, in 2009, India emerged as the fourth largest exporter of automobiles. Several Indian automobile
manufacturers have spread their operations globally as well, asking for more investments in the Indian automobile
sector by the MNCs. 

Potential of the Automobile industry

In 2008, Hyundai Motors alone exported 240,000 cars made in India. Nissan Motors plans to export 250,000 vehicles
manufactured in its India plant by 2011. Similar plans are for General Motors. 

Turnover of Automobile Manufacturers(In USD Million)

Year In USD Million
2002-03 14,880
2003-04 16,544
2004-05 20,896
2005-06 27,011
2006-07 34,285

The figures show that the automobile sector in India has been growing robustly. The market shares of the different
types of vehicles will clearly depict the demand pattern in this sector. 
 Domestic Market Share for 2008-09
Passenger Vehicles 15.96%
Commercial Vehicles 3.95%
Three Wheelers 3.6%
Two Wheelers 76.49%