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Indian Auto Industry

Submitted by niko123 on March 23, 2008

Category: Business
Words: 2203 | Pages: 9
Views: 273
Popularity Rank: 39,730
Average Member Grade: N/A (Add a Comment / Grade this Paper)

1] INDIAN AUTO INDUSTRY : OVERVIEW

The automobile industry in India is the eleventh largest in the world with an annual production of approximately 2 million units , the 2nd largest two wheeler market in the world and the 4th largest commercial vehicle market in the world. India is expected to overtake China as the world's fastest growing car market in terms of the number of units sold and the automotive industry is one of the fastest growing manufacturing sectors in India . The industry has grown at a CAGR of 14% p.a over the last 5 years, with sales of 9 million vehicles in 2005-06 .Because of its large market (India has a population of 1.1 billion; the second largest in the world), a low base of car ownership (7 per 1,000 people) and a surging economy, India has become a huge attraction for car manufacturers around the world.
The automotive industry directly and indirectly employs 13 million individuals in India. The industry is valued at about US$ 35 billion contributing about 3.1% of India's GDP (nominal). India's cost-competitive auto components industry is the second largest in the world. In addition, India's motorcycle market is also the second largest in the world with annual sales of about 5 million units.
Though several major foreign automakers have their manufacturing bases in India like honda and kawasaki, the Indian automobile market is dominated by domestic companies. Maruti Suzuki is the largest passenger vehicle company, Tata Motors is the largest commercial vehicle company while Hero Honda is the largest motorcycle company in India. Other major Indian automobile manufacturers include Mahindra & Mahindra, Ashok Leyland and Bajaj Auto.
While automobiles were introduced to India in the late 1890's, the manufacturing industry only took off after independence in 1947. The protectionist economic policies of the government gave rise in the 1950's to the Hindustan Motors Ambassador, based on...

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