The Indian automotive industry has witnessed an unprecedented boom in recent years, owing to the improvement in living standards of the middle class, and a significant increase in their disposable incomes. The size of the Indian automotive industry is estimated between US$ 120.09 billion and US$ 155.12 billion by 2016. The industry is expected to touch the 10 million mark, to which the Commercial Vehicle Segment will be a major contributor. Industry experts peg the Indian Automobile sales growth at a compounded annual growth rate (CAGR) of 9.5 per cent - 13008 million vehicles - by 2010.

Production

Growth in consumer-spending habits has reshaped the industry which has spurred an enormous cost advantage in manufacturing, research and development (R&D), skilled labor, software, and design, encouraging leading automakers to perceive India as a global player in this sector.

Marked by consistent growth at a frantic pace, the automobile industry recorded production of a wide variety of vehicles - including over 1.76 million passenger vehicles, 0.54 million of commercial vehicles, and over 8.52 million two-and-three wheelers (scooters, motor-cycles, mopeds, and three wheelers) - in 2007-08.

Sales

Spurred by a huge demand due to increasing purchasing power, new product launches, coupled with attractive finance schemes and booming exports, automobile sales has been growing at a frenetic pace.

According to SIAM, cumulative growth of the Passenger Vehicles segment during 2007-08 was 12.17 percent. While Passenger Cars grew by 11.79 percent, Utility Vehicles and Multi Purpose Vehicles sales grew by 10.57 percent and 21.39 percent respectively.

Also, the Commercial Vehicles segment grew by 4.07 percent over the same period in 2006-07. Light Commercial Vehicles recorded a growth of 12.29 percent. Scooters and Mopeds grew by 11.64 percent and 16.63 per cent respectively.

Simultaneously, automobile Exports continued to grow at a robust growth rate of 22.30 per cent in 2007-08. While Commercial Vehicles exports increased by 19.10 per cent, Two Wheelers and Passenger Vehicles exports grew by 32.31 percent and 9.37 per cent respectively.

• Maruti Suzuki India, the country’s biggest car maker, recorded its highest ever annual sales (7,64,842 vehicles), registering a growth of 13.3 per cent in 2007-08 over 2006-07.
• Mahindra & Mahindra Limited (M&M) cumulative sales grew by 30 per cent in 2007-08- 2,31,355 units compared to 1,78,201 units in the corresponding period last fiscal.
• Hyundai Motors India Limited (HMIL) has shown a robust growth at 16.13 per cent with 360,934 units during 2007-08, against 310,787 units sold in 2006-07.
• SkodaAuto has sold 14,187 vehicles in 2007-08 against 12,444 in 2006-07, a growth rate of 14.06 per cent.
• General Motors India (GM), the wholly owned subsidiary of US-based General Motors Corporation, reported 71 per cent increase in domestic sales in 2007-08 - at 66,543 units against 38,857units in 2006-07.
• Mercedes-Benz India recorded a 59 per cent sales growth during the first quarter of 2008.
• Hero Honda, India's largest two-wheeler maker, sold a whopping 33,37,142 units in 2007-08, over 33,36,756 units sold in 2006-07.
• Motorbike exports from India grew to 3, 21,321 units in the April-August period this fiscal from 2,37,103 units in the same period last year.
• Honda sold 62,802 cars in 2007-08, higher than the 61,325 units sold in 2006-07.