The favourable Indian market conditions are acting as a catalyst for luxury and premium carmakers, which are receiving impetus from new launches. The top-end carmakers have posted double-digit growth for the quarter ended June 30, 2013, with firms like Honda at 45 per cent and Audi recording 28.8 per cent, besides others.
India is emerging as an export hub for sports utility vehicles (SUVs). Global automobile majors are looking to leverage India's cost-competitive manufacturing practices and are assessing opportunities to export SUVs to Europe, South Africa and Southeast Asia too. India is also one of the key markets for hybrid and electric medium-heavy-duty trucks and buses.
Ford Motor Company is staking big on Asia-Pacific (APAC) markets, especially India and China. "Ford will export Figo and EcoSport models out of India. The Indian plants would support the market here, as well as other global markets," said Mr Alan Mulally, Chief Executive Officer, Ford.
The production of passenger vehicles in India was recorded at 3.23 million in 2012-13 and is expected to grow at a compound annual growth rate (CAGR) of 13 per cent during 2012-2021, as per data published by Automotive Component Manufacturers Association of India (ACMA).
Passenger car sales stood at 1.89 million units in 2012-13. Additionally, share of luxury cars to the total passenger car market of India is expected to increase to four per cent by 2020. The total number of passenger cars in India is likely to touch around 8 million units by 2020, as per Mr Boris Fitz, Director, Sales and Network Development, Mercedes-Benz India.
The industry produced 1.74 million vehicles in May 2013. The export of passenger vehicles and three- wheelers grew by 7.34 percent and 26.53 percent respectively during the April-May 2013, as per data released by Society of Indian Automobile Manufacturers’ (SIAM).
Furthermore, the amount of cumulative FDI inflow into the Indian automobile industry during April 2000 to April 2013 was worth US$ 8.32 million, amounting to 4 per cent of the total FDI inflows (in terms of US$), as per data published by Department of Industrial Policy and Promotion (DIPP), Ministry of Commerce.
With India becoming a magnet for car makers, Kochi in particular has emerged as India's strongest growing market for luxury car brands like BMW, Audi, Mercedes and Jaguar Land Rover on back of rising value of spices and rubber and ever-increasing inflows from non-resident Keralites. Kerala now accounts for 10 per cent of India's luxury car sales.