With sales over 4.25 million vehicles (including passenger and commercial), India became the third largest vehicle market in 2022. China and the US are top two automobile markets worldwide both in terms of demand and supply. In a recent interview, RC Bhargava, the Chairman of Maruti Suzuki India Limited (MSIL) said that the India will become the largest car market in the next 5 years (i.e. by 2028), beating China and the US.
The country will receive new investments from OEMs (original equipment manufacturers) and witness export gains. In CY2022, China’s car sales figures stood at 26.86 million and a total of 20.75 million vehicles sold in the Indian market. The global automakers are witnessing sales decline in China and fixing their eyes on India. There is a strong market demand, thanks to the rising income (especially middle-class) and a huge youth population. In December 2022, a total of 1,557,238 units of the passenger vehicles, three-wheelers, two-wheelers and quadricycles were produced in the country.
EV is the next big thing!
India could also lead the shared mobility market by 2030 with increasing opportunities for electric vehicles and autonomous vehicles. Government aims to increase EV sales to 30 percent in the next 8 years including 80 percent for two and three-wheelers and 70 percent for commercial vehicles. In order to promote EVs, the government announced multiple promotional measures and policies in the past few years. The EV schemes include vehicle registration fees, monetary subsidies on EV purchases, low loan interest rates and exemption on road tax.
Fresh investments in India
Maruti Suzuki recently announced an investment of Rs 18,000 crore for its upcoming Kharkoda plant in Sonipat, Haryana. The investment will be made over the next 7 years. MG Motor India plans to invest over Rs 5,000 crore for its entire operations in the next five years. The British automaker will setup a new manufacturing facility, introduce new models (mostly EVs) and localize new technologies. Hyundai also aims to invest Rs 20,000 crore in a phased manner in Tamil Nadu onver the next 10 years. In its long-term investment plan, the carmaker will develop electric vehicles and modernized its vehicle platforms.
