Automotive

India’s automotive industry produced two million vehicles in 2014. India is the world’s largest manufacturer of tractors and second largest manufacturer of two-wheelers. By 2020, it is projected to produce at least six million units annually, becoming the world’s third largest automotive manufacturer.

Breakdown of automotive manufacturers in India:

  • 16 for two-/three-wheelers
  • 15 for passenger cars
  • 14 for tractors
  • 9 for commercial vehicles

The southern city of Chennai, dubbed the “Detroit of India,” is notable for its collaboration with foreign companies including Ford, Nissan, Datsun & Royal Enfield, and Renault. In the western city of Pune, 225 German companies and Indian automotive groups are located in the Chakan industrial area. In Mumbai, ports, roads, and skilled workers are favorable factors for companies such as Bajaj Auto, Mercedez-Benz, Tata Motors, and Mahindra & Mahindra. Other major car manufacturers are located in Kolkata in the east, Pithampur in the west, Bangalore in the south, and Gurgaon (near New Delhi) in the north. Gurgaon is home to Maruti Suzuki, India’s largest carmaker, which produces over 1.5 million small four-wheelers annually.

Out of the 16 most popular cars in India in 2015, the Ford Ecosport was the only American automobile on the list. Japanese and Korean companies such as Honda, Toyota, and Hyundai are the most popular. These companies often outshine Western brands by offering up-to-date assets such as keyless entry, long-life components, infotainment systems, and lightweight construction with aluminum and carbon fiber instead of the traditional steel.

A 2014 study by J.D. Power Asia Pacific demonstrated that Indian consumers are more likely to purchase cars based on brand distinguishability. Indian consumers are less interested in European and U.S. automotive companies such as Ford, Fiat, and Renault because their automobiles are difficult to distinguish.

Some of the major Indian automotive companies include Mahindra & Mahindra, Ashok Leyland, Hero MotoCorp, and Bajaj Auto. Mahindra & Mahindra is famous for SUVs and pickups. Ashok Leyland produces commercial vehicles as well as military vehicles and health units. Hero MotoCorp and Bajaj Auto are top two-wheeler manufacturers in India. Tata Motors is recognized as one of the most reliable and fuel-efficient brands in India. The company started out making light trucks and continues to do so.

India is also home to a boutique manufacturer, Chinkara Motors, known for its off-road Jeepster and sport car Roadster. Luxury cars such as BMW and Mercedes Benz are popular among India’s upper class.

In 2015, the Maruti Alto, Maruti Swift, Hyundai Grand i10, Mahindra Bolero, and Honda Amaze were the most exported cars. Most exports from India are destined for Asia and Africa. India’s Maruti Suzuki is the second largest exporter after Hyundai. Major exports from India include motorcycles, passenger cars, tractors, and transportation vehicles. India’s $4.8 billion automotive exports greatly outweigh its $588 million imports.

Passenger Vehicles
Production of passenger vehicles (PVs) grows 13% annually and represents 51% of India’s automotive industry. In 2014, approximately 622,000 units were exported. The most popular PV models are the Tata Nano, Maruti Suzuki Alto, Maruti Suzuki Swift, Honda City, and Toyota Etios Sedan. Nearly a quarter of PVs in India are driven by chauffeurs so comfort is the most important factor for consumers. For utility PVs, the Mahindra Bolero and Mahindra Scorpio are the most popular; for vans, the Maruti Suzuki Omni and Tata ACE Magic.

Commercial Vehicles
Commercial vehicles (CVs) can be categorized into small, light, medium, and heavy. CV production is expected to grow 11% annually until 2021. Tata Motors and Mahindra & Mahindra are the top producers of light CVs in India.

Ashok Leyland is a leader in the production of medium and heavy CVs and specializes in rail and double-decker buses. Volvo India is a leading manufacturer for heavy-duty tippers (dump trucks) and luxury passenger buses.

Supplying India’s agricultural industry, the majority of medium and heavy CVs are tractors. Top tractor companies include Mahindra & Mahindra, John Deere India Private Ltd., Escorts, Balwan Tractors (Force Motors Ltd.), and Tractors and Farm Equipment Ltd.

Two-Wheelers
In rural areas, the public transportation infrastructure is underdeveloped. Therefore, consumers rely on private vehicles, preferring two-wheelers because of their small size and low cost. Among these, motorcycles are the most prominent followed by scooters, mopeds, and electric two-wheelers. Two-wheeler production is expected to grow 12% annually until 2020.

This industry is dominated by Hero Honda Motors, Yamaha India, and TVS Motor Company. Some of the most popular motorcycles in India are the Yamaha FZ-S (Fazer), TVS Apache RTR 160, and Honda CB Trigger STD.

Three-Wheelers
Three-wheelers are convenient alternatives to vehicles that congest India’s narrow roads. The most prominent are auto rickshaws, used in urban areas as passenger carriers, goods carriers, delivery vans, mobile shops, and tankers. Three-wheeler production grows 8% annually.

With small engines and high mileage, three-wheelers are mainly used as taxis and are most common among people without their own forms of transportation but do not utilize public transportation. Bajaj Auto is one of the leading manufacturers for two- and three-wheelers. Piaggio Vehicles is also influential in the three-wheeler industry.

With high consumer demand and widespread foreign investments in India, the country’s automotive industry will continue to flourish. To meet the increasing desire for inexpensive, modern, and efficient automobiles, the sector has to continue evolving to keep up.

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