Tata Motors: Struggling for Leadership
Indian Automobile Industry at a Glance
India is the sixth largest automobile producer in the world and its automobile industry accounts for 22% of the country’s manufacturing gross domestic product (GDP). Over the years, the Indian automobile market has evolved from being a sellers’ market to a consumers’ market. The Indian auto industry is expected to grow at a CAGR of more than 10% over the period of next 7 years. The Indian automobile industry is well positioned both demographically and geographically as it can serve both domestic as well as the export markets. A growing economy, increase in the disposable income, easily available vehicle financing, better road infrastructure, increase in the working population and general prosperity of the Indian population are the driving forces behind the growth of the Indian automobile industry.
The Indian automobile industry can be divided into four categories – two-wheelers, three-wheelers, passenger cars and commercial vehicles.1 Globally, India is the second largest two-wheeler market, the fourth largest commercial vehicle market, and the eleventh largest passenger car market. India is also Asia’s fourth largest exporter of automobiles, after Japan, South Korea and Thailand.2 The industry produced a total of 23,366,246 vehicles including passenger vehicles, commercial vehicles, three wheelers and two wheelers in FY2014- 2015 as against 21,500,165 in FY 2013-2014, registering a growth of 8.68%. Automobile export volumes increased to 35, 73,806 vehicles in FY 2014-15 from 31, 10,584 vehicles in FY 2013-14, registering a growth rate of 14.89%. Exports of Passenger Vehicles, Commercial Vehicles, Three Wheelers and Two Wheelers grew by 4.42%, 11.33%, 15.44% and 17.93% respectively during FY2014- 15 over the last year.3 ............................
1 “Indian Automotive Market-Trends and Forecast (2010-2015)”, http://www.marketsandmarkets.com/Market-Reports/indianautomotive-market-trends-and-forecast-market-research-148.html (Accessed on 11/10/2015)
2 “Automobile Industry”, http://www.frontline.in/static/html/fl2820/stories/20111007282011800.htm (Accessed on 12/9/2015)
3 "Society of Indian Automobile Manufacturers - Automobile domestic sales trends”, http:// www. siamindia. com/ statistics. aspx?Mpgid=8&pgidtrail=14 (Accessed on 12/9/2015)