The Hindu : Kerala News : Passenger cars : Poised for greater heights

Online edition of India's National Newspaper
Saturday, Nov 10, 2007
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Kerala

Kerala

Passenger cars : Poised for greater heights

With a buoyant economy, the nation’s infrastructure development is all poised for a major expansion drive and in the process one particular industry that’s gaining much momentum is that of automotives, especially that of passenger cars. In totality, the automotive industry is all likely to achieve an impressive growth in recent future. The automobile industry in India is growing at a fast pace clocking an annual overall growth of 10-15%. According to industry sources, annually more than one million passenger vehicles are getting sold in India. With the market looking extremely good, more and more car manufacturers from across the globe are touching down in India while the already existing players are gearing up well with newer models to face the music.

The recent growth in car sales has, to some extent, been driven by liberalized financing options and also largely due to the enhanced income levels of the Indian middle class. Today, the car financing options have become so accessible that all kind of cars is being sold for a song, literally. With competition mounting by the day, not only financial institutions but also car manufacturers themselves have launched their own finance schemes, that too with attractions such as no down payment, easy equated monthly installments, zero processing fee and longer repayment periods. This has acted as a catalyst for car sales, in a big way.

Of late, the small car segment has witnessed an unprecedented growth largely due to the excise duty reductions brought into effect by the government. Till recently, the car retailers in India were concentrating on the metros. However, this age long attitude has undergone a sea change and today according to most retailers, the rural India is surfacing with amazing results in the sales of passenger cars. Finally, the car manufacturers have started acknowledging the huge potential that the rural India has in its fold. Resultantly, more and more makers of passenger cars are reaching out to small towns in the country with their sales and service networks.

The biggest car manufacturer in India and leader in small car segment, Maruti is confidently surging ahead with newer models like Swift, SX4 and Grand Vitara, thereby catering to every class of aspiring customers. However, the Indian major Mahindra & Mahindra and the top player in the utility vehicle segment is delighted by the success of Scorpio and is looking forward to consolidate their market with models such as Renault-Logan. The Honda, which has put the Indian cities on fire with their City, is all set to redefine luxury with their Civic. In between, the grand old warhorse of Indian roads, Hindustan Motors’ Ambassador is still going strong and despite all the competition is still a favourite with many.

Another complimenting factor is that more number of people are increasingly upgrading to new cars. According to a study, nearly two-thirds of all new car purchases were by people who already owned a car, while one fourth of them previously owned two-wheelers. Now an assortment of cars, from mid-size to big size, luxury to premium to utility cars, is flooding the Indian roads. As the car industry in India is rapidly growing, several global players are now vying with each other for better brand visibility and, many of them have either opened their manufacturing plants in India or are importing vehicles to cater to the huge market in the country.

Way back in the early nineties it was with the deregulation and economic reforms that the automotive sector in the country underwent a total change. It was both a qualitative and qualitative one. And soon the Indian roads witnessed a deluge of four-wheelers that were unbelievably more smoother, faster and comparatively cheaper too. Indians who were till the other day accustomed with machines such as Ambassador, Premier Padmini and Maruti were given an opportunity to choose from an array of world-class beauties. Today, even though there are plenty of models to choose from, majority of Indians still fancy one such dream machine that’s cheap on pocket and gratifyingly efficient on the roads. With the Tatas still working on the much awaited ’one-lakh wonder car’, the Indian roads are all likely to see a revolution of sorts in the passenger car segment in near future.

SUNIL NALIYATH

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