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Indian Auto Industry

Auto is a growing sector with total annual domestic sales by the auto industry having crossed 10 million units mark in 2006-07. This translated into a compounded annual growth of over 15% during the last five years.

Almost all major international car manufacturers, from across the world are present in India ' and those that are not here have made announcement to this effect. The passenger vehicle market is dominated by compact cars and the rest of the market is fragmented, with about 12-13 manufacturers fighting for one-third of the market space.

Another characteristic of the Indian market is our low car penetration of 8 cars per thousand people (much less than other developing countries)' which indicates the scope for growth.

No doubt the demand is projected to grow over two-fold in the next few years expecting which various manufacturers have started / announced their plans to increase the production capacity. Compiling all the announcements, the total figure will exceed 4 million.

Growth Drivers of the Economy


	A high economic growth (over 7.6% GDP growth running since last five years),
	Favourable taxation & duty structure (along with excise duty seeing a downward trend, import duties
	on components has also been reduced recently)
	More number of and newer models available
	Developing road infrastructure,
	Widening reach of finance companies &
	Underlying changes happening in the demographic profile of the country as represented by
	a rising middle class; favourably skewed age profile and the huge two-wheeler population
	presents a good opportunity.