According to data from the Society of Indian Automobile Manufacturers (SIAM), the apex lobby body for the country, India beats Germany and the UK to emerge as the world’s fourth largest vehicle market. The country registered sales of 1.64 million units from January to May 2017 to seal the fourth position beating European auto major Germany which saw sales of 1.60 million units during the same period.
China, US and Japan continue to hold the top three spots, selling 11.18 million, 5.43 million and 2.30 million cars, respectively. Despite the so-called economic slowdown in China the country remains the top consumer of automobiles.
India has also registered the highest growth amongst the top nine countries in passenger vehicle (PV) sales. India’s PV sales grew by 11.3%during the review period and Japan stood second with a growth of 9.05%.
The factors that have driven the growth in new car sales are deeper penetration levels, improving road network, greater buying abilities and addition of new affordable models.
India has 32 vehicles per 1000 people compared to around 800 vehicles per 1,000 people in the US, formerly the world’s biggest vehicle market. This shows the country has much more future growth potential in the auto market. But unlike the top vehicle markets, India's passenger vehicle demand is dominated by compact cars at below- INR 10 lakh value.
With popular auto majors like Maruti Suzuki, Hyundai, Tata Motors and new players like Peugeot, Kia, SAIC and Daihatsu strategizing expansion plans and lining up new models, India’s automotive market is set to hit new highs every year driving growth for the allied industries like metal casting, forging and rolling etc.
In the luxury car segment India is one of the smallest markets in the world. With less than 35,000 units per year, India’s sales number is humble in comparison to China which saw more than 1.65 million units of luxury car sales last year. However, India houses manufacturing facility of all the luxury automakers like Mercedes-Benz, BMW, Audi, Porsche and Jaguar Land Rover.
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The growth in automobile is a strong catalyst for the growth of aluminium industry. Aluminium consumption in the automotive is the highest in North America due to demand for lighter cars and strict fuel emission rules. However, with more focus on fuel emission and on electric cars, China and India would need more aluminium for their cars in near future. India has already announced its ambitious plan to shift to only electric cars by 2030. The quick growth in passenger vehicle segment marks a positive growth in the OEM sector, which is turning into aluminium slowly for lightweighting durability and cosmetic factors.
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