Automobiles Market Opportunities & Growth in India : Report IBEF – July 2019

India could be a leader in shared mobility by 2030, providing opportunities for electric and autonomous vehicles. India has significant cost advantages; auto firms save 10-25 per cent on operations vis-à-vis Europe & Latin America. India became the 4th largest auto market in 2017 with sales increasing 9.5 per cent year-on-year to 4.02 million units in 2017.Honda Cars India had a cumulative growth of 3.7 per cent year-on-year by selling 134,797 units during April-December 2018.As of February 2019, Bajaj Auto will launch its new all electric brand Urbanite in India in the coming six to nine months. The luxury car market in India is expected to grow at 25 per cent CAGR till 2020.Audi is launching its luxury electric SUV in India in 2019.Luxury Vehicles Premium motorbike sales in India crossed one million units in FY18.

Volvo plans to assemble hybrid electric cars in India and scale its market share to 10 per cent by 2020 in Indian luxury car segment. Auto finance business of NBFCs in India is expected to grow at a CAGR of 15 per cent by FY20 on the back of better macroeconomic environment and government’s focus on infrastructure and rural areas. As of October 2018, Honda Motors Company is planning to set up its third factory in India for launching hybrid and electric vehicles with the cost of Rs 9,200 crore, its largest investment in India so far. Volvo plans to come out with hybrid version of its upcoming S60 sedan in India along with a PHEV version of the S60. Avan motors, an electric scooter start up announced in December 2018 that it plans to have total sales of 100,000 units in the coming two to three years. Electric Vehicles As of December 2018, local arm of Finland based energy company Fortnum India is planning to install about 720 charging facilities for electric vehicles by 2020 in seven cities in India. 

EV Motors, in partnership with DLF, ABB India and Delta Electronics, is also planning to invest US$ 200 million to set up 6,500 electric vehicles charging stations in the next five years. In May 2019, Nissan Motor Company received a patent for wireless charging of electric vehicles in India. Honda is planning to launch three new car models in India by 2020 and will localize the engines to keep the prices low. Hyundai will launch its first electric vehicle in India in 2019.Maruti Suzuki is planning to start testing prototypes of its electric vehicles in India in October 2018.Launch of new models Superbike seller Motorcycle Kinetic Pvt Ltd is planning to develop 300cc-500cc bikes in India by 2021.As of November 2018, Volvo Cars India Ltd is planning to launch four plug-in hybrid vehicles in the next three years. Initiatives like ‘Make in India’, ‘Automotive Mission Plan 2026’, and NEMMP 2020 to give a huge boost to the sector.

 The Government of India has introduced a policy which allows organizations and researchers to buy bulk data related to vehicle registrations on an annual basis.5.09 per cent of total FDI inflows to India from April 2000 to March 2019 went into the automobiles sector. In 2018, automobile manufacturers invested US$ 491 million in India’s automobile industry start-ups, according to Venture intelligence. Under the scheme, the Government of India is planning to provide grants of up to Rs 105 crore to each of the selected city with population of more than a million, for buying electric buses, cars and three-wheelers in FY18.The company plans to launch eight new car models in India by 2021.Hyundai Plans to invest US$ 1 billion in India by 2020. In March 2018, SAIC announced that its subsidiary MG Motor India will invest Rs 5,000 crore in India over the next six years. Mercedes-Benz Increased the plant capacity of 20,000 units per year in Chakan Plant, which is the largest for any luxury car manufacturer in India. Honda Motor Company As of October 2018, Honda Motors Company is planning to set up its third factory in India for launching hybrid and electric vehicles with the cost of Rs 9,200 crore, its largest investment in India so far. General Motors, Nissan & Toyota announced plans to make India their global hub for small cars.

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