Rising Demand of Indian Cars in The Overseas Market

Demand for Indian cars in the overseas market is on the rise. Indian car makers are expanding their overseas presence more fiercely than ever, and that too at a time when global automakers are busy buffering themselves against soaring fuel prices. This has been reflected in the exports figures of the recently ended fiscal report. Export of Indian cars witnessed a robust 33.23 per cent growth.

According to the Society of Indian Automobile Manufacturers (SIAM), export of Indian cars from the passenger car segment touched a figure of 4,41,710 units in FY10 against 3,31,535 units in the previous financial year. The increase was primarily driven by the demand for Indian cars in the small car category in the European nations, which offered handsome incentives to those buying new cars in exchange of their old ones under a “scrappage incentive program.”

Indian car makers who reaped the maximum benefits from this incentive program included Hyundai Motor India and Maruti Suzuki India. On an overall basis, export of Indian cars grew by 17.90 per cent at 18,04,619 units in 2009-2010, which was at 15,30,594 units in 2008-09.

However, in a not-so-interesting recent turn of events, the scrappage incentive program got withdrawn from the European nations, and now the Indian auto industry experts and car manufacturers fear that this will hit the export of Indian cars to the overseas market rather badly. Another reason that is being sited for the prospective slump in the export of the Indian cars is the recent rise in demand for Indian cars in the domestic market.

Indian car market is poised to grow by an impressive 12-15 per cent this year, and the production facilities of the major car manufacturers are already in stretch and are struggling to meet the rising domestic demand. Now, whether the car majors are successful in living up to the demand of Indian car market while delivering a decent export figures at the same time, only time will tell.