Indian Small Car Market This Year

The Indian auto industry is pushing aside another calendar year which has seen many fanciful moments. This is the year when the Indian automobile market saw the delivery of 4,50,000 small cars comprising Maruti Suzuki A-Star, Hyundai Santro, i10 and i20. The wings stretched beyond the nation to many trans nation lands especially the European market. This was due to the special offer waited in Europe - cash incentives for scrappage scheme. But for this scheme, the Indian small cars would have to struggle in the export markets. The scheme was in other form in the UK where the scrappage scheme deserved 2000 pounds and the plan had been there for more than 10 years. This resulted with delivery of more than 4 lakh cars, said UK"s Society of Motor Manufacturers and Traders.

As a result of such schemes, the export volume of India"s small cars doubled to 44,000 for two years since 2008. As of now the export volume of India is 25%.The marketing director of Hyundai said the local economy spree has envisaged the European market in large competition. Hyundai"s export volume in 2009 was 2,70,000 units compared to 12,7000 units in 2007. The export volume slipped by 2% upto this November due to the withdrawal of scrappage scheme in European market. The Indian export volume constitutes just 1% of worldwide volume amidst reports from Nissan, Toyota, Suzuki, Ford and VW claiming to boost this export volume even in the absence of any schemes. The major contributory for the Indian car export is the small car segment as it seems to occupy 75% of the anticipated 1.8 million export units.

The Chairman of Maruti Suzuki said India is equally competitive in the small car segment. For Suzuki, India is the largest export hub for its small cars having one third of is net overseas turnover. A-Star is exported to over 100 countries though it is made in India it is exported mainly to Europe as Suzuki Alto. The same car is marketed by Nissan as Pixo. However, the export potential of the Indian car market hit the headline with the arrival of Hyundai to India some 14 years ago. The company landed into India for availing low labor, excellent vendor base and the growing economy.

Hyundai initiated its marketing with its Santro which is still one of the popular brands in India with sale of 1.6 million annual units. Thus Hyundai shifted its export base from its apex Korea to India. Hyundai has extended since then with its brands as Santro is exported as Atos in overseas markets. In addition the company sells i10, i20 and Accent in more than117 countries with 50%sale volume coming under export market. The margin from this small car is relatively less both in domestic and in overseas market. India fits in this cost efficiency as the companies avail a minimum of 10-15% less cost in Indian production, said the President of Ford India. The companies are able to offer good small cars at affordable prices even after meeting the logistics cost and transportation.

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