Maruti India sets its eyes on youth

The undisputed king of Indian auto market is all geared up to combat the slowdown witnessed in the car sales in the thriving Indian auto market which amazed the world with its remarkable growth in the fiscal 2010. In order to withstand the downturn in the stagnancy in the car sales in India Maruti India has set its eyes on the budding young India. The Indian auto czar is putting its meticulous efforts to understand the usage pattern of cars in India by the youth. India stands at the second position amongst the youngest nations across the globe after South Africa,the median age in India is 25 years.

Talking about the consumption pattern of the youth in India, there was a 24% increase in the household income, along with that a considerable hike (around 41%) was also seen in overall consumption in the year 2010 as per Mc Kinsey Global Institute.

The report further mentions that the average household income is expected to grow upto 28%. However it is also expected that the rate with which the urbanization is accelerating, the household income is likely to grow around 37%. The increase in the urban household income will lead to higher consumption and it is being expected that this growth would be somewhere around 43%.

McKinsey further estimates that in coming time a transportation is going to be heavy on pocket. Looking at the last decades trends it is noticed that in 1995 transportation expenses were around 11% which rose to 17 in 2005 and it is being estimated that it will touch 19% by 2015.

As per a research conducted by TNS some interesting facts have come up according to which the small car segment is expected to be benefited the most by the rapid urbanization is the premium compact segment which has swelled from 35% in 2005 to 41% in 2009. Similarly, it is the upper premium segment that's shown tremendous growth and opportunity in the past two years. From being 1% in 2005 to ~ 13 % in 2010.

According to McKinsey's latest consumption report, there will be a ten fold increase in the number of households able to purchase a new car by 2025. Incidentally,Maruti Suzuki is in an advantageous position here. In recent years, it has focused on designing compact premium offerings which include Swift, Ritz, A-star which have been lapped up by younger audiences.