The future of Indian Auto Exports

Almost 450,000 hatchback, which includes such as Maruti A-Star, Hyundai i10, Hyundai i20 and Hyundai Santro were shipped to the European auto market. The overseas auto market gave cash incentives to the buyers in Europe which helped them to get a new car in exchange of an old wagon for environment protection, have experienced a halt. The question, however arises if the Indian small cars will swim abroad or not.

India auto market is best known for its small car business and it has been supplying that in the global auto market but as Europe opened the gates by introducing the 'scrappage' schemes, the exports sped up. As per the UK's Society of Motor Manufacturers and Traders said that, the UK government gave £2,000 bonus to the one who scrapes their 10 year old car which raised the demand for almost 400,000 units. This scheme led to double the car exports to 440,000 from India in just two years till 2009-10. In India, one car is exported for every four units rolled out in India. Arvind Saxena, the Director-Marketing and Sales at Hyundai Motors India, said that, the local auto markets make the auto giants competitive in Europe.

But as the European government removed the incentives against the scraping of the old cars in the beginning of this year, the exports moved down to 2 per cent (in the first eight months of the current fiscal year). The Indian automobile exports contributes only 1 per cent across globe. However, the big players such as Ford Motors, Toyota Motors, Nissan Motors, Suzuki and Volkswagen will be able to survive even without incentives.

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In India,exporters is hoping to roll out 1.8 million cars. RC Bhargava, the Chairman, Maruti Suzuki India, said that, in the small car market, India can give competition to any other accomplished market in the world. Suzuki is the biggest exporter base for the small cars which contributes to one-third of the worldwide turnover. The small car Maruti A-Star is exported primarily is sold in as many as 100 countries, is manufactured in India is rolled out in European markets as Suzuki Alto and Pixo by Nissan.

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Hyundai entered in 1996, due to the growth, lost cost human resources, strong vendor base. It offered Hyundai Santro and established itself in the Indian auto sector and forced to shift the export from Korea to India. At present, the Hyundai India, exports almost 50 car models Hyundai Santro (Atos known in other auto markets), Hyundai i10, Hyundai i20 and Hyundai Accent in 117 countries and the car shipping registers to almost half of the auto giants sales.

The Indian auto market is cheap compared to the other auto sector. Micheal Boenham, the President for Ford India, said that, when the Indian auto market is compared with other auto markets 10-15 per cent reduction in the production cost is observed. Even transportation and logistics pricing, the car can be priced competitively.

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