The distinct revival of demand for vehicles of all categories and the sustained rise in production have once again been confirmed by SIAM’s latest assessment of the auto sector prospects. The statistical details released by SIAM reveal an overall vehicle production growth of 13.83 per cent during March-April 2012 as compared to the same period last year. The industry produced an aggregate 20,366,432 vehicles during 2011-12, of which the share of two-wheelers and passenger vehicles were 76 per cent and 18.20 per cent respectively and that of three-wheelers and CVs four per cent each. Vehicle sales were on the increase all along, and the only segment that lagged behind was three-wheelers, sales of which dipped by 2.3 per cent. Overall automobile exports at 2,950,055 units reflected a handsome growth of 25.44 per cent.
The performance of the Indian auto industry is considered exceptional in view of the fact that individual economies across the world, both developed and developing, are still reeling under the impact of the general US slowdown and the EU debt crisis. However, India and China, with their resilient economy, have not merely weathered the situation but keep attracting overseas attention as emerging global auto powers. With economic fundamentals remaining strong, the two were perhaps the first to come out of the worldwide recession of 2008. The Indian auto industry has also the distinction of having registered double-digit growth for three years in a row immediately preceding the recession when even the industry in Western nations reported neglible or nil growth.
Of course, the industry is now beset with certain unavoidable adverse factors like the irksome rise in world crude prices that leads to periodic increase in auto fuel prices and the Government move to deregulate diesel prices. Of immediate concern to the Government are the threat by oil marketing companies (OMCs) to raise petrol prices unless offered a price subsidy and cut in excise, the truckers’ resentment of the decision to deregulate diesel prices, and the hike in prices announced by car manufacturers, one after another, in view of the higher excise burden. All this however won’t impede growth, and the Indian auto industry would remain a major attraction, with several MNCs having already set up plant and others waiting in their wings to enter the market.