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India’s Car Exports Inflated by 35% in First Half of FY2010
Oct 30, 2009

India’s car exports grew by over 35% in the first six months of FY2010, largely assisted by the scrappage scheme running in European market.
 
As per the recent statement of the Society of Indian Automobile Manufacturers Association (SIAM), Indian car exports surged by 35.73% in the first six months of this fiscal (2009-10), despite the decline recorded by other segments of the industry, reported The Economics Times.
 
Overall, 808,455 Units of vehicles were exported from India during the first half of the current fiscal against 774,302 Units exported during the corresponding period of last fiscal, representing an increase of around 4.41%.
 
However, rest of the industry segments recorded fall in overseas sales during the same period. Motorcycle exports were slightly down at 497,611 Units during April-September 2009 from 502,031 Units during the same period of the previous year.
 
In the domestic market, passenger car sales surged by 14.75% while that of utility vehicles and multi-purpose vehicles grew by 3.47% and 21.90% respectively during the same period. Entire credit for this upsurge in Indian car exports goes to the scrappage incentives being offered in Europe. In May 2009, the European Union members had announced to offer incentives on the purchase of new cars in exchange of the old ones. The scrappage scheme will last till February 2010.
 
India’s largest car maker Maruti Suzuki led the growth in exports. The company’s overseas shipments surged over two folds during April-September 2009 to 65,752 Units from 29,699 Units during April-September 2008.
 
Similar trend for the future has been projected by RNCOS in its industry research report “Indian Automobile Sector Analysis”, which states that India’s passenger car exports are expected to increase at a CAGR of around 20% between 2009-10 and 2012-13. Citing the reasons for this forecast, the report says that developed markets are under immense pressure to slash the cost of passenger cars while their cost of production is radically increasing. Thus, exporting low-cost passenger cars overseas can largely benefit Indian automobile market.
 
According to a Research Analyst at RNCOS, “Although there are healthy growth prospects in the longer run (till 2012-13), the growth in India’s car exports remains uncertain in the coming months as the scrappage programme in Europe is subject to the condition that the funds allocated by the governments have not exhausted till the deadline. The growth of Indian car exports would be seriously affected once the scrappage programme is withdrawn.”
 
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