projects4mp
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EXECUTIVE SUMMARY OF INDIAN AUTOMOBILE INDUSTRY:
The Indian Passenger Car market has undergone interesting transformation in the past fifty years. In the forty years since Independence the Indian passenger car Industry had seen very little activity and the consumer choice was restricted to only very few models. The government took a major initiative to introduce a new player to the Indian customers when it entered in to a joint venture with Suzuki Motors of Japan in 1983. Even then, the government ensured that it had the majority stake of 76 percent in the company, lest its control over the passenger car market would decrease. Maruti was a success story in India and people, who had been bored of the two bland models of Ambassador and Padmini, readily opted for the new model at a lower cost. Thus, Maruti emerged as the true “people’s car”. From 1984 to 1998, Maruti Udyog limited enjoyed a dominant position in the Car market with a market share of 82 percent. The government decided to deli censes the Passenger Car sector in 1993. Thus the market again underwent a major upheaval when the Korean, German, Japanese, American MNC’s started flooding the market with various models in all possible price segments. All of a sudden, the market was flooded with models of various size and prices. This greatly enhanced the choice of the consumers. But the large number of models did not lead to a corresponding increase in the demand for cars, and hence in the present situation the Indian Car market is afflicted with overcapacity. This is not hindering the MNC’s from entering the Indian manufacturing unit as their Export base.
It will really be interesting to closely watch the changes that are going to take place In this sector in the next 10 years. The future looks as if there will be major shakeouts in the Passenger Car market.
The Indian Passenger Car market has undergone interesting transformation in the past fifty years. In the forty years since Independence the Indian passenger car Industry had seen very little activity and the consumer choice was restricted to only very few models. The government took a major initiative to introduce a new player to the Indian customers when it entered in to a joint venture with Suzuki Motors of Japan in 1983. Even then, the government ensured that it had the majority stake of 76 percent in the company, lest its control over the passenger car market would decrease. Maruti was a success story in India and people, who had been bored of the two bland models of Ambassador and Padmini, readily opted for the new model at a lower cost. Thus, Maruti emerged as the true “people’s car”. From 1984 to 1998, Maruti Udyog limited enjoyed a dominant position in the Car market with a market share of 82 percent. The government decided to deli censes the Passenger Car sector in 1993. Thus the market again underwent a major upheaval when the Korean, German, Japanese, American MNC’s started flooding the market with various models in all possible price segments. All of a sudden, the market was flooded with models of various size and prices. This greatly enhanced the choice of the consumers. But the large number of models did not lead to a corresponding increase in the demand for cars, and hence in the present situation the Indian Car market is afflicted with overcapacity. This is not hindering the MNC’s from entering the Indian manufacturing unit as their Export base.
It will really be interesting to closely watch the changes that are going to take place In this sector in the next 10 years. The future looks as if there will be major shakeouts in the Passenger Car market.
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