India’s emergence in the global automotive marketplace is being cemented with a series of key announcements and new model launches at the Indian Auto Expo in New Delhi this week, according to SupplierBusiness.
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Bosch’s Indian unit is to invest 20 billion rupees (US$430 million) in India by the end of 2012 to expand in the country’s fast-growing automotive market. “India is witnessing a strong increase in demand for diesel engines,” the company, which is a major maker of diesel injection systems, said in a statement. A quarter of the investment is likely to be invested in research and development programmes.
Bosch is hoping to ride the country’s industrial growth, especially its booming automotive sector, which has seen sales spike on the entry of several overseas vehicle manufacturers and the higher purchasing power of the country’s burgeoning middle class.
Bosch Automotive Group chairman, Bernd Bohr, told a press conference that sales in India likely grew 5% to 68 billion rupees in 2009. He also said India, which currently accounts for about 5% of the company’s global auto business, is likely to account for 7–9% of its total auto business by 2017.
“India is a very important market for us, and it has been profitable as well,” Mr. Bohr said.
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By GlobalDataWhile the group didn’t give any domestic sales guidance for India in this calendar year, it said exports would remain flat. Bosch exported somewhere between 5 and 6 billion rupees worth of products from India in 2009.
The announcement is likely to be one of many as global automakers head to India unveil a slew of cheap, compact cars at India’s Auto Expo this week. The region is one of the few remaining growth markets, alongside China, for automakers.
Car sales in India, the world’s second-most populous country, are set to jump about 16 percent in 2010 to 1.4 million vehicles, buoyed by robust economic growth and government incentives, in contrast to a slump in many developed markets.
But growth potentials are not just restricted to vehicles. The tire industry in India is forecast to grow by 7–8% in 2011. Echoing the same view, two major tire manufacturers in the country, JK Tyre and CEAT have earmarked investment plans to expand their capacity in 2010-2011 and meet the likely rise in the demand.
JK Tyre sees the domestic tire industry to reach up to 270 billion rupees in the next financial year from the current 250 billion rupees (US$5.33bn, 31 December 2009), as a result of increasing demand for vehicles high demand from the automobile industry. In line with the expected growth, the company has planned a 12 billion rupee investment (US$255.89m) over the next two years in order to expand production in its car and truck radial segment. The company targets a growth of 20% in the next one year.
That, and the abundance of important new models waiting to make their world premiere at the Indian Auto Expo has industry insiders talking for the first time of a Delhi auto show that could rival or surpass the annual Detroit auto show in importance.
“The Indian auto industry and the Indian auto market have become internationally very important and therefore, no one can ignore this market,” said Mahindra & Mahindra’s automotive chief, Pawan Goenka, who is also the president of industry body Society of Indian Automobile Manufacturers.
“Even though the Detroit auto show immediately follows the Delhi auto show, there is full participation from all international companies and they are bringing in concept vehicles as well as launching brand new products.”
This article was supplied to just-auto by SupplierBusiness, an IHS Global Insight company.
