The Indian automobile sector has grown into a ₹8.7 lakh-crore ($108 billion) industry by producing 2.7 crore vehicles in FY23, management consulting firm Primus Partners said in a report.
Considering the production volumes, India ranks third in passenger vehicles (PV) and first in two-wheelers globally, the firm said.
Primus Partners said the PV segment grew to ₹5 lakh crore in FY23 and half of the revenue came from mid and full size SUVs.
It said the automobile industry registered an employment figure of over 1.9 crore, thus occupying paramount importance in the economy.
As per the report, while electrification has progressed well in two- and three-wheelers, it is still nascent compared with many countries.
“As per our study, the Indian market is bypassing the lower priced products and more value is being created in feature rich higher priced vehicles,” said Anurag Singh, Managing Director, Primus Partners. “We believe that the value growth is happening faster than volume growth,” he added.
According to the study, passenger vehicles accounted for the largest value share at 58%, while two wheelers accounted for the largest volume share at 77%.
“Passenger vehicles produced ₹5 lakh crore value. The mid size and full size SUVs sub segments accounted for over half of the value. The compact sub segment is also important and created 25% of value. The luxury vehicles contributed to ₹63,000 crore in value, or 13% of the segment,” the firm said in the report.
“People are not preferring the cheaper ‘mini’ cars and sedans and they have low share in value. The key manufacturers in this segment are Maruti, Hyundai, Tata, Mahindra, Kia, Toyota, VW and Honda,” it said.
India produced more than 10 lakh commercial vehicles ranging from a small four-wheel carrier with less than 2-ton capacity to large tractor trailers and specialty vehicles like tippers.
The commercial vehicles category, generating more than ₹1.7 lakh crore, accounted for 4% of volume and 19% of value.
The key manufacturers in this segment are Tata Ashok Leyland, Eicher, and BharatBenz.
As per the report, India retained the number one position in two-wheeler production, closely matched by China.
“Over 20 million two-wheelers were produced during 2022-23 accounting for 77% of the volume share. The overall segment accounted for ₹1.8 lakh crore amounting to 21% of value,” the firm said.
The key manufacturers in this segment are Hero Motocorp, Honda Scooters, Bajaj and TVS.
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