School of Management Sciences, Varanasi

India has been one of the most preferred markets for automobile manufactures. The demand for four wheelers and two wheelers has always been on rise since last 10 years. It is obvious that growing Indian economy based on increase on demand created a huge demand of automobiles in India. Although recent trends has put automobiles companies in dark clouds of recession. Recent statistics indicate that the growth of automobile industry which was stagnant in 2012-13 has declined in 2013-14. This has resulted in reduction in sales volume of these companies too. Well the most important question is who is to be blamed for this? The inflation hit Indian economy, increase in oil prices or failure of most cars to pass safety tests.

India is sixth largest market in terms of units sold. Credible projections suggest that it could become the third largest behind USA and china overtaking Germany, Brazil and japan, but with this recessionary trend the projections can be a paradox. A lot of cars and two wheelers are being sold in developing countries but the safety regulations lag 20 years behind standards. Air bags, rear seat belts, child safe seats are not mandatory in order to keep prices competitive. India has more than 140000 road fatalities every year, which needs to be blamed for making India most dangerous driving environment.

In this case the sentiment of the buyers must be understood and rethink of marketing strategies is very important. This year there has been a substantial increase on attention of buses, since a single bus can reduce 60 personal vehicles causing less accident, pollution and congestion. To make public transport robust in India, the roads and transportation methods must be improved. This again calls a need for good governance. And better roads can also be a factor in increasing the demand for cars.

Hence if the automobile industry wants to come out of the dark clouds of recession, they must need to put some great reforms. And this is the time when then need for innovation comes into being. The Auto Expo that starts form Wednesday will be very crucial for the customers as well as the automobile companies. The companies are launching as many as 70 new models that include cars, bikes, trucks and utility vehicles. This is the largest ever display which includes an entire pavilion of hybrids and electrics, which is a great change. However, the interest or the response that the companies will get from the customers will determine the future of automobile industry in India.

Contributed by:

Satyam Anand



School of Management Sciences, Varanasi.


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