NEW DELHI: Global car manufacturers jostled for attention at the opening of the Indian Auto Expo last week, attempting to revive buyers’ interest in a local market that is contracting for the first time in a decade.
The giant show on the outskirts of the capital will be used to launch 69 new vehicles for the Indian market, which local and foreign carmakers still see as a future growth center despite its present-day woes.
Last year car sales fell nearly 10 percent on an annual basis, the first fall in 11 years, and few see the prospect of a turnaround before national elections due by the end of May. Sales have been hit by a combination of slowing economic growth, high interest rates, rising fuel prices and low consumer confidence.
“We have no concern in the long term as incomes increase,” said Ravi Pisharody, head of commercial vehicles at Tata Motors. “The long term will be strong but there are uncertainties until elections.”
Despite a decade of often double-digit growth in annual sales, India counts just 16 cars per 1,000 inhabitants, compared with 39 in China or 1,000 in the US, according to industry figures. But while the general car market is contracting, the top end, dominated by Western luxury brands, is still growing strongly, analysts said.