After a decade of owning two Maruti Suzuki India Ltd. minicars, Koravangattu Vinayraj says he's craving a change.
"I've always wanted to buy a global car brand," said the 36-year-old rubber industry executive in the southern Indian state of Kerala. "In the past, there weren't many options available for small cars."
Carmakers including Toyota Motor Corp. and Honda Motor Co. are unveiling at least six vehicles this week at the Delhi auto show. They aim to lure buyers like Vinayraj, part of a 50 million-strong middle class that's boosting Indian car sales while demand slumps in the U.S. and Europe. The surge of new models may pose the biggest challenge yet to the local dominance of Suzuki Motor Corp., which controls half of India's market.
"There will be more choices and some of Suzuki's market share will be eaten up," said Puneet Gupta, a New Delhi-based analyst at consultant CSM Worldwide Inc.
Maruti, the Indian unit of Hamamatsu, Japan-based Suzuki, may lose up to 5 percentage points in the next two years, Gupta said. India is Suzuki's biggest market, accounting for about 42 percent of its global vehicle sales.
Ford Motor Co., General Motors Co. and Volkswagen AG are all building plants and introducing new cars in India, the world's second-fastest growing major economy, as annual sales may double to 3 million units by 2015, according to government estimates.
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Surging sales in India and China -- set to dislodge the U.S. as the world's biggest automobile market when 2009 numbers are tallied later this month -- contrast with closing of factories and firing workers in the U.S. and Europe. Maruti's stock almost tripled last year and Suzuki will maintain its market share by introducing cars and expanding its sales network, said Hideki Taguchi, a company spokesman.
"We are aware that India now isn't in a situation where we can be the sole winner," Taguchi said. "But this doesn't mean that we will give up."
India is one of the few markets that continues to grow amid the global recession, said Jnaneswar Sen, vice president of Honda India.
Some 1.8 million visitors are expected at the biennial Auto Expo 2010 starting in Delhi tomorrow, said the Society of Indian Automobile Manufacturers. Honda will hold a world-premiere of a compact vehicle at the show, choosing India for the concept vehicle ahead of the North American International Auto Show in Detroit later this month.
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