China and Indian car market boom

The fast developing car markets in China and India seem to inscribe a new wave of growth. The move comes in the wake of revival after undergoing a tough trough for more than two years. The projection for the Chinese car market is 24% growth to the sale of 17 million units of cars, buses and trucks in this financial year. The Indian market is set to make a serious come back to secure the second largest country status. It is expected that India will be able to deliver 3 million cars during the same period, which will still indicate a growth of 22% from its 2009 performance.

The International Organization of Motor Vehicle Manufacturers revealed that China is on the verge of overtaking its own production stint of 15 million units as India is equally on the rise to reach the 3 million mark. The period taken for assessment is the financial year of 2010-11 and the overall industry globally is expected to manufacture 74 million vehicles. In the view of this organization,China and India have become the back bone of the universal auto industry and the performance of these two countries is sure to wipe out the down fall in the industry.

This is evidenced with the growth of the global market by 42% during the first six months. This growth could be achieved duly through the sale volume in China and India, in addition to Brazil and North Korea. The secretary of SIAM expressed the opinion that Chinese car market saw its growth amidst leaps and bounds unlike the Indian car market which has tasted the large scale growth. The report said that the major constraint for the Indian segment is in production and otherwise India too could match China. The entire auto industry faced a tough phase in 2008 due to the economic downfall, which resulted with a fall to 4% sale of 70.5 million units. The condition in the next year was worse with a fall by 12.5% to the sale volume of 61.7 million units.

Prior to China making its pervasive invasion, the US and the Japanese car markets underwent a sliding stage with a fall of 34% and 31% respectively. The third larger volume country of that time Germany too succumbed to this fall by 14% with a sale of 5.2 million units in 2008. No country in the world escaped from this down fall during that phase and the performance rate of some countries was accounted by fall rate as Austria by 52%, Sweden by 49%, Ukraine by 84%, Russia by 60%, Uzbekistan by 43%. This accrued to the net fall of 13% with the overall sale volume of 61.71 million units in 2009.

The rise of the Indian car market to this level could be attributed to the entry of global players like BMW, Audi, Man Motors and VW from Germany, Navistar International from the US. All the companies are on optimistic view for the ensuing festival sale volume to boost the growth. China for its part is concerned about reaching 20 million mark in 2011 based on the growth rate of 15%, said the China Association of Automotive Manufacturers official.