India expected to become the third-largest economy by 2025
India was the only country in the top five global markets to experience double-digit growth. The global automotive industry has been impacted by the Covid-19-led pandemic. It has changed the way we think, eats, live, and very well move in every country. However, when it comes to global vehicle sales, India has surpassed Germany to become the fourth largest automotive market.
According to the most recent figures from OICA, the Organization Internationale des Constructeurs d’Automobiles, India sold 3,759,398 vehicles in 2021, compared to 2,973,319 in Germany. This equates to a nearly 26 percent difference.
India expected to become the third-largest economy by 2025
Surprisingly, India rose to fourth place in 2019 and was expected to become the third-largest economy by 2025. It is still possible for the country to reach the position, but it would require exceeding Japan’s sales of 4,448,340 units in 2021.
The Indian market offers opportunities because vehicle penetration in the personal mobility space is around 33 vehicles per 1,000, which is one of the lowest in the developed world.
Then there’s the demand for commercial vehicles driven by infrastructure and e-commerce. Indeed, according to industry observers, the segment is still in its prime.
However, given the ongoing challenges, particularly supply chain issues and fluctuations in key raw material prices, retail sales in the domestic market may not be as strong as one would like.
India was the only country in the top five global markets to experience double-digit growth
It’s also worth noting that, according to a recent CRISIL report, there’s a shift in the Indian passenger vehicle market, with growth in the premium vehicle segment (cars priced above Rs 10 lakh) outpacing growth in the entry-level segment.
It’s also worth noting that India was the only country in the top five global markets to experience double-digit growth (28 percent). Although China remains the largest market, automobile sales have remained almost unchanged. Similarly, the United States reported 4% growth, but it was lower than in 2019. In comparison to both 2020 and 2019, the Japanese market shrank to number three.
