Summary:

According to S&P Global Mobility, India is set to lead global light vehicle production growth with a compound annual growth rate (CAGR) of 4.6% from 2023 to 2033. This surpasses the previous decade's CAGR of 4.1%, solidifying India's role as an industry leader. By 2023, India will be the fourth-largest producer of light vehicles, manufacturing 5.4 million units, ahead of Germany and South Korea. In contrast, Mainland China’s CAGR is forecasted at 1.7%, the US at 0.3%, and Japan and South Korea are expected to decline by 2% and 2.6%, respectively.

Despite these promising projections, India faces challenges in the electric vehicle sector, such as limited charging infrastructure and high production costs, which could impact sales. High inventory levels may lead to greater discounts and more aggressive export strategies. Mr. Gaurav Vangaal of S&P Global highlights that India remains a stable market with significant foreign investment, despite a low vehicle penetration rate of 38 per 1,000 people. Rising vehicle prices, driven by Bharat Stage-VII emissions standards, may affect demand, particularly if first-time buyers decrease after the pandemic-driven surge.

Source: IBEF 

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