India's Automobile Industry Accelerates: 2.7 Crore Vehicles Manufactured

According to a recent report, the Indian automobile industry has achieved a remarkable feat by producing a staggering 27 million vehicles across various segments and types in FY23. This impressive output amounts to a total value of approximately USD 108 billion (Rs 8.7 lakh crore). The passenger vehicle segment contributed significantly, accounting for 57 percent of the total value, reaching Rs 5 lakh crore. The findings were presented by management consulting services firm Primus Partners.

In terms of volume, the commercial vehicle segment comprised 10 million vehicles, encompassing a range from small 4-wheel carriers with a capacity of less than 2 tons to large tractor trailers and specialized vehicles like tippers. The commercial vehicle segment's value amounted to Rs 1.7 lakh crore, representing 4 percent of the total volume and 19 percent of the total value.

The report also highlighted that China closely matches India's two-wheeler production, with 20 million two-wheelers manufactured in the country, accounting for 77 percent of the volume share. The two-wheeler segment in India, overall, accounted for Rs 1.8 lakh crore, contributing 21 percent to the total value.

Furthermore, the Indian automobile industry employed a significant workforce of 19 million people during this period. Within the passenger vehicle segment, the report revealed that the mid-size and full-size SUV sub-segments accounted for over half of the total value. The compact sub-segment was also noteworthy, generating 25 percent of the value. Luxury vehicles made a notable contribution of Rs 63,000 crore, representing 13 percent of the segment's value.

However, the report pointed out that the demand for cheaper "Mini" cars and sedans was declining, resulting in their lower share in value. On the other hand, the electrification trend gained significant traction in the two-wheeler and three-wheeler segments. Although India's electric vehicle (EV) industry still trails behind leading countries such as China, the United States, and the European Union, substantial investments have been made in India, indicating the country's potential to substantially grow its EV segment in the coming years.

The report concluded by stating that the Indian automobile industry is currently undergoing unprecedented changes, driven by various factors that are reshaping the landscape. With substantial investments and evolving trends, India is poised for significant growth in its automotive sector in the near future.