India was the fifth-largest automobile market, with around 3.81 million units combined sold in the passenger and commercial vehicles categories. It was the seventh largest manufacturer of commercial vehicles in the year 2020. The two wheelers segment dominated the market in terms of volume owing to a growing middle class and a nascent population.
Electric Vehicle Segment
India's electric vehicle (EV) market is estimated to be a Rs. 50,000 crore (US$ 7.09 billion) opportunity by 2025, with two- and three-wheelers expected to drive higher electrification of the vehicles. EV sales, in India witnessed a growth of 20% and reached 1.56 lakh units in FY20 driven by two wheelers. According to Industry sources, India's EV finance industry is likely to reach Rs. 3.7 lakh crore (US$ 50 billion) in 2030.
Domestic automobiles production increased at 2.36% CAGR between FY16-20 with 26.36 million vehicles being manufactured in the country in FY20. Overall, domestic automobiles sales increased at 1.29% CAGR between FY16-FY20 with 21.55 million vehicles being sold in FY20. Two wheelers and passenger cars accounted for 80.8% and 12.9% market share, respectively, accounting for a combined sale of over 20.1 million vehicles in FY20.
Overall, automobile export reached 4.77 million vehicles in FY20, growing at a CAGR of 6.94% during FY16-FY20. Two wheelers made up 73.9% of the vehicles exported, followed by passenger vehicles at 14.2%, three wheelers at 10.5% and commercial vehicles at 1.3%.
The Indian Automobile industry has attracted Foreign Direct Investment (FDI) worth US$ 24.62 billion between April 2000 and September 2020, according to the data released by Department for Promotion of Industry and Internal Trade (DPIIT).
Indian automotive industry is expected to reach Rs. 16.16-18.18 trillion (US$ 251.4-282.8 billion) by 2026. The Indian auto industry is expected to record strong growth in 2021-22, post recovering from effects of COVID-19 pandemic. Electric vehicles, especially two-wheelers, are likely to witness positive sales in 2021-22after a major slump due to Covid lockdowns. The luxury car market is expected to register sales of 28,000-33,000 units in 2021, up from 20,000-21,000 units sold in 2020.
INDIAN AUTOMobile INDUSTRY AT A Glance IN 2017 - 2018