HIGH PRIORITY MARKET- AUTOMOBILE
RISING INCOME AND MIDDLE-CLASS POPULATION DRIVING GROWTH IN DOMESTIC DEMAND
Increasing income and middle-class population
GDP per capita has grown from USD1,430.19 in 2010 to USD1,595.7 in 2014, and is expected to reach USD2,128.78 by 2018( E).
Apart from the impact of rising incomes, widening of the consumer base will also be aided by expansion of the middle class, increasing urbanisation, and changing lifestyles.
A young population is boosting demand for cars.
Demand for commercial vehicles increased due to the development of roadways and greater market access.
Changing income dynamics of India’ s population
Source: IMF, World Bank, McKinsey Quarterly, TechSci Research Note: E-Expected
EASIER ACCESS TO CREDIT A KEY DETERMINANT OF GROWTH IN AUTOMOTIVES
Easy availability of credit
Greater access to credit eases the purchase of passenger and commercial vehicles.
Indian car finance market size
The Indian car finance market is growing at a CAGR of 13.20 per cent from the year 2010-15 and it is expected to grow to USD30.43 billion by 2020.
BMW, Audi, Toyota, Skoda, Volkswagen and MercedesBenz have started providing customized finance to customers, dealers and suppliers through dedicated Non-Banking Finance Companies( NBFCs).
Source: Kotak Mahindra Prime, TechSci Research Note: Greater distributional efficiencies, increasing demand( especially from rural areas) due to rising disposable incomes have created new markets for products within the country mn – million; bn- billion
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