All set for small car surge

In 2009, it was the tiny Nano that stole the headlines, if not the thunder. But the Auto Expo due in January promises big-bang launches galore, marking the optimistic turnaround mood for the industry that crawled out of a slowdown that hit the economy in 2008.

In 2009, it was the tiny Nano that stole the headlines, if not the thunder. But the Auto Expo due in January promises big-bang launches galore, marking the optimistic turnaround mood for the industry that crawled out of a slowdown that hit the economy in 2008.

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The intensifying crunch for space and a slew of planned launches only underline India's emergence as an automotive powerhouse not only in Asia but in the world.

“In India sales volumes in cars started to grow in the second half of 2009 and are expected to remain robust," said Rakesh Batra, partner and national leader, auto practice, Ernst & Young. "At the current monthly sales volumes, country's passenger vehicle volumes will cross total production of 2 million vehicles in 2010-11 and two-wheeler volumes will cross 10 million, setting new milestones."

While two-wheelers eye the one-crore mark, goodbyes are being said for the Bajaj scooter, which is being phased out by Bajaj Auto in what means a triumph of business logic over national sentiments — because two-wheeler is now effectively a synonym for the motorbike.

But the story is now definitely in small cars.

While US heavyweights General Motors and Ford would be launching small cars — Beat and Figo respectively in January, Japanese majors Toyota and Honda will showcase the concept versions of their small cars. While Toyota will launch the car in 2011, Honda will need one more year.

New entrants like world's third largest carmaker Volkswagen which has been slow in India will also debut its small car Polo and a sedan variant based on the same platform. Similarly French carmaker Renault and its Japanese counterpart Nissan are set to launch their respective hatchbacks during the year.

"The global slowdown has accelerated the progress of small cars worldwide and since India has always been strong in this, it is becoming a focal point for such activities," said Dilip Chenoy, director-general, Society of Indian Automobile Manufacturers.

Policy changes will affect the market landscape. The first would be the Bharat Stage (BS) 4 emission norms in 13 cities and BS3 in the rest of the country in April. Most cars would be upgraded, but some like 26-year-old Maruti 800 will fall by the wayside.