Soaring automobile sales point to resurgent economy: Advani
Deputy Prime Minister on Thursday said soaring automobile sales are a key sign of the country's booming economy but urged the launch of low-cost cars to keep the momentum going.india Updated: Jan 15, 2004 17:55 IST
Deputy Prime Minister on Thursday said soaring automobile sales are a key sign of the country's booming economy but urged the launch of low-cost cars to keep the momentum going.
Advani said despite rising incomes, cars and other vehicles are still beyond the reach of a majority of the rural population.
"Just imagine, if only we had a people's car costing no more than 100,000 rupees, how many millions of people would be queuing up to buy it," Advani said at the launch of Auto Expo, Asia's largest automotive show.
"The challenge before you therefore is to bring down the cost of vehicles and make them more affordable," he added.
India's 1991 economic liberalisation has ushered in a virtual automobile revolution with dozens of models on offer from global car giants such as Ford, Fiat, General Motors and Toyota jostling for space on crowded roads.
Only a decade ago, India's bulky Ambassador car and an old-fashioned Fiat model were virtually all that one could see on the roads.
The lowest-priced cars in India cost around 250,000 rupees, a sum affordable to mostly middle class urban families with the help of cheap loans extended by banks and other lending agencies.
"Economic developments are now percolating into rural India, raising aspirations and expectations," said Advani.
"Almost always, the first thing a rural citizen wishes to spend his increased disposable income is on a vehicle -- perhaps a motorcycle. As his prosperity increases, he wants a tractor and perhaps, thereafter, a four-wheeler," he added.
India's car sales for April to December surged by more than 25 percent to 484,029 from 381,462 in the same period a year ago, data released by the Society of Indian Automobile Manufacturers (SIAM) showed.
The jump in sales has come on the back of a resurgent economy that is expected to clock at least seven percent growth in the year to March 2004.
Jagdish Khattar, Managing Director, Maruti, said he expected car sales to rise by 28 to 29 percent in the fourth quarter.
The automobile industry's contribution to the economy is likely to rise rapidly beyond the current level of two percent with a host of global companies increasingly importing components and cars made here, industry experts say.
Khattar said the automotive show would help the Indian industry showcase its capabilities to the world.
Former Confederation of Indian Industry president Subodh Bhargava said more than one million visitors were expected to visit the exhibition which has 960 companies participating from more than 36 countries.
Several automobile firms including DaimlerChrysler AG, Hyundai Motor of South Korea, Japan's Suzuki Motor Corp and India's Tata Motors are expected to unveil new models that will be launched in India.