INDIA: AUTOMAKERS BATTLE MOTORCYCLES

India faces an uphill battle as it attempts to grow its domestic car market beyond the 2 million units it currently sells each year. Considering there’s just over 1 billion people living there, 2 million is a leaf in a forest. After all, Australia sold just over a million cars last year. And China, the world’s most populous country, became the biggest automotive market with over 17 million cars sold.

So how can India, a country some forecast will be more populated than China by 2050, plan to go about doubling its automotive market? For one, you have companies like Tata which released the Nano, a car that costs about R15 200 (100 000 INR). In a market utterly dominated by scooters and motorcycles, Tata thought it’d hit the proverbial jackpot: build and sell a no-frills, small, cheap car and the masses will migrate from two to four wheels in droves. Not so apparently.

Only 83 000 Nanos have been sold so far, almost two years after launch. It turns out Indians, like South Africans, love their frills. Tata sells Indicas, Indigos and Vistas here. They all feature niceties like power steering and air conditioning. Other models even come with on-board DVD players. Anyone who’s travelled to India will know how hot it can get there. Without air con it’s almost unbearable. Why then, pay 100 000 Rupees to get cooked up inside your own car? Plus traffic and parking can be a nightmare, hence the massive popularity of scooters.

Nevertheless the well-heeled middle-class and the rich do buy cars. A lot. In February alone sales hit 189 008 units, from 154 132 in February 2010. More is set to come as manufacturers like Volkswagen, General Motors, Honda and Ford launch or prepare to launch a slew of new models in the country. Whether one of them finally succeeds in getting ordinary Indians off their beloved scooters and into cars remains to be seen.