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Growth Of The Indian Automobile Industry In FY 2018

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India is currently one of the largest markets in the world as far as automobile sales are concerned. Car manufacturers raised a toast for the financial year 2017-18 as it turned out to be one of their best in terms of sales. The industry registered double-digit growth between 1st April 2017 and 31st March 2018. The year also marked India surpassing Germany as the fourth largest automobile market on a global scale to stand right behind China, the US, and Japan.

The automobile industry in India observed a sales growth of 9.2% during the last financial year, as total sales hit 4.02 million units. In comparison, Germany saw a sales growth of 2.19%, selling 3.81 million units. These statistics are inclusive of commercial and passenger vehicles that were sold between April 2017 and March 2018.

Indian Automobile Industry

Expert Opinion:

Industry experts are of the opinion that FY18 was a landmark in the history of automobile sales in India. The volume of sales grew on the back of the momentum of the previous year to reach double-digit figures. This has happened for the first time since the financial year 2012. The growth can be largely attributed to the improvement in the rural economy and the after-effects of demonetisation.

The Society of Indian Automotive Manufacturers (SIAM) shared a report recently, showing domestic sales and exports across all segments in the market recording a surge.

  • The passenger vehicle market observed growth of 7.89%, selling 3.28 million units during FY 2018. The majority of the units sold were utility vehicles, the sales of which independently surged by 20.97%. The sale of passenger cars and vans also recorded a growth of 3.33% and 5.78% respectively during the same timeframe.
  • As far as commercial vehicles are concerned, the total sales saw a growth of 19.94% during the last financial year. The segment of Medium & Heavy Commercial Vehicles (M&HCVs) grew by 12.48% while the Light Commercial Vehicles (LCV) segment observed growth of 25.42%. The sale of three-wheelers also grew by 24.19% between April 2017 and March 2018.

Industry analysts are expecting to see the momentum of growth carry forward to the financial year 2018-19, across most of the segments. There may be moderation in growth of commercial vehicles (CVs) sales though.

The industry is currently subjected to a series of investments in research and product development so that regulatory changes such as BS VI emission norms are implemented. Investments are also being made for the implementation of the government’s vision of an all- electric fleet by the year 2030. There are also reforms likely to come up in the safety standards of four-wheelers in the country.

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Production Statistics:

When the statistics of vehicle production is taken into consideration, a total of more than 29 million units were produced between April 2017 and March 2018. This includes commercial vehicles, passenger cars, two-wheelers, three-wheelers, and quadricycles. The growth in production in the industry was 14.78% when compared to the same period the previous year.

Market Share Of Auto Manufacturers:

According to SIAM data, car makers’ market share in the year 2017 in India is as follows:

Auto manufacturer Percentage of sales
Maruti Suzuki 49.6%
Hyundai Motor India 12.33%
Mahindra & Mahindra 7.5%
Tata Motors 5.91%
Honda Cars 5.53%
Toyota Kirloskar 4.32%
Renault India 3.48%
Others - including Skoda, GM India, FCA, Force Motors, Isuzu 5.49%

The above data is based on the total sales for the calendar year 2017

SIAM has confirmed that Indian automakers are producing vehicles at 60-65% of their production capacity on an average. Although the implementation of the GST regime has had a negative impact on car exports, tax refunds worth Rs.2,000 crore will be provided by the government to the companies in the near future.

  • The largest auto manufacturer in India, Maruti Suzuki, dominated the car sales in the country in the calendar year 2017 with a 49.6% market share. The company has sold more than 1.60 million vehicles in the country and it expects a growth of almost 15% along with exports.
  • The second-largest car maker in India, Hyundai Motor India has sold more than 5 lakh vehicles for the second time in a row. The total sales for the auto manufacturer stood just above 5.27 lakh units. The growing demand in the domestic and international markets has resulted in Hyundai’s Chennai plants working at full capacity.
  • Mahindra and Tata Motors stood at third and fourth places as far as car sales for the year 2017 are concerned. Mahindra sold more than 2.42 lakh units while Tata Motors sold 1.91 lakh vehicles in the country. Mahindra only released facelifts and additional variants the last year. But Tata Motors followed a more aggressive sales strategy, launching three new cars, the Tata Hexa, Tata Tigor, and Tata Nexon. Both companies are also looking forward to supplying electric cars in the coming years.
  • Honda Cars India and Toyota Kirloskar had decent sales, despite the taxation policy changes that were effective in 2017. Both companies supply hybrid cars to the automobile industry in India, and the extra cess that was imposed on these vehicles had resulted in Toyota halting the production of the Camry hybrid sedan.
  • Renault India saw a drop in sales, selling only 1.12 lakh units last year. The last quarter of the calendar year saw the launch of the Renault Captur, as the company looked to strengthen its position in the crossover market.
  • The sales of Ford India grew after the introduction of the Ford Ecosport, and the company sold 87,578 units last year - an aggregate of 2.71% of the market share. The company has also improved its exports from the country as is evident from its robust export figures in 2017.

Towards the last quarter of 2017, most of the auto manufacturers have increased prices of vehicles across segments by 3-5%. This is due to the hike in input costs, including commodity prices. India is expected to emerge as the third-largest market for automobiles by the year 2020, when it would be capable of selling up to 5 million vehicles in a year.

GST Update: GST of 18% is applicable on car insurance effective from the 1st of July, 2017

Car Insurance Reviews

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  • HDFC Ergo Car Insurance
    "Need to reduce the premium"
    0.5 4.5/5 "Excellent!"
    I had a car insurance with HDFC Ergo and I felt the premium is very high hence I changed my insurance provider. The customer service is very good. There was no claim experience. The policy period is one year. It is a zero dep policy which includes bumper to bumper and RSA. It is a first party insurance.
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    , hyderabad
    Reviewed on Jan 23, 2019
  • New India Car Insurance
    "Good"
    0.5 5.0/5 "Blown Away!"
    My car insurance was recently purchased with New India Assurance through online. When I logged into the online site it gives better option with multiple insurer and I felt New India Assurance is good with reasonable premium and better benefits. I have paid 13,500 rupees for a year. I got the insurance paper. The claim experience is very good.
    Was this review helpful? 0
    , hyderabad
    Reviewed on Jan 23, 2019
  • ICICI Lombard Car Insurance
    "Good Policy."
    0.5 3.0/5 "Satisfactory"
    I have bought my car insurance with ICICI Lombard for last 5 years which I'm continuing for with the same company. The claim experience was better and when i applied for the same, they have given upto 80%. Its covered with bumper to bumper facility. They have given the claim in 1 week.
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    , bangalore
    Reviewed on Jan 22, 2019
  • Royal Sundaram Car Insurance
    "Good policy "
    0.5 5.0/5 "Blown Away!"
    My car insurance was purchased in the year 2014 with Royal Sundaram. My dealer has recommended me about this policy. I pay the premium amount of Rs. 14000 with the coverage value of Rs. 6.27 lakhs which covered with the bumper to bumper facility.
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    , ahmedabad
    Reviewed on Jan 22, 2019
  • Bajaj Allianz Car Insurance
    "Good Policy"
    0.5 3.0/5 "Satisfactory"
    I had taken this insurance policy a while back and the premium amount has been quite good and not too high. The payment method has been easy and there has not been any sort of charges, and the policy covers bumper to bumper. Their customer support has also been responsive and was helpful as well.
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    , mumbai
    Reviewed on Jan 22, 2019
  • ICICI Lombard Car Insurance
    "Its Good"
    0.5 4.0/5 "Great!"
    There was no claim experience for my Tata Tiago with ICICI Lombard. I have renewed the car policy at last june, I paid the amount around Rs. 10,600 because its around 1.5 year old vehicle. I took comprehensive plan which includes loss , damage, ICICI Lombard got tie up many showroom.
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    , new delhi
    Reviewed on Jan 21, 2019
  • ICICI Lombard Car Insurance
    "Best cover"
    0.5 4.0/5 "Great!"
    Very recently I took policy from Car insurance for my new Baleno car, it was done by ICICI bank, they deducted insurance fee from the loan. The loan department issued the policy copy on time. For first year its 100% coverage available its a bumper to bumper with ex showroom.
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    , new delhi
    Reviewed on Jan 21, 2019
  • ICICI Lombard Car Insurance
    "Good Car Insurance policy"
    0.5 4.0/5 "Great!"
    I have selected the ICICI Lombard for my car since the dealer has given me this insurance. I have been paying the premium amount of Rs. 15000. This is not covered for the bumper to bumper facility. They have given me a IDV value of Rs, 3.10 lakhs. They are providing the good garage facility all over the city.
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    , bangalore
    Reviewed on Jan 21, 2019
  • United India Car Insurance
    "Yet to experience the policy"
    0.5 3.0/5 "Satisfactory"
    I have applied the claim for my car recently. I have given the car into the showroom and they have asked me to inform in the insurance company. When i visited other branch they have asked me to the home branch. They have given me a sufficient IDV value. Its covered with a bumper to bumper facility.
    Was this review helpful? 0
    , chennai
    Reviewed on Jan 21, 2019
  • ICICI Lombard Car Insurance
    "Reliable Policy"
    0.5 5.0/5 "Blown Away!"
    Purchased my car insurance through ICICI Lombard and They have given me a low premium since i have taken a loan from ICICI bank. They have given me a good IDV value. This is a bumper to bumper covered policy. They have given me a road side assistance, no claim bonus benefits.
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    , chennai
    Reviewed on Jan 21, 2019
  • National Insurance Car Insurance
    "Good Insurance"
    0.5 3.0/5 "Satisfactory"
    My Honda amaze car got insured with National insurance for one year of tenure period. I think my old premium amount was around Rs.30,000. I took first party comprehensive plan it covers for loss, damage, theft. The customer support is good even the IDV is good.
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    , bhubaneshwar
    Reviewed on Jan 21, 2019
  • ICICI Lombard Car Insurance
    "Competitive price"
    0.5 5.0/5 "Blown Away!"
    I have taken a car insurance from ICICI Lombard and the service is really good. I spoke wtih the customer care once for the claim. The garage people taken care of the full settlement process. The premium amount is nominal. They have given me a best claim what they can offer according to their norms.
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    , bangalore
    Reviewed on Jan 21, 2019
  • Royal Sundaram Car Insurance
    "Economic offering and wide accessibility"
    0.5 5.0/5 "Blown Away!"
    Because it was good comparison between other companies hence i have chosen the Royal sundaram. The premium amount is reasonable. The IDV value is good. This a comprehensive policy which covers third party insurance. They have tie up with most of the garages. They have cashless facility in most of the places.
    Was this review helpful? 0
    , bangalore
    Reviewed on Jan 21, 2019
  • Royal Sundaram Car Insurance
    "Average"
    0.5 3.0/5 "Satisfactory"
    I took my car insurance with Royal Sundaram. I never contacted the customer service. It is a default insurance from the showroom. The premium is high because I go for bumper to bumper offer, road side assistance, zeo dep. It is a first party insurance and no claim. The policy period is one year.
    Was this review helpful? 0
    , bangalore
    Reviewed on Jan 19, 2019
  • SBI General Car Insurance
    "Good Policy"
    0.5 4.0/5 "Great!"
    The showroom people has offered me a car insurance policy with SBI. I have made a premium amount of Rs. 22000. They have given me a coverage value of 100%. Total IDV value is 90% of the car value. I have no claim experience till now. The documentation process was done by showroom.
    Was this review helpful? 0
    , new delhi
    Reviewed on Jan 19, 2019
  • National Insurance Car Insurance
    "Smart protection with National"
    0.5 4.0/5 "Great!"
    The major factor to chose National Insurance because of the premium is economic, I took the policy for 3 years the IDV value remains the same for the whole tenure. The customer support is good on time they activated the policy. I have Tata Tiago , its around four months vehicle. Its zero depreciation comprehensive plan. I taken the policy through showroom.
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    , lucknow
    Reviewed on Jan 19, 2019
  • ICICI Lombard Car Insurance
    "Satisfied with the policy"
    0.5 5.0/5 "Blown Away!"
    My car insurance is with ICICI Lombard. The customer services are good and I got the policy documents on time. The policy coverage is good and there are features of a road side assistance is there. The premium is economical too. Good overall.
    Was this review helpful? 0
    , bangalore
    Reviewed on Jan 19, 2019
  • ICICI Lombard Car Insurance
    "Need to reduce the premium"
    0.5 3.0/5 "Satisfactory"
    I had a car insurance from ICICI LOMBARD which was offered by the showroom at the time of purchasing the vehicle. I felt the insurance premium is very high compared to others. I got a reminder call from the customer service at the time of renewal. It has zero dep for one year.
    Was this review helpful? 0
    , new delhi
    Reviewed on Jan 19, 2019
  • Tata AIG Car Insurance
    "Excellent"
    0.5 5.0/5 "Blown Away!"
    I took my car insurance from TATA AIG through online channel. They have given lesser premium with zero dep and it includes road side assistance. The customer service is very good. The policy period is one year. I have no claim experience. It is a first party insurance.
    Was this review helpful? 0
    , new delhi
    Reviewed on Jan 19, 2019
  • Tata AIG Car Insurance
    "Satisfied policy"
    0.5 5.0/5 "Blown Away!"
    TATA AIG is the best company to take the car insurance. Since long time i have taken this insurance. The customer care people used to call me to renew the policy and they used to policy renewal letter. I will do payment through online. Several times i have claimed the policy and i have received very good response.
    Was this review helpful? 1
    , hyderabad
    Reviewed on Jan 18, 2019
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