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The Indian Car Market Grow
The Indian Car Market Grow

The new hinterland of car sales is the cities like Kanpur, Lucknow and Allahabad, for instance, in addition to the North East and certain pockets in central and east India. The car financiers now have a greater focus on metro markets and premium vehicles, where risk factors are comparatively lower.

This new creamy-layer focus adopted by the car finance biggies could also make them lukewarm to the Tata Nano when it debuts in October of this year. The increasing number of defaults and the current credit environment ,has made this a very high-risk segment. ICICI, the biggest player in the car loan finance business, has "re-jigged its portfolio" to cut back exposure in "high-risk segments" of the hinterland. Other players like Kotak have become "cautious" as defaults increase. When the big financiers pull back their non-creamy layer schemes, the focus is automatically back to metro markets and low-risk customers.

The reduced geographical spread of the car loan finance is part of a portfolio management strategy which examines locations and creditor profiles for profitability aspect . With the hike in interest rate and growing number of defaults, the mix and match is changing, the exposure in premium segments is becoming more and it has cut down on delinquent locations or profiles. However, despite of high input costs and fuel prices, car manufacturers in the country managed to post six percent growth in sales in the month of June. The domestic passenger car sales recorded a hike of 6.1 percent increase while sales of motorcycles went up by 8.2 per cent in that period.

We saw well reputed auto companies like Honda, Hyundai, GM, Audi, BMW and Mercedes Benz coming to explore the Indian market. With a high rate of growth of the Indian economy, we now see sale of cars like never before. Competition and high demand drive the market and ensure that companies keep coming up with better products and economical pricing. Many multi-national auto firms have tasted success in the market and have several best-selling products. Cars like Honda City, Hyundai Santro, Honda Civic and RR Phantom are already highly reputed brands in India.

Considering the huge population of the country, India still has a vast unexplored market for cars. The competition has also made Indian auto companies deliver their best. As of now, Maruti is India' biggest car maker. Interestingly, South Korean company Hyundai has successfully established itself as the no. 2 player in the highly competitive and important car market.

Believing in the core brand value 'Vorsprung durch Technik', Audi looks at growing as the unbeaten premium brand in India in the coming years. It is believed that Audi India will be investing as much as Rs 192 Crore for production of cars in India over the next 3 years. It has already begun assembly of its cars within the country starting with the A6 being assembled at Aurangabad in Maharashtra, India.




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