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The Growth and Development of the Automobile Industry – A Deeper Insight

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The word “Automobile” has its origins in Greek and Latin and it has ended up an essential a part of every guy’s existence. It has come to be so fundamental that on an average, a person spends a minimum three hours in his vehicle each day. Automobile becomes as soon as the thought of as a luxury and handiest a pick few ought to take pleasure in. Now, the instances have modified and motors have grown to be a means of transportation catering to the tremendous majority.

Automobile Industry


The transformation from luxury to inevitability

Automobiles, in preferred, discuss with the humble vehicle and the estimates advise that there may be an automobile for each eleven folks on earth amounting as much as 590 million passenger vehicles. There are various versions of automobiles that cater to every go segment of the populace. There are versions that would set you lower back by using more than one million dollars and different fashions that cost you some thousand greenbacks.

The technological advances inside the car area have the been splendid in the remaining one hundred years. The century’s greatest invention or advancement should certainly belong to the auto enterprise. One of the earliest pioneers of the car Industry turned into Ransom Olds from the Oldsmobile manufacturing unit. In the early 1900’s, he brought the Production Line concept, therefore churning out automobiles every little while. This concept changed into substantially revolutionized and implemented by Henry Ford, who accelerated car enterprise to the following stage. Ford fast grew within the first 1/2 of the 20th century and slowly but regularly unfold globally.

Growing along side time

With the development of age, the car industry progressively grew in continental Europe and England. Japan added fine initiatives that similarly greater the enterprise. Toyota from Japan has been the pioneers of Total Quality Management and Six Sigma, which have been the guiding standards of the auto enterprise for the last 50 years. Today, Toyota is the sector’s biggest automobile agency in line with recent marketplace estimates.

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The international increase of the 1980’s become in large part due to the car revolution. Ford, General Motors, and Chrysler, the huge 3 car giants of America, had a large say at u. S .’s financial system. They decided the fitness of the financial system and the recent international economic recession has affected them badly. This has made them technique the authorities for loans and benefits, which have been fulfilled by way of the authorities after setting appropriate clauses.

Advent of generation and improvements

The automobile has transcended from being a medium of transportation to a medium of enjoyment after the appearance of extraordinary speedy automobiles competing against each different. NASCAR and F1 races are large crowd pullers each year. People have made fortunes and drivers of those machines have made their name in records. The fact that car racing entails massive charges has made the racing enterprise reel in these uncertain economic times. The game has visible tragedies with the lack of life in some times. This has made room for strict protection regulations, which can be now mandatory for all the automobile shows.

The negative element


Although guy has made a big soar ahead with vehicles, there’s a downside to this technological surprise. The emissions from those machines have raised critical environmental worries with calls for extra eco-friendly motors. Automobile groups have invested highly in research and improvement of eco-friendly vehicles. Except for this single drawback, there may be slightest of doubts to mention that motors had been the find of the previous century.

This situation reflected the India of yester years. Economic reforms and deregulation have transformed that scene. The automobile industry has written a brand new inspirational tale. It is a tale of exciting multiplicity, unheard of increase and fun patron revel in – all within a few years. India has already turned out to be one of the quickest developing automobile markets inside the world. This is a tribute to leaders and bosses within the industry and, similarly to policy planners. The vehicle industry has the possibility to move past this first-rate achievement. It is a status on the doorsteps of a quantum jump.

The Indian vehicle enterprise is going via a technological alternate wherein every company is engaged in converting its tactics and technology to maintain the aggressive advantage and offer clients with the optimized services and products. Starting from the two wheelers, vans, and tractors to the multi utility cars, commercial cars, and the posh motors, the Indian car industry has accomplished terrific fulfillment within the latest years.

Automobile Magazine

On the canvas of the Indian economy, auto enterprise keeps a high-flying area. Due to its deep frontward and rearward linkages with several key segments of the economy, the car industry has a robust multiplier impact and is able to be the driver of monetary growth. A sound transportation device plays an essential position within the USA’s speedy monetary and commercial development. The well-advanced Indian car enterprise skillfully fulfills this catalytic function by means of producing a wide style of automobiles: passenger vehicles, light, medium and heavy business automobiles, multi-software vehicles such as jeeps, scooters, motorcycles, mopeds, three wheelers, tractors and many others.

Types of Industries

The automotive region is one of the center industries of the Indian economy, whose prospect is reflective of the monetary resilience of u. S . A .. Continuous monetary liberalization over time via the authorities of India has ended in making India as one of the prime commercial enterprise destination for lots global automobile players. The automotive zone in India is developing at around 18 in line with cent consistent with annum.

The Indian automobile enterprise began its new journey from 1991 with relicensing of the sector and subsequent establishing up for 100 per cent FDI via the automated route. Since then almost all the worldwide majors have set up their centers in India taking the production of the automobile from 2 million in 1991 to 9.7 million in 2006 (nearly 7 in line with a cent of world automobiles manufacturing and 2.4 according to cent of 4 wheeler manufacturing).


The cumulative annual increase charge of production of the car enterprise from the year 2000-2001 to 2005-2006 became 17 in line with cent. The cumulative annual boom rate of exports for the duration of the length 2000-01 to 2005-06 turned into 32.Ninety two according to cent. The manufacturing of the automobile enterprise is predicted to attain a boom fee of over 20 in keeping with cent in 2006-07 and about 15 per cent in 2007-08. The export during the same duration is anticipated to grow by 20 per cent.


The automobile area has been contributing its percentage to the shining monetary performance of India in the latest years. With the Indian center magnificence incomes higher consistent with capita profits, extra people are geared up to own non-public automobiles including cars and two-wheelers. Product actions and manned offerings have boosted inside the income of medium and sized commercial cars for passenger and goods delivery.

Side through facet with sparkling automobile sales boom, the automotive components quarter has witnessed massive increase. The home auto components consumption has crossed rupees 9000 crores and an export of one-half length of this determination.


India is at the peak of the Foreign Direct Investment wave. FDI flows into India trebled from $6 billion in 2004-05 to $19 billion in 2006-07 and are expected to quadruple to $25 billion in 2007-08. By AT Kearney’s FDI Confidence Index 2006, India is the second one most attractive FDI destination in China, pushing the US to the third position. It is commonly believed that quickly India will trap up with China. This may additionally manifest as China tries to cool the financial system and its protectionism measures which might be eclipsing the Middle Kingdom’s attractiveness. With growing wages and excessive land charges in the eastern regions, China may be losing its aspect as a low-value production hub. India appears to be the herbal choice.

India is up-and-coming a sizable manufacturer, specially of electrical and electronic device, cars and automobile-components. During 2000-2005 of the total FDI inflow, electric and electronic (which includes computer software program) and car accounted for thirteen.7 in keeping with cent and eight.Four in keeping with cent respectively.

In offerings sectors, the lead gamers are America, Singapore and the UK. During 2000-2005, the total funding from these three nations accounted for about forty per cent of the FDI in the services region. In cars, the important thing player is Japan. During 2000-2005, Japan accounted for approximately 41 according to cent of the full FDI in vehicle, surpassing all its competition by a huge margin.
India’s sizable home market and the massive pool of technically professional manpower have been the magnetism for the foreign traders. Hitherto, known for know-how-based totally industries, India is emerging a powerhouse of conventional production too. The manufacturing region in the Index for Industrial Production has grown at an annual fee of over nine in keeping with cent over the last three years.
Korean automobile-makers think India is a better vacation spot than China. Though China affords a bigger marketplace for vehicles, India offers a ability for higher increase. Clearly, manufacturing and carrier-led boom and the increasing consumerization make India one of the maximum crucial destinations for FDI.

Automotive Mission Plan 2016

The bumper-to-bumper site visitors of global vehicle biggies at the passage to India has subsequently made authorities sit up and take observe. In a bid to power more investments into the world, ministry of heavy industries has determined to put together a ten-year undertaking plan to make India a worldwide hub for automobile industry.

The Government of India is drawing up an Automotive Mission Plan 2016 that targets to make India a international automotive hub. The idea is to draw an revolutionary plan of action with full participation of the stakeholders and to enforce it in task mode to fulfill the challenges coming in the way of growth of enterprise. Through this Automotive Mission Plan, Government additionally desires to provide a degree gambling area to the players in the sector and to lay a predictable destiny path of increase to permit the manufacturers in creating a greater knowledgeable investment choice.

About the author / 

Shirley D. McCormick


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