Car Penetration In India: 12 Cars per 1000 in 2010, 72 Cars per 1000 in 2015

Car penetration in India will grow at the fastest clip in the coming 5 to 7 years among the emerging markets, even outpacing China at 12 per cent albeit on a low base.

With the growing population and increasing wealth in the BRIC markets, the overall motorisation rate will significantly increase until 2025. Citing Skolkovo Institute for Emerging Market Studies, the report said India is catching up in the future motorisation rates.

It said the penetration of motor vehicles per 1000 inhabitants in BRIC countries will be faster than the 1 %, 1.1 % and 1.4 % CAGR in developed markets of the US, the UK and JapanKorea, respectively.

By 2025, vehicle penetration in India is going to grow the fastest at 12.5% to 72 vehicles per 1000 from 12 vehicles per 1,000 in 2010.

China will grow at 10.1 % to 187 vehicles per 1000 inhabitants, Brazil at 3.8 % to 221 per 1000 and Russia at 4 % CAGR to 388 vehicles per 1000 inhabitants.

Within the passenger vehicle space, micro cars will grow by 29 %, mini cars by 6 %, compact cars by 6 %, super compact cars by 10 %, mid-size cars by 15 %, executive cars by 22 %, premium and luxury cars by 84 %, UV segment by 19 % and vans by 17 % .

Within the commercial vehicle space, the heavy commercial vehicle segment will grow at the fastest pace at 12 %, led by improving infrastructure, market trend moving towards higher tonnage vehicles and emergence of hub and spoke model in the country.

The small commercial vehicle (SCV) space will grow at 5 % on a high base. The goods segment will grow at 12 %, whereas the van segment is likely to see a decline within SCV space with people preferring MPVs and SUVs over vans. hile sales in the commercial vehicle industry fell 20 % in 2013 - 14, that in the passenger vehicle industry fell 6 %.

Capacity utilisation in the commercial vehicle industry was 40 % in that year, while in the passenger vehicle industry it was 60 %.

It was the two-wheeler segment that had the best capacity utilisation at 74%, stemming the industry decline by growing over 14% to 14.8 million units.

The key drivers of the 2 wheeler growth in India were favourable demographic, lower penetration, rising per capita income & poor public transportation. The scooter segment will drive the two-wheeler growth on the back of shifting consumer preferences, the report said.

The scooter segment is forecast to lead the growth with 19.5 % CAGR to 10.5 million units, followed by 9.4 % growth in motorcycles that will translate to 17.9 million units. Mopeds will show a growth of 7 % to 1.1 million units.

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