The global automotive industry involves the manufacture and sales of automobiles and other retail activities, such as gas-station retail and the sale of car parts. The industry’s yearly growth rate is expected to exceed 5.5% from 2010 to 2015, reaching a value of more than $5.1 trillion by 2015,
The automobile industry surged ahead in 2012 and 2013, with the notable exception of Europe, where a dull economy was particularly hard on auto sales. Estimates of the global automobile market vary substantially from one source to another.
The biggest upward trend in auto sales has been in China. While estimates of its annual unit sales vary widely, China has clearly become the world’s largest car market. And the market was running at about a 20 million units pace for the first seven months of 2013. SUV growth has been particularly strong in Europe, as it has been throughout the world.
One of the biggest winners by far in today’s highly competitive automobile market has been Korea, where Hyundai, along with its brand Kia, have enjoyed soaring global sales. Consumers are attracted to their reasonable prices, excellent warranties and world class manufacturing quality. Korean car makers are competing aggressively against the world’s largest firms. Volkswagen has a goal of boosting its total global sales to 10 million units by 2018.
The rising affluence of consumers in China is creating both huge opportunities and major problems. China has become the world’s largest user of energy overall and one of the world’s largest importers of petroleum products, primarily to fuel its burgeoning fleet of cars and trucks.
European manufacturers are facing challenges of their own. High costs, tough labor laws and daunting government regulations are constant challenges to manufacturers there. Nonetheless, firms like Volkswagen and Daimler/Mercedes-Benz have found great success in the global market, often locating plants in nations where their products sell well. Volkswagen has its eye on becoming the world’s largest car firm. Nonetheless, as of 2012-13, difficult economic conditions in Europe were leading to slow domestic sales, and manufacturers were struggling to reduce both costs and manufacturing capacity.
In its report World Economic Outlook April 2008, the International Monetary Fund shows how, under one method of analysis, the number of cars in emerging and developing economies could increase by 1.9 billion from 2005 to 2050, bringing the world’s total to nearly 3 billion automobiles.
The Indian automobile industry produced a total 1.69 million vehicles including passenger vehicles, commercial vehicles, three wheelers and two wheelers in August 2013 as against 1.56 million in August 2012, registering a growth of 8.18 percent over the same month last year.
The cumulative foreign direct investment (FDI) inflow into the Indian automobile industry during April 2000 to July 2013 was recorded at US$ 8,932 million, amounting to 4.5 per cent of the total FDI inflows (in terms of US$), as per data published by Department of Industrial Policy and Promotion (DIPP), Ministry of Commerce.
The overall automobile exports grew by 2.03 per cent during April-August 2013. Furthermore, the production of passenger vehicles in India was recorded at 3.23 million in 2012-13 and is expected to grow at a compound annual growth rate (CAGR) of 13 per cent during 2012-2021, as per data published by Automotive Component Manufacturers' Association of India (ACMA).