From Maruti's middle class appeal to luxury cars... A brief history of the Indian auto industry of last 75 years

While Indian roads experienced motor cars for the first time in 1867, it was only in the 1940s that manufacturing facilities were developed within the country

Twisha SoniUpdated: Saturday, August 27, 2022, 11:34 PM IST
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The Indian Automobile industry has grown tremendously over the past seven decades. While Indian roads experienced motor cars for the first time in 1867, it was only in the 1940s that manufacturing facilities were developed within the country. Here’s a brief history of the Indian automobile industry of last 75 years:

The early years: We often think Hindustan Motors’s Ambassdor was the first manufactured car in India, however, Menon’s Aravind ‘Baby — Model 3’, a traditional four-door sedan, was the first Indian automobile produced on home soil in 1966. K. A. B. Menon, a self-taught automotive expert, had founded Aravind Automobiles in 1956 with the goal of creating an Indian car from scratch in Kerala. The Aravind Baby Model failed to win the support of the general populace and important industrialists. Soon Hindustan Motors introduced the Ambassador, which became the country’s first locally produced car. Despite having British roots and being based on the Morris Oxford Series III, the Ambassador was unmistakably an Indian automobile. Hindustan Motors dominated the Indian market from 1960 to the 1980s, with the Ambassador model.

Maruti’s middle-class appeal: In 1980s the two giants, Hindustan Motors (Ambassdor) and Premier (Padmini), were challenged by a new entrant, Maruti Udyog Limited. A partnership between the Indian government and Japanese auto manufacturer Suzuki, it was the first international joint venture after liberalisation. The primary objective of the partnership was the government’s intent to make a people’s car for middle class India.

In the years to come, Maruti Udyog Ltd. established itself as a brand synonymous to quality and affordability for the middle class Indian.

Global brands that overtook desi ones: The economic changes implemented later saw entry of significant multinational corporations like Hyundai and Honda. They cemented their place in Indian markets with their budget cars for young India. Santro and City were a common site on Indian roads in the 2000s. In the midst of all the noise created by global brands, veteran Indian companies like Hindustan Motors and Premier were quickly losing their shine. Soon, the Ambassdor and Padmini were replaced by Maruti 800s and Santros. Almost all of the major automakers increased their market share in India between 2000 and 2010 by developing production sites throughout the nation.

Recent years: The past decade has by far been the most exciting phase in the industry’s history, with Indian brands like Tata Motors and Mahindra emerging as a top players and several global brands entering the market. Skoda, Volkswagen, Toyota, luxury brands like Porsche, Jaguar, Audi, BMW, Mercedes and in recent years KIA, MG Motors, Range Rover, Jeep have all created a distinct mark in the market. Over the years, the purchasing power of Indian consumers has increased several folds, allowing them to own luxury cars. Brands like Audi, BMW, Mercedes have become a common sight in the last few years.

Farewell to others: Not all brands that entered Indian markets could sustain the cut-throat competition and unique demands of Indian consumers. Reputed auto giants had to shut their operations due to huge losses they were clocking. Fiat, Ford, Harley Davidson, General Motors, and Datsun are just a few names that shut down their manufacturing units and sales in India.

What the future holds: The Indian auto industry is the fourth largest in the world, and also a major exporter, after Japan, South Korea, and Thailand. In fact, the AMP 2026 envisions the Indian automotive industry to become one of the world’s top three in terms of engineering, manufacture, and export of vehicles and auto components by the end of 2026. The automobile industry is expected to grow in value to more than 12% of India’s GDP and generate more than 65 million jobs.

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