Summary
India Automotive Market is segmented by vehicle type (Passenger Vehicles, Commercial Vehicles, Three Wheelers, and Two Wheelers) and engine type (Petrol, diesel, CNGs, and EVs).
Market Overview
India Automotive Market Overview
The India Automotive Market was valued at 26 Mn units in 2023 compared to 25.3 Mn units in 2017. The market is expected to reach 147.80 Mn units by 2029, growing at a CAGR of 34.00% during the forecast period 2023–2029. As per the DPIIT report September 2023, the Automobile sector resulted in 5.41% of the total FDI (Foreign Direct Investment) inflow. In 2022, the automotive market in India accounts for 7.1% of the country's GDP, and the industry employs 37 million people in the country. In 2022, India's Automotive sector accounts for a 40% share of the global R&D sector, and the industry contributes a 4.7% share of India’s total exports.
India Automotive Market Definition
Definition of India Automotive Market: The market size has been defined based on the number of automobiles produced domestically including all types of cars. The market incorporates segmentations including vehicle type (Passenger Vehicles, Commercial Vehicles, Three Wheelers, and Two Wheelers) and engine type (Petrol, diesel, CNGs, and EVs). The market excludes the used car market and has been calculated based on the number of units sold in the country. The report includes prominent automobile manufacturers such as Maruti Suzuki India Limited, The Hyundai Motor Company¸ Mahindra & Mahindra Limited, Toyota Motor Corporation, and others.
Taxonomy
India Automotive Market Ecosystem
India Automotive Market Size (in Mn Units), 2017-2023
India’s automotive production (proxy for market size) reached 26.00 Mn units in 2023, up from 25.33 Mn units in 2017. The market experienced a sharp disruption during the COVID-19 period, primarily due to nationwide restrictions that constrained manufacturing operations and broader supply-chain activity. After peaking at 30.92 Mn units in 2019, production fell by ~4 Mn units in 2020, reflecting the immediate pandemic shock. The contraction persisted through the recovery phase, with output declining further to 22.65 Mn units in 2021 and 19.56 Mn units in 2022. Post-pandemic normalization supported a rebound in 2023, and the market is expected to expand steadily in the coming years as production stabilizes and demand conditions improve.
India Automotive Industry Analysis
IIndia Automotive Market Segmentation, 2022
India Automotive Market Segmentation by Vehicle Type (in unit %), 2022
In 2022, the Indian automotive market remained highly concentrated, with two-wheelers and passenger vehicles together accounting for ~93% of total market share. Within this mix, two-wheelers led with 77%, followed by passenger vehicles at 16%, underscoring their dominance in overall industry volumes. In contrast, commercial vehicles held a modest 3% share, while three-wheelers formed the remaining smaller portion of the market. Despite the lower base, the commercial vehicle segment has strengthened in recent years, supported by government initiatives such as Make in India and FAME-2, alongside the growth of the industrial sector, which is driving higher freight movement and fleet expansion demand.
India Automotive Market Segmentation by Engine Type (in unit %), 2022
In 2022, petrol cars dominated the Indian passenger car market with a 68% market share, largely driven by strong preference among cost-conscious buyers, as petrol vehicles are typically cheaper than diesel and electric alternatives. Within the luxury segment as well, petrol variants of brands such as Mercedes, Audi, and BMW accounted for 62% of sales in 2022, although this share declined by 6 percentage points from 68% in 2021. Diesel cars represented 18% of the passenger vehicle market in 2022, but the segment has contracted significantly—down by 29% since 2014—as consumers increasingly shift toward petrol and electric options. CNG vehicles strengthened their position, reaching 12% market share in 2022 compared to 9% in 2014. The remaining share is held by EVs, and the government anticipates the EV market to reach 30% by 2030.
India Automotive Market Future Size (in Mn units), 2023-2029
The India automotive market is projected to expand rapidly over 2023–2029, with an indicated CAGR of 34%, taking the market from 26 Mn in 2023 to an expected 147.80 Mn by 2029. The forecast narrative also indicates ~34% YoY growth through the period, with interim values cited as 834.73 Mn in 2024, 46.4 Mn in 2025, and 61.99 Mn in 2026—however, the 2024 figure (834.73 Mn) is not directionally consistent with the 2023 base (26 Mn) and the 2029 forecast (147.80 Mn), and likely requires validation or a unit/typing correction. Looking ahead, the industry is expected to be increasingly shaped by electric vehicles (EVs), supported by aggressive government promotion of EV adoption. Building on the EV momentum visible in 2022, India also launched its first double-decker electric bus in Mumbai, Maharashtra, reinforcing the policy push and signaling stronger electrification focus in public mobility.
India Automotive Players Company Profile
| Company Name | Establishment year | Description |
|---|---|---|
Maruti Suzuki Limited | 1981 | Maruti Suzuki India Limited (formerly Maruti Udyog Limited) is the Indian subsidiary of Japanese automaker Suzuki Motor Corporation. The Government of India established Maruti Udyog Limited in February 1981 as a joint venture with Suzuki Motor Corporation as a small partner. |
Hyundai Motor Company | 1967 | The Hyundai Motor Company, often referred to as Hyundai Motor, is a South Korean multinational automotive manufacturer headquartered in Seoul, South Korea, which was founded in 1967. Currently, the company owns 33.88 percent of Kia Corporation, and fully owns two marques including its luxury cars subsidiary, Genesis, and their electric vehicle Ionia. |
Mahindra & Mahindra Limited (M&M) | 1945 | Mahindra & Mahindra Limited (M&M) is an Indian multinational automotive manufacturing corporation headquartered in Mumbai. It was established in 1945 as Mahindra & Mohammed and later renamed Mahindra & Mahindra. Part of the Mahindra Group, M&M is one of the largest vehicle manufacturers by production in India. |
Tata Motors Limited | 1945 | Tata Motors Limited is an Indian multinational automotive company, headquartered in Mumbai and part of the Tata Group. The company produces cars, trucks, vans, and busses. Subsidiaries include British Jaguar Land Rover and South Korean Tata Daewoo. |
Honda Cars India Ltd. | 1995 | Honda Cars India Ltd., abbreviated as HCIL, is an automobile manufacturer in India owned by Honda Motor Co. Ltd. The company was established in 1995 as a joint venture called Honda Siel Cars India (HSCI). The company was renamed to HCIL in September 2012 following the sale of 3.16 percent stake owned by Usha International, making it a 100 percent subsidiary of Honda Motor Co. Ltd. |
Kia India Private Limited | 2017 | Kia India Private Limited is a subsidiary of Kia for its operations in India. The company was founded on 19 May 201 following an announcement of the construction of a new 536-acre manufacturing facility in Anantapur District, Andhra Pradesh. |
India Automotive Market Macroeconomic Indicators
India's population was valued at 1437 million in 2023, increasing by 30 million from 1407 million in 2022. By the end of 2025, India's population is predicted to reach 1500 million.
In the year 2020, The population between the 25-49 age group is the largest age group (36.40%) in India followed by 0-14 (26.40%), 50+ (19.40%), and 15-24 (18%).
In 2023, India's GDP was valued at USD 3732 billion compared to USD 2710 billion in 2018. The country’s GDP is expected to reach 5000 billion by the end of 2025.
In 2023, India’s Inflation rate stands at 5.66 % an increase of approximately 2.5% from the 2018 inflation rate of 3.94%. During the COVID-19 pandemic in 2020, the inflation rate in India surged unexpectedly to 6.62% from 3.72% in 2019.
As of 2023, India comprises of majority of the middle-class population which is 57% of the total population of India. After the middle class comes the lower-class category which comprises 33% of the total population of India. The remaining 10% of the population belongs to a high-income class.
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