# India Automotive Market (2023-2029 --- ## Report Summary The India Automotive Market worth 26 Mn units in 2025 is projected to reach 147.80 Mn units by 2031, driven by EV adoption and rising vehicle demand. --- ## India Automotive Market Table of Contents Table of Contents - 1. Executive Summary - 1.1. Executive Summary: India Automotive Market - 2. Country Profile: India - 2.1. India Country Overview - 2.2. Population Analysis, 2022 - 2.3. Urbanization, 2022 - 3. India Automotive Market Overview and Sizing - 3.1. Ecosystem of Major Entities Operating in the India Automotive Market - 3.2. Value Chain in the Automotive Market in India - 3.3. Popular Revenue Models in the India Automotive Market - 3.4. India Automotive Market Size by Revenue (USD Bn), 2017-2022 - 3.5. India Automotive Market Revenue by Units Sales (Units Mn), 2017-2022 - 4. Snapshot of India Automotive Market - 4.1. Ecosystem and Overview of the Automotive Market in India - 4.2. Market Size of Automotive Market, By Revenue (USD Bn), 2017-2022 - 4.3. Competition Framework- India Automotive Market - 4.4. India Automotive Market Share (in units %), 2022 - 5. Industry Analysis - 5.1. SWOT Analysis of the Automotive Market in India - 5.2. Trends and Development in India Automotive Market - 5.3. Growth Drivers in India Automotive Market - 5.4. Issues and Challenges in India Automotive Market - 5.5. Government Initiatives in Automotive Market - 6. Future Outlook - 6.1. India Automotive Market Size by Revenue (USD Bn), 2023-20 - 6.2. India Automotive Market Size by Units Sales (Units Mn), 2023-2029 - 7. Analyst Recommendations - 7.1. Target Market and Offline Marketing - 7.2. Risks and Mitigation Strategies - 7.3. Technological Advancements in the India Automotive Market - 8. Research Methodology - 9. Disclaimer - 10. Contact Us --- ## India Automotive Market Overview India Automotive Market Highlights 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. *The India Automotive Market was valued at 26 Mn units in 2023 compared to 25.3 Mn units in 2017.* --- ## India Automotive Market Definition ### 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 | ID | Parent ID | Label | | --- | --- | --- | | 1 | | India Automotive Market | | 2 | 1 | By Vehicle Type | | 3 | 2 | Passenger Vehicles | | 4 | 2 | Commercial Vehicles | | 5 | 2 | Three Wheelers | | 6 | 2 | Two Wheelers | | 7 | 1 | By Fuel Types | | 8 | 7 | Gasoline | | 9 | 7 | Diesel | | 10 | 7 | Hybrid | | 11 | 7 | Electric | | 12 | 7 | Hydrogen Fuel Cell | | 13 | 1 | By Market Segments | | 14 | 13 | Economy Cars | | 15 | 13 | Mid-Size Cars | | 16 | 13 | Luxury Cars | | 17 | 13 | Sports Cars | | 18 | 13 | Heavy-duty Trucks | | 19 | 13 | Light-duty Trucks | | 20 | 1 | By Region | | 21 | 20 | North | | 22 | 20 | East | | 23 | 20 | West | | 24 | 20 | South | | 25 | 1 | By Automotive Components | | 26 | 25 | Engine and Powertrain | | 27 | 25 | Chassis and Suspension | | 28 | 25 | Interior Components | | 29 | 25 | Exterior Components | | 30 | 25 | Electronics and Connectivity | | 31 | 25 | Safety Systems | | 32 | 1 | By Sales Channels | | 33 | 32 | Dealerships | | 34 | 32 | Online Sales | | 35 | 32 | Fleet Sales | | 36 | 32 | Leasing and Rental | | 37 | 1 | By Automotive Technologies | | 38 | 37 | Autonomous Vehicles | | 39 | 37 | Advanced Driver Assistance Systems (ADAS) | | 40 | 37 | Infotainment Systems | | 41 | 37 | Connected Cars | | 42 | 37 | Electric Vehicle Technologies | --- ## India Automotive Market Ecosystem ### Market Ecosystem **Ecosystem of India Automotive Market** India automotive industry is highly consolidated as approximately 80% of the market share is occupied by the top 5-6 players. India automotive industry is divided into various categories based on the vehicle type including passenger vehicles, commercial vehicles, and two-wheeler vehicles. Maruti Suzuki, Tata Motors, Hyundai, and Mahindra & Mahindra are some of the leading companies in India passenger vehicles market. However, Tata Motors and Mahindra & Mahindra also have a stronghold in the commercial vehicles category. On the other hand, Hero MotoCorp, Honda Motorcycle, TVS Motor Cycle, and Bajaj Auto are dominating the two-wheeler market in India. --- ## 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. --- ## 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 Industry Analysis ### India Automotive Market Growth Drivers **Greater Availability of cheaper and easier finance** In India, all nationalized and scheduled banks provide loans for new vehicles purchased at very low interest rates. Approximately 75% of the country's new vehicle purchases are done through bank loans. This shows the dependence of Indian buyers on loans resulting in the growth of India auto finance market. According to the Reserve Bank of India, up to February 2021, the outstanding vehicle loans with banks stand at Rs 2,39,400 crores with an increase of 8.5% from 2020 when the outstanding amount was valued at 2,20,600 crores. In India, around 80% of cars and SUVs are financed and approximately 100% of commercial cars are purchased through loans. However, only 50-60% of two-wheelers are financed. **Low car penetration & Rising family income** In 2022, India will have 19 cars per capita (1000) and 120 vehicles per capita in case of all segments including passenger vehicles. Approximately, 60% of the mobility demand in India is fulfilled through transportation modes like buses and metros alongside non-motorized transport modes (Walking and Cycling). In comparison to other developing countries like China where cars per capita income is 222, India still lags. However, India’s cars per capita number is anticipated to reach almost 300 in the next 10 years. **Rising family income** India’s per capita Net National Income (NNI) income grew from INR 72805 in 2014-15 to 98374 in 2022-2023. Within in span of 9 years, NNI increased by 35.12 %. The rising national income has multiplied the purchasing capacity of the country as a whole. As a result, growing domestic income is to make motor vehicles more affordable for local consumers. ### India Automotive Market Challenges **Rising Used Car Market** The growth of the used car market is posing a hindrance to the development of the automobile industry in the country. The India used car market is valued at USD 30.50 Billion in 2024 and is expected to grow at a CAGR of 15% between the forecasted period of 2024-2029. Further, the market is expected to reach a market size of USD 62 billion. As of 2023, the pre-owned car market has crossed the mark of 5 million while on the other hand new car market is standing at 3.8 Mn per year. In 2015, the used car market was organized only up to 10% but in 2023 approximately 30% of the transactions in the used car market are done through organized channels **Lack of Adequate Skilled Labor** Growing industry expansion, an expanding economy, rapidly evolving technologies, increased disposable income, and shorter new consumer vehicle lifecycles have all contributed to the need for upskilling and new skilled labour in the industry. According to the Automotive Mission Plan, the industry needed an extra 30 million workers by 2022 to meet its expanding demands and employ 15 million people. In an industry where rapid expansion and acceleration might be impeded by slow-paced infrastructure development, it is essential to advance skilled labour. **Low Information and Communication Technology (ICT) adoption** Comparing the Indian automobile sector to international standards reveals a significantly lower degree of ICT usage. According to the NASSCOM study, a lot of them are having difficulty adopting IT, even though doing so is essential for improving their competitiveness, productivity, and the overall expansion of the sector. ICT interface enables OEMs to communicate with suppliers and customers regularly and incorporate their suggestions or preferences into vehicle design. The automotive industry's increased use of IT not only makes it more competitive in the current markets but also opens up new ones for the Indian automobile sector. To help the Indian automobile industry grow and fulfil its ambitions to become globally competitive, the IT sector is crucial. **Disruptions in the form of new regulations** New restrictions are causing technological disruptions in the auto sector. To bring India up in line with developed economies like the USA and Europe, cars had to comply with the Bharat Stage IV to Bharat Stage VI pollution control standard starting in April 2020. The automotive sector is facing hurdles as a result of the emission regulations changing from Bharat Stage IV to Bharat Stage VI. These challenges include upgrading technology and closing operations to avoid building up out-of-date stock. The car industry is suffering because of the excessive expense of adhering to new rules and the tremendous demand to invest in BSVI technologies. ### India Automotive Market Recent Developments To improve the infrastructure at eight schools close to Chennai, Renault Nissan announced plans to invest US$ 1,68,762.86 (around Rs. 1.4 crores). In June 2023, Tata Motors declared that it would commit US$ 2 billion over the following four years to the development of new platforms and products. In June 2023 Hero MotoCorp announced intentions to invest up to US$ 180.81 million (about Rs. 1,500 crore) for the development of high-end motorcycles and electric vehicles in India. In February 2023, to increase their market share in passenger cars and electric vehicles, Nissan and Renault said that they were going to invest US$ 600 million in India over the next three to five years. In February 2023, German luxury automaker Audi India started producing the Q3 and Q3 Sportback domestically at the Skoda Auto Volkswagen India Private Limited (SAVWIPL) facility in Aurangabad. MG Motor India stated in January 2023 that it will invest US$100 million to increase capacity, with a target expansion of 70% by 2023. Furthermore, Tata Motors announced the launch of Tata Altroz CNG at the Auto Expo in January 2023. In September 2022, Kinetic Engineering Limited (KEL) invested in Ahmednagar to establish a specialized production line with a starting monthly capacity of 5,000 sets. ### India Automotive Market Government Initiatives The Indian government has approved 100% FDI under the automatic route and promotes foreign investment in the auto industry. Furthermore, the Center authorized US$ 97.77 million (about Rs. 800 crore) for 7432 public fast charging stations in January 2023 as part of the FAME-II program. As of July 15, 2022, oil firms under the Ministry of Petroleum and Natural Gas (MoPNG) had established a total of 532 EV charging stations under the FAME India Scheme I & II. The National Policy on Biofuels – 2018 was amended by the Government and was revised in July 2022. The 2030 deadline for blending 5% biodiesel and 20% ethanol into gasoline was pushed back to 2025–2026. As part of the government's effort to boost domestic vehicle manufacture and draw in new investment, 20 automakers—including Tata Motors Ltd., Suzuki Motor Gujarat, Mahindra & Mahindra, Hyundai, and Kia India Pvt. Ltd.—were selected in February 2022 to get production-linked incentives (PLI). A total of around Rs. 45,000 crore (US$ 5.95 billion) in investment has been planned by the 20 automakers. In November 2021, the Union Government introduced over 100 advanced technologies under the PLI scheme for automobiles. These included advanced driver assistance systems, flex-fuel engines compliant with Bharat Stage VI, compressed natural gas (CNG), electronic control units (ECU) for safety, and e-quadricycles. --- ## India Automotive Players Company Profile | Year | Company | Description | | --- | --- | --- | | 1981 | Maruti Suzuki Limited | 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. | | 1967 | Hyundai Motor Company | 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. | | 1945 | Mahindra & Mahindra Limited (M&M) | 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. | | 1945 | Tata Motors Limited | 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. | | 1995 | Honda Cars India Ltd. | 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. | | 2017 | Kia India Private Limited | 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 Future Size (in Mn units), 2023-2029 ### 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 Market Macroeconomic Indicators ### India Size of Population, (In Million), 2017-2023 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. ### Population Based on Age Group in India, (in %), 2010-2025 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%). ### India's GDP, (In USD Bn), 2017-2023 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. ### India Inflation Rate, (In %), 2017-2023 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. ### Population of India by Income Class, (in %), 2023 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. --- ## Frequently Asked Questions Find quick answers to common questions about the India Automotive Market **Q: How big is the India Automotive Market?** A: The India Automotive market was valued at 26 million in 2023. **Q: What is the future of India Automotive Market?** A: Mahindra & Mahindra Limited, Maruti Suzuki, Tata Motors, Hyundai, and Toyota are some of the prominent companies operating in the India Automotive market. **Q: What are the growth drivers of the India Automotive market?** A: Greater Availability of cheaper and easier finance, Low car penetration & Rising family income, Premiumization of two-wheelers and four-wheelers, and Market entry of established international brands are some of the major growth drivers of the India Automotive market. **Q: Who are the key players in the India Automotive market?** A: Mahindra & Mahindra Limited, Maruti Suzuki, Tata Motors, Hyundai, and Toyota are some of the prominent companies operating in the India Automotive market. **Q: Which segment is dominating the India Automotive market?** A: Two-wheeler vehicle type is dominating the India Automotive market with a market share of 77% followed by Passenger vehicles, Commercial vehicles, and three wheelers.