A lot has been said about the new car potential of populous India. This time, they mean it, says J.D. Power. India surpassed France, the United Kingdom and Italy to become the sixth-largest automotive market in the world in 2010. In 2020, India is expected to become the world’s third largest auto market. This according to a special report titled “India Automotive 2020: The Next Giant from Asia,” released by J.D. Power and Associates.
More than 2.7 million light vehicles (passenger cars and light-commercial vehicles) were sold in India in 2010, up from just 700,000 light vehicles sold in 2000. J.D. Power expects India to reach 11 million light-vehicle sales by 2020. This would be what Americans bought last year. It would also make India the third-largest light-vehicle market in the world, behind the United States, which J.D. Power projects to return to its former glory of 17.4 million sales in 2020. By that time, J.D. Power expects the Chinese market to reach 35 million light-vehicle sales, double the projected number of the U.S.A.
What is standing in the way of even higher motorization of India? It’s India’s “three deficits:” Continual international trade deficits; chronic government budget deficits; and an underdeveloped power generation and distribution infrastructure. According to J.D. Power, “the country’s lagging infrastructure poses the biggest potential obstacle to future growth.”
Readers who pay attention may think J.D. Power’s numbers are a bit off. India’s 2010 numbers had been reported as 1.87 million, J.D. Power says it was 2.7 million. The official Chinese number for 2010 was 18.06 million, J.D. Power says it was 17.2 million. Where is the confusion? The 1.87 million reported by the Wall Street Journal for India omitted commercial vehicles. The Chinese number includes commercial vehicles. J.D.Power attempts to replicate the American “light vehicle” count, which often is not officially tracked in other countries. Cars classified as “commercial vehicles” (trucks, vans, etc. can have a large impact on the count, especially in emerging markets, but also in the U.S.A. Please refer to my treatise on car counting. And watch out for some wire services, notably the Associated Press, that blatantly report wrong numbers when it comes to pass.
TTAC’s position is that in absence of hard light-vehicle data, the total of all automobiles should be taken. It is much closer to the light vehicle count than passenger vehicles. And most of all, it is the number which the world’s car counting authority OICA uses.