New Delhi: India’s passenger vehicles sales will reach 2.1 million units by the 2009-10 fiscal as economic growth and rising incomes persuade more people to buy cars, research company Frost & Sullivan Inc. said.
Sales of passenger vehicles in India are likely to grow at 14.9% each year in the five years until then, Frost & Sullivan said in an e-mailed release.
Volkswagen AG, Suzuki Motor Corp. and other automakers are spending more than $5 billion (Rs22,000 crore) to build factories and expand capacity in India to meet growing demand. India’s economy grew 9.1% in the six months ended 30 September, the fastest semi- annual pace in 15 years, boosting car sales in Asia’s fourth- biggest automobile market.
Only 8.5 in 1,000 people own a car in India, the lowest penetration rate in relation to developing countries such as Malaysia, Mexico, Brazil and Thailand, said Anand Rangachary, managing director, South Asia and West Asia at Frost & Sullivan. This leaves high potential for growth, which has led companies such as Renault SA and General Motors Corp. to expand in India, he said