New Delhi: The Indian passenger car market is likely to witness a major shift by 2015 with B-segment premium cars registering higher annual sales growth compared to that of entry-level or A-segment cars, says global consultancy Booz & Co.
At the same time, the commercial vehicle segment is likely to see the most innovations, it said.
“By 2015, the B-segment passenger cars are likely to see sales growth surpassing the A-segment. It will compete with A-segment for the biggest share in the Indian passenger cars market,” Booz & Co Partner Vikas Sehgal told the agency.
He said the passenger car market will reach a size of 2.8 million to 3 million units annually by 2015, with the top players maintaining their present slots.
The Indian passenger car market was over 1.2 million units in 2008-09, and A-segment sales comprise an overwhelming proportion of it.
On the market shares, Sehgal said, “Maruti Suzuki India will have a market share of 40% or little less, followed by Hyundai at 20%. To guess Tata Motors’ share would be wild card bet but Toyota and Honda are likely to register higher market share.”
Currently, Maruti Suzuki leads the pack with around 53%, followed by Hyundai at above 20%
According to Booz & Co, Indian customers will start dictating the styling and designing of cars, at least in the A-segment, in five to 10 years.
“Most of the cars in the Indian market now are styled on European designs with minor changes. It will change in the A-segment cars over next 10 years,” he added.
Sehgal said the Indian car market is also likely to go more ‘green´.
“There a is need to encourage the green car segment and electric vehicles. India will go electric in another 10 years, by compulsion if not by choice when crude oil will reach a figure of USD 150-200 per barrel,” he said.
For this purpose, the Indian auto sector have to become more R&D focused, rather than the country remaining merely a manufacturing hub.
Sehgal said the most important changes will come in commercial vehicles, mainly trucks, with innovations not only in the engine and structure but also in ownership models, thanks to India’s growing economy.
“Trucks will be technologically more sophisticated with greater tonnage and improved engine technology,” he said, adding that logistic and fleet management will drive the truck market and the owner-operator model will give way to company owned fleet.