Identify the Financial Growth of Indian Automobile Industry in the Last Ten Years

Running head: IDENTIFY THE FINANCIAL GROWTH OF INDIAN AUTOMOBILE
INDUSTRY MARKET IN THE LAST TEN YEARS AND THE FACTORS CONTRIBUTING
IN IMPROVEMENT
1
Identify the financial growth of the Indian Automobile industry in the last ten years
Name of Student
Institutional Affiliation
Name of Professor
Date

IDENTIFY THE FINANCIAL GROWTH OF INDIAN AUTOMOBILE INDUSTRY
MARKET IN THE LAST TEN YEARS AND THE FACTORS CONTRIBUTING IN
IMPROVEMENT
2
Identify the financial growth of the Indian Automobile industry in the last ten years
Introduction
The automobile industry market of India is acknowledged as one of the biggest
automobile industry in the world in terms of the production and the sales volume (Timmer et al.,
2015, pp.575-605). Dating back to the historical roots, India had its first car on the road in 1897,
which was imported from other countries. This went on until the year 1930 and through the
1940s that the country first had a manufacturing facility with companies such as the Hindustan
Motors among others that started the manufacturing process. At independence in 1947, the
Indian Government put in efforts to set up an automobile industry in order to supplement the
industry. Since then, there have been continual improvements in the automobile sector that have
seen Indian perform well in the world market as it is today. This has led to the attraction of many
investors from all over the world to gain interest in the Indian automobile industry in the market
today (Kale, 2017, pp.121-150). In this report, we will identify the factors that have promoted the
financial growth of the industry in detail.
Title and Justification
The topic to identify the financial growth of the Indian automobile industry market in the
past decade and the factors contributing to it seeks to give an analysis of the financial growth and
the major causes of the success in the automobile industry in India (Luthra, Sunil, and Dixit,
2015, pp.37-50). This topic was selected due to the impressive performance of the Indian
automobile in the world market, which led to the motive to identify the factors behind its
success.

IDENTIFY THE FINANCIAL GROWTH OF INDIAN AUTOMOBILE INDUSTRY
MARKET IN THE LAST TEN YEARS AND THE FACTORS CONTRIBUTING IN
IMPROVEMENT
3
Background information
The Indian automobile industry started its development after independence when the
Government resolved to set up a manufacturing industry. It is reported that since then the Indian
market was dominated by the Hindustan Motors from early 1960 to the 1980s, which enjoyed the
monopoly in the market was the only major company (Krishnaveni, 2015, pp.110-118). The
Hindustan Motors by then owned most shares in the automobile industry due to the Ambassador
model. However, before then there had been challenges that led to sluggish growth in the
industry in the 1950s and 1960s due to strict policies on trade and imports, which were only
favourable for the commercial vehicle segments and the tractors.
However, in the 1980s the Hindustan and the Premier motor companies were challenged
by the entrance of Maruti Udyog Limited that was allowed to invest in the country (Singh et al.,
2015, pp.543-554). This was after the liberalization where the car marker who had been
restricted out of India were allowed to trade in the country. The Maruti formed an alliance with
the Suzuki, which was the first joint between the local company and the foreign company. This
slowly and steadily established a strong economic baseline that led to the growth of the revenues
between the two companies, which attracted other foreign companies such as Honda and
Hyundai among others. Reports indicate that from 2000-2010, most of the major car
manufacturing companies have expanded their base in Indian and established the manufacturing
facilities in the country (Kale, 2017, pp.121-150).
Over the years, the car market in India has been reported to be continually growing with
the presence of almost all the major players in the car industry existing in India. This has made

IDENTIFY THE FINANCIAL GROWTH OF INDIAN AUTOMOBILE INDUSTRY
MARKET IN THE LAST TEN YEARS AND THE FACTORS CONTRIBUTING IN
IMPROVEMENT
4
India the hub for the automakers whereby the manufacturing plants are targeting both the local
and international markets (Delhi, 2016, pp.25). With the large population in India, there is a
prominent region where the car manufacturing industries are dominated. These are the South,
North, and West. Moreover, apart from the local market, in 2009, India emerged as the fourth
largest exporters of passenger cars after South Korea, Japan, and Thailand that led to receiving
an award as the sixth largest in terms of production in 2011.
Research aim and Problem statement
The aim of this research is to identify the growth of the Indian automobile industry in
terms of the financial revenues within a decade and the factors that have contributed to this
growth. Additionally, the research seeks to address the main factors that the managers in the
automobile industries can implement for the growth in the financial revenues in the industry.
Research questions
Is there a relationship or a link between the individual performance of the car
manufacturing industries in India and the overall financial growth of the Indian automobile
industry?
Critical Literature review
There has been different studies and research conducted in relation to this research topic.
Most scholars have put in more effort to identify the factors that have led to the success of the
automobile Indian industry in the market to rise to the sixth position in 2011 as the largest
automobile industry in terms of production (Kochan, Thomas, and Russel, 2018). However,