“Baby You Can Drive My Car”
In the October 31, 2010 issue of Business Today, Booz & Company Partner Vikas Sehgal (India and North America) said the high growth of the Indian automotive industry is linked closely to the strength of the country’s informal or “black” economy. “I think this (black) economy is growing at close to 20 percent, and that is the reason high-end car sales are booming,” he said. “That said, India will maintain its ‘pyramid’ structure of car sales, with mini and sub-compact cars still dominating the market.” Indeed throughout the country at various dealerships, times have never been better. The Renault-Nissan combine has built a 400,000 unit-a-year plant outside Chennai, which only recently started production of the new Micra. Meantime, a chunk of Suzuki Motor Company’s Rs 1,300-crore fresh investment in Maruti Suzuki India will go into adding capacity of 700,000 cars by 2013 to a factory that already rolls out one million cars a year.