Indian automobile companies said on Wednesday that the global recession that is looming around the world right now will not have an impact on the Indian market as such and that there is growth opportunity for everyone here.
According to the World Bank, the Indian economy will grow at 6.6 per cent in FY24, even though it projected a gloomy outlook for the global economy.
Positive outlook
“The growth in the Indian economy was very good. However, there are some uncertainties in the markets, like the US-Ukraine war will cause some supply chain disruptions. However, the Indian economy will grow, and I see positivity here,” Unsoo Kim, Managing Director and Chief Executive Officer, Hyundai Motor India, told businessline on the sidelines of the Auto Expo here.
Kia India also said that although the industry would face a lot of hurdles and difficulties this year, the global economic recession would not affect India.
Supply chain issues
“There are still some issues on the supply chain due to Covid again in China and also new regulations in India like Safety and real driving emissions (RDE) norms coming this year, so all these hurdles are there only this year. But, the Indian automotive industry is a relatively bright market as compared to other countries. Even though the growth rate is going down, that itself is higher than other countries,” Tae Jin Park, MD and CEO of Kia India, said.
“It will be better than 2022,” he added.
Rajeev Chaba, President and Managing Director, MG Motor India, also said that the industry will grow at about the same rate as the GDP growth.
“It depends on the potential of GDP growth... so if GDP growth is six to seven per cent, then the car market will also be similar, unless and until there is a sudden fundamental change in the economy,” Chaba said.
Chaba added that MG Motor India grew by 20 per cent in the 2022 calendar year with 50,000 units due to supply constraints, but since the supply chain is improving now, more demand will come, and that is why the company is expecting to almost double (80,000 to 1 lakh units) the 2022 sales this year.
“India is now positioned in the top three markets globally, and Suzuki Motor Corporation and Maruti Suzuki India would like to grab this opportunity by developing the right products for this market... we are making efforts in various directions to promote the economy in India,” Toshihiro Suzuki, Representative Director and President, Suzuki Motor Corporation (Japan), said.
‘Sluggishness by year end’
However, according to Naveen Soni, President of Lexus India, the market may see some sluggishness towards the end of this year due to the global economic phenomenon.
“Till the first half of the year, the industry can look up because of the pending orders, which are getting cleared now. But, towards the end of the year, it may go down, especially post-festival season,” Soni said.