Indian auto industry sees double-digit growth in FY 2007-08

[B. KARTHICK]

Despite the 8% appreciation of rupee since April 2007 and the fact
that it had badly hit sectors like textile and IT, the Indian
automobile industry actually witnessed a double-digit positive growth
in absolute numbers during the financial year 2007-08, thanks to
Companies foraying into newer Markets, several new launches and a
gradual shift from dollar driven countries to Euro nations.

Auto major Maruti Suzuki India Ltd (MSIL) posted 34.9% jump in exports
during this period at 53,024 units as compared to 39,295 units during
the same period last year.

Hyundai Motor India Ltd also witnessed a growth of 25.03% to 1,44,442
units, against 1,15,525 units in the corresponding period last year.
Even Tata Motors' cumulative sales for exports went up by 3% to 54,272
units compared to 52,796 units exported sold last year.

"Export of OEMs like Maruti and Tata Motors has largely gone up for
the basic reason that these players are exploring newer Markets as
they want to establish their brand overseas. Also, due to really small
volume of passenger cars exported by these manufacturers, their
objective is not to make profit but to expand footprints across
developing countries," says Abdul Majeed, auto analyst and partner,
Price Waterhouse.

"However, for Hyundai the fact that the company has developed India as
its export base, it would be inevitable to pull down exports," says
Majeed, adding that though the bottom line would have been impacted
due to rupee appreciation but that will not prevent these players to
foray into newer Markets.

Adds an industry expert, "With euro comparatively more stable vis-à-
vis dollar, major players are now focusing on European nations to
counter the impact of dollar. Moreover, with several new launches in
the small car category, the demand from overseas has also gone up."